The Hill: Government inaction - an economic death sentence for many producers

Tuesday, March 2, 2010

Agriculture ministers showed no signs of responding to the farm crisis when they met in February. Are they sending a 'survival of the fittest' message to producers?

by BARRY WILSON

Given the prolonged meltdown that has been unfolding in livestock sectors for several years, particularly in the hog industry, Canada's agriculture ministers show a remarkable lack of urgency in trying to help.  

Federal and provincial ministers emerged from an early February meeting in Toronto to promise only that they will continue to talk about changes to business risk management programs, including the flawed AgriStability program that is all but useless for producers in a prolonged revenue slump. But they will do nothing until at least July when they meet again.

In fact, there is no guarantee that any changes will be made in the design of existing programs before they expire in three years. These talks may well be only about making the next generation of programs better.

At the end of the February meeting, federal minister Gerry Ritz suggested that part of the reason may be that, in deficit times, all governments are keeping ministers with spending proposals on a short leash.

"We want to assess (programs) on farmgate friendliness," he said, meaning programs that work in farmers' interests. "We've always said these programs have to be bankable and predictable. They also have to be bankable and predictable for our treasury boards and our finance departments, so I'm not going to commit to any specifics at this point."

For many farm leaders, the lack of urgent political response and the potential for months if not years of delay in program improvements is an economic death sentence for many livestock producers.

Ontario Pork director Curtiss Littlejohn said before the meeting that last year's government-guaranteed Loan Loss Reserve Program for the already heavily indebted hog sector is not working. Just a handful of producers have qualified or want to take on more debt, and the AgriStability program based on historic margins, is irrelevant for most producers.

"The state of the industry continues to deteriorate, the red ink is flowing and the programs in place are not doing the job," he said from his Hamilton-area farm. "Governments need to react."

When they failed to respond Feb. 5 in Toronto, Canadian Federation of Agriculture president Laurent Pellerin felt they had missed an opportunity.

"I am very disappointed," he said. "There are some things they can do, should have done today, yesterday. Planning for the longer term is fine, but farmers live in the short term and for many, these programs are not working."

It's not like ministers don't understand the unfolding carnage and the lack of meaningful program help. They would have to be blind and deaf not to recognize it. In fact, rookie Ontario minister Carol Mitchell said program inadequacy was a topic of vigorous debate during the meeting. "Some of my provincial counterparts certainly raised concerns on that and minister Ritz heard those comments. There is a process going forward."

Saskatchewan's Bob Bjornerud said he was one who raised it as co-chair of the ministers' meeting. "A program based on historic margins for triggering payments is of limited value," he said. "In my province, I'll use the hog side.

It has been going on for years and the program right now simply does not work."
So if the program flaw is understood and still ministers feel no urgency to act, it is reasonable to wonder if a different agenda is at play.

Perhaps the message from Ottawa, to which the provinces acquiesced, is that policies should only support the strongest farmers. If you are not able to withstand two, three or four years of economic shock, you should consider some other line of work.

If that is the new "survival of the fittest" philosophy, farmers should know that so they can stop wishing on a government star and move on. BF

Barry Wilson is a member of the Parliamentary Press Gallery specializing in agriculture.