By Mark Wales, President, Ontario Federation of Agriculture, August, 2012
The Ontario Federation of Agriculture (OFA), along with our national and provincial counterparts had a rare opportunity for frank, transparent discussion about changes to Canada’s agricultural programming recently when Ontario’s agriculture minister Ted McMeekin addressed the meeting of the Canadian Federation of Agriculture hosted in Toronto by the OFA.
On the agenda was the expected outcome ofFederal/Provincial/Territorial (FPT) negotiations on Growing Forward 2, which will determine the next five years of agricultural programs for Canadian farmers. The federal and provincial agriculture ministers are expected to sign off on the new agreement this fall. Minister McMeekin shared some of the options beingdiscussed by ministers at the table.
Minister McMeekin suggested farmers can expect to see a reduction to current spending levels on business risk management programs including significant cuts to a key program – AgriStability. AgriStability is a vital program that helps protect Canadianfarmers from large declines in farm income due to market conditions, production loss or increased input costs.
OFA sees three main problems with the proposed cuts to AgriStability. First, such programs were originally designed so that farmers and government share the significant risks of producing food. The proposed cuts to AgriStability will result in a disproportionate “risk shifting” to farm families, instead of “risk sharing.” Secondly, implementing the government’s proposed cuts to the program’s design will overshoot their targeted budgetary expenditure cuts. That’s because farmers will be less likely to enrol in the program if they perceive AgriStability will no longer provide adequate risk protection. Finally, cuts to business risk management programs such as AgriStability will only serve to increase the pressure on governments to distribute one-time assistance to producers facing sector-wide or regional challenges.
Canada’s primary production agriculture represents the heart of Canada’s agriculture and agri-food sector, and contributes more than 9 percent of Canada’s GDP and more than 2.3 million jobs, or 13 percent of all employment in Canada. In the current financial difficulty facing much of the world, our agricultural sector has remained buoyant and become a driving force behind Canada’s economic prosperity. Agriculture is a strategic resource, and its viability and productivity must be protected. Cuts to AgriStability coverage or other business risk management program spending will most certainly lead to less effective programs for farmers.
The OFA understands the federal government’s interest in balanced budgets, but it is unfair and irresponsible to make drastic cuts to these vital programs for farmers. Current programs and their associated coverage levels are crucial to keeping Canadian agriculture viable and competitive in increasingly challenging global markets. Funding and functionality of AgriStability and the rest of the current business risk management suite of programs must be maintained to deal with the situations beyond thefarmer’s control such as this summer’s drought. Any additional investments into innovation, competitiveness or other industry supports cannot be reallocated from current business risk management programs.
The Ontario Federation of Agriculture believes strongly that industry associations have the right to be engaged in the development of business risk management programs that will keep our industry viable. It is unfair and unrealistic to expect farmers to shoulder the risk alone. We will look for further open discussions with our elected officials to secure agricultural programming that will be an effective use of federal and provincial funds for Canadian farmers.
For more information contact:
Ontario Federation of Agriculture
Ontario Federation of Agriculture