AGRI Committee Meeting

37th PARLIAMENT, 1st SESSION

Standing Committee on Agriculture and Agri-Food

EVIDENCE

CONTENTS

Thursday, May 30, 2002

Â

1220

The Chair (Mr. Charles Hubbard (Miramichi, Lib.))

Mr. Vanclief

The Chair

Mr. Lyle Vanclief

Â

1225

Â

1230

The Chair

Mr. Hilstrom

Mr. Lyle Vanclief

Mr. Howard Hilstrom

Â

1235

Mr. Lyle Vanclief

Mr. Howard Hilstrom

Mr. Ron Doering (President, Canadian Food Inspection Agency)

Mr. Howard Hilstrom

Mr. Ron Doering

Mr. Howard Hilstrom

Mr. Lyle Vanclief

Mr. Howard Hilstrom

The Chair

Mr. Lyle Vanclief

The Chair

Mr. Odina Desrochers (Lotbinière—L'Érable, BQ)

Â

1240

Mr. Lyle Vanclief

Mr. Odina Desrochers

Mr. Lyle Vanclief

Â

1245

Mr. Odina Desrochers

Mr. Lyle Vanclief

The Chair

Mr. Claude Duplain (Portneuf, Lib.)

Mr. Lyle Vanclief

Mr. Claude Duplain

Mr. Lyle Vanclief

Â

1250

The Chair

Mr. Dick Proctor (Palliser, NDP)

Mr. Lyle Vanclief

Mr. Dick Proctor

Mr. Lyle Vanclief

Mr. Dick Proctor

Mr. Lyle Vanclief

Â

1255

Mr. Dick Proctor

Mr. Lyle Vanclief

The Chair

Mrs. Rose-Marie Ur (Lambton—Kent—Middlesex, Lib.)

Mr. Lyle Vanclief

·

1300

Mrs. Rose-Marie Ur

Mr. Lyle Vanclief

·

1310

The Chair

Mr. Rick Borotsik (Brandon—Souris, PC)

The Chair

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

The Chair

Mr. Rick Borotsik

The Chair

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

The Chair

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

Mr. Rick Borotsik

Mr. Lyle Vanclief

The Chair

Mr. Lyle Vanclief

The Chair

Mr. Bob Speller (Haldimand—Norfolk—Brant, Lib.)

Mr. Lyle Vanclief

Mr. Bob Speller

Mr. Lyle Vanclief

Mr. Bob Speller

Mr. Lyle Vanclief

·

1315

The Chair

Mr. Anderson (Cypress Hills—Grasslands)

Mr. Lyle Vanclief

Mr. David Anderson

Mr. Lyle Vanclief

Mr. David Anderson

Mr. Lyle Vanclief

Mr. David Anderson

Mr. Lyle Vanclief

Mr. David Anderson

Mr. Lyle Vanclief

Mr. David Anderson

Mr. Lyle Vanclief

Mr. David Anderson

Mr. Lyle Vanclief

Mr. David Anderson

Mr. Lyle Vanclief

Mr. David Anderson

Mr. Lyle Vanclief

·

1320

Mr. David Anderson

The Chair

Mr. Paul Steckle (Huron—Bruce, Lib.)

Mr. Lyle Vanclief

Mr. Paul Steckle

Mr. Lyle Vanclief

Mr. Paul Steckle

Mr. Lyle Vanclief

Mr. Paul Steckle

The Chair

Mr. Mark Eyking (Sydney—Victoria, Lib.)

·

1325

Mr. Lyle Vanclief

The Chair

Mr. Odina Desrochers

Mr. Lyle Vanclief

The Chair

Mr. Claude Duplain

Mr. Lyle Vanclief

·

1330

The Chair

Mr. Lyle Vanclief

The Chair

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CANADA

Standing Committee on Agriculture and Agri-Food

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NUMBER 070

l

1st SESSION

l

37th PARLIAMENT

---

EVIDENCE

Thursday, May 30, 2002

[Recorded by Electronic Apparatus]

  (1220)  

[English]

    The Chair (Mr. Charles Hubbard (Miramichi, Lib.)): Good afternoon, everyone.

    Pursuant to Standing Order 81(4), we are continuing with the main estimates for 2002-03, and votes 1, 5, 10, 15, 20, 25, 30, 35, and 40, under the Department of Agriculture and Agri-Food.

    We would like to welcome the minister and his officials to our committee. We have about an hour and fifteen minutes set aside for this session.

    Mr. Vanclief, we would first of all ask you to introduce the officials from your department. As we had arranged beforehand, we have ten minutes for your presentation, and then we'll have questions from various members of the House. The floor is yours, Mr. Minister, and we'll start counting time after we've had the introductions.

    Hon. Lyle Vanclief (Minister of Agriculture and Agri-Food): Thank you very much, Mr. Chairman.

    With me are Deputy Minister Samy Watson, Associate Deputy Minister Diane Vincent, and Bruce Deacon, from Corporate Branch. Also here are the president of the Canadian Food Inspection Agency, Mr. Ron Doering, and one of his vice-presidents, André Gravel.

    The Chair: Thank you, and if we need to get other officials to the table later, they are certainly welcome to come. We do have some extra chairs.

    Mr. Lyle Vanclief: There are plenty of officials in the room, Mr. Chair, in case we need any information from those people.

    Mr. Chairman, thank you very much. It's certainly a pleasure to appear before the committee again. I want to take the opportunity right from the outset, Mr. Chairman, to acknowledge the extent of my appreciation for the strong contribution that the committee continues to make toward securing a strong and prosperous future for the agriculture and agrifood sector.

    When we last met in February, we talked about some of the major issues facing agriculture, and about the development of a national agricultural policy that would take us beyond crisis management. As you may recall, I concluded my comments at that time by saying that while we had a vision and a direction for the sector in the agricultural policy framework, we didn't have all the answers, or even all the questions. The specifics would be developed through an extensive consultation with the industry, consumers, and a broad cross-section of Canadians.

    I called on this committee to play an integral role in that process, and I appreciate the way you have delivered. Together with the consultations that we have undertaken through the agricultural policy framework, your cross-country hearings have provided us with an extensive, grassroots reading of the state of the agriculture and agrifood industry. As we know, the Senate agriculture committee had hearings across the country as well, and the Prime Minister also put in place a task force on the future of farming. All of these things have been very invaluable as we look at the comments and the recommendations. This input continues to shape our strategy for the future. And while a number of issues and challenges have been raised in the consultations, two are clearly centre stage and a major priority for us. I'm talking, of course, of drought and the U.S. farm bill.

    Last year, we experienced a serious national drought, from British Columbia to Nova Scotia. Already this spring, severe drought conditions exist in large areas of the southern prairies. We know we cannot prevent drought, we can only try to mitigate its effects, and we've made investments to help farmers do that.

    Part of the answer is to address the financial hurt that comes with drought. You'll note in the estimates that we have allocated $1.1 billion to help the sector deal with income risks such as drought and other risks that are beyond their control. It's a substantial sum of money, and the provincial portion that will be added to it is $700 million, for a total of $1.8 billion. With extensions to the spring cash advance program, interest-free up to $50,000 per farmer, it's our estimate that $700 million will be asked for and will be interest-free to farmers this spring.

