AGRI Committee Meeting

STANDING COMMITTEE ON AGRICULTURE AND AGRI-FOOD

COMITÉ PERMANENT DE L'AGRICULTURE ET DE L'AGROALIMENTAIRE

EVIDENCE

[Recorded by Electronic Apparatus]

Tuesday, May 15, 2001

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[English]

The Chair (Mr. Charles Hubbard (Miramichi, Lib.)): Good morning, everyone. We'd like to start our meeting this morning. We're looking at Bill C-25, an act to amend the Farm Credit Corporation Act and to make consequential amendments to other acts.

This morning as witnesses we have representatives from the National Farmers Union, the Canadian Cattlemen's Association, the Credit Union Central of Canada, and the Canadian Federation of Agriculture. The witnesses are not all here. I understand a few are coming in a bit late.

In any case, we'd like to welcome those who are here. We normally have about ten minutes for a presentation from each, followed by questions from various members of the committee. I'm not sure who would like to be first.

Mr. Eby, would the Cattlemen's Association like to begin?

Mr. Stan Eby (Director, Canadian Cattlemen's Association): Mr. Chairman and members of the standing committee, I, along with my family, operate a beef farm near the town of Walkerton in Bruce County in Ontario. I'm past-president of the Ontario Cattlemen's Association and presently a director of the Canadian Cattlemen's Association.

Most members of the committee are somewhat familiar with the Canadian Cattlemen's Association; however, I'll give just a quick history. The CCA was established in 1932 and is the only national association representing the interests of Canada's 100,000 beef producers. All provincial beef organizations are members of the CCA with the exceptions of Quebec and Newfoundland. However, we have a good working relationship with Quebec, and Newfoundland is not known for its beef industry.

The size of the beef industry varies from a few cows and calves to large feedlots that market in excess of 100,000 head a year. In both categories, most operations would be considered family farm operations. I don't think we'll ever come up with a good definition of a family farm. However, whether the producer is large or small, we must work closely with lending institutions. Beef farming, especially at the feedlot level, requires a tremendous amount of financing. Unlike the grain farmers, who can use government cash advances to get through to harvest time, beef farmers, along with the lending institution, must carry the financial load until the cattle are marketed several months later.

Because the beef industry uses a lot of financing, we welcome the changes proposed in Bill C-25. More opportunities for financing at reasonable levels are good for beef producers. If the FCC gives more competition to our traditional lending institutions that is healthy for all segments.

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Agriculture does not stand still. Rural Canada is changing. The beef industry is changing. Proposed changes that will allow FCC to broaden its lending to businesses related to farming is a step in the right direction. The CCA has no problem with providing loans to businesses that are not majority-owned by farmers. If a non-farmer wants to invest in agriculture, that can only be of benefit to the overall industry.

Agricultural enterprises will continue to grow and expand, and beef farming is no exception. Bigger is not necessarily bad. If producers want to support their families at a reasonable level of income, then operations will continue to expand. They may be large and they may not look like family farms, but they are still family farms. Why should they be discriminated against just because they decide that being large is more economical?

FCC must provide a level of service to these larger operations, just as they have to the smaller operations in the past. The amendments that will allow FCC to offer a greater range of services to help producers plan long-term success are a move in the right direction. Today's producers are business people. However, they require as much expertise on money matters as they can find. It is to be hoped that FCC can assist in this area.

Farm Credit Corporation must support agribusiness that adds value to products. If this can be done in small rural areas, that's even better. Venture capital has not always been available to the agribusiness sector. Under the new legislation, it is hoped that FCC can take a lead in this area and act as a catalyst to attract other equity providers to invest in agriculture.

Canada has tremendous opportunities. Over half of the total beef produced in Canada is exported each year. We're developing new markets in Asia and Mexico. The beef industry has changed. Now we must change our institutions. Farm Credit Corporation must position itself as the lender of choice. FCC should develop products or policies that will assist new entrants into agriculture.

I don't have any further comments. On changing the name, it is still FCC, but will be known as Farm Credit Canada.

The CCA welcomes the changes being proposed in the bill and hopes it brings FCC into a new era, one that we hope will serve agriculture well.

The Chair: Thank you, Mr. Eby.

Mr. Dewar.

Mr. Donald R. Dewar (Director and Member, Canadian Federation of Agriculture Executive, and President, Keystone Agricultural Producers Inc.): Good morning, Mr. Chairman and members of the committee. I'm here representing the Canadian Federation of Agriculture, and Keystone Agricultural Producers as a member of that organization.

The CFA represents 200,000 farm families across Canada. On behalf of rural Canadians, we want to express our appreciation for the support the FCC has offered the agriculture community over the years.

The FCC has been a valuable partner with the CFA in such campaigns as the “Be Seen, Be Safe” farm safety campaign. Time and again it has shown itself to be far more than just a financial institution. We're happy to be here as Farm Credit Corporation evolves into Farm Credit Canada through Bill C-25. It will better meet the needs of Canada's farmers in supporting the structure of our rural economy.

When the changes to the legislation were proposed, we had one overriding concern, which was this: would the primary producer continue to be the focus of FCC? We believe that primary producers must always have first priority in accessing Farm Credit Corporation financing.

FCC undertook consultations with stakeholder groups like ourselves, as well as with a number of the members. We're actually quite pleased to see that the legislation has acted upon our concern, almost word for word, the wording being that: “The primary focus of the activities of the Corporation shall be on farming operations, including family farms.” Now the Canadian Federation of Agriculture and its members are very comfortable and very secure in saying that our concern has been addressed.

Being satisfied that primary producers will remain the primary focus, we must say that we fully support the expansion of the FCC to provide financial services to farm-related businesses. This will have a positive impact on the rural economy as a whole. There's no doubt that one of the biggest problems is input costs—equipment, fertilizer, etc. By providing financial services to the farm-related businesses both upstream and downstream, FCC will be helping better to control and stabilize these costs to producers.

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More and more the rural economy is diversifying and becoming involved in secondary farm-related businesses. FCC will be supporting this necessary diversification and indirectly helping support farm incomes by offering these financial services.

Small farm businesses are an integral part of the infrastructure of the rural economy and the rural community, and farm businesses keep money flowing through the rural economy. If we don't support the farm-related businesses, we're ignoring a significant piece of the food chain.

CFA supports a clause granting FCC the right to provide lease financing for assets used in farming. A major input cost is the land and equipment to work the land, and many farmers simply don't have the financial ability to purchase the land and equipment outright.

If farmers are able to lease the equipment from the FCC, they can have their choice and perhaps lower input costs and make their operation more profitable. The leasing arrangements would provide greater flexibility for both the Farm Credit Corporation and the farmers.

There is some concern expressed that by expanding the mandate of FCC to include financial services for farm-related businesses, there'd be an overlapping of services with the other public sector agencies and private sector service providers. We've looked at this issue and our conclusion is that there would not be a negative impact. There was some concern that they would be competing with local credit unions. We see this rather as an opportunity to complement services with the credit unions and form beneficial partnerships sharing the risk in larger operations.

The FCC has signed alliances, we understand, with 11 credit unions in Prince Edward Island, 15 in Ontario, and one in New Brunswick, and continues to work in other areas with individual credit unions without having a formal agreement.

S the extra provision under the bill giving FCC the authority to provide products and services through or with other persons or bodies can only enhance this already well-established spirit of cooperation.

The Canadian Federation of Agriculture does not see the issue arising of an overlapping of services between FCC and the Business Development Bank of Canada. In the first place, the services of the Business Development Bank of Canada are not as readily accessible to the people of Canada's rural communities. It does not have an extensive infrastructure in rural Canada, while FCC on the other hand has already a strong infrastructure in place in the rural communities.

