AGRI Committee Meeting

37th PARLIAMENT, 3rd SESSION

Standing Committee on Agriculture and Agri-Food

EVIDENCE

CONTENTS

Wednesday, February 18, 2004

·

1300

The Chair (Mr. Paul Steckle (Huron—Bruce, Lib.))

Hon. Bob Speller (Minister of Agriculture and Agri-Food)

The Chair

Hon. Bob Speller

·

1305

·

1310

The Chair

Mr. Gerry Ritz (Battlefords—Lloydminster, CPC)

·

1315

The Chair

Hon. Bob Speller

Mr. Gerry Ritz

The Chair

Hon. Bob Speller

The Chair

Mr. Louis Plamondon (Bas-Richelieu—Nicolet—Bécancour, BQ)

Hon. Bob Speller

·

1320

Mr. Louis Plamondon

Hon. Bob Speller

Mr. Louis Plamondon

Hon. Bob Speller

The Chair

Mr. Larry McCormick (Hastings—Frontenac—Lennox and Addington, Lib.)

·

1325

Hon. Bob Speller

The Chair

Mr. Dick Proctor (Palliser, NDP)

·

1330

Hon. Bob Speller

Mr. Dick Proctor

Hon. Bob Speller

The Chair

Mr. Dick Proctor

Hon. Bob Speller

The Chair

Mr. Howard Hilstrom (Selkirk—Interlake, CPC)

·

1335

Hon. Bob Speller

Mr. Howard Hilstrom

Hon. Bob Speller

Mr. Howard Hilstrom

Hon. Bob Speller

Mr. Howard Hilstrom

Hon. Bob Speller

Mr. Howard Hilstrom

Hon. Bob Speller

Hon. Bob Speller

Mr. Howard Hilstrom

Hon. Bob Speller

Mr. Howard Hilstrom

The Chair

Hon. Wayne Easter (Malpeque, Lib.)

·

1340

Hon. Wayne Easter

Hon. Bob Speller

The Chair

Ms. Pauline Picard (Drummond, BQ)

·

1345

Hon. Bob Speller

Mr. Richard Fadden (President, Canadian Food Inspection Agency)

·

1350

The Chair

Mr. Dick Proctor

The Chair

Hon. Bob Speller

The Chair

Mr. Dick Proctor

Mr. Richard Fadden

·

1355

The Chair

Hon. David Kilgour (Edmonton Southeast, Lib.)

Hon. Bob Speller

The Chair

Mr. Garry Breitkreuz (Yorkton—Melville, CPC)

¸

1400

Hon. Bob Speller

The Chair

Mrs. Carol Skelton (Saskatoon—Rosetown—Biggar, CPC)

The Chair

Hon. Bob Speller

Mr. Garry Breitkreuz

The Chair

Hon. Bob Speller

The Chair

Mrs. Carol Skelton

The Chair

Hon. Bob Speller

¸

1405

The Chair

---

CANADA

Standing Committee on Agriculture and Agri-Food

---

NUMBER 003

l

3rd SESSION

l

37th PARLIAMENT

---

EVIDENCE

Wednesday, February 18, 2004

[Recorded by Electronic Apparatus]

·  (1300)  

[English]

    The Chair (Mr. Paul Steckle (Huron—Bruce, Lib.)): Order. Ladies and gentlemen, we will begin our meeting this afternoon.

    We are pleased to have with us today the Honourable Bob Speller, Minister of Agriculture and Agri-Food, along with Deputy Minister Samy Watson and a gentleman from the Canadian Food Inspection Agency, Richard Fadden, president.

    We welcome you to this meeting, as we have in the past welcomed you here. This afternoon we want to examine a number of issues, and hopefully you will address those, Mr. Minister, as you make your opening comments. These are matters relating to the cashflow problems that Canadian farmers are experiencing. You may want to touch base a little bit on the BSE issue and perhaps give us some sort of update on where we might be on that issue pertaining to border openings.

    The time is yours. We are going to give you 10 or 12 minutes. Will you be the only one speaking?

    Hon. Bob Speller (Minister of Agriculture and Agri-Food): That's right.

    The Chair: Okay. We'll begin our question period after that.

    We have one hour today because of time constraints.

    Hon. Bob Speller: Thank you very much, Mr. Chairman. It is a pleasure for me to be back here, on this side of the table. In fact, I used to sit where you are sitting, Mr. Chairman, and I want to congratulate you for being reappointed chair. I also want to congratulate the vice-chairs for being appointed.

    I want to say, before I begin my remarks, that I believe very strongly in the approach that the Prime Minister has taken in terms of trying to involve standing committees more within the process of how government governs, and I look forward to working very closely with the committee.

    I know I have a short time here today, but we have estimates, and I hope to be able to come back sometime on estimates and really sit down with the committee to get a better sense of where it is you think we as a government should be setting our priorities. As you know, the government does set priorities on a number-of-years' basis, and I certainly want to use this committee as a sounding board. I want to use this committee to help me on some of the issues I am dealing with. Specifically, I can think of no better issue than BSE, or the farm income situation, where this committee might play a very useful role in helping me in my role as Minister of Agriculture.

    I also want to say, Mr. Chair, that I do believe there is a future in agriculture in this country. I believe there are opportunities in agriculture. I know that today, as farmers and farm families are looking in, people who are struggling out there on the land sort of wonder whether or not there is a future, or a future for them. I want to assure them that the Government of Canada is committed to this sector. The Prime Minister has told me very directly that he has a strong interest in agriculture, and he believes, as I do, that the agricultural industry in this country is an industry of national significance, one that should be supported by this government and by governments across this country.