    But our response goes beyond these safety net programs. Agriculture and Agri-Food Canada spends about $13 million to fund drought research each year. Through our research efforts, we have developed drought-resistant crop varieties, such as Arid and Amulet, which are now in production. We have successfully promoted zero and minimum tillage that pays big dividends in conserving moisture. We are helping to expand the drought monitoring system in Alberta, and we continue to provide update information through our drought watch website.

    Last year, through the Prairie Farm Rehabilitation Administration, the federal government spent almost $9 million on direct assistance to water-supply projects such as wells and dugouts, and studies on water availability and quality. With the additional money, this investment leveraged about $20 million worth of water development that was done in drought-prone areas. Also last year, the federal government provided $3 million to fund 1,500 water-supply projects in Saskatchewan in order to help livestock producers deal with critical water shortages. Some of this money was also used for water studies in Alberta and in Nova Scotia.

    The projects developed with this funding will help to lessen the impact of drought in 2002 and future years. However, I remind everyone, Mr. Chairman, that we cannot make it rain when we want it to rain, and we can't stop it from raining when it wants to rain.

    We know these efforts do make a difference. Despite recurring droughts, absolute wheat yields in Saskatchewan have increased, while the variability has decreased over the past decades due to the introduction of hardier varieties and the adoption of better soil and water management practices. In fact, our sector must continue to adapt and be innovative, in response to what may be long-term climatic changes. This government is and will continue to be there to help with the adaptation and innovation.

    Let me now talk, Mr. Chairman, about the U.S. farm bill. Unlike Canada, which has opted to build sector profitability through the proposed agricultural policy framework and other supports to the industry, the Americans, through their farm bill, have chosen to make their farmers dependent on distorting subsidies. In the process, they have seriously weakened the leadership role that they can play in, for example, WTO negotiations.

    Mr. Chairman, like you and the members of this committee, I am appalled, I am disgusted, and I am disappointed by the protectionist policy of the United States. I have been very candid in expressing my disapproval for these U.S. actions. I've been taking every opportunity to build support among many countries that oppose the bill. Quite frankly, I have found no countries that support the bill, Mr. Chairman. Every country opposes that bill, including probably the most negative United States press on any administrative action that I've ever seen the U.S. take. Even their own press disagrees with it.

    We need to aggressively pursue the Doha agenda and remind the U.S. administration of its commitments at that time. To that end, I've been working with the Cairns Group and Mark Vaile, the Minister for Trade for Australia, who is the chair of that group. I've been speaking with EU agriculture commissioner Franz Fischler, the minister from India, the minister from Mexico, and the Brazilian agriculture secretary. They are all very concerned about the U.S. legislation and how it will affect all farmers.

    At the upcoming meeting of the Food and Agriculture Organization, in Rome, I will be further rallying the support of those who share the view with us on the farm bill: that this is a return to the past by the United States and the world therefore needs to take on the United States. In talking to some of the people I just named, Mr. Chairman, they had not planned on attending the FAO meetings in Rome in the next couple of weeks personally, but when I had a conversation with them and told them the initiative that I thought we should take collectively, they said that as a result of my discussion with them, they would be there.

    I've already expressed my concern to U.S. Secretary of Agriculture Ann Venemen about the legislation. It's particularly disappointing that they are entrenching the recent high levels of support, and what was supposed to be temporary emergency support. I've also pledged to pursue all avenues to help counter the impact of this legislation on the marketing of Canadian agricultural products, referring to the “country of origin” part of that.

    It's not just about Canada and the United States. It's about the United States and the world, and we will make every effort with our global allies to convince the U.S. to live up to the commitments made in Doha to freer and fairer trade. But while we continue to fight vigorously for a fair and level playing field on the international front, here at home we are taking steps to equip our producers to be more profitable and to put them in a competitive position to meet all challenges. That's the rationale behind the agricultural policy framework.

    As you know, I've been working with my provincial and territorial colleagues and with industry to develop a comprehensive national agricultural policy—a policy that will take action in a number of key areas to build the capacity of Canadian agriculture to be the world leader in quality, food safety, environmental sustainability, and innovation. These are all necessary concerns and requirements of our industry, along with a stronger and more effective risk-management package for our producers.

    Almost a year after agreeing in principle to this approach in Whitehorse, provincial ministers across the country remain committed to the plan and are determined to make it work. Some three weeks ago, we met again here in Ottawa to confirm this direction and to review the input we received from the first wave of national dialogue with stakeholders. Much work and analysis still remains to be done, and we will continue to involve stakeholders as we move forward. In fact, a second round of industry consultations will begin shortly on specific details of the framework. This afternoon, you will be getting a schedule of those meetings, and shortly—hopefully tomorrow, if not by the first of the week—you will be receiving the consultation kit that will be the basis for the second round of dialogue.

    We're working very hard to secure an agreement favourable to the future of our sector. Mr. Chair, we are prepared to make that commitment, as outlined in the December budget. We're also working hard to help producers deal with pressing and immediate challenges. We know other countries are moving quickly to respond to consumer concerns and preferences. To be successful in this competitive environment, we must beat these other nations to the punch. To do that, we need to make the crucial investments in the sector that are envisaged under the proposed framework.

  (1225)  

    Next month, I will be meeting with my provincial and territorial colleagues for our annual summer meeting, which is in Halifax this year. I'm confident that we will sign an umbrella agreement that will enable us to further develop and implement the framework, and I am confident the provinces will be there with their share.

    This is the right way to go, Mr. Chairman. Exit polls from the consultation sessions show strong support for a national, long-term agricultural policy in this country. The men and women who are part of the agriculture and agrifood industry are proud of the work they do, and they are committed to working for an even better future. By acting now, we can ensure that the agriculture and agrifood sector remains a key contributor to the high quality of life enjoyed by citizens across Canada.

  (1230)  

    The Chair: Howard, we'll begin with your round, for eight minutes.

    Mr. Howard Hilstrom (Selkirk—Interlake, Canadian Alliance): Mr. Minister, you're going to have a bunch more dialogue and a bunch more meetings. I don't understand what it is that you don't understand about what the problem is. Grain and oilseed prices are in the tank. These farmers are hurting, and they're hurting now. That is the problem. You may want to comment on that after I ask my question, but I just find it amazing that you feel you have to go studying across this country when the problem has been facing all of us for five years. Your own study showed that.

    You can protest and talk to the foreign countries all you want, but the fact of the matter is that the U.S. farm bill is in place, so subsidies are going to be flowing. Our farmers need help right now. That is what we want you to talk about today. Tell us what you're doing right now?

    Your spending in the 2001-02 estimates was $1.98 billion. Your projected or planned spending for this fiscal year of 2002-03 is $1.3 billion. That's a $670 million drop. And by 2003-04, you expect to be down to $750 million, which is only $100 million over what it was in 1998.

    Farmers can't wait for the safety-net plans that you have from the APF. Why aren't you doing something now to keep the funding at least at what it was in 2001-02? In fact, why aren't you increasing it, since you've acknowledged that foreign subsidies are hurting our prices and hurting our farmers?