Further, the agriculture sector, including farm-related businesses, has unique needs not shared by other types of business. By virtue of history and experience, FCC already understands these needs. They have historically offered unique products and services to provide solutions tailor-made for the agriculture sector.

In conclusion, we have carefully examined the proposed changes to the Farm Credit Corporation as it becomes Farm Credit Canada. It's our opinion that Farm Credit Canada, with its new range of services and abilities, will prove a positive benefit and an asset for Canadian agriculture. The Farm Credit Corporation will strengthen the rural economy and help build the infrastructure of the rural community.

I'd like to thank the Standing Committee on Agriculture and Agri-Food for this opportunity to offer our perspective and our insights on this legislation.

The Chair: Thank you, Mr. Dewar.

Ms. Murray.

Ms. Susan Murray (Vice-President, Government Affairs, Credit Union Central of Canada): We're now all here from Toronto. Thank you.

I want to introduce my colleagues and thank them for coming. Leo Gautreau came in this morning from Niagara Credit Union in St. Catharines to help us. He's going to give us a little bit more of a hands-on experience, which Credit Union Central of Canada does not have. My colleague from Credit Union Central of Canada is Rob Martin.

I do have a brochure here about the credit union system for the committee. You can take them back to your offices after the presentation.

Mr. Dewar did refer to some of the alliances that Farm Credit Corporation has with credit unions. We'll be discussing some of that in our presentation and would be happy to answer questions on them further on.

On behalf of the credit union system, Credit Union Central of Canada would like to thank you for the opportunity to give our views with respect to Bill C-25.

Credit unions continue to grow in importance as providers of financial services in rural areas in the agricultural economy.

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The FCC is a significant presence in many of the areas where credit unions do business, and it is important that good relations continue to be maintained between the FCC and credit unions.

It has been some time since Credit Union Central has had the opportunity to talk with this committee, so I'm just going to take a few moments to familiarize you with the credit union system across the country.

One in three Canadians—over 10 million people—belong to a credit union or caisse populaire, right across Canada, including Quebec. Outside of Quebec, just over 700 credit unions provide service to members at over 1,700 locations. In a growing number of communities right across the country, the credit union is the only financial institution in town. Just as a little appendix, recently we have purchased over 50 branches from the Bank of Montreal in rural communities. We've purchased a couple from the Scotiabank and most recently from the National Bank in Newfoundland.

We manage over $56 billion in assets and provide a full range of services and products to our members, including mortgages, personal wealth management products, commercial credit, lease financing, full retail investment dealer services, credit card services, and agricultural equipment to financing through agrifinance services.

Credit unions are community-owned financial service providers. Our members are our shareholders. The democratic foundation of the credit union system is based on the concept of one member, one vote. We are organized into three tiers—over 700 local credit unions, 9 provincial centrals, and Canadian Central, the national organization federally regulated under the Cooperative Credit Associations Act. Again, the corporate brochure will give more details on that to anybody who is interested.

When Bill C-25 was introduced, Canadian Central consulted with our provincial centrals and some of our key credit unions that are involved in agricultural lending. As many of you may be aware, the credit union system has several alliances with the FCC, as Mr. Dewar mentioned, in various parts of the country. We value those partnerships, which are working very well, and want to ensure a legislative framework that allows them to flourish.

As we understand it, Bill C-25 proposes to further broaden the FCC's mandate by allowing it to increase the range of products and services it offers to primary producers and to businesses upstream and downstream from farming, whether or not they are primarily owned by farmers. The proposals in Bill C-25 will also allow the FCC to expand the range of lease financing services it offers, provide a range of commercial and management services, property and succession planning, create subsidiaries to diversify services, and offer a broader range of risk management tools and partnership with financial consortia. These expanded powers build on the broadened mandate back in 1993.

Let me say clearly that the credit union system is not opposed in principle to expanding some of the products and services delivered by the FCC, with one very important caveat. We are not opposed as long as the FCC focuses its efforts on providing products and services in a manner that complements those provided by credit unions.

The business of providing financial services is one that is undergoing radical change. Competition is increasing for all financial service providers, and credit unions are not immune to these forces of competition. We have participated at every step in the process of revising the legislation that governs federally regulated financial institutions. We are appearing before the Senate committee tomorrow on Bill C-8.

Our view is that credit unions can become an even stronger alternative to the banks right across the country. Bill C-8 provides some tools to help us with that objective. While other large financial institutions have turned their attention to international markets, we have stayed focused on the communities we serve in Canada. We want to make sure we work in partnership with the FCC, rather than competing with the FCC in these communities.

There are a couple of areas in Bill C-25 that we feel need to be clarified. First, the bill expands the powers available to provide business services and products to businesses related to farming. It states that the FCC has the power to provide its products and services in a complementary manner to those in the private sector. There is no definition of complementary and there is no positive obligation on the part of the FCC to do so.

We urge the committee to ask for guidelines in terms of what is meant by complementary. We would like to suggest perhaps a regulation in this regard that could be drafted in consultation with stakeholders.

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The second issue is in proposed subclause 3(2). The bill defines the phrase “business related to farming” as one:

that primarily produces, transports, stores, distributes, supplies, processes or adds value to inputs to or outputs from farming operations;

The bill does not define the term “primarily”. Here again we would like to suggest some regulatory guidelines.

Clause 5 of the bill proposes to replace subsection 4(1) of the act and set out the purpose of the FCC. The statement of purpose states that:

The primary focus of the activities of the Corporation shall be on farming operations, including family farms.

Once again it is unclear to us how the term “primary” is to be defined. Again, regulatory guidelines could be of assistance.

These are our substantive suggestions regarding Bill C-25. In addition to these suggestions, the committee may want to spend some time thinking about the overall direction of crown-owned financial institutions.

Many credit unions, and not all I will say, have offered the view, for example, that there may be some overlap between the Business Development Bank and the FCC. We read in the papers last week that the federal government may be planning to create a new government-owned financial institution to help small and medium-sized businesses export to developing countries.

This initiative is in contrast to the nearly four years of extensive research and open and public consultations before amendments to the act governing the federally regulated FIs were introduced in Bill C-8. Our work with Bill C-8 is not over yet, with hundreds of regulations left to write. We believe that publicly elected parliamentarians have a strong role in this regard.

Thank you for your attention. I'd like to invite my colleague, Leo Gautreau, to give you a couple of anecdotes and some personal experiences in dealing with his community.

Leo, thank you.

Mr. Leo Gautreau (Vice-President, Corporate Development, Niagara Credit Union, Credit Union Central of Canada): Thank you, Susan.

Good morning, and thank you, Mr. Chairman, for the opportunity to address the committee.

The Niagara Credit Union, based in St. Catherine's, Ontario, is the largest credit union in Ontario with approximately $1.3 billion in total assets owned and managed on behalf of over 80,000 members. Niagara Credit Union was founded in 1945, in fact, by a small group of farmers at a time when banks were reluctant to extend credit to farmers.

We play a significant role in agriculture in the Niagara region, with over $50 million in credit extended to our farming members out of the over $300 million in loans we have provided to small and medium-sized businesses.

Our major involvement in agricultural loans in Niagara tends to be grapes, tender fruit, nurseries, wineries, and greenhouses. I've been asked to provide you with some of our experience with the Farm Credit Corporation in our market area, which is the Niagara region. Our perception of the general mandate of the Farm Credit Corporation is one of providing affordable credit to farmers. At Niagara Credit Union we certainly support that notion, and we are pleased to note that there have been many occasions when we have found their services to complement those offered by us quite nicely.

In one specific example, a small winery with significant capital invested and good management was growing at a very strong pace. It was having difficulty financing the growth with an already very heavy debt load. The Farm Credit Corporation provided long-term financing in an amount far greater than we were prepared to provide under our normal guidelines. This allowed us to extend sufficient operating funds to carry the operation until they were able to sustain their growth on their own profits generated.