    Mr. Chairman, I was appointed to this position on December 12, and by December 22 I managed to get Saskatchewan, the final holdout province, to sign on to the agricultural policy framework implementation agreement. Since December 12, I have made it a point to get out across the country to talk to farmers and farm families about where they see a role for government in agriculture in this country.

    I want to tell you, I've been listening, and to date I've tried to address some of the concerns I've heard across the country from farmers, from farm leaders, and from my provincial counterparts concerning things we could be doing, as the federal government, to assist farmers today.

    This past Monday I had a meeting with my national safety nets advisory committee, a group of individuals who come in and advise the Minister of Agriculture on safety nets and whether or not the programs we have in place are working for farmers. I'd like to underline the fact that they believe it would be very important, for instance, to extend the deadline for CAIS. In fact, I am announcing today that we are doing just that.

    I'd like to underline the fact that CAIS kicks in this spring for the first time ever, that Canadian farmers will have a permanent disaster coverage program, and coverage will be based on need, not pro-rated, as CFIP was in the past. This allows the industry to know in advance what support they will be getting, and it will help in terms of their future planning.

    At the national safety nets advisory committee, we also talked about government's commitment to this annual review of CAIS, and how the industry could work with us in terms of working through that review.

·  (1305)  

    As well, we talked about the topping up of CFIP to 100%. As colleagues know, CFIP was a program that had a certain dollar base, and when that dollar base ran out that was it. We talked about the possibility of topping up CFIP so that producers could get 100%. In the previous two years they had received the 100%, but being the last year there was only a certain dollar amount left. In fact, it was about $65 million short. I've taken their advice and I'm going back to my cabinet colleagues to talk about the need to top up CFIP so that producers will be able to get the full 100%.

    The 2003 income situation has been difficult. You saw the figures that came out, and the figures are startling. I've had an opportunity of sitting down with the banking community and talking to them about how they approach farmers and farm families across this country. They assured me that they would do everything in their power to make sure that their local people are recognizing the fact that the Government of Canada is giving a commitment to agriculture, that these are just short-term difficult times for some of these farmers, and they need assistance from the banks. I assured them that I would continue to monitor the situation, and to meet with them regularly to get an update as to how they see the impact of this financial situation on farmers and farm families.

    The federal and provincial governments have responded to this income drop in 2003. You will note that payments totalling almost $5 billion have gone out to farmers. Now that, colleagues, is a record level. It's a lot of money, but as you saw with these figures, it clearly wasn't enough. About $3 billion were paid through crop insurance, NISA, and CFIP. An additional $800 million came from the BSE recovery program and the federal transition program funding. The balance was made up by various provincial programs.

    In response to this 2003 situation, as I mentioned earlier, CAIS will be starting to pay out this spring, and there will be significant payments under the cull animal program. This past Monday I announced that the slaughter provision will be removed from this program. Moreover, producers will receive the maximum assistance allowed under the program. The cull animal program is an important program because of the situation being faced by many cattle producers across this country. Financial support for producers affected by BSE is only one part of the story. Obviously the other part of the story is getting the borders open.

    A week ago my officials were once again down in Washington to have talks with the USDA about these issues. I had an opportunity, early on, of travelling to Japan and Korea and then meeting my American and Mexican counterparts in Washington. We sat down and worked through a three-point plan: to work together in terms of first and foremost normalizing trade within North America; secondly, working together in international markets to promote North American beef; and finally, to work together within the context of the OIE to make sure that they recognize the significant difference between North America on this issue and the European Union.

    Mr. Chair, I'll wrap up. I do understand there is a time problem, but I do again want to give you my commitment to work with this committee, and to come back at every opportunity to this committee, and to work together for the betterment of Canadian farmers and farm families.

    Thank you very much, Mr. Chairman.

·  (1310)  

    The Chair: Thank you, Mr. Minister.

    I should initially congratulate you, on behalf of the committee, for accepting the role of Minister of Agriculture and the work you're doing. We look forward to working with you in the months ahead.

    Now that we are getting down to the point where we're going to have the members around the table question you, I wonder if I could, as the chair, ask that today we limit our questions and comments to five minutes. We have more members than we have time within an hour, and we're not going to get through everybody as it is.

    We're going to start with Mr. Ritz as our first questioner. I'm going to take the liberty to be very rigid with my five minutes so that we can get as many members in as we can.

    Mr. Gerry Ritz (Battlefords—Lloydminster, CPC): We're disappointed that you can only make it for an hour today, Mr. Minister. Two hours would have been less than adequate to begin with. So I would like to see you back here at your earliest convenience, and we can certainly make that available to you any time, any day, anywhere.

    You touched very briefly on the two issues. The bottom line is getting the borders open, not just one border. We and the farmers out there are wondering who ultimately is in charge. We've seen a lot of folks going back and forth here, but nobody seems to have the magic answer as to who they need to talk to and who we need to send down there to make this happen. Even Ben Thorlakson, the chairman of the Beef Export Federation, says “We would still respectfully suggest that the current structure is woefully inadequate if we are to generate timely market re-entry”. He's not seeing the proper action here. We're going through the motions and nothing is happening.

    To build on that, of course this is an industry in peril, not just the livestock sector, but grains and oilseeds hit the skids here about four years ago, and government programs were woefully inadequate and continue to be. You talk about CAIS kicking in in the spring of 2004. CFIP was less than adequate in 2002, with a 60% payout. You need to go back to cabinet, bang on the table, and get that up to 100% yesterday. You made that commitment during the take-note debate. You said you would go back to cabinet and make that happen. We need that to happen yesterday, Mr. Minister. These folks are cash starved. The year 2003 was the year that shouldn't have been. There's no government program. There was $5 billion of spending in that year, and we're still at negative $13 million agricultural income in this country. That's not acceptable. Primary production of this food is of far more importance than this government is willing to give it.