    Mr. Lyle Vanclief: There is no question that we have some immediate problems. There's also no question that I believe your party, and maybe you yourself—I probably couldn't go to a direct quote, but I might be able to—has said over the years that we need an agriculture policy for this country and that we shouldn't be flying—I'm using my words here—by the seat of our pants every year.

    There are two things that we have to do, Mr. Hilstrom and members of the committee. We have to prepare our industry the best we possibly can for the future, and we have to make investments and help our industry make those investments so that it can do that. In many ways, a different set of circumstances exists out there now as compared to what we had just a few years ago, and we all know what those numbers are.

    We also recognize very clearly that we have to get there. There has been a lot of talk about bridge funding and bridge support as a result of drought, as a result of the U.S. farm bill, etc. I can tell you that I'm working on those, and I'm confident we will be able to do that type of thing.

    The provinces agree that we need an agriculture policy for the future in order to help our industry to be prepared and to be more profitable than it is at the present time, and to be able to help to address that. That takes investment, but it also takes investment in order to get there.

    I want to go to the estimates. I know these other questions are important, but I just wish, Mr. Chairman, that we could sometimes get the committee...I tried this the last time I was here on estimates. I had officials explain how the estimates work. There are estimates, projections, and the actual numbers that have been spent.

    In response to Mr. Hilstrom's comments, I could ask Mr. Bruce Deacon if he could just give those numbers on what it is that we know.

    The supplementaries do not show up in the estimates. Actual spending may have further supplementaries added that do not show up in the estimates, because the decisions on that spending have not been made. We're not comparing apples and apples when we talk about actual spending from previous years—and maybe that wasn't high enough; we always want to get it higher—as compared to estimates in the future years, when the supplemental decisions have not yet been made.

    Mr. Howard Hilstrom: I would like to know how come you hired Pierre Tremblay as your advertising manager when he had been under suspicion because of the way he gave out contracts. He broke the rules at Public Works. He then went on to be your main manager, at about $140,000 a year. The RCMP started investigating him, yet he's still employed at the CFIA. You haven't done anything about it other than take away his signing privileges to sign these contracts. Why would you keep a man like that on and not suspend him at least?

  (1235)  

    Mr. Lyle Vanclief: Mr. Speaker, before I ask the president of the Canadian Food Inspection Agency to explain that situation, I must explain that I'm surprised when a gentleman who had a very distinguished career in law enforcement earlier on makes the kinds of statements that he did about a person and then goes on to say the person is under investigation. I think the previous statement was a pretty strong accusation that has not been demonstrated to that extent at this time.

    I will ask Mr. Doering to comment on the hiring of that gentleman.

    Mr. Howard Hilstrom: Many police officers are suspended when they partake in these kinds of breaches.

    Mr. Ron Doering (President, Canadian Food Inspection Agency): If I can, Mr. Hilstrom, Dr. Tremblay was hired by the Canadian Food Inspection Agency this fall, after a fully competitive, transparent process. He was simply the best candidate for the job, and he was hired on that basis. I can assure you that there was no political interference whatsoever in his hiring.

    Your question also relates to the issue of why he is still there. There is no suggestion that, in his current job, he hasn't done a good job. While he continues to be in our employ, he has voluntarily given up any rights to sign any contracts. In fact, on that point, sir, we have a very consistent contracting policy in order to prevent any opportunity to do anything inappropriate. That's why we haven't had a contracting problem in the over five years of the agency's existence. If future information arises from investigations and a prudent manager should take additional steps, additional steps will be taken.

    Mr. Howard Hilstrom: Sure, you filled out a hiring form, but how many applicants did you have for that job? The way it's transposed is that this man simply got transferred from Public Works to over there.

    Mr. Ron Doering: Dr. Tremblay was a public servant at Public Works Canada. We hired a head-hunting firm, a specialist in this kind of field, to do a national search for the best person. I would say we initially had perhaps a dozen names. Finally, through a competitive, transparent, and open process, we came down to interviewing four people. There are five people on that panel, and he was the unanimous choice. He was selected in, it would have been September. At that time, of course, no one had heard anything about what would be in the Auditor General's report.

    Mr. Howard Hilstrom: Minister Vanclief, are you examining all the contracts that have been given out by this man and the rest of your department agency that is promoting Agriculture Canada, particularly in the province of Quebec? How many are the RCMP going to be examining in your department?

    Mr. Lyle Vanclief: I do not personally examine every contract. I have confidence that those officials who work in the department—for example, in the Canadian Food Inspection Agency—carry out their roles as they should be carried out. If, at some time, there is any indication that something was not done according to the way it should be, then we take the corrective action that's appropriate.

    Mr. Howard Hilstrom: This man is still doing every bit of his job except signing the contract. How can you leave him in that position?

    The Chair: Mr. Hilstrom, your time is up.

    Mr. Lyle Vanclief: Nothing against this man has been proved by investigation in any way, shape, or form, Mr. Chair. I'm disappointed that the member is making that accusation at this time.

    The Chair: Mr. Desrochers.

[Translation]

    Mr. Odina Desrochers (Lotbinière—L'Érable, BQ): Thank you very much, Mr. Chairman.

    Mr. Minister, agency representatives and ladies and gentlemen accompanying the Minister, thank you for coming here today. Above all, thank you for agreeing to our request that this meeting be televised. You agreed to our request on only a few days' notice. I think the public will be the big winners here.

    Mr. Vanclief, my comments will pertain primarily to the international situation and to the US Farm Bill. According to newspaper reports, it seems that everywhere around the world, whether it be the Cairns Group, MERCOSUR or Europe, the Americans are being soundly criticized for their attitude.

    I know that you have been holding consultations on this issue for some time now. Last week, the weekly paper La Terre de chez nous reported that the US position could jeopardize all WTO agreements. As you also know, Mr. Vanclief, the Americans have not even reduced their subsidies, as was requested during the Uruguay Round.

    In light of these facts, Mr. Minister, wouldn't you agree that the time has come to form a coalition of world countries to challenge the US on its position? The Americans are not troubling themselves unduly over this matter. They refer every dispute to the WTO, knowing full well that the WTO will find in our favour two or three years down the road but that in the meantime, all of our producers have to live with these US restrictions.

    Mr. Vanclief, is there any kind of truly global movement afoot to send a clear message to the US government?

  (1240)  

[English]

    Mr. Lyle Vanclief: Mr. Chairman and Mr. Desrochers, I explained in my opening comments that I have been making those phone calls around the world, and that most of the secretaries of agriculture and ministers of agriculture will be at the FAO meetings in Rome in a couple of weeks. I have a series of meetings with individuals at that time, including a meeting with Secretary Ann Veneman.

    All of the secretaries of agriculture and ministers of agriculture that I've been talking to, including the Cairns Groups, are also.... It takes a number of us to start to do this, but we are arranging that we will collectively seek a meeting with Ann Veneman when we are at the FAO. The Prime Minister raised this issue again with the President at NATO meetings a couple of days ago. We know no one is happy with this bill—even many Americans are not happy with this bill—and we will continue that pressure.

