by SUSAN MANN
A coalition of Ontario farm groups is concerned the federal government may be considering slashing funds for AgriStability, a national business risk management program that supports farmers when they have a large margin decline.
In a June 19 commentary posted on iPolitics, a Canadian political and news commentary website, Amy Cronin, the chair of the Ontario Agricultural Sustainability Coalition and Ontario Pork chair, writes that there are indications the federal government is seeking to reduce AgriStability funding by 50 per cent.
AgriStability is one of the business risk management programs that are part of Growing Forward, the country’s agricultural policy framework. The cut is being discussed as part of proposals to develop Growing Forward 2, which will replace the current round of programs when they expire on March 31, 2013.
Such a significant reduction would amount to a more than $425 million cut to Ontario farmers over the five years Growing Forward 2 is in place, Cronin writes. It would be detrimental to Ontario’s rural economy and affect all non-supply managed commodities. The cuts would also reduce farmers’ access to bank credit.
Business risk management programs allow farmers to mitigate risk and fairly compete in the domestic and export markets. But any reduction in AgriStability under Growing Forward 2 has the potential to reduce overall output and eliminate farmers in Ontario, she says.
Cronin could not be reached to discuss her comments.
The coalition has set up a website to inform farmers about the potential cut.
Patrick Girard, media relations supervisor for Agriculture and Agri-Food Canada, says by email a refocused suite of business risk management programs was part of this year’s federal budget. “With record high incomes and growth in the agricultural sector, the time is right to look at changes to enable Canadian farmers to make their money from the marketplace, not the mailbox,” he writes.
Negotiations between federal and provincial officials are continuing on Growing Forward 2 programs and “governments continue to look at fiscally-responsible ways to ensure farm income programming is achieving desired outcomes” and programs funded by both the federal government and the provinces invest strategically to promote competitiveness across the sector, he adds.
Ontario Agriculture Minister Ted McMeekin says he couldn’t participate in a telephone conference call Tuesday between federal Agriculture Minister Gerry Ritz and provincial agriculture ministers about Growing Forward 2 because he was flying home after being in Europe for his 40th wedding anniversary cruise with his wife.
But his deputy agriculture minster and chief of staff, who did participate, told him “there was universal concern expressed that the feds need to be consulting with agriculture stakeholders,” McMeekin says.
Ontario has been consulting with stakeholders and they’re telling him they “want to see a continuation of an effective suite of business risk management programs and we continue to advocate for that,” he says.
Asked if proposed cuts to AgriStability were discussed during the call, McMeekin says the federal government has proposed a series of options but “I think we headed that off by talking about the need for consultation and the effective suite of programs.”
McMeekin says the federal government has said it needs to find $300 million in savings and about 80 per cent of federal support goes to business risk management programming. “They’re looking at some potential flexibility but we haven’t bought in to that, we haven’t agreed to anything other than to continue to consult and continue to articulate our primary objective” to ensure there’s an effective suite of business risk management programs.
Growing Forward 2 will come up again at the agriculture ministers’ annual meeting being held in Whitehorse, Yukon in September. Girard says that’s when federal and provincial governments aim to reach an agreement on a new five-year agricultural policy framework. BF
Comments
Whenever farm programs get taken for granted, they've outlived their usefulness because any benefits have been capitalized into asset values - that's the paradox/contradiction of Agri/Stability. Even if AgriStability hasn't been fully-utilized, farm land, at least in Southern Ontario, is trading for anywhere up to 50 times earnings, meaning that, at least as far as land buyers are concerned, there is no need for AgriStability. Ritz, is, of course, only partly right because he is aggregating all sectors of agriculture, and ignoring the fact that supply management is booming thanks to 200% tariff barriers, and grains are booming thanks to mandated and subsidized ethanol, but livestock farmers are, in effect, sucking canal water, because they don't benefit from either tariffs or mandates/subsidies. In short, Ritz is suffering from the inability to separate the widely-varying fortunes (depending on how tightly they are clenching the government teat) of individual farm sectors, and farm groups are suffering from the inability to see that we're definitely NOT "all in it together" - meaning that Ritz, and farm groups, are both completely, and not-surprisingly, completely out of touch with reality.
Stephen Thompson, Clinton ON
The points raised on this website are troubling, largely because they assume that government can't see the weaknesses within them. The net result is lost credibility with government stakeholders.
In the challenges section, they claim that that Ontario produces 23.2% of national output, but only received 16.5% of safety net money. If we take out the supply managed portion of production, the two number are much closer, around 18% of national output. This still isn't perfectly balanced, but isn't it good to need fewer dollars from government?
Then they complain about energy, labour, environment and municipal controls. Yes, those are cost factors, but the sector should stop complaining and focus on leveraging the advantages of being in Ontario - being close to the GTA and the second largest food manufacturing hub in North America, and within a 1 day drive of 100 million people - with forward looking initiatives and value chain efficiencies.
Then they pit supply managed farmers against other farmers in the race for land, ignoring that areas with few supply managed farms, like Chatham-Kent, are experiencing the same set of circumstances. Cash croppers are just as guilty of driving things upward. Dividing the sector is a poor strategy.
It is galling that this group complains about Agri-recovery dollars going to areas that needed it. I genuinely hope that the tender fruit industry in Ontario gets support this year "balancing the inter-provincial scales". However, shouldn't it be considered a good thing to not need any Agri-recovery money... because it means we didn't face a disaster in Ontario.
Then on to agri-invest, which has winners and losers... like every other farm program in history...
Finally, is it really that bad that farmers are getting their money from the marketplace instead of agristability? And its awful that reference margins are being rebuilt so that farmers have the potential to collect when things go bad, even if total coverage is reduced.
I could continue, but I think that is enough for now...
Isn't it high time that agriculture put on its "big boy pants" and learned to deal market fluctuations on our own? I support the need for disaster assistance, and even the need for a helping hand when the market goes really far south unexpectedly (BSE, swine Flu). But, the Hog cycle isn't new... nor is the beef cycle... Private sector tools exist to reduce risk - use them. Farmers are in the business of farming, and it should be our responsibility to use the tools available for the best possible outcomes on our own.
You didn't go quite far enough in pointing out that taking out the production due to supply management would go a long way to equalizing Ontario's share of safety net money with Ontario's share of national production. If you also took out the farm income derived solely from the subsidies and mandates underpinning ethanol, it is quite conceivable that the percentages would be exactly the same, or would even be to the point where Ontario was a net beneficiary in the safety net versus production equation. And as for dividing farmers, we are divided, and we will stay that way as long as both supply management and ethanol are on the receiving end of favourable legislation which isn't available to anyone else.
Stephen Thompson, Clinton ON
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