    I would like your responses to that. Rather than all this BS about BSE, tell us what you're going to do and when and where the cash is.

·  (1315)  

    The Chair: Mr. Minister.

    Hon. Bob Speller: Mr. Chairman, I appreciate the honourable member's statement. I'm not sure if there were questions there, but certainly a lot of statements about BSE and other things.

    I would like to say in terms of timing that I did give the honourable members an opportunity for a half-hour in the House of Commons, when we were talking about BSE, to have any and all questions answered.

    I most certainly respect the importance of this committee, and I would be more than pleased, Mr. Chair, to come back to this committee and to sit down with members who want to talk about these issues.

    The honourable member talked about the process with regard to the border opening. I think he was referring in particular to the United States. Clearly, the decision in the United States is made by Secretary Ann Veneman. Mr. Thorlakson, if I go by the statement he made, was showing the frustration he has, I have, and a number of Canadians have about the process in place in the United States with regard to opening the border.

    Mr. Gerry Ritz: Who is responsible? Is it DFAIT, is it Agriculture, is it Industry?

    The Chair: Mr. Ritz, please, the minister is responding. You'll get your chance again.

    Hon. Bob Speller: His frustration is shared at all levels in this government.

    I want to tell the honourable member that it's a number of different people within the Government of Canada, including the Prime Minister, who is in charge of this file. There are people working in the Department of Foreign Affairs around the world who are talking to different countries about opening the border. There are people within the Canadian Food Inspection Agency who are meeting with their counterparts around the world to talk about and to show what we have done here in Canada and in North America in terms of opening up these borders.

    The Americans have in place a process, and shortly that process will again involve a consultation period with regard to live cattle going into the United States. That consultation period will more than likely be for about a month. They have a legal process they have to go through. After that time, I believe we have the arguments and the science-based arguments that will allow the United States to open the borders. I believe very strongly that the arguments we have reflect the reality that the risk factors between Canada and the United States are no different and that there should be absolutely no reason why that border is not opening.

    Mr. Chairman, as Minister of Agriculture I will continue to promote that and to work with the farmers and the farm groups across this country, who have put their heart and soul into working on this issue.

    The Chair: Okay.

    We'll move to Mr. Plamondon.

[Translation]

    Mr. Louis Plamondon (Bas-Richelieu—Nicolet—Bécancour, BQ): Thank you, Mr. Chairman. My questions to you will be brief, Minister. So I would like your answers to be brief and specific.

    When you announced the creation of the cull cow assistance program, you left the rate at 16%. In Quebec, we have 47% of the quota. Cull cows account for 25% of herds where there is rejuvenation. So if you stay at 16%, there will be no compensation for one-third of the cull cows in Quebec.

    Are you aware of that?

[English]

    Hon. Bob Speller: Mr. Chairman, certainly I believe that program addressed the needs of farmers across the country. There is no question that in terms of the percentage of cows normally culled, the numbers reflected this. And that's why those numbers were chosen. They reflected the reality of the situation on the ground.

·  (1320)  

[Translation]

    Mr. Louis Plamondon: But that does not take into account the special situation in Quebec, which has 47% of the quota and where 25% of cows are culled each year.

    Am I to understand that, given the measures you announced to deal with this crisis, you will not be working in cooperation with the Financière agricole du Québec? I thought that that was a condition for Quebec to sign the strategic framework.

[English]

    Hon. Bob Speller: Quebec is part of this program. They've certainly signed on to it.

    In terms of payments in the culled cow program, this was a program that was agreed to with the industry. It wasn't a program we made out of thin air. We sat down with representatives of the industry and with the provinces, and we agreed to it. It's a $200 million program, of which the federal share is $120 million and the provincial share is $80 million.

[Translation]

    Mr. Louis Plamondon: I would like to ask you another question, which involves the throne speech. Minister, the throne speech talks a lot about access to foreign markets, but it says nothing about supply management. As Minister of Agriculture, do you have a clear position with respect to the supply management program? Are you in favour of it and do you still see it as a program that cannot be touched?

[English]

    Hon. Bob Speller: As part of my role as agriculture negotiator at the WTO, I will be going to a group of countries, called the CairnsGroup, next week, where I will be talking about issues such as this. The Government of Canada is very clear in terms of our commitment to the three pillars of supply management. There is no question about that. The Prime Minister has indicated that commitment, and certainly it is the commitment of my colleagues around the cabinet table.

    There will be challenges, there is no question. Around the international negotiating table, there are those who feel that we shouldn't have supply management. There are those who feel that we should be taking an approach that deals with tariffs, in terms of reducing these tariffs.

    I will be making very clear to other countries around the world Canada's commitment to supply management. I will make it very clear to them that this commitment includes a commitment to make decisions around the international negotiating table that respect a balanced approach, that recognize the importance of international trade and getting rid of trade-distorting impacts of trade, but that at the same time recognize sensitive industries, such as our supply-managed industries in Canada.

    The Chair: Larry McCormick, please, for five minutes.

    Mr. Larry McCormick (Hastings—Frontenac—Lennox and Addington, Lib.): Thank you very much, Mr. Chair.

    Not to lose our precious moments here, but some of us who were late, Mr. Minister, didn't want to miss any of your words; our schedules, on both sides of the table, showed us across the road, in another room.

    First of all, thanks very much for the great event last night. It was good to see that we had members from all political parties, Minister, at your event, the beef-in-a-bun reception. We had a lot of members from the industry there. It's good to meet together and work together.