    Can we make them change it? I suppose that's the same as having the Americans change us. They would very much like to get rid of supply management. They would very much like to get rid of the Canadian Wheat Board. The world has ganged up on us on supply management and the Canadian Wheat Board. Are we going to say that because the majority of the countries in the world don't like supply management or the Canadian Wheat Board, we'll give up? We will continue the pressure. I'm not defending in any way, shape, or form what the U.S. has done, but we need to make it clear that they are, with their former actions, within the Uruguay Round commitments.

    This bill is being examined, but it's like every piece of legislation. You can't do the final, detailed examination until you see the regulations and how they're specifically going to put it in place. That examination is taking place. Canada is doing it, and every other country is doing it. I can assure you, and Minister Pettigrew will assure you as well, that if there is any area that we feel we can demonstrate is contrary to the WTO, we will not hesitate for one second to take them to the WTO in the immediate future or in the longer-term future. We recognize that this takes time. In the meantime, we can keep the pressure on them in terms of how they carry it out and how they activate it.

[Translation]

    Mr. Odina Desrochers: I understand all of that, Minister, but will there be any kind of formal agreement reached at the conclusion to the upcoming meetings? I realize that you are in the process of establishing a common fund. Will there be any kind of tacit agreement reached between all of the countries affected by the US Farm Bill to the effect that enough is enough? We're asking for a clear signal, Minister, for something concrete in writing.

[English]

    Mr. Lyle Vanclief: I don't know what your definition of a formal agreement is, but I do know that there is a full agreement at this present time. Are all of the ministers around the world going to sit down and sign a petition or whatever you want against the United States of America? The approach we take collectively will certainly be discussed as we get together at the FAO meetings in Rome, as will what we do singularly and what we do collectively to make our views known to the United States. Some joint communiqués have already come out, expressing concerns about the effects of the farm bill not only in Canada's case, but in regard to developing countries as well. It's very harmful to developing countries.

  (1245)  

[Translation]

    Mr. Odina Desrochers: Mr. Minister, we're quoting you in good faith and we know that you are working very hard with your colleagues around the world. However, if the US Farm Bill were to start doing some real damage to our industry, what steps would you take to support Canada's agricultural industry and what level of financial assistance would you be prepared to provide? In addition, does the Canadian government intend to share responsibility with the provinces when it comes to facing the consequences of the US Farm Bill?

[English]

    Mr. Lyle Vanclief: I outlined earlier that we need to have a two-pronged approach, and that takes in a longer-ranged approach and a shorter approach in order to help our industry get there from here and to address the issues such as the U.S. farm bill and the drought. Those are the types of issues that are there.

    In response to the latter part of your question, Mr. Desrochers, agriculture is a shared jurisdiction according to the Constitution. If there are benefits from trade, the provinces and the federal government share in the benefits. If there are challenges from trade or whatever, whether it's weather or whether it's other issues, the federal and provincial governments share in those challenges as well.

    The Chair: Mr. Claude Duplain.

[Translation]

    Mr. Claude Duplain (Portneuf, Lib.): My question also concerns the Farm Bill. According to reports, the United States is poised to inject billions of dollars into farm programs. I'd like to know why your department has failed to secure international markets for Canadian producers through trade negotiations which ultimately would lead to the gradual lowering of international subsidies?

[English]

    Mr. Lyle Vanclief: It is something our market development people, along with those in the industry, do spend a lot of time on and do a lot of work on. Overall, a lower percentage of our agricultural exports goes to the United States than the overall exports of Canadian goods and services. I believe about 61% of Canadian agriculture and agrifood exports go to the United States. Overall for Canada, for all goods and services, it's about 85% or 87%. In that regard, we are not as dependent upon the United States in agriculture as we are overall.

    However, we have increased our overall exports. We were up to over $26 billion last year, which was the highest it has ever been in Canadian history. It was the highest percentage-wise as well, I believe. We're very close to the industry's goal of 4% of the world agricultural trade by 2005. I think that was the industry's goal, and we said we'd be there with them to help. But we must continue.

    The American market, like anything else, has a culture like ours. The language is closer to the languages we speak here in Canada. It's easier for people to do business in the United States because it's like doing business in the ways in which it's done here in Canada. But we do work with others.

    Later next week, I will be making a visit to the Middle East to help to expand trade in the Middle East. I will be leading a trade mission—it's in the plans—hopefully to South America, to a couple of countries, later this year, and then again with the industry in January of next year. We need to continue to explore those options so that, in agricultural terms, we have as few eggs in any one basket as we possibly can. We need a lot of baskets with eggs in them out there.

[Translation]

    Mr. Claude Duplain: Aren't you concerned that the Farm Bill might lead to more international subsidies? What concrete steps can you take to try and stem the growing tide of subsidies? Canada will never be able to keep pace with the United States on this front. What do you plan to do to prevent this from happening?

[English]

    Mr. Lyle Vanclief: I think there is. Without question, there's a grave danger now that the Americans have done a 180º from what they said they were going to do in the WTO. The WTO process is now driving and will continue to drive them back to what we agreed to in the wee hours of the morning over there at that time.

    I will be very candid in saying that any country that now wants to do something that may very well be within the WTO parameters will have the opportunity to say they can do it because of what the United States did. They can use it as an excuse, so there is a very grave danger of ratcheting things back up.

    Quite frankly, because of the farm bill, we are going to have to do the same type of thing. We will have to look at how we put in more supports, but we are going to have to be very careful about how we do so. We need to do it, quite frankly, in a more meaningful way than they do it in the United States. Some members in this room were with me in Washington a few weeks ago, when it was pointed out to us that close to 500 farmers in the city of New York benefit by millions of dollars as a result of the U.S. farm bill. The last time I was in New York City, there weren't many farms. I believe close to 75% of the money disbursed to commodity support by the U.S. farm bill goes to less than 20% of the producers. By far, the largest number of smaller producers in the United States get very little, if anything, out of the U.S. farm bill. It's targeted, for political reasons, at certain groups in certain parts of the country.

  (1250)  

    The Chair: Mr. Proctor.

    Mr. Dick Proctor (Palliser, NDP): Minister, you were quoted last Friday in Saskatoon as saying that the federal government is already giving farmers $3.8 billion in support programs. I've gone through the estimates book, and I can't for the life of me figure out where you get that number. I'm wondering if you were misquoted, or if you could please provide us with how you get to $3.8 billion.

    Mr. Lyle Vanclief: If I was quoted just as you said, Mr. Proctor, then I was misquoted. I've said in the House a number of times that program payments from the federal and provincial governments last year to Canadian farmers were between $3.7 billion and $7.8 billion. That includes payments as a result of crop insurance, as a result of NISA—the Net Income Stabilization Account—and programs such as the Canadian farm income program, which are all handled differently.

    Mr. Dick Proctor: So what you're saying, then, is that the $3.8 billion reflects the 40% from the provinces and territories in the so-called—

    Mr. Lyle Vanclief: No, when you say how much money goes out as a result of payments like crop insurance, a distribution of the payments for crop insurance premiums differs in provinces. Overall, the federal contribution to agriculture for those types of programs in an individual province is on a 60:40 basis. For example, take a province like Saskatchewan. Because Saskatchewan's choice was to distribute its 40 cents in a different way, with individual programs versus others, I stand to be corrected, but I believe the producer pays only 10% of the basic crop insurance in Saskatchewan. The federal government and the provincial government have a distribution on the rest of it.