Today it is an award-winning, extremely profitable winery with a solid balance sheet. The complementary relationship between the Farm Credit Corporation and the Niagara Credit Union contributed to their success.

While I am aware that many credit unions have entered into strategic alliances with the Farm Credit Corporation over the past few years, we, however, find ourselves to be in increasing competition with the Farm Credit Corporation in what we would consider to be more typical transactions: regular conventional mortgages of lands for planting or replanting, farm purchases, etc.

An example of a specific recent transaction follows. A member of the Niagara Credit Union approached both the Niagara Credit Union and the Farm Credit Corporation to provide financing to fund the purchase of two farms. Our member advised us that the Farm Credit Corporation's offer and our own offer were identical in terms of interest rate pricing. Only after learning this, the Farm Credit Corporation then reduced their rates offered to our member to a level that we could not equitably provide amongst our other members.

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Additionally, they do not invariably conduct independent appraisals of the assets they are financing. As we are required to do this by our own act, this places us at an unfair disadvantage.

The member took their business to the Farm Credit Corporation.

As a general comment, the Farm Credit Corporation has been very aggressive in our area, soliciting existing loans that our members have with us, even when increases in credit are not required. In some cases there may be little or no interest rate differentials to our members and in other cases it may cause us, as a defensive measure only, to reduce our rate to match their competitive offer. In either case we question whether it is in fact the mandate of a crown corporation to compete at this level with a member-owned cooperative financial institution.

In summary, I agree with my colleagues that we desire a cooperative and complementary relationship with the Farm Credit Corporation and not one of direct competition.

Thank you.

The Chair: Thank you, Leo.

Has Rob anything to add?

Ms. Susan Murray: Rob's here to help us with questions and answers.

The Chair: Mr. Dowling, welcome. You have a short presentation, then, from the NFU?

Mr. Peter Dowling (Ontario Coordinator, National Farmers' Union): Yes. I have a few comments on the bill.

First of all, the National Farmers' Union is the only voluntary, direct membership general farm organization in Canada, and we represent small and medium-sized family farms.

We did make a presentation to the Farm Credit Corporation during the consultation process in February of last year, and we have some concerns about the bill.

We think the expanded focus will eventually become a fundamental shift away from family farms toward agribusiness. The reason we say that is because the taking away of the farmer-owned requirement can lead to FCC investing or loaning to large agribusiness. We know that FCC has a cap of $5 million on loans now, but the legislation doesn't cap it there, so it leaves it fairly permissive.

We're concerned that industrial factory farms will be supported by this change in focus and we're concerned about the primary focus of farming operations. There's no indication of what percentages are involved in the primary focus. Does primary focus mean it's going to continue to be in the 90% focus on family farms and primary producers, or are we going to see that shift significantly down to 50%, or whatever? It doesn't really say; there's no definition there.

During the consultations, FCC used the term “farm-related business for the benefit of primary producers”, and this is not reflected in the bill. They have not said that it has to be for the benefit of primary producers. Already FCC has approved a loan for a water bottling operation in Grey County in Ontario, in spite of its current mandate to lend to farmers.

This particular loan is of concern in that community because of the amount of rainfall that's been accumulating in that area in the last few years and the threat to the groundwater, both for farmers and for the rural communities. So FCC is loaning to a bottling company that isn't really farming and it is disrupting the rural community and interfering with groundwater. That's happening already.

There are other examples where farmers may not benefit, for instance, say, a canola crusher borrows from the FCC to build a plant and then imports the canola to do the crushing.

Another possibility is in Prince Edward Island where a huge potato processor borrows to increase its landholdings. There's nothing to stop a borrower using FCC funds to invest outside Canada as long as they have security in Canada. The question is, if FCC is involved in these kinds of examples, how do they benefit primary producers?

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The new proposals allow competition from the lending pool for non-farm businesses that promise higher returns than farmers, and farm families will be less able to compete successfully for funds. FCC will be involved in venture capital for agribusiness, which is higher-risk lending and could lead to higher interest rates for family farms to cover the losses. FCC has already incurred some losses in agribusiness under the current legislation.

Wasteful spending is already happening. We look at the sponsorship of a $100,000 workshop at the excellence conference in Banff. It's an activity that's elitist and inaccessible to farmers, yet farmers' interest payments are paying for it since FCC's only source of income is interest payments.

We have some recommendations, some that we've presented to FCC last year and others we're adding now.

We recommend that farm-related businesses that are controlled by farmers, and include farming operations, be continued as the mandate of the Farm Credit Corporation.

Definitions should be clarified, with full input from the farm community to ensure that FCC loans continue to serve and not adversely affect farmers in rural communities.

The FCC should firmly and consistently enforce its criteria for every FCC transaction.

The FCC should ensure that farmers have ready access to the details of their accounts and put in place a functional and timely appeal process for use when adequate access is not provided.

The FCC personnel—this is kind of ironic—should be trained in the elements of conflict resolution, win-win negotiating, seeking to understand synergizing so they are equipped to assist rather than victimize farmers in financial crisis.

The FCC should affirm its commitment to supporting food production for the domestic market and guarantee that it will not give preferential treatment to export-oriented agriculture.

I should comment on those last three resolutions.

The NFU has worked for a number of years with farmers in financial crisis and we've found that the FCC has a history of treating farmers in crisis badly, sort of vindictively, and not having ready access to information. Rather than working to keep them on the land, they seem to be more anxious to see them moved off the land.

In regard to the last recommendation, about exports, the NFU's analysis is that in spite of exponential increases in exports, farm incomes are as low as they've been since the 1930s. FCC has named export markets as an impetus for this change, so they may be focusing on something that has been failing farmers so far. An export focus has failed farmers on their income. The trickle down just doesn't work.

On the definition of the “family farm”, affirm and define the primary focus on providing service to and for the benefit of family farms, require that the eligibility-related farm businesses be majority farmer owned, and require that FCC services be beneficial and not detrimental to farms in their community.

Thank you very much.

The Chair: Thank you, Mr. Dowling.

We'll now begin our round of questions. With that, probably it might be best if we would identify who we'd like to have answer the question. If you need more than one answer, then feel free, as a member, to do that. In other words, we don't want four answers to each question, which might take up a member's time.

On the allocation, of course, we'll start with Howard. He has about eight minutes, and others have an allotted time, too.

Howard, if you don't mind, specifically name who you would like to pose your question to.

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Mr. Howard Hilstrom (Selkirk—Interlake, Canadian Alliance): Absolutely, Mr. Chairman.

The ag committee is functioning very well, I'd like to tell the presenters, under the current chairmanship, and we find we're working quite cooperatively on these issues.

Mr. Murray Calder (Dufferin—Peel—Wellington—Grey, Lib.): Oh oh, he wants something.

Mr. Howard Hilstrom: I have a couple of comments and observations to make.

Number one, I'm a cattle rancher myself. I have a cow-calf operation with a background feedlot, and I use credit union services for my financing, expansions, and whatever I'm doing at a given time. The issue of competition with the credit unions and even the big banks in our small communities is something that astounded me a little bit.

Stan, when you say you think competition is good, how many banks and financial institutions does Walkerton have available to the producers in that 40-mile radius? Would it be more than one or two?

Mr. Stan Eby: Yes.

Mr. Howard Hilstrom: Out west, we often have towns with only one, maybe two at the most. If we're lucky, we have a credit union and a financial institution. So we're very concerned about this competition, because we need those financial institutions a lot more than we need the FCC.