    Now, as to the border, of course, if it were open it would look after so much of this. We have our great customer and our great neighbour there to the south. I think 86.5% of everything we make and grow goes there. Sure, we may have an election in the next year, but they have one for certain, and it is protectionism that's happening. That's the only reason for it. I mean, we have the health and the science. We have the greatest, safest food in the world....

    I can say it's protectionism, because it is. And the restaurant association in the United States may be our greatest ally this time. They want the border open.

    Mr. Minister, I realize you know this, probably more than most anyone in this room. The urban people cannot understand how the producers and their families and their communities are suffering. It's devastating. We are going to lose a lot of people. And I should talk about the truckers and the veterinarians and the sheep producers, the goat producers, the elk producers, the bison producers, and all of these other ones.

    We're going to have to have more money, Mr. Minister, and we're going to have to get it to these people immediately. The challenge I see is that every time we invest some money that deserves to be invested in this great industry, the packers and the wholesalers gobble up all the money. Some people have said that it's criminal, what they're doing.

    Have we plans, or have you plans, on how we can invest in this industry without it all disappearing because of the world “greed”?

    Thank you, Mr. Chair.

·  (1325)  

    Hon. Bob Speller: Mr. Chairman, there were a number of points there.

    Certainly first and foremost, I will reiterate that in fact it is a very strong commitment from the Government of Canada, particularly from the Prime Minister, to work hard to get that border open. The United States has a legal process they have to go through. That legal process will probably take another month or so, but after that, I believe very strongly that we have the science-based arguments to get that border open.

    I understand the concerns that were expressed by the member with regard to the packers. I understand this committee in fact is in the process of looking into that, and I commend you for that. I've written to my cabinet colleague who's responsible for the Competition Bureau to ask her to ask the Competition Bureau to look into these issues. There is concern out there that in fact there are some taking advantage of this situation. I would like this committee to continue its work in that area, and I would hope that the Competition Bureau would take a look too, so that in fact we know if that's the case.

    In terms of dollars going out there, there are dollars that have been made available for Canadian farmers and farm families who are beef producers. Clearly we had the $520 million. We have another $200 million for the culled cow program, in which, as you know, we changed the slaughter provision, after sitting down and listening to different farm groups across the country. Those dollars will be going out in the near future.

    What we had to do there was have the provinces do their inventories first, to tell us how many cows to pay out on. As you can well imagine, the government doesn't want to be paying out dollars that shouldn't be going out. It's for legitimate farmers and people who have these culled cows. Those provisions will be done shortly, and I'm hoping those dollars will start to flow out in early March.

    We have a number of people who are drawing down on their NISA. We have a number of people who are taking advances on CAIS. So there are dollars there. But I've sat down with people, particularly in the past week, when I was in Calgary talking to the Canadian Cattlemen's Association and a number of the Alberta cattlemen there. They've indicated that there is a major cashflow problem right now, today, and that in fact the recent downturn in price has put them into a very difficult situation. I've told them that I will sit down and work with them. In fact, they were in town yesterday, and today they're sitting down with my departmental people to talk about other things that we could do. I told them that once they've done, I will then take that to my cabinet colleagues and try to work on another program that will help the situation.

    The Chair: Thank you, Minister.

    We will move to Mr. Proctor.

    Mr. Dick Proctor (Palliser, NDP): Thank you, Mr. Chair.

    Picking up on that point, could we expect that action will be taken such that any new program might be announced in a budget this spring? You have referenced the Prime Minister's commitment to agriculture. We know that BSE has so distorted agricultural economics out there that your department hasn't even come up with any forecast for 2004. There is a reluctance to do that. You were on the record a week ago saying that we need to pour more money into the agriculture sector.

    The short question is can we expect to see something when the budget is introduced this year?

·  (1330)  

    Hon. Bob Speller: I hope to have a program up and running—once I get the work being done by my department and the cattlemen—as soon as possible.

    Mr. Dick Proctor: I know time is of the essence. I have just two questions. I will ask them and then the minister can respond, Mr. Chair.

    I don't know if there is a bit of double-speak going on, but you indicated you have had conversations with the lending institutions, Farm Credit Corporation and the bankers, and that they are ready to do everything they can. There are lots of farmers who are telling us different stories. When they go to their lenders they are not feeling reassured, which was the word you used to reference the bankers. That is one issue.

    The other thing is farmers are skeptical about any border reopening to live cattle exports with the United States any time soon. A lot of people think it won't happen before the presidential elections in November. You are on the record, and you just said a few minutes ago, it would be another couple of months, but there is a lot of skepticism that it isn't going to open as quickly as you believe it will.

    Hon. Bob Speller: There is no question that there is concern. People are having difficult times. I want to give them my assurance that we are doing whatever we can.

    I've been given no indication from U.S. Agriculture Secretary Ann Veneman or anybody in the U.S. administration that they will not look at this based on the laws that they have and based on the arguments that are put forward. They have indicated to me that they have a legal process, which they have to go through. They have not given me any indication that they will make any political decisions on this. They recognize the difficulties that Canadian farmers and farm families are having.

    I believe, at the end of the day, our arguments will prevail. So yes, I am maybe a little bit more positive than others out there.

    In terms of the banks, there is no question that there are people who are having difficulty. There is a range of people out there. Some were having difficulty before this case came on. Some are able to handle it because of the equity they have, and there are others who are having difficulty. It is those ones that I've tried to impress upon the banks that we certainly need to concentrate on. These are the ones who, if the borders open in the near future, will be able to survive. In the meantime, we need a bridge to get there. These are the ones I want to help deal with through this new program.

    The Chair: A very short question, if you have one.

