FREDERICTON – With the flash of new gold Cross pens purchased for the occasion, federal and provincial agriculture ministers last week signed agreements to guarantee multi-billion dollar funding for a basket of farm support programs into 2003.
It officially put meat on the bones of decisions made by ministers at a stormy March meeting.
Ministers touted it as a landmark deal which guarantees up to $5.5 billion for farm programs over three years, 60 percent from Ottawa and 40 percent from the provinces.
Funding for crop insurance, the Net Income Stabilization Account program, cash advances and provincial companion programs is included.
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A newly named $725 million annual Canadian Farm Income Program was announced to replace the controversial Agricultural Income Disaster Assistance program.
“Today’s framework agreement is a huge step forward in providing the agriculture and agri-food sector with the security it needs to continue to grow and prosper, and take advantage of the exciting opportunities that lie ahead,” federal minister Lyle Vanclief told a July 5 news conference.
“Although there is still more work to be done, I believe … that today’s agreement marks an important milestone in farm income support.”
The package includes two distinct parts.
Funding for the basic, permanent safety net program basket of NISA, crop insurance, cash advances and provincial companion programs will be distributed on the basis of the size of provincial farm economies. That was the result of a bitter March meeting during which eight provinces insisted the old risk-based formula sent too much money to the Prairies.
Ottawa will put $665 million into that portion of the package. For three years, an additional $42 million will flow from Ottawa to Saskatchewan and Manitoba to make sure those two provinces do not lose funding while all other provinces receive more. The provinces will commit just over $440 million.
Ottawa will spend up to $435 million per year on a new disaster program. The provinces will spend up to $290 million.
The package will be in place until March 31, 2003, although federal and provincial officials conceded that if the programs do not meet farmer needs, pressure will be on politicians to find more money and to make interim program changes.
The politicians said no more money will be added to the safety net fund, but governments can add more farm program funding if they do it outside the rules of the safety net deal.