Now the Canadian Alliance supports the FCC as a primary producer financing organization, as opposed to this vastly expanded new Farm Credit Canada. The new Farm Credit Canada is going to be even more aggressive than they have been in the past in going after financial business in our communities, and in essence, what they're doing is playing banker when really they're bureaucrats running a bureaucracy—albeit at arm's length from the federal government—and they're really carrying out federal government policy. That is the bottom line for the FCC. That's what their function is. Otherwise, the federal government wouldn't have created it in the years past.

They are not—Mr. Ryan has presented to us—in the business of lender of last resort. We could find virtually nothing other than their good intentions to work with farmers when they get into financial trouble—they have good intentions in that regard. They do have built-up expertise, so we recognize that. But other than that, they're going to be operating strictly as a financial institution, and the amendments I'll be putting in, in regard to this bill, will address the issues the credit unions have brought up.

There's one other observation here. It's not too often that I in particular and the Canadian Alliance's economic policies ever agree with the National Farmers' Union, but I'd like to say, Peter, at this time, on this issue, we do agree. If you've heard of Mr. Fred Tate out west, he and I get it on once in awhile on radio on different things. Having said that, this is one of those bills that you could say makes strange bedfellows.

Don, you said the new Farm Credit Corporation would control and stabilize costs. Could you expand on that, just how it would control costs, because my understanding is that they lend at virtually the same rates and required paybacks?

Mr. Donald Dewar: Well, the Farm Credit Corporation, historically at least, is not driven to have a return for shareholders, so they provide stability that way. They can come in on the longer term with an interest rate that is acceptable, and help stabilize, if it's an upstream or downstream. If the business is stable, has a stable mortgage, then the farmers dealing with that business would enjoy that indirectly. I guess that's what I was referring to.

Mr. Howard Hilstrom: There is no new money coming in, unless Farm Credit gets into trouble, and then of course the taxpayer will fill in the money. But there's going to be, if Farm Credit's really aggressive on this upstream lending, competition for available loan dollars.

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I guess I'll ask Peter and Don to comment on this. Do you not see a problem for primary producers in having to compete with a business like a farm dealership, machinery dealership, an Isobord plant, or whatever for those dollars? Peter, could you comment on that?

Mr. Peter Dowling: We see that as a definite possibility. If Farm Credit doesn't have enough money to allocate to all demands, they're going to have to choose. If there's a chance to make a few more interest dollars, they may want to—

Mr. Howard Hilstrom: Or more security held by—

Mr. Peter Dowling: Yes.

Mr. Howard Hilstrom: Don, could you comment too? Antler Machinery went down there—I think it was Antler down in southwest Manitoba. Would the Farm Credit have saved that? And also there's this idea of competition for available dollars.

Mr. Donald Dewar: I don't see a competition for the dollars. The industry needs the dollars, whether it's on the farm or, as I said, directly upstream and downstream. I don't see that there would be a competition. We're not fearful of competition for scarce resources—I guess that's what you're asking. The FCC has proven its ability to raise needed funding from the money market, and as long as they have a stable portfolio, they should be able to maintain that and have money available for everyone.

As far as Antler Equipment goes, I have no idea of the financial situation prior to the flood of 1999. If 1999 had been a normal year, would they have closed? We saw a dealership in Dauphin close last fall, which was a bit of a shock to the community. I think whatever financial institution was involved was probably wishing they weren't. If Farm Credit had been there.... There are going to be good news stories and bad news stories, I think, with every organization.

Mr. Howard Hilstrom: Basically, the marketplace is better run by financial institutions, like the banks and the credit unions, than it is by a government bureaucracy. We have some very big concerns about this vastly expanded Farm Credit Corporation.

Don, you talked about the primary producer. The primary producer already feels our agriculture minister, Lyle Vanclief, is trying to represent the primary producers, who want to sell their commodities for as high a price as possible, but he's also representing the further processors, the agrifood people, who want to buy it at the lowest possible price, so they can make more profit. We're going to end up with the same thing in the Farm Credit Corporation. Lyle Vanclief is torn between trying to serve both of these devils, and the Farm Credit is going to be in the same position. I really have concerns.

I'll just finish off—I'm probably getting pretty close. I agree completely with the complementary aspect of Farm Credit and the credit union. What would enhance that complementary aspect without having all this big expansion? Is there a necessity for any changes in legislation to have this complementary aspect function better? It seems like it's functioning pretty well right now.

Ms. Susan Murray: What we'll say is that the legislative framework is there. The alliances and partnerships are formed outside the legislative framework. Our only point is that we want the framework to be there, to be flexible, but also to give us some guidelines as complementary aspects and primary involvement, so that we can get engaged in alliances and partnerships with the FCC with more of a sense as to where they can offer it and where they can't.

Leo may have some additional comments on the specific services.

The Chair: We're a little bit over.

Suzanne.

[Translation]

Mrs. Suzanne Tremblay (Rimouski-Neigette-et-la Mitis, BQ): Thank you, Mr. Chairman.

First of all, I would like to apologize for not being here at the beginning of the meeting; I had to go to the Fisheries and Oceans Committee.

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I unfortunately have the pleasure to advise you, Mr. Chairman, that I will not be able to follow your directive, namely to designate in advance the person I will address my question to, as I have not heard the testimonies. So I am going to ask my question, and the witness who feels most able to do so can answer it.

We, in the Block, have two major objections to this bill. When I say they are major, they are minor in fact. But they are extremely important, in our view.

The definition of what is a family farm is lacking because it says “including”. The resources of this FCC should go to farming operations—it says so in clause 5—including family farms. But “family farms” is not defined. So I would like to know if you can come forward with a definition of “family farms”.

Moreover, because it is the small farms which need credit and because it is the primary industry which often has some difficulty to find money, we would like to establish a limit to ensure that the FCC cannot commit more than 20% of its portfolio to other businesses than primary producers. So they should devote 80% of their funds to the primary farms.

I would like to hear your comments on those two issues, please.

[English]

Mr. Peter Dowling: The National Farmers' Union actually did pass, at their last convention, a definition of the family farm, and I'll share that with you:

An operation that produces food or other agricultural products, and the vast majority of labour, capital, and management are provided by family members.

That is the definition.

On the other point, from what I understood, you thought that 20% should be the limit on the amount of resources going to primary producers?

[Translation]

Mrs. Suzanne Tremblay: 80% would be devoted to primary farms and 20% would go to other types of businesses.

[English]

Mr. Peter Dowling: Okay. I think FCC is lending right now to primary producers about 94% of their portfolio. I agree that there should be some limit on how much is going to agribusiness. Also, we've suggested a limit on how much farmers should be involved in those businesses too.

The Chair: Donald—and maybe Susan wants to answer too.

Mr. Donald Dewar: I'd like to agree with Peter and—maybe it is a rare day—with the definition of a family farm as well. We say family farm, and people think it's small, but in Manitoba 99.9% of the farms fit the description of family farm. Some choose a different ownership structure for tax reasons or something. They may have a family corporation in some cases. But virtually all of them are family farms, and so I think when we talk about serving the family farm, we're talking about serving the vast majority of agriculture.

As to the limit, with the Farm Credit Corporation dividing it up between industry and primary agriculture, I would like to see that limit, if there were one, be high enough to provide the flexibility, so that the corporation can put the money where it is needed. Very often in an area a strong value-added industry will significantly help the producers, without being a direct producer. I think we'd have to be pretty careful putting a limit on it. I can think of some potential needs in our own community. We have a cooperative of producers who have tried to develop a hemp processing industry, and it's going to take massive investment. I don't think the farmers really want to own the plant, but if that industry does come in, it will certainly benefit the producers who are part of this cooperative now. So I think a limit could be dangerous if it's not high enough.

Ms. Susan Murray: No credit union mentioned any limits to us, so I don't think we have anything to add to the previous witnesses.

The Chair: Suzanne, do you have anything further?