    Mr. Dick Proctor: Just to go back to the American border, you will be aware, as we all are, about Ron DeHaven's comment that the border would not open before August, at the earliest. That is his quote from roughly a month ago. Again, people see that and their expectations get dashed.

    Hon. Bob Speller: I understand that there are, unfortunately, in these circumstances, all kinds of different information that come out, that people take certain ways. There was a report that came out that talked about the fact that it was played in the media that the border wouldn't be opening for a couple of years, and actually it was talking about a commitment of getting countries around the world to commit to some sort of agreement at the OIE. Unfortunately, in these circumstances there are those sorts of information that come out. I can only tell you what I believe and what I am being told by my U.S. counterparts.

    The Chair: Mr. Hilstrom, for five minutes.

    Mr. Howard Hilstrom (Selkirk—Interlake, CPC): Thank you, Mr. Chair.

    The fact of the matter is that every cattle rancher right now is bankrupt at these prices. It's just a matter of the banks not calling in loans or the creditors not calling in their payments. So the importance of opening up the border is the only number one issue here.

    With regard to the sponsorship program, which we are debating in the House right now and over which there is a scandal, we find the Prime Minister saying that he is going to get to the bottom of who was in charge of this and who was responsible. The problem with regard to opening up the borders is, as set out by Ben Thorlakson, the head of the Beef Export Federation, that the government structure in place to negotiate and get the borders open with all these other countries is woefully inadequate and has to be fixed. Is it the CFIA under the agriculture minister, is it Trade Minister Peterson, or is it the Prime Minister? Who has ultimate responsibility for coordinating Canada's activities and who is responsible precisely for getting that border open? Is it the Prime Minister? Is it you, Mr. Minister? Who is it?

·  (1335)  

    Hon. Bob Speller: The person responsible for this file is me as agriculture minister. I'm also working, of course, with the Canadian Food Inspection Agency, DFAIT, the Prime Minister's Office, and Health Canada. A whole range of individuals are working on different aspects of this. For instance, in meetings with our counterparts in the U.S., their Secretary of Agriculture looks after certain aspects of it. Other aspects are looked after by Tommy Thompson. He looks after the feed aspects. People from Health Canada deal with them on those sorts of issues. People from the CFIA go down and meet with their counterparts in the United States. So a number of different departments are working very hard with their American counterparts, and in fact their counterparts around the world, to get these borders open.

    Mr. Howard Hilstrom: What you've just described is a structure that Ben Thorlakson identifies as Health Canada being responsible for this aspect, CFIA being responsible for this, trade negotiators being responsible for this, and you are supposedly in charge. When was the last time you convened a meeting of the ministers responsible for those departments and discussed your overall strategy for getting that U.S. border open? When was that meeting held?

    Hon. Bob Speller: We talked about it yesterday in a cabinet meeting. We have a number of cabinet meetings.

    Mr. Howard Hilstrom: Who was at the meeting?

    Hon. Bob Speller: The ministers responsible.

    Mr. Howard Hilstrom: Who? Name them.

    Hon. Bob Speller: As I told you, we talk about this with my cabinet colleague in Health. The Deputy Prime Minister is very involved in this, the Prime Minister is very involved in this, the Minister of Finance is very involved in this, and the Minister of Trade is very involved in this. We are having meetings and talking about strategy. We have one message among all of us, and that is that we want to get the border open.

    Mr. Howard Hilstrom: Could you tell us what the steps are in that strategy to get the border open so that we can have some accountability about the progress you're making? Give me the specific steps of what you're going to do to get that border open.

    Hon. Bob Speller: First and foremost, what we do to get the border open is to work with groups such as the Canadian Cattlemen's Association and the Ben Thorlaksons. Frankly, I find that quote hard to believe, because we work with--

    An hon. member: It was in an article.

    Hon. Bob Speller: Well, you can't believe everything you read. Ben Thorlakson has said on more than one occasion that he is very pleased with the cooperation and coordination and the work and support he is getting from the Government of Canada on this.

    We work with the Canadian Cattlemen's Association, which is working with their American counterparts. I try to work very closely with them and with our provincial counterparts, who I'm on the phone with on a weekly basis, to bring them up to date on the issues, to get their support, and to get them working on other aspects with colleagues they know.

    Mr. Howard Hilstrom: Okay. You're in charge. When is the border going to be open?

    Hon. Bob Speller: Let me finish, please. We have a process in place in which we are working with these people on a coordinated basis.

    If you want to know whether or not there is support out there, why don't you go ask the Canadian Cattlemen's Association whether or not they think that the work and support the Government of Canada is giving to them is the support they need and expect? Why don't you do that?

    Mr. Howard Hilstrom: Nobody is disputing that. What is happening--

    The Chair: Order.

    Mr. Hilstrom, you're out of order. We're moving to our next questioner.

    Mr. Easter, please.

    Hon. Wayne Easter (Malpeque, Lib.): Thank you, Mr. Chair.

    I think there is an important role that the Conservative Party, as I guess it's called now, could play here as well, Howard, and that is to talk to some of their Republican friends in the U.S. and tell them to quit playing politics with this issue and have it be based on science. There's a role you could play here too.

    An hon. member: Bravo!

·  (1340)  

    Hon. Wayne Easter: That is a fact. You could play an important role. We need to work as Canadians on this issue.

    Mr. Minister, I am pleased to hear you mention some of the improvements in CAIS and the fact that you are looking at topping up CFIP. On this point as well, I do think we all have to work together on the agricultural committee. We do need more money out of the centre. That's a simple fact. In Prince Edward Island, our income levels last year were at 1926 levels. That is unacceptable. We see that in the United States, on February 2, Secretary of Agriculture Ann Veneman talked about increasing the expenditures down there again by 5%. The Canadian government has said that we will certainly support you in terms of going to the centre to try to get more funding to backstop our farmers, because it definitely has to be done.