    That's how the contribution to NISA...overall, it's a basic 60:40 ratio, but some provinces have chosen to put up far more than 40 cents to support their industry than others have, in relation to the federal 60 cents.

    Mr. Dick Proctor: On the $3.8 billion, then, you say that if that was the way it was reported, it was indeed a misquote. Therefore, what is the number for the federal government support programs to farmers?

    Mr. Lyle Vanclief: The federal government investment, if I could put it that way, in support programs was $1.1 billion last year. There was also the $500 million ad hoc payment that was made after I announced it in March of last year. The federal government portion was $1.6 billion. To have the 40% go with the $1.1 billion, the provinces would have to put their $700 million with that. And for the $500 million ad hoc, their 40% to match that was another $330 million.

    We have to keep in mind, as I am sure you're aware, that you pay an insurance premium and the federal and provincial governments and the producers contribute to the premium. If you have a fire, though, the program that you invested in may pay out far more than your premiums were that year, but that's why you have insurance.

    The other things is that hundreds of millions of dollars are triggered in the NISA, but for whatever reason, farmers have chosen not to take them out. For example, a few hundred million dollars were available in Saskatchewan, triggered last year, that farmers chose not to withdraw.

  (1255)  

    Mr. Dick Proctor: In the past decade, though, support for our farmers has declined by about 38% on a per capita basis, and U.S. spending before the farm bill had gone up by 22% for American farmers. With the farm bill, we're told that they now have an advantage over our farmers of approximately 55% in terms of support. You're on the record as saying there may be a program someday, but it won't be $1.3 billion and it will be cost-shared with the provinces and territories. At the end of the day, is this going to be significant enough that it won't be perceived to be a day late and a dollar short?

    Mr. Lyle Vanclief: With agriculture or any other area, as much as we sit at the tables that we sit at, when we want tax relief and we want this and we want that, when we do make expenditures, we're all pressured to make expenditures for a lot of very good reasons and to set priorities. What I do know is that, in my department in 1998-99, the departmental budget was $1.3 billion in total. That included marketing development and all of the other things we need to do. That did not include the food agency. That was just in Agriculture and Agri-Food Canada. In 2001-02, it was $2.6 billion, and I can tell you we're not done yet.

    We recognize that further investments are needed. I'm confident that some of the further investments will be federal-only further investments for certain things. But when we get into doing things with the provinces, there are investments the federal government can make for the benefit of the whole industry. Those investments need to be made, and I'm confident a number of those will be made in the very near future.

    In other areas, it has been a 60:40 relationship for the past number of years as far as support to agriculture has been concerned. I have to emphasize that this doesn't prevent any province from spending more and investing more in its industry if it so chooses.

    The Chair: Rose-Marie.

    Mrs. Rose-Marie Ur (Lambton—Kent—Middlesex, Lib.): It's nice to have you here, Mr. Minister.

    I'm going to pursue it a little bit on the same vein as Odina. We've discussed on several occasions the fact that many countries are of the same view regarding the U.S. farm bill. We have many allies indicating that they are in the same frame of mind.

    Since Canada is perhaps being looked at as a leader in this respect, has the department done any legwork to see the numbers that would band together with Canada so that we can join in a constructive effort against the U.S. farm bill and show them how so many countries...? Small countries certainly do not have as much at the table, so could we get those numbers?

    Also, in the farm bill, are there any escape clauses on parts of it that may or may not have to be implemented?

    Those are two questions, but I have more.

    Mr. Lyle Vanclief: In response to your first question, Mrs. Ur, the department is certainly helping to make arrangements for me to make those phone calls. Officials around the country are certainly discussing between themselves and back and forth on how the U.S. farm bill is being interpreted and read in terms of what it looks like and what it may or may not do.

    We're a very integral part of the Cairns Group. There are seventeen countries, including a number of developing countries. We put out a joint communiqué with the Cairns Group, and they are certainly helping to prepare me for the role I will play in bringing countries together at the FAO meetings in June.

    We're running a full-court press as much as we possibly can. In my phone calls to some ministers, I have suggested that maybe a group of ministers should visit Washington. I have been met with different responses. Some have said it may be a good idea, but they want to think about it again. Others have said they felt the most effective thing was the fact that, first of all, we will all be at the FAO meetings, and that we all need to put individual pressure on the United States as well. I know New Zealand has been there, and other countries have been there, too, since the farm bill came in.

    Now, enter the bill. When she was here in town a couple of weeks ago, Secretary Veneman said to me that the implementation of some parts or specifics of the bill is still up to her, her department, and the administration. So I want to make it very clear again that I'm not defending what they have a possibility to do, but I think and hope the pressure the world has put on and will continue to put on will give them second thoughts on how they do it.

    For example, we do know that this bill took the former bill and incorporated and folded into it, built into it, all of the ad hoc payments that they made from the previous bill, along with the ad hoc-ery in the meantime. Overall, if they do no more ad hoc-ery, there's less money in this bill than there was in the last one. However, like us, they will likely see or may see pressure for different ad hoc money for different things.

    I hope we can do more, but if we can keep the ad hoc-ery out from here on in, that will be a little bit of an accomplishment. However, some of the bill certainly has raised the loan rates and the payments for certain commodities. They have entered into the pulse industry. The U.S. is the only country in the world that has entered into and is supporting and subsidizing the pulse industry. That's affecting our very strong and very good pulse industry in western Canada that has been built on the marketplace and not the mailbox, because the Americans are now involved in building a pulse industry in the United States that is based on the mailbox and not the marketplace.

·  (1300)  

    Mrs. Rose-Marie Ur: Some of our colleagues travelled south when we were on break, and they came back with information. They had met with some of their U.S. counterparts who didn't understand what the U.S. bill was doing to our Canadian farmers. Obviously, the communication avenue isn't working. I know you're well aware of that, so have you decided to make some changes? We'd better have better communications, because when these individuals are telling us that they didn't realize these things, it's pretty scary that we can't get that message across. It's pretty simple: We have a problem.

    Mr. Lyle Vanclief: It is pretty simple, but you have to get the other people to listen, first of all. The previous Secretary of Agriculture and I put in place a memorandum of understanding for this type of discussion back and forth between our countries. On our side, the discussion is to involve the industry and the provinces, and the federal government as well. There is a role for everybody out there, but collectively we need to do more. I don't think it's only in agriculture that the United States does not understand Canada and what their actions might do to us. The next question is whether they care.

·  (1310)  

    The Chair: Rick.

    Mr. Rick Borotsik (Brandon—Souris, PC): I do welcome the minister to our committee once again. Unfortunately, he couldn't introduce all of his staff members. Out of curiosity, could I have the members of the department and the members of the minister's staff just raise their hands? We have a large gallery.

    The Chair: I'm not sure that's in order. We have a group that came to the table.

    Mr. Rick Borotsik: It's a large gallery, Mr. Chair. Is the minister embarrassed about how many staff are here?

    Mr. Lyle Vanclief: No, I'm not embarrassed.

