As an appointee of federal agriculture minister Gerry Ritz and the federal cabinet, Farm Products Council of Canada chair Laurent Pellerin receives what might be called his annual marching orders.
In bureaucratic Ottawa, ministers receive a “mandate letter” from the prime minister when they are appointed. Ministers replicate that in letters of instruction to their appointees.
A “mandate letter” from the responsible minister outlines the goals he expects his appointees to achieve or at least work toward in the year ahead.
In Pellerin’s case, as chair of the federal agency that oversees the governance of supply management agencies, with the exception of dairy, the instruction primarily lays out Conservative expectations.
Read Also
Agriculture needs to prepare for government spending cuts
As government makes necessary cuts to spending, what can be reduced or restructured in the budgets for agriculture?
Last week, in an unusually blunt speech to the annual meeting of Chicken Farmers of Canada, the former Canadian Federation of Agriculture president offered a rare glimpse of the private correspondence between minister and appointee.
The message as Pellerin relayed it was not in these words and not this political, but the core message to take from the five-page letter from Ritz was clear: if the government is going to continue to support and defend supply management, the agencies that operate the system have to keep their noses clean and run efficient, transparent and defendable systems.
The message Pellerin said the minister conveyed was “to expect more from the agencies.”
The main target, for the moment, is CFC , which is embroiled in a divisive battle over how to allocate among provinces additional quota coming from industry growth.
With the board at a stalemate and Alberta ready to leave the agency at the end of the year if it doesn’t receive more quota to reflect its growing population, Pellerin warned that the FPCC will intervene if the board cannot resolve the issue by the end of summer.
He also targeted CFC’s cost-of-production calculation, which is key in determining prices.
The minister’s letter said pricing must be based on real costs that are defensible to the industry and critics.
“The real question is what are the costs?” Pellerin said pointedly.
Under the system, chicken producers have a right to receive their cost of production and a “reasonable” profit margin, he said. However, he suggested the agency must update its cost of production calculation to make it credible.
“We will put pressure on this file,” Pellerin warned.
Later, he suggested that the chicken industry’s cost-of-production calculation is out-of-date and may not account for falling costs because of increasing feed efficiencies on the farm.
“They have to be in survey mode much more often than they have been in the past,” he said. “There is a lag between real costs and what they are using, and that hurts credibility.”
CFC president David Janzen said the complaint will be dealt with when Ontario completes an extensive update of its cost of production.
“By and large, if the Ontario COP is found to be transparent and credible, then it can set the tone for the rest of the country.”
That may not satisfy Pellerin, whose council must endorse the results. Because of differences in operational scale and varying input costs, Ontario’s cost of production does not necessarily translate into Western Canada, he suggested.
If Ritz wants a firm and knowledgeable hand to ride herd over supply management, Pellerin appears to be his man.