    On the BSE issue, as I think you know, you and I may have a difference of opinion on that issue...or I don't think we may, I think we do. The fact of the matter is that I believe Canada should place the same restrictions. We have science on our side, yes, but I really firmly believe we have to play hardball on this issue with the U.S., and I believe we have to restrict American imports here the same as they are restricting our exports into the United States.

    I know that's not based on science, but the other day I had a nephew, who is a truck driver, call me. He got stopped at the border, where they opened his lunch pail. He had a beef sandwich, and he said he wasn't allowed across the border with that beef sandwich. That's how crazy this is getting. They're harassing Canadians. They're harassing the trucking industry.

    I certainly believe we have to move immediately to restrict movement of product into Canada under exactly the same rules as the Americans are applying to us, to send them a message. Yes, all the negotiations are taking place, and I congratulate you on them. You need every minister and every member of Parliament involved. But I do believe we have to be more restrictive on American beef coming in here, and I'm wondering if you're willing to do that.

    To move on to point two, because I'll run out of time here, you've talked about the banks and Farm Credit. We do have some control over Farm Credit. In my view, this is not the year for Farm Credit Corporation to return a profit to the Government of Canada, to the consolidated revenue fund. I don't even care if it has a loss. It needs to be there to backstop every farmer it can, and it should not be the first to move on farmers who find themselves in financial trouble because of subsidies in other areas and the Americans playing games on BSE.

    Hon. Bob Speller: Thank you very much. I certainly appreciate your support on this issue. I understand your frustration. A lot of us have frustration, but at the end of the day, I believe the approach we have taken, an approach that is based on science and on working together in a coordinated manner, is one that will eventually lead to the opening of the border.

    I don't believe the United States will make decisions based on politics. I believe there is overwhelming evidence, as expressed by the international peer review group that reviewed the situation in both Canada and the United States. In fact, they said quite directly that they thought the Americans should be moving in terms of the border. They also recognized that the risk factors for Canada and the United States were similar, were ones that should lead to an opening of the border. And I believe the work we're doing, right from the Prime Minister down, with cabinet members across the border meeting on a weekly basis, will eventually work, and we will get the border open.

    The Chair: That's it. I'm sorry, the time has expired.

    We move to Ms. Picard.

[Translation]

    Ms. Pauline Picard (Drummond, BQ): Good afternoon, Minister. I would like to ask you three questions, all in a row. Please take notes if you wish to, since time is going by quickly and I would like you to be able to answer these three questions.

    Over the past decade, the agriculture department's operating budget has increased by 43%. During the same period, the agricultural support program has been cut by half. I would like to know if you intend to correct that situation.

    Second, you were talking earlier about a new disaster assistance program. I would like to know who will pay for that program and what it will cover.

    I would also like to raise a case involving chicken processing plants. The Canadian Food Inspection Agency hired a Quebec firm, Terra Nova Systèmes, to carry out a study of slaughter techniques. The report was completed 15 months ago and the conclusions are alarming. Wastewater is discharged into rivers, as was the case in Walkerton. The report talks about serious risks to human and animal health as well as salmonella and E. coli bacteria counts that are 30 times higher than the legal limit. The department has sat on that report for 15 months: nothing has been done. The researchers have gone to court to force the department to enforce its own laws.

    What is the department waiting for before taking action?

·  (1345)  

[English]

    Hon. Bob Speller: In terms of your first question, with regard to the budget of my department, this budget has increased over the last number of years. In 1998-99 it was $1.4 billion, in 1999-2000 it was $2.3 billion, in 2000-2001 it was $2.5 billion, in 2001-2002 it was $2.6 billion, in 2002-2003 it was $2.8 billion, and in 2003-2004 it was $3.9 billion in total, with the main estimates for 2003-2004 being $1.3 billion. The main estimates for 2004-2005 will be $2.1 billion. So that is in fact an increase.

    We have a new program. As you said, it is the CAIS program. It's a program that's unique. In the past we had CFIP, which had to be pro-rated, but now we have a program that is unlimited. So if there is a need there, this program will address that need. That's one of the good things about this new program. This program looks at the disaster portion.

    One aspect of it that we still don't have in place, because we don't have all the provinces signed on, is the final amendment to it, which is called amendment 3. In that amendment you get negative margins, which will help a lot of producers this year. To date, three provinces have signed on. Your own province is in the process of doing that, being the fourth. Two others are going through the cabinet process leading up to it. So we're looking for another few provinces to sign on. If they sign on to that, farmers will get the negative margins they need. Farmers will also get an increase in the cap, which will help western beef producers. The cap will go from $900,000 up to $3 million, and that will really help the situation. Can you imagine going to the bank knowing that you have $3 million coming in? The bankers will know that those dollars are there, and that will certainly help. If we can get these provinces to sign on to this amendment, we can move ahead and increase the caps.

    I'm going to ask Dick Fadden, the president of the Canadian Food Inspection Agency, to answer your third question.

[Translation]

    Mr. Richard Fadden (President, Canadian Food Inspection Agency): Thank you, Minister.

    Mr. Chairman, I am sorry to have to tell you that we have just received notice of a legal proceeding in the federal court regarding that very situation. As a result, I cannot comment on the subject, except to tell you that we will fight the case. We do not accept the report's conclusions. However, rules and custom prevent me from making any comment on the substance of the issue.

·  (1350)  

[English]

    The Chair: Thank you very much.

