Producers biggest losers of failed agriculture minister talks

Politicians from different levels of government and party stripe continue to debate agricultural business risk management programs, but already, producers have lost.

Finger pointing among elected officials began almost as soon as the latest round of federal-provincial-territorial agriculture minister meetings ended with no consensus on changes to business risk management programming.

The provinces, represented by Ontario’s agriculture minister Ernie Hardeman, rightfully made the point that federal minister Marie-Claude Bibeau waited until the final day of the meetings to put an offer on the table to reform AgriStability, the biggest irritant of the country’s BRM programs.

Considering the parties had spoken more than 20 times, Bibeau did not have to wait so long to make her position clear. She previously rejected the provinces’ offer to have the cost sharing of the programs move from a 60-40 split between federal and provincial coffers to a 90-10 split.

Even in the unprecedented age ushered in by COVID-19, such a drastic shift in how these programs are paid for was never going to happen.

Bibeau can’t escape blame for the lack of reform. As the federal minister, the buck ultimately stops with her.

As was clear even before the pandemic, Canada’s massive deficit meant Bibeau was more likely to buy time on reforming the programs rather than immediately putting up cash.

Now, at least, the federal government is willing to make the program easier to access and pay producers more when they do receive an AgriStability pay out, but the changes won’t be coming soon, if ever.

There is no deadline for when the provinces are expected to respond to her proposal.

As it stands now, the provinces, which must first reach a consensus among themselves, will reject the federal proposal.

The lines drawn by Bibeau, like removing the reference margin limit and maintaining 60-40 cost sharing, will be a barrier to concluding any immediate reforms.

Meanwhile, those provinces claiming they can’t pay for the proposed changes given their current fiscal situation should consider doing a more wholesome review of their finances.

Manitoba agriculture minister Blaine Pedersen says Bibeau’s proposal would cost at least $15 million more a year for his province.

Pre-pandemic, while still combatting a deficit, Manitoba increased its agriculture budget by $8 million.

If $15 million is going to make or break the finances of Manitoba, the province has bigger problems. It’s a lot of money, but consider that figure in the context of a province with a $15 billion budget.

Plus, presumably there would be some increased costs associated with designing and launching an entirely new program to replace AgriStability, as Pedersen has suggested doing.

Saskatchewan agriculture minister David Marit has also raised concern his government will have difficulty paying for changes. The Saskatchewan government is also fighting a pre-pandemic deficit.

Currently, Saskatchewan is using massive federal transfers to boast about reducing the deficit faster than expected. Yet Marit wants the federal government to pay more money for AgriStability, while simultaneously his government is sitting on a $260 million “contingency” fund to deal with uncertainty.

Perhaps Marit could consider taking a small portion of that money and directing it to AgriStability.

There’s also the nagging point that money for business risk management needs to be budgeted each year, but is only used when needed.

The failings of politicians mean AgriStability likely won’t change until 2023, when many of these elected officials will endeavor to make substantive changes to BRM programs as part of a new federal-provincial-territorial agreement.

Through no failure of their own, producers continue to lose.

D.C. Fraser is Glacier Farm Media’s Ottawa correspondent. Reach out to him by emailing dfraser@farmmedia.com.

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