[Translation]

Mrs. Suzanne Tremblay: No, thank you.

• 0955

[English]

The Chair: Murray.

Mr. Murray Calder: Thank you very much, Mr. Chairman.

Peter and Don, I actually have my own definition of the family farm: an intergenerational operation that relies largely on family labour. We incorporated our operation in 1995 for income tax reasons.

I think we in the agrifood industry have always had a problem with venture capital. Do we in fact have a problem with venture capital, and if we do, in what sector is the need most acute? Is it with the primary producer or the value-added sector?

Susan, as a lender where do you exert the most caution when you're putting out a loan? For instance, would it be to the primary producer or would it be to a value-added operation?

Mr. Leo Gautreau: I think in our particular case we treat every transaction individually on its own merits. I don't think we look at whether one is a primary producer or a value-added producer with any different degree of caution, if I understand your question correctly. I can only speak from our own experience in our own particular area, and we have not seen a great demand for venture capital in the type of farming we generally have experience with.

Mr. Murray Calder: What type is that?

Mr. Leo Gautreau: We have tender fruit, greenhouses, grape production, estate wineries.

Mr. Murray Calder: So your loans are basically centred in the horticultural sector.

Mr. Leo Gautreau: Yes, primarily.

Mr. Murray Calder: Okay. So there could be problems in other sectors.

Don, would you agree with that?

Mr. Donald Dewar: I think there is a problem with venture capital in the agriculture industry, both in the value-added sector, or processing, and in the primary agriculture. Being a low-return industry historically, and with venture capital tending to look for the highest-return industries, it just stands to reason. If FCC is prepared or has the ability to undertake some venture capital equity financing, I think that's good for the industry.

Mr. Murray Calder: Yes. There's one thing Howard did touch on, and I agree with him too—I know, it scares me too—is that FCC could get into the practice of taking a look at where the highest return is and less risk. If it happened to be that less return and higher risk is with the primary producer instead of value-added, we want to make sure they look at this fairly right across the board. Would you agree with that?

Mr. Donald Dewar: I'd agree with that, yes.

Mr. Stan Eby: I have a question for both Murray and Howard. Howard was concerned about competition in the rural area. In the past we've seen Farm Credit involved in property and mortgages. We're seeing other financial institutions that do not want to touch that. I think we must maintain a farm credit structure to address that issue. Some of the financial institutions are backing away from rural Canada. In my sector, with a large land base, we need that long-term financing available to us, which we may not see with other sectors of the financial community.

Mr. Murray Calder: Peter, you talked about a water bottling company in Grey County. I come from Grey County. I want to know who and where.

Mr. Peter Dowling: I have a detailed report on that particular question. The fellow who's involved in that is a lawyer from Toronto. It's Echo Springs.

Mr. Murray Calder: Echo Springs?

Mr. Peter Dowling: Yes.

Mr. Murray Calder: Okay. I can find out from there.

Mr. Peter Dowling: Their business has been expanding and supplying Wal-Mart, Zellers, and a number of other companies, and there are possibilities for export as well. Our question is, how does this benefit primary producers in Grey County, in your riding?

• 1000

Mr. Murray Calder: Yes.

Mr. Peter Dowling: On the question of venture capital, generally venture capital is considered to be high-risk capital. Don mentions it as being low-return, but usually they charge higher interest, and the risk of default is higher. As long as Farm Credit is depending on interest rates to finance its operations—they mention a profit objective of $40 million—then the risk of failure of venture capital loans would be high enough that farmers could end up paying higher interest rates in order to bail out the corporation. So that's our concern.

Mr. Donald Dewar: Could I respond to Murray's—

The Chair: Sure.

Mr. Donald Dewar: —comment, maybe? Peter said, how does this help the producers of Grey County? I know in our area, in particular, we would welcome it because part of it is the rural community. If we had a business that needed FCC's support to be there, then that helps put some jobs in the community, and it helps other services be in the community, and that's part of what we need. Maybe it's a geography problem between what you have in Grey County and what we have in Dauphin—Swan River, because we would welcome a type of industry just to help build the community. That's what helps the producers to have...you want to maintain a grocery story within a reasonable driving distance, for example, and the more that other people use that store, the better chance we have of keeping it.

Mr. Murray Calder: Thank you, Mr. Chairman.

The Chair: Just to clarify, Peter, you contend that FCC was loaning money to a lawyer from Toronto to bottle water in Grey County. I'm not sure if that's right or wrong, but you have put that before the committee. That is the position of the NFU. That did happen, from what you have heard—

Mr. Peter Dowling: Yes. That's my understanding of what's happening.

The Chair: —but whether or not it's a fact, I'm not sure, is what I'm saying as chair.

Mr. Peter Dowling: Well, it's been documented and researched.

The Chair: I know it's been talked about.

Dick, we're going to you now for....

Mr. Dick Proctor (Palliser, NDP): Yes. Just to pick up on that point, I think it did come up in testimony when Mr. Ryan was here a few weeks ago, so I think we've established that point.

I want to direct my questions to the credit union representatives who are here. It seemed to me that what you were essentially saying was that you want to cooperate and not compete with the new Farm Credit Canada. One of the things that is offered—I don't know if it's offered across the country, but it's certainly offered in Saskatchewan—is this financing, this CU Lease, which I assume is a credit union lease where the Farm Credit leases new and used farm equipment through, I guess, the credit unions. Maybe you could just explain or help to tell the committee what it is and whether the new, proposed legislation will allow that to continue in an unfettered way.

• 1005

Ms. Susan Murray: Sure. CU Lease is owned by one of the credit union-owned entities called the Co-operative Trust Company of Canada. It's based in Saskatchewan but operates across the country because it's a federally regulated financial institution. It has a strategic alliance with the Farm Credit Corporation to offer lease financing services to primary producers and agribusiness operators. They started in Saskatchewan. They just rolled it out—in early April it was introduced in Ontario. We think it's a very successful partnership, and we're quite excited about it.

I guess CU Lease's leasing expertise and FCC's established agricultural equipment dealer network open up all kinds of new opportunities. Our concern would be that this partnership be able to be maintained and that there isn't anything.... The legislation would now allow.... FCC isn't likely to get into the areas where the partnership....

Basically we had something that FCC needed, and they had something we needed. Now that may be taken away with the legislation. But that doesn't necessarily mean that this partnership would be tossed, because it's established and we're happy with it. It's just a point that under the previous legislation we were able to complement each other.

Mr. Dick Proctor: There was no doubt under the previous legislation about the cooperation, and there's perhaps more uncertainty with what's proposed?

Ms. Susan Murray: Well, if it was just starting out, if we didn't have that partnership currently.... There may not be a need for that kind of a partnership is a better point, I think, because it's an established alliance that we think is working well on both sides. That's the kind of thing that we think is very positive, and we think Farm Credit is of great assistance to us.

Mr. Dick Proctor: My second question, Mr. Chair, is.... From Saskatchewan, it's my understanding that Farm Credit currently offers something called a payday loan, which is for, as I understand it, the acquisition of acreage properties. There's a question about whether that's fair in competition with the banks and the credit unions. I just wonder if, again, the credit union folks can enlighten us on that.

Ms. Susan Murray: We don't know particular details. Some credit unions in Saskatchewan, through our central, have let us know that there's a product available that they have some questions about. I think at the moment they are making those inquiries to the FCC, and I wouldn't have any examples to give to the committee.

Mr. Dick Proctor: So this isn't part of...this is something that exists now, and it's not—

Ms. Susan Murray: Yes.

Mr. Dick Proctor: —anything that.... Is it just in Saskatchewan, as far as you know?

Ms. Susan Murray: I really don't know.