    Mr. Rick Borotsik: I just want a show of hands to see how many are ministerial and departmental staff.

    The Chair: That's the purpose of this meeting, and we're glad to see so many people are showing up.

    Mr. Rick Borotsik: There is a reason for it, because I would like to.... He has a lot of very talented...obviously, there's some embarrassment, because they don't want to raise their hands.

    The Chair: We have a former minister here from your own province.

    Mr. Rick Borotsik: That's very nice, Mr. Chairman.

    Mr. Lyle Vanclief: The last time I checked, this was a public meeting, Mr. Chairman.

    Mr. Rick Borotsik: There's a large gallery, that's all. I just didn't know how many were the minister's staff. The reason I ask is that—

    Mr. Lyle Vanclief: You should be pleased, Mr. Borotsik.

    Mr. Rick Borotsik: I am, but why are you embarrassed about having your staff identified?

    Mr. Lyle Vanclief: I'm not.

    The Chair: Mr. Borotsik, it's not him, it's me. I'm the chair of this meeting, and in our meetings, we don't attempt to identify—

    Mr. Rick Borotsik: Mr. Chairman, through you to the minister, maybe the minister could.... Anyway, he has a lot of very talented staff. I know he has.

    Mr. Lyle Vanclief: Thank you.

    Mr. Rick Borotsik: There's a proposal for a trade injury program worth some $1.3 billion. I was simply going to ask whether or not, with all of that talented staff, he has analysed that number. Is it a realistic number that we could put forward as being a trade injury program?

    Mr. Lyle Vanclief: I believe the number being used by the industry, Mr. Chairman, is a number that came from an analysis done by the department in the past. I believe I showed it to this committee, if I'm not mistaken.

    Mr. Rick Borotsik: Is it a real number?

    Mr. Lyle Vanclief: If it's an analysis and I showed it to the committee, I guess it's a real number.

    Mr. Rick Borotsik: Okay, thank you.

    Mr. Lyle Vanclief: If you want to debate what the number is—

    Mr. Rick Borotsik: No, the reason I ask is that I want to go back to the estimates now.

    Mr. Lyle Vanclief: Mr. Chairman, does he want me to answer or does he just want to make a speech?

    Mr. Rick Borotsik: I do.

    Mr. Lyle Vanclief: Then he had better shut up so that I can answer him.

    Mr. Rick Borotsik: So the $1.3 billion is right. But then I go to the estimates. Right now, in 2001-02, it shows adjustments—which are the supplementaries—of $720 million. From that, am I to expect that the supplementaries for 2002-03 will perhaps be equal to that $720 million, or could they be upwards of that $1.3 billion you brought forward as the number?

    Mr. Lyle Vanclief: Mr. Chairman, we're not done. I emphasized and said to the committee a few minutes ago that we need to do a number of things in a number of different ways. I can assure the honourable member that we are looking at not only the long term, but also at the short term, in order to recognize, to the best of our ability, the concerns about the effect of the U.S. farm bill and the concerns about the drought taking place in too much of our country right now.

    Mr. Rick Borotsik: Is the $720 million that was identified as supplementary spending in 2001-02 more realistic, or is the $1.3 billion more reflective of those issues, with trade injury as well as the potential drought that's a probability in western Canada?

    Mr. Lyle Vanclief: It's a work in progress, Mr. Borotsik. I'm confident that I will be able to give you a clearer answer in the not too distant future.

    Mr. Rick Borotsik: All right.

    Not that long ago, Mr. Chairman, we had an ADM from the department sitting before us, and I asked whether there were any proactive programs that they were identifying for the drought. At that time, the answer was that crop insurance was sufficient, was in place, and would be able to satisfy it. It therefore goes back to my question. The $720 million was supplementary, but now we have your department saying the potential drought is already taken care of by the crop insurance. So are you now saying there is no more money for a potential or probable drought?

    Mr. Lyle Vanclief: Mr. Chairman, the honourable member is a very slow listener—

    Mr. Rick Borotsik: I'm a very slow learner because I haven't heard any numbers.

    Mr. Lyle Vanclief: —if he's listening at all.

    I have said several times that we are looking at and working on a number of approaches to this. For example, it has come out very clearly that, in the analysis of the safety nets as they are today, crop insurance is wanted but needs to be improved. NISA is wanted, but it needs to be changed and have some improvements made to it. CFIP works for some people, but it doesn't work for other people.

    What we are doing and looking at with the industry and with the provinces...for example, can we take our current resources and maybe add resources to make a stronger and better crop insurance program? Can we make NISA more effective with different triggers, different levels, etc.? Can we make other investments? This table has been very clear, and I appreciate it. There are concerns about minor use, concerns about green cover, concerns that we need support for our veterinary colleges, and concerns that we need more money for market development.

    Mr. Rick Borotsik: If I may, Mr. Minister, I understand all your green cover.

    PFRA is a wonderful program, with $5 million program spending right now. Your department is spending $15 million for a consultative process. We know and have been told by our own people that more money put into PFRA would be money well spent. Is your department prepared to put more money into program spending and into PFRA?

    Mr. Lyle Vanclief: I believe the expenditure in PFRA right now is about $126 million for this year. We added some more money last year in water projects. We reorganized some money within there just a couple of months ago in order to fulfill a number of applications that were there.

    The Chair: Thank you, Mr. Minister. I have to move on.

    Mr. Lyle Vanclief: Now he wishes he hadn't talked so much, because I could have given him more answers.

    The Chair: Mr. Speller.

    Mr. Bob Speller (Haldimand—Norfolk—Brant, Lib.): Mr. Chair, maybe we should question whether or not we have cameras in the room the next time we have the minister here. We might get something done.

    Mr. Minister, I want to take this opportunity to thank you for your comments in terms of the report of the Prime Minister’s Caucus Task Force on Future Opportunities in Farming, and for some of the comments you made with regard to the areas you're looking at. This committee certainly heard about these things when it talked to farmers across the country, and we certainly appreciate that fact.

    I want to ask you about this whole issue of bridge financing. Given the American farm bill and the challenges of these production-distorting subsidies, there's no question that grain and oilseed farmers in particular are going to be directly impacted. In the short term in any event, before we get to the agricultural policy framework that you, your department, and the provinces are working at, we need to address some immediate issues. Minister, could you bring us up to date on your thoughts on what bridge financing means and where you feel we should be going in that area?

    Mr. Lyle Vanclief: Certainly, as I've alluded to in my comments so far this afternoon, we need to get to there from here, to the agricultural policy framework, with investments both short-term and long-term, and with support in the short term. I am confident we will find some resources to do that. When we find them, the next challenge, as always, will be to get them distributed in such a way that we help as many people as we possibly can.

    In the past—for example, last year—the ad hoc money was given to the provinces to disperse on the allocation formula that they chose. Even though some provinces said they had certain sectors that really needed the help, they went ahead and gave that money to everybody. I'm not saying everybody doesn't like to have help, but they gave it to everybody. So if we get that kind of support, we need to try to distribute it to those who are hurting the most at the present time, and be as fair with that as we possibly can. That will be a challenge, there's no question.