    We'll move to Mr. Proctor.

    Mr. Dick Proctor: Thank you.

    There's an old rhyming couplet I heard when I was a kid:

    

He was right, dead right, as he sped along,
But he's just as dead as if he'd been wrong.

    You talk about having science on your side, and we might agree with you, but farmers are dying as a result of what's happening with BSE. You say, well, the border will open eventually. But the point here--and I think you appreciate it, or I hope you do--is that we have to send a signal that we're serious on this issue of BSE. I want to agree very much with what Mr. Easter said a few minutes ago.

    We have--if I can just get Mr. McCormick's attention--one case of BSE on this side of the border. We have one case on their side of the border. They continue to export beef products into our country. We're very much restricted. We can send boxed beef down, but we're restricted on live animal.

    I think we need to send a signal instead of just saying, oh, well, we'll work with the science and eventually we'll be proven right, because eventually those farmers are going to go out of business.

    The Chair: Mr. Minister.

    Hon. Bob Speller: Again, I appreciate the honourable member's frustration. I think the approach we've taken is, as I said, an approach that will open the border. In terms of beef coming in, live animals, in fact there hasn't been from the United States. I believe what we need to continue to do....

    For instance, members on all sides might have contacts with American Congressmen. I've also asked the chair of the Canada-United States group to get a group together, and to go down and lobby in Washington. Clearly, I believe we as parliamentarians should be working together in a coordinated fashion to give the same message. I believe the message is that the risk factors for the United States and Canada are in fact no different. In fact, the Americans should be willing, once they're done their legal process, to open the border immediately. I believe they have the information they need, frankly, to do that. So I've asked the chair of the Canada-U.S. group to do that.

    I'd also like to know what honourable members have been doing to help the situation. If they could give me an idea of what they've been doing, it would help me in terms of my deliberations.

    So if members wouldn't mind, have they gone down and talked with their American counterparts? Has the committee done so? It might be a role for this committee to do something like that, too.

    The Chair: Mr. Proctor.

    Mr. Dick Proctor: Thanks.

    To Dr. Fadden, there's a bit of a debate going on within Health Canada about what some scientists there are saying in terms of the inadequacy of testing for BSE. They think it's present and it's here to stay as opposed to an isolated incident. They think the specified risk management is inadequate to protect. They say that prions can also be present in blood and muscles, which is something we haven't heard, and that the only way is a total ban on the use of dead and rendered animal parts in feed of all other animals.

    I'd just like to know what your response is to that. Do you agree with them?

    Mr. Richard Fadden: You've made a number of comments, and it will be hard to talk about each individual one. However, all of the actions the government has taken have been based upon the scientific advice of the Department of Health.

    You will be aware there are members of the Department of Health who have, over the last several years, expressed views that have been at variance with majority health opinion. They were reported in this fashion, I think, a week or two ago in the newspapers.

    That said, there are a number of issues. Science is not a black and white issue. There are some issues, for example, surrounding blood. Some people feel that it's a method of transmission. Others scientists do not. However, what we do believe we've done, or the minister has done, by removing SRMs before slaughter, is remove more than, I think, 98% of the infectivity that can be transmitted. I don't know if it's possible in the real world to remove 100%, but I think the government has done just about everything it can do in practical terms to get up to the 97% or 98%.

    There will always be arguments between scientists, both in this country and other countries in the OIE, but generally speaking, I would commend to you the view that Health Canada has been entirely supportive of the measures taken by the Government of Canada.

·  (1355)  

    The Chair: Thank you very much.

    We'll move to Mr. Kilgour.

    Hon. David Kilgour (Edmonton Southeast, Lib.): Mr. Chair, I'll try to raise a couple of issues and then give more than half of the time to the minister for a reply.

    One, it's a farm income problem. I think we'd all agree on that. Roy MacGregor, in his column yesterday, talked about three prairie farm suicides. I wonder if you have any thoughts on the farm helpline, right across the country, in terms of what kinds of calls we're getting from people in difficulty.

    Second, I see a federal court in the U.S. has awarded $1.2 billion U.S. to a group of cattlemen after finding that Tyson had unfairly manipulated cattle prices. Are you looking, Minister, at any proposals such as getting our packers to share the pain a lot better than they're doing now, perhaps barring them from owning cattle before they go into the packing plants? We had quite a session the other day with the Commissioner of Competition, and I think there was a lot of frustration around the table.

    Finally, as an Albertan, perhaps I would have a different view than my two colleagues here, but in terms of getting the U.S. border opened, which is the crux of the problem in large measure, would it help us to get them to open the border to us if we in fact blocked some of their products, some of their animals, some of their meat coming into Canada? And the same, I might say, as you know from your trip to Japan, applies there. As I understand it, Canada bars most cuts of beef coming from Japan to Canada.

    Would it help us if we were to take a different approach to those two issues?

    Hon. Bob Speller: Thank you very much.

    Certainly all honourable members, when they hear about suicides and the difficulties being faced by people out there.... I mean, it's difficult sometimes to comprehend, and certainly our thoughts go out to their families.

    The helplines are generally set up by the provinces, and the provinces are the ones that deal with those. I think it would be very good, though, if we had a better sense of what it is they're hearing. I generally get my information from just talking to different farmers and farm groups across the country, but I'll certainly get in touch with these provinces and get a sense of what they're hearing. I got an update about a month or so ago in a conference call with my provincial colleagues just to get a sense of what they were feeling out there. But I think you're right, we need to get a better sense of how it's impacting.

    With regard to the packers, as I mentioned earlier, it's something I've asked the minister responsible to look into. I know this committee is looking into those issues, and I commend you for doing that.