Mr. Donald Dewar: That's available in Manitoba as well. I don't think it's just for acreages. It's for people who are supporting or want to farm or add to a farm—

Mr. Dick Proctor: Right.

Mr. Donald Dewar: —and they're dependent on a salary. Their payments, rather than being semi-annual, are payday.

Mr. Dick Proctor: I see.

Mr. Donald Dewar: That's the link. Historically, I guess, the old Farm Credit Corporation in the 1980s couldn't. They had to lend to a farmer, and that farmer couldn't earn off-farm income.

Mr. Dick Proctor: Right.

Mr. Donald Dewar: That's a package they've put together for people who are working off the farm and dependent on the off-farm income to support the farm.

Mr. Dick Proctor: But you're not concerned, Don or the credit union, that there's any unfair competition in all of this from Farm Credit vis-à-vis the other lending institutions?

Mr. Donald Dewar: I don't think so. I think there will always be a partnership as long as producers need their operating capital from another source.

I know of a situation at home, again, where the producer has a mortgage with the credit union and has his operating capital with the credit union, but also has a mortgage with Farm Credit because the package was too big. The loan is something around $1 million, so the credit union didn't really want it all.

So there's going to be a complementary....

Mr. Dick Proctor: Yes.

Mr. Donald Dewar: That's working whether, as I said, there are formal agreements or not.

Mr. Dick Proctor: Right.

Ms. Susan Murray: I think that's true, Don. The only time we have concerns is when there's a product available that is packaged as a direct competitive package. In the kinds of examples Don gives, that's exactly the way we like it to work, and it works really well.

Mr. Dick Proctor: Thank you.

The Chair: Thanks, Dick.

Paul.

• 1010

Mr. Paul Steckle (Huron—Bruce, Lib.): Yes. Thank you for meeting with us this morning.

Unfortunately, I had another engagement, one involving about 65 children from my riding. I deemed them to be pretty important assets.

Anyhow, I'd like to hear from you. We've talked about the leasing side of it, and I quite understand that, having been involved in that business in my former life.

Now, Stan comes from my riding, so I would appreciate it, perhaps, if Stan could comment. Are we going too far in terms of involving ourselves, realizing that we're not going to take business away from John Deere, Ford, or Rand New Holland because they have their own leasing companies? It's short-liners we're talking about, and some of the manufacturing isn't very far from my riding. We're offering an opportunity for these short-line businesses to do business with our farm community, and we're offering a tool for the dealer to sell the product and for the farmers to be able to find financing.

I'm just wondering whether you feel we've gone too far or whether this is a positive step? How do you view this?

Mr. Stan Eby: In response to that, Paul, I feel that this lease option gives the farmers another option, the option of putting everything in one package as opposed to getting their credit in various places. I think there's merit to that.

Mr. Paul Steckle: I'm wondering whether the Farmers' Union would want to respond to that.

Mr. Peter Dowling: Yes. We didn't really address the leasing aspect in our presentation. We pointed out that the Farm Credit Corporation has been using the term “lending to farm-related businesses for the benefit of primary producers”. We would like to see the legislation say the same thing, that it has to benefit the primary producer if FCC is to be involved in it as a public lender.

Mr. Paul Steckle: Would that not be the case the way the legislation is drafted now?

Mr. Peter Dowling: It doesn't say that specifically.

Mr. Paul Steckle: What would the people in Farm Credit have to say to that? How would you respond to the concern Mr. Dowling has?

Ms Susan Murray: We're from the credit union system.

Mr. Paul Steckle: Oh, I'm sorry. It helps when you—

Ms. Susan Murray: I could guess.

Mr. Murray Calder: I went there. Don't go there.

Mr. Paul Steckle: I apologize. It helps when you're here for the entire meeting. Anyhow, we'll drop that one for now.

Since we have the farming community here, what about long-term financing? Back in the days when I started my farming career, we had Farm Credit and we also had the Junior Farmers' Association of Ontario. You could take a 25-year mortgage or you could take a 29-year mortgage at a given, fixed rate. Is there a need to look at that? In the question period after other presentations, there didn't seem to be an appetite for that. What's your feeling?

Mr. Leo Gautreau: In our area, at Niagara Credit Union, the maximum we can go presently is five years under our own provincial act. We have had requests on numerous occasions for terms beyond that. Some of the chartered banks are manufacturing a way around that through obligations and so on to go longer than that, and we are experiencing competition in that. I can only assume in the present interest rate environment that there's no reason a farmer or producer wouldn't want to have the stability of a long-term rate guarantee in excess of that. We'd be fully supportive of that.

Mr. Paul Steckle: Do you have requests coming to your offices for that kind of thing, for 25-year mortgages?

Mr. Leo Gautreau: Yes. Actually, I won't say for 25 years, but there are requests for terms in excess of five years.

Mr. Paul Steckle: What about the other people? Mr. Dewar?

Mr. Donald Dewar: I believe there's a real need for, as you said, the stability of a long-term, locked-in interest rate. The first mortgage I ever had was with the Farm Credit Corporation. It was at 7%. It was taken out in 1973, I think, and it was for 25 years. You know what happened to interest rates through that time period, and I was very happy to have a 7% mortgage. I just paid it off a couple of years ago.

Mr. Paul Steckle: Would anyone else care to comment?

Mr. Peter Dowling: I would agree too, and I would add that the flexibility to have a longer term would be beneficial for young farmers who are trying to start out. They would make smaller payments over a longer period, given that stability. So, yes.

Mr. Stan Eby: I would echo those same comments. I think it's not only about property mortgages. The term that's been used here this morning, factory farms, really upsets our industry. We consider these farms to be high-tech operations, and we're going to see more of them, not fewer. It's going to take some understanding on the financing side to help these things survive, and we need understanding from the environmental side as well as the economic side.

• 1015

Mr. Paul Steckle: Do I have a chance for another one?

The Chair: You'll have to wait, Paul.

Mr. Paul Steckle: Thank you.

The Chair: You've had your five, and I'm going to go to David now.

Mr. David Anderson (Cypress Hills—Grasslands, Canadian Alliance): Thank you for coming today.

I'm a dryland—and right now it's an extremely dry land—grain and specialty crops producer in southwestern Saskatchewan, so I understand a little of the role FCC has played.

Stan challenged us a bit there earlier by saying that FCC has supported property mortgages and that it needs to continue in that. I think Howard said that too, but I would suggest that if anything, this legislation threatens rather than enhances this role, especially for the primary producers.

You had said that involving non-farmers is okay and that it can only be of benefit to the industry. I think we would all agree with that. I find it interesting this morning to recall that normally the NFU is the organization calling for more government involvement while the Cattlemen's Association usually calls for less government involvement. I'm just wondering if you can explain to me why you think it's appropriate that a crown corporation be the funding vehicle to bring non-farmers into agriculture.

The Chair: Mr. Eby.

Mr. Stan Eby: I believe that in this respect it can do it in a more structured way than can outside capital entering agriculture from other avenues, bearing in mind that the Canadian Cattlemen's Association and the cattle industry are fanatically independent. We have to be, or we wouldn't survive, would we, Howard?

Mr. Howard Hilstrom: Right.

Mr. Stan Eby: We need options, and that's where we're coming from with the comment that we need the options of the farm credit-type mortgage institutions to be there because we see the chartered banks backing away from agriculture. When you talk with them, they'll tell you their agriculture portfolios have been as good to them as other portfolios, so why are they backing away? We don't want to end up with a void, and as we see it, Farm Credit can fill part of that void.

Mr. David Anderson: I just have a couple of comments about venture capital here. Normally that involves high risk and high return, and maybe this is more for Susan than anyone. I'm just wondering what advantage FCC has, as you see it, that would allow them to fund some of these high-risk ventures some of the rest of you aren't willing to take on.

Ms. Susan Murray: Do you want to try that, Leo?

