Politician, farm group criticize changes to federal business risk program

Thursday, October 23, 2014

by DAVE PINK

The changes made earlier this year to Canada’s agricultural stabilization policies are unfair to the nation’s farmers, says a senator from New Brunswick.

Sen. Pierrette Ringuette says she has received “many” complaints from the farmers in her province about these AgriStability program revisions, particularly regarding the labour expenses that farmers can claim on their stabilization applications. While the money paid to off-farm employees is regarded as a legitimate expense, the revisions do not allow farmers to claim the wages paid to family members – as defined by the agricultural stabilization program as “arm’s-length” and “non-arm’s-length” employees.

Ringuette, speaking in the Senate last week, said that all other government programs including Revenue Canada, the Canada Pension Plan and Employment Insurance do not make that distinction.

She is calling on the federal government to re-assess this policy.

“This is an issue that needs to be resolved. It’s a complete disgrace the way we are treating our farmers,” she said in an interview this week, pointing out that about 90 per cent of Canadian farmers rely on some family labour.

As well, this kind of discrimination violates the spirit of Canadian law. “A precedent has been set in many decades of jurisprudence,” she said.

Ringuette also said the appeals process for stabilization claims – in which the agency that first denied the claim is the same agency that considers the appeal -- is bogus. “How can you be both the accuser and the jury?” she asked.

The changes, introduced this spring, are also a cause for concern among members of the Canadian Federation of Agriculture – not only the labour expenses issue, but the formula for determining how much a farmer is entitled to. Federation president Ron Bonnett said that in the past a reference margin – a farm’s history of profitability – had been taken into consideration. Not anymore. Now, he says, it is only a farm’s expenses that matter.

“It’s a combination of these two things that are causing the problem,” Bonnett said in an interview.

These changes discriminate against some of the country’s best farmers, he says. “If you’re an efficient farmer, you’re almost penalized.”

While Bonnett says he has not heard of any complaints so far, he says the federation is calling for a review of AgriStability program now that these changes are about six months old.

“At the time when these changes were brought in we really had no way of analysing what the impact would be,” he says. “What we’re asking is, ‘Let’s take a look at it and see what’s happening.’ ”

The AgriStability program is administered by the provincial governments in Ontario, Quebec, Alberta, British Columbia, Saskatchewan and Prince Edward Island. For the farmers in New Brunswick, Nova Scotia, Newfoundland and Labrador, Manitoba and Yukon it is administered by a central office in Winnipeg.

According to the program’s website, AgriStability provides assistance to farmers who are enrolled to protect their operations from large declines in income. BF