    Does it help to open borders when we bar their products? Their beef products exported into Canada represent 1%. That's 1%. Ours going the other way, as you know, represents quite a bit more. Will it have an impact? I doubt it. I think what we need to do is approach this on a legal and scientific basis, and I believe this approach will, at the end of the day, open the borders. And I could use the help of all honourable members on this.

    The Chair: Thank you very much, Mr. Kilgour.

    We'll move to the Conservative Party. Mr. Breitkreuz and Ms. Skelton, I believe, are going to share the last five minutes.

    Mr. Garry Breitkreuz (Yorkton—Melville, CPC): Thank you, Mr. Chair.

    I sit here today and I don't know what I can take back to my farmers in Saskatchewan that's going to give them hope. This is extremely frustrating.

    I have Brian Patron coming to me this last weekend talking about losing $600 an animal. He goes to his bank and his banker tells him, “I can't give you any more money”. Do you know why? It's because of the lack of certainty. It's killing our farmers. And there is nothing that I've seen come before this committee today that's giving them any hope and providing any certainty to the industry.

    We don't see a coordinated plan to get the border open. The evidence that you've presented today doesn't seem to me like you have hold on it and that you have a master plan here that's going to carry this thing forward.

    The programs being put in place right now are not sufficient. If you look at a farmer who has 200 animals and for 8% of them he's going to get a couple hundred dollars, he might get $5,000. That won't even fill us his big fuel tank and keep him operating. That is just not going to cover it, Mr. Minister.

    And what we've heard today is not helping the situation. This should be an absolute priority for this entire government, and I don't detect any evidence here that the urgency of the situation has seized you yet with this.

    So what can I take back to my farmers? What evidence can I give them that we have some certainty developing here and that the farm programs are going to be adequate to cover this?

¸  (1400)  

    Hon. Bob Speller: Do you want both questions first, or do you want me to answer one at a time?

    The Chair: Do you want to put your question first?

    Mrs. Carol Skelton (Saskatoon—Rosetown—Biggar, CPC): No, no, I'm going on a different route.

    The Chair: Okay, answer the question.

    Hon. Bob Speller: Well, I think what might be helpful is if you went back to your government in Saskatchewan and you told them that in fact--

    Mr. Garry Breitkreuz: Blame somebody else.

    The Chair: Let's have the answer or the response and let's listen to the response, please.

    Hon. Bob Speller: I think it might be helpful if you went back to your province and asked them to sign on to the amendments, which would give a cap of $3 million to that farmer to take to his banker and say “This is what I have now, rather than $900,000”. I think it would be useful that in fact if these provinces signed on it would help.

    Is there a master plan? There most certainly is a master plan. It involves working together with the farm groups. It involves working together with the provinces and, in a coordinated manner, working together with my cabinet colleagues and these departments to push for the international borders to open.

    That involves a lot of work that is being done on a coordinated basis and one that I think the Government of Canada, including the Prime Minister, has shown, in terms of the seriousness of this issue and the seriousness with which we take this issue.

    In terms of the dollars, I agree: I don't think there are enough dollars there now, particularly since the downturn in the past few weeks. As I said, I am working with the Canadian cattlemen, and I implore you--they're here today--why don't you talk to them. Ask them whether or not they feel we're working in a coordinated manner. Ask them whether or not they feel the support they're getting from the Government of Canada is to support--

    The Chair: I must intervene. We're going to have Ms. Skelton ask the last question, please.

    Mrs. Carol Skelton: Mr. Minister, I've been here for three and a half years talking about drought, and people in Saskatchewan killing themselves, and farm families not having any money. For three and a half years this Liberal government has not responded to people crying for help. Mr. Minister, we need your help, and we've been saying it over and over and over.

    I have a question about the CFIA and how they keep saying it's a whole science-based thing. We have an industry in Canada, the bison industry. They have no disease. Basically, the CFIA, the border closure, and the Department of Agriculture have killed that industry. I know of people who are giving cows away. There's no market for them because your government, over the last three and a half years, has not stepped up to the plate and helped these industries.

    Mr. Minister, we need to have support for these people within the next month. We go into the fields. People start seeding. We have no support. Farm Credit is calling loans. The banks are calling loans. Mr. Minister, what can we tell Saskatchewan producers, myself, and producers across Canada?

    The Chair: Thank you.

    Response?

    Hon. Bob Speller: Again, I understand the honourable member's frustration. It's a frustration that a number of us have when there are difficult situations out there, such as drought, which, as you can well imagine, the Government of Canada can't plan for.

    We have put dollars into Saskatchewan to help in this area, and have provided programs out there for farmers and farm families. In fact, if you look at the dollars we put out into Saskatchewan for 2003, it was $1.6 billion.

    If the honourable member would listen to my response....

    We put $1.6 billion out into Saskatchewan in 2003. These are real dollars that are going into the hands of farmers and farm families. I most certainly agree that the situation has been difficult in Saskatchewan and in fact right across the country. What we are trying to do is to provide programs that will help them through these difficult times. We have a new program, CAIS, and with that program there will be no caps. It won't be like CFIP. There will be dollars that will be able to go out there based on need. Our budget for this year in that area has increased from $1.3 billion to $1.8 billion.

    So we are addressing these questions.

¸  (1405)  

    The Chair: Thank you, Mr. Minister, and thank you to all who participated.

    This is a very time-sensitive issue, and we understand that. As you well know and will have been advised, we will be meeting in this room on Monday at 3:30. We will be meeting with the packing groups as well as a number of other groups, so please, I ask for your presence here.

    At this point in time I will thank the minister for being here today, and we look forward to him coming again.

    The meeting stands adjourned.