Mr. Leo Gautreau: Yes. I'll address that.

I'm not sure what kind of advantage they would have other than their specific expertise in farming, depending on the representative who is looking at individual transactions.

Mr. David Anderson: The reason you don't fund them is usually that they're too high-risk.

Mr. Leo Gautreau: Exactly.

Mr. David Anderson: We also seem to have some competing visions here this morning. Stan had talked about the CCA wanting more competition in the financing area. You just mentioned that, and you see the FCC providing that. Don mentioned that as well. Susan, on the other hand, talks about how you don't want more competition brought in by this legislation, but you want the complementary aspects of it. I'm just wondering if you can both comment on how you see that. I see two different visions here of what you want this legislation to accomplish.

Ms. Susan Murray: I'll just start out by saying that credit unions are not opposed to competition, and we haven't been before.

All we're saying is that from our point of view, where FCC has operated the best is when we've been able to work together to help serve the primary producers. We'll say that.

We're not opposing any of the expansion in terms of this bill. What we're saying is that we'd like some guidelines as to what to “complement” services and products means and what “primarily” involved in something means. This is just to clarify our perspective. There are various credit unions that have different views. We represent 700 individual businesses across the country, and we're trying to bring you a consensus view from them all. That would be....

Mr. Leo Gautreau: The concern we had from our credit union's point of view was about non-value-added competition, where it strictly involved transferring financing.

Mr. David Anderson: I have one question for you. Does the FCC have a tax advantage over the credit unions? Do you know?

Ms. Susan Murray: In taxes, I'm not sure. Certainly, they don't have to maintain regulatory capital and things like that. We have different provincial acts, and in different parts of the country we're under different regimes. Leo has made comments a few times about the provincial act restricting them in terms of the length of loans, the amount of capital a credit union has to keep, and these sorts of things. In terms of taxes, however, I'm not aware of any advantage.

Mr. David Anderson: Okay. I'll turn my extra time over to Mr. Bailey—if I have any left.

The Chair: Do you want to wait, Roy, or do you—

• 1020

Mr. Roy Bailey (Souris—Moose Mountain, Canadian Alliance): I'd rather wait.

Mr. Howard Hilstrom: I'll take that one minute—really.

The credit unions do pay taxes to the provincial and federal governments, don't they?

Ms. Susan Murray: Our tax regime is like the small business tax regime. The bigger the credit union gets, the more tax they pay. We don't pay taxes the same way the banks do. Instead, it's based on the small business tax rate.

Mr. Howard Hilstrom: That's my understanding, that a crown corporation like the Farm Credit Corporation doesn't pay those taxes, and that would be an advantage to them, wouldn't it?

Ms. Susan Murray: I'm sure there are several advantages, again, around the objectives of why we have the Farm Credit Corporation and things like that. They're not a private financial institution, so we don't look at it as, well, they don't do this and we do this. We're trying to look at the market as a whole, and they are filling gaps in—

Mr. Howard Hilstrom: Yes, with the bottom line being that they should be doing those things that private business can't do, and Ontario government policy.

Thank you, Mr. Chairman.

The Chair: Suzanne, again.

[Translation]

Mrs. Suzanne Tremblay: Thank you, Mr. Chairman.

I listened very carefully to this series of questions and answers, given my lack of knowledge in this area. Well, I am more and more skeptical. Someone mentioned that 94% or so of the funds of the FCC were going to primary industry. I agree with us developing a business-like mentality among our farmers. I have no problem with that. I also agree with us trying to invest a little bit of risk capital but I think that a legislation should not be changed for nothing and that, above all, we should not change its mandate for nothing. So, it is not because up to now 94% of the funds were devoted to the primary sector that it is going to continue. There is no assurance in the legislation that things are going to stay the same.

I am concerned to see that the government, in spite of everything it said about the protection of supply management, is acting opposite in fact, controls very badly import rates, shuts its eyes in the face of abuse in some areas and rather has a mentality of importing goods which are reprocessed here, rather than produced here. If we just reprocess here, we lose the whole chain which goes with primary production.

Personally I am concerned that there is no benchmark of any kind and that little by little, we are taking, as far as agriculture is concerned, an approach which favors industry over production. I am terribly concerned about this. Mind you, it may be only due to my lack of knowledge.

When the first persons to be affected do not seem to be concerned, I am even more concerned. I do not know very well, Mr. Chairman, what to do with my question. Maybe there is no answer to it, but I am concerned. I do not know what you can say to reassure me.

[English]

The Chair: Stan.

Mr. Stan Eby: Maybe this is not a complete answer to your question, but we're seeing a number of food safety initiatives that are being driven from the consumer end that involve not only the primary producer, but the processors and suppliers to the primary producers. So I see the Farm Credit Corporation changing and being able to work with these other people as part of that continuum.

As to how the percentage of financing is determined, I certainly haven't any vision on that, but we've seen a number of things change rather quickly on the food safety side of things in the last year or so, and even in the last few months, and we'll see major changes in the near future. I think this whole financing opportunity with Farm Credit here can play a major role.

Mr. Peter Dowling: On the shift, yes, we agree that eventually the Farm Credit Corporation will make the shift over towards agribusiness, away from family farms.

• 1025

As far as imports are concerned, the way this legislation is presented, we think the Farm Credit Corporation could be investing in agribusiness that will support foreign farmers before Canadian farmers. We're concerned that farmers should benefit from public involvement in lending. We think that should be included in the legislation.

We talked about the water and the benefits or lack of benefits of water-taking in Grey County. There are a couple of things that weren't mentioned. The threat to the water table of taking half a million bottles of water a day is one thing that has to be considered over and above what local employment is offered. The strife, discontent, and controversy it creates in a rural community also has to be considered beyond employment.

The Chair: Thanks, Suzanne.

Paul, you had a brief question again.

Mr. Paul Steckle: Yes.

Of course, coming from Huron—Bruce, the area where there's probably more dominance of larger farms, not factory farms—as I think most of us would agree, that term is misnomer, and as Stan has already said, they will get larger and there will be more of them—I wonder, as we finance these operations, is there enough consideration given to the environmental impact that the new operation, that livestock enterprise, will have on its communities?

I realize it's very complicated, because federally we are not really involved at the local level in terms of the environmental issues surrounding the water. But it does ultimately find its way to the larger bodies of water, which become our jurisdiction.

I wonder whether, for Farm Credit Corporation, when the applications are given, there should be a greater concern or consideration given to the kind of compliance we have with the local bylaws. How far do we go in ensuring that? Should we do more there?

Mr. Donald Dewar: Maybe I'll lead that one, because I had a little note here when we were talking about competition that it's not just competition on interest rates, but it's competition on the products they offer.

FCC has been a leader in coming up with unique products. One of them is the enviro-loan, where if you show good environmental stewardship, you get better terms, whether it's in interest or in the payment schedule, for doing that.

As you mentioned, it's provincial jurisdiction primarily, and I think all lenders are conscious of the environmental risks. I've heard of a lot in downtown Edmonton that the city owns because the oil company couldn't afford to clean it up. It had been a service station at one time. That might be anecdotal, but those types of incidents do happen. So I think all lending institutions are conscious of any environmental risks.

I haven't taken a mortgage out recently, but I may have to, and I understand that on some of them you sign that you're not aware of any hazard, anything that would be in conflict as an environmental danger, which ultimately the lending institution could end up owning. In fact, maybe it's a good way to transfer the risk, if you can engineer it.

Mr. Paul Steckle: Go ahead, Mr. Dowling.

Mr. Peter Dowling: On these large operations, again I come back to the question of benefit. They are very disruptive in the rural communities. That's a consideration beyond employment.

Studies have been done that prove that many small farms are much better for the economy in a rural community than one huge farm that disrupts the community.