    For example, sometimes we have well-meaning programs put in place that work for a while and then don't work as well as they should. For example, NISA needs some changes. The industry has said that. When we get new money, we need to be careful in the distribution of it in order to help those who need it. There's no question that the grains and oilseeds have been hurt, but I'm sure other sectors of the industry will feel they need a portion of whatever that might be as well.

    Mr. Bob Speller: Minister, you met last week with some of the western premiers and farm leaders and talked about the future. Frankly, I'm worried about some of the comments that I'm hearing out of the provinces. They feel they may not have the dollars to put into some of this new programming, yet it seems some of the provinces with some of the greatest needs are the ones bucking moving forward. Could you bring us up to date on your negotiations with the provinces? I understand that you're meeting with the ministers next week or sometime in the near future.

    Mr. Lyle Vanclief: At the end of June.

    Mr. Bob Speller: Will you be putting some ideas on the table for them? What are their feelings about moving forward?

    Mr. Lyle Vanclief: The provinces would certainly like the federal government to pay for everything, and I'm not being flippant when I say that. Agriculture is a shared jurisdiction. I suppose that if you talk about a shared jurisdiction between two parties, it should be 50:50; however, for a number of years now, the federal government has paid 60%. The provinces have been there. As I said, some provinces are pretty well about even, are about dead on, with 40 cents for every 60 cents that the federal government puts forward. Some provinces put in considerably more than that to support their agriculture industry, and some put in just a little bit more than that.

    Over the years, when the federal government has spent less money on agriculture for different reasons—it was done in the past for financial reasons, priority reasons, or whatever; it's a reality, but it's behind us now—the provinces have spent less at that time as well, and some of them have spent considerably less. I think that needs to be recognized as well when any province says to us that agriculture is extremely important to their province, vitally important to their province, but they then tell me they don't have any more money.

    It wasn't a large amount of money, but I did do some reorganization in the PFRA to find money to fill some water projects that were done in Saskatchewan recently. That was done previously on a one-third–one-third–one-third basis with the producers. But the province didn't have any money to help the producers. They didn't put a nickel into it.

·  (1315)  

    The Chair: Mr. Anderson, for five minutes.

    Mr. David Anderson (Cypress Hills—Grasslands, Canadian Alliance): Mr. Minister, a few of the members have talked about the estimates, and I want to come back to them because I think it's important to do so. You mentioned a few minutes ago that you spent $1.9 billion last year—you added it up for us—and that it was the federal government's contribution of the—

    Mr. Lyle Vanclief: It was $1.6 billion.

    Mr. David Anderson: It's listed at $1.98 billion in our estimates.

    You budgeted $1.3 billion this year, which, according to the estimates, is $670 million short of last year. It's going to take $670 million just to bring safety net funding up to what is was last year, and you're that amount short. You're talking about supplementary funding and bridge funding, and “trade injury compensation” is a term used in places as well. That first $670 million is just going to bring farmers' safety net funding up to last year's level. When are you going to bring that funding back to last year's level? Do you understand that any trade injury money needs to be on top of that?

    Mr. Lyle Vanclief: On the difference between the estimates last year and where we were, I can ask Mr. Deacon to explain that, but $500 million of that was the ad hoc money that was there. He might help us on what took it up to, was it $1.7 billion, David?

    Mr. David Anderson: No, $1.9 billion.

    Mr. Lyle Vanclief: Bruce, would you comment on that?

    Mr. David Anderson: The estimates explain where it came from on page 20, but the reality is that you're budgeting $670 million less this year.

    Mr. Lyle Vanclief: Yes, because those are the estimates and there have not been any supplementary decisions made at this time. That's my point.

    Mr. David Anderson: Then are you going to put $670 million in supplementary funding into safety net funding in order to bring it up to last year's levels?

    Mr. Lyle Vanclief: I'm confident that we will probably have more than that.

    Mr. David Anderson: And you understand that any trade injury package needs to be on top of that in order for farmers to get any more money than they had last year?

    Mr. Lyle Vanclief: I am aware that we need transition dollars to assist our industry to deal with the problems that are there now and to get to the agricultural policy framework. As I've said several times, everybody agrees—I think everybody around this table does—that we need a long-range policy for agriculture and a lot of investment in a number of different ways in agriculture, but we have to get there from here. I am aware it will take some dollars with and for our industry to get us there.

    Can I say specifically today what dollars they are? No, but I can tell you I've had a lot of conversations with the cabinet and I'm not done yet.

    Mr. David Anderson: How long are farmers going to have to wait before you can say what that amount will be?

    Mr. Lyle Vanclief: I'm not going to put a date on it today, Mr. Anderson, but I can tell you the government, the cabinet, the Prime Minister, and I realize the urgency of it. I'm confident it will be in the not too distant future.

    Mr. David Anderson: When do you think the earliest delivery date on that money would be while the government, the cabinet, and the Prime Minister spend time discussing it? When will farmers see that money?

    Mr. Lyle Vanclief: As I said earlier in response to the question from Mr. Speller, once you get money, sometimes that's a tough challenge. The next challenge is to get an agreement with provinces, etc., in order to get it out. I recognize that, if and when we get more money, it needs to be out there and it needs to be out there in this calendar year.

    Mr. David Anderson: I'd like to address a second issue, and that's the U.S. farm bill. It has been in development for three years. There are no surprises in it. We all knew several months ago what the major clauses in it would be. I would suggest that you and your department should have had an action plan that went into effect the day the bill was signed. A couple of things there, the country-of-origin labelling in particular, have been challenged in other parts of the world and have been dealt with. For the most part, we could have stopped that if we had been willing to deal on the feedlot protocol that we would not move on. Instead, we're now faced with country-of-origin labelling. The new crops that have been added into the farm bill are also another issue.

    Instead of getting action, we're getting delays, excuses, and false bravado from you and your cabinet. Over two weeks have passed since that bill became law. Why haven't we launched WTO and NAFTA challenges particularly on those two issues, but also against that whole bill?

    Mr. Lyle Vanclief: Mr. Anderson, I explained that earlier. When you see this bill on paper, in a text about eight inches high, it's very detailed. Not a country in the world has completed its fine analysis of it yet. They have done preliminary analyses of it, but before you take anybody to court—and that's what the WTO is—whatever you're going to do, you need to know you have some fairly firm grounds on which to do it.

    The other thing is that they have not yet put in place the regulations and how specifically they are going to do it. As much as we don't like what we see in the devil, we don't know the detail in the devil at this stage. We can't take somebody to the WTO on the basis that we think this is what they're going to do. We must be able to demonstrate clearly what it is that they are going to do. That analysis is taking place.

    One of the ministers I talked to said they were going to go to the WTO. When I quizzed him a little further, he said that his country was doing an analysis and that they thought they would able to but were not done the analysis yet.

·  (1320)  

    Mr. David Anderson: We heard a million excuses about the softwood lumber as well. We can't have those in wheat.

    The Chair: Mr. Anderson, I have to respect the time limits.

    Paul Steckle.

    Mr. Paul Steckle (Huron—Bruce, Lib.): Mr. Minister, I have two questions, the first of which relates to deliveries of money.