Mr. Paul Steckle: That's a case where I think education comes in, too.

People have made attempts to talk to me on these issues, and we do listen. But I think there's often a misunderstanding of what we really say by interpreting these operations to be factory farms, and what happens with small operations that don't have the same kind of controls on the manure-handling, of course, as a large operation can have, if it's properly applied? There are certainly implications that weren't there 25 years ago, but I think we can deal with them providing we take the right approach.

• 1030

My concern is that Farm Credit is not seen to be an adversary in the rural communities to those people who are not necessarily rural, because we do have in my area lakeshore communities—residential tourism areas—and these people are not rural by nature. And, of course, they view this as a negative. We want to be seen to be an agency of positive approach to the farm community. I'm just wondering what we might be doing in this legislation that would ensure that farm credit is viewed, as I'm sure the credit unions want to be viewed, as attempting at least to ensure that everything is done in such a way that the environment, for the future of our children and grandchildren, is protected.

The Chair: Okay. Stan.

Mr. Stan Eby: I guess Don referred to the environment alone. I think that type of thing positions Farm Credit well to be a leader in the environmental issues. I think it's a matter of getting positioned with the products to address those kinds of issues. And those are not short-term issues, either. Those are long-term issues.

The Chair: Roy, can we go to you now? Are you ready?

Mr. Roy Bailey: Yes. Thank you, Mr. Chairman. I'm glad to be in the agriculture committee this morning and swing to another one this afternoon and a different one tomorrow afternoon. So, like a farmer, you have to be quite flexible.

Stan, when you started off mentioning the cattle venture in Newfoundland, most of that came from my colleague's constituency, and I remember that very well.

What I'm hearing here, Mr. Chairman and colleagues and witnesses, is that we're doing a little bit of history, really. If you go back far enough, all of the things we've talked about here today...there was a need for it to start with. All right?

Let's go back to the need for PFRA. With that need, you know what has been created in western Canada, and there have been modifications to it over the years.

I remember, Susan, the need that we had for the development of the credit union. It now is the largest financial institution in my constituency, and, because of the need for constant changes, I wouldn't know the credit union today from when it first came to my town.

There was a need for Farm Credit Corporation. That need continues to modify and change. I remember very well that, if you had a part-time job and you weren't going to be full-time living on the farm, you couldn't get a loan. Now it's the reverse.

So what we're looking at here is the history of the need in agriculture and bringing that need and modifications up to today. That's what we're dealing with. I suppose one advantage in being a little bit older, Mr. Chairman, is that you can associate these things as they come along.

For instance, I don't recall the Business Development Bank ever making a loan to an agricultural enterprise. Maybe it's happened, Mr. Chairman. It wasn't designed for that, and I don't remember that.

But I can tell you this much: whether you like it or not, whether we like it or not, there is going to be constant change that will continue. And if you want a “family farm”, well, “family farm” takes on a different meaning almost every decade—virtually every decade. So I'm not concerned about that.

But I want to express just one thing in the historical part of it. I've worked with all of these things over the years in a political and non-political area. But I often thought, Susan, what would be wrong with the farm credit union going out and making the deals, so to speak, the deals being reviewed by a financial institution, and let the financial institution do what they do best, which is handling the money?

Now, I'm not so sure I agree with the banks at this time, because in my constituency they've pulled all their agriculture people off. But I'm firmly convinced that on most associations' cases I've worked with—and I can tell you they're many—a financial institution, with the expertise, can maybe do a better job than what Farm Credit Corporation has done at times. I just throw that out for a comment.

• 1035

I want to thank you for listening to me because it just brought back a whole generation and more of a need, and these needs change, and I think you're looking at that today, very much so. Thank you, Mr. Chairman. Comments only.

The Chair: Stan had a...now Roy is one of our senior members of the House—

Mr. Roy Bailey: Now watch it.

The Chair: Because of his age, he always goes back to the history.

Mr. Stan Eby: And we must remember our history.

Mr. Roy Bailey: Yes.

Mr. Stan Eby: We must remember that we need something with continuity in our industry. When you mentioned the banks—and I'm not trying to bash the banks because we've had good relationships personally with them—they have not been consistent—

Mr. Roy Bailey: That's right.

Mr. Stan Eby: —in the agricultural community. That's where Farm Credit, I think, has shown consistency. We want to keep that in mind.

Ms. Susan Murray: Just to add in terms of comments from the credit union system, we take our history very seriously in the credit union system as well. Over the last decade we've really been trying to change to meet the needs of, as I mentioned in our remarks, the rapidly changing financial services industry.

In terms of your comments about the types of partnerships.... Leo may add to this, but some credit unions mentioned to us that one of the drawbacks to that kind of thing is that FCC could go out and make the deal and do some partnership with the credit union, but they don't want to be left with the business that costs them money to produce without any of the other...so just be careful.

Mr. Roy Bailey: I guess what I'm saying there, Susan, is...you've heard the term colder than the banker's heart? Sometimes I have felt that we've gone through difficult times in my particular area, and maybe it had to be so, but I thought at that time in some of the actions that the Farm Credit Corporation.... If it was the credit union, I'm sure they'd show a little more warmth than they have shown in the past. I mention that because I've had a lot of work to do with them.

Ms. Susan Murray: Absolutely, and certainly those are the kinds of partnerships that are happening right across the country, informally and formally, with the FCC.

Leo, do you want to add anything to that?

Mr. Leo Gautreau: I'll just echo Susan's comments somewhat. I use a specific example of an additional product that FCC might come up with—say, operating loans, for example. With operating loans today, you want to have cash management services around. You're looking at paying interest only to the penny of what you're borrowing. You want to do it on an overdraft basis. Unless there's a financial institution on the front end of that, it's not going to be practical to do that type of thing. So I wonder if the extension of something like operating loans by FCC wouldn't in fact cause more of a problem in the end to the farmer because of the impracticality of trying to—

Mr. Roy Bailey: That's a good point.

Mr. Leo Gautreau: —maintain their banking with a regular institution.

Mr. Roy Bailey: Good point.

Mr. Donald Dewar: That's why there will always be the partnerships, because you need somebody on the ground in the area. You talk about the need. I think the need is there more than ever for these types of changes to Farm Credit Corporation because, as you said, we don't want to load the credit unions with all of rural Canada's equity needs. There's a dire need for capital in rural Canada. We need to have access to that somehow.

The Chair: Thanks. Peter.

Mr. Peter Dowling: I recall some of the history you're raising here, as a child in rural Ontario when my parents were struggling to get enough money to operate their farm. Fortunately, they did, so I'm farming today.

The FCC was meant to be our lender. It's serving farmers. While farmers haven't always fared that well in the hands of FCC, aligning FCC more with the interests of agribusiness will have negative effects on independent family farms in the future, I think.

Mr. Roy Bailey: Well, thank you very much to all of you.

The Chair: I've given you five now. Are there other short questions now?

Murray.

Mr. Murray Calder: Don, you just touched on the possibility of an enviro-loan. Stan well knows that we went through an issue last year in Ontario with the Walkerton issue. I'm not really too concerned about the larger farming operations because they have already done environmental farm plans. They have nutrient management programs that are in place. The ones that I am concerned about, though, are what I refer to as “the sun-downers”, where the guy has a job off the farm and he comes back at 7 o'clock at night and starts farming, and he farms on the weekend. This is a pastoral operation that hasn't changed much since the late sixties or early seventies. Manure storage is going to be a big issue, as I see it. I'm wondering if you have any vision as to where governments should be on this, particularly the Farm Credit Corporation.

• 1040

Mr. Donald Dewar: I think the enviro-loan is a good concept. Large or small—and again every province is different—in Manitoba you can't pollute. No matter what the size of