    Some months ago, the Province of Ontario and the federal government reached an agreement in terms of the delivery of about $50 million to farmers in Ontario in regard to market revenue. Once that agreement was reached, I'm sure there were details to be worked out. However, I'm just wondering where that money is, given that the Province of Ontario made a promise to the farmers of Ontario that the money would be delivered some time in April. We're now almost at June 1 and we have no money delivered to the farmers of Ontario as of yet. I'm just wondering where that is.

    Secondly, given that we've now gone to $26 billion in exports—that's a very high number—one would think the farming community would be the better for it, but that's not necessarily the case. The throne speech indicated that we were going to go from crisis management to risk management. Does the department have the stomach to go forward and put in place a commitment to the farm community that food security is so important in this country that it's a sovereign issue? Will it commit that we're prepared, as a government, to support our farmers in the interim until such time when the governments around the world come to the conclusion that subsidies are not the answer?

    Mr. Lyle Vanclief: Mr. Steckle, in answer to the last one, the departments act on the directions of governments. We're all part of the government, so they will act on the direction that the government gives them. It's not whether or not the department has the intestinal fortitude to do that. I'm proud that my officials work under the direction of our government and under my direction. That's the challenge and the opportunity that we have as a government.

    On the other one, Mr. Steckle, I think you're referring to the market revenue interim payments. That's a companion program in Ontario. Ontario made the announcement some time ago about what that program was going to be. Therefore, it's in their hands in terms of how it pays out. We contribute, but we don't manage the program in Ontario. It's my understanding that the actual interim payment cheque will be going out this month.

    Mr. Paul Steckle: We have placed our portion of market revenue moneys in the hands of the province, so do you have a specific date on that?

    Mr. Lyle Vanclief: No, you'll have to ask the province. Ontario made the announcement, and they do the analyses. They come to us and say it's a program that they want to do. They then do an analysis and we confirm with them the analytical work that they do. Our officials confirm that work, and then Ontario manages the program and issues the cheques from there.

    It's not a situation in which the federal money isn't available. The federal money is already there. The surplus is there, and we pay the rest on invoice. We can't pay them until they invoice us. As soon as they invoice us, we'll pay them. If they pay the farmers or if they invoice us, we'll pay them. We're not in the habit of sending anybody any money before they give us an invoice for doing it. The Auditor General doesn't like that.

    Mr. Paul Steckle: So you have not received that as of yet.

    Mr. Lyle Vanclief: No.

    Mr. Paul Steckle: Thank you.

    The Chair: Thanks, Paul.

    There's a bit more time left in that segment. Mark, would you like to use it?

    Mr. Mark Eyking (Sydney—Victoria, Lib.): Yes, thank you, Mr. Chairman.

    Minister, we often talk about how Canada cannot compete with the other treasuries of the world when we're setting up our programs. Mr. Speller mentioned that even within our own provinces, we have problems with different treasuries.

    I don't think we should have a situation in which a grain grower in Saskatchewan has programs different from those for a grain grower in Alberta, or ones in which an apple grower in B.C. has it different from an apple grower in Nova Scotia. Federally, should we be striving for the same kinds of programs throughout this country, ones in which everybody has equal programs? On that note, should we sometimes be going it alone with our programs, without the provinces?

·  (1325)  

    Mr. Lyle Vanclief: That's a very good question. For programs such as crop insurance and NISA, for example, I think there should be national standards and national parameters. It's much easier to do that across the country with NISA. With crop insurance, we know specific situations are different in the different provinces because of different commodities and different breakdowns of commodities, etc.. Therefore, in something like crop insurance, we need national parameters for crop insurance, but we also need some program and industry flexibility within the provinces in order to do that.

    We need to avoid going back to where we were a number of years ago, when there was an awful lot of discrepancy...that's not a good word...a lot of difference between the levels of support between different provinces. Some provinces would have a high level of support for one of the meat industries, let's say, and another province wouldn't have it. What you then had between Canadians, between provinces, was competition. One of the things a program like NISA does is start to level that out so that we keep a more level playing field within Canada.

    We can't avoid having some of that happen. If a province wishes to give provincial-only support to a sector, it is certainly at liberty to do that. As a federal government, though, we should not be part of creating any of those differences.

    The Chair: We have a little bit of time left, so we'll go for one-minute, very short questions, with very short answers.

    I'll go to Odina next.

[Translation]

    Mr. Odina Desrochers: Thank you very much, Mr. Chairman.

    Minister, the initial economic impact of the US Farm Bill should be felt within the next six to twelve months. You said that we would feel some of the effects very soon. Are you planning to announce some kind of financial aid package within the next year? When do you plan to meet with your provincial counterparts to ratify this agreement? Finally, are you planning to introduce a new program or to retool existing programs to contend with the fallout from the US Farm Bill?

[English]

    Mr. Lyle Vanclief: Odina, as I've said a number of times, we need a multi-pronged approach, or long-term, mid-term, and short-term approaches to this. I will be meeting with the provincial and territorial ministers at the end of June to continue the dialogue, but we are having discussions with them constantly on addressing the short-term approach as well. I'm confident that we will be able to come up with something very worthwhile. Will it satisfy everybody? No, but we'll do all we can.

    The Chair: Claude, do you have a short question?

[Translation]

    Mr. Claude Duplain: I have one final, very brief question about this whole matter. I know that thousands of farmers and organizations in Canada have different ideas and initiatives in mind. I'd like to know what the department intends to do about this. I'm talking specifically about issues that directly concern me. No doubt you're aware of the problem of the shortage of funding for veterinary colleges. As I see it, this shortage could cause a very serious problem. Is the department aware of this situation and taking steps to address the problem?

    One project with interesting possibilities is the proposal by the federated cooperatives which are seeking a capital carry over. Is the department interested at all in these kinds of proposals?

[English]

    Mr. Lyle Vanclief: I am discussing them with the department. There is no question about that. I've discussed them with the cabinet as well. Support is needed to ensure that our four veterinary colleges in Canada have international accreditation, which is very meaningful to our livestock industry and to food safety. I am confident that we will be assisting the provinces in the not too distant future, recognizing, however, that even by doing that, it is post-secondary education and is a provincial jurisdiction. Nonetheless, I'm confident the federal government will be helping.

    The co-op movement is important and growing across Canada, and very helpful to individual producers as they become part of a system, of a value chain, as commodities move off the farm, so that the individual producers can have a piece of the action further up. We need some more support there.

    There was one other issue that you mentioned. What was the third one? Mr. Chairman, do you remember?

·  (1330)  

    The Chair: No, I don't, but I have an old friend back home who says he never runs out of stories but sometimes runs out of time. We're running out of time.

    Mr. Lyle Vanclief: I remember what the other one was. It was on the need for venture capital and equity capital. The Farm Credit Corporation needs more money, and I think the finance minister recognizes that.

    The Chair: As 1:30 has arrived, we would like to thank the Mr. Minister for coming today. Later, we'll be hearing from his officials.

    Rick, to get back to your question, we've had a lot of very important people in the room. For example the ambassador from New Zealand was here. There's great interest in agriculture in this country and around the world, and we'd like to thank all those who came to hear the minister's performance today.

    We'll adjourn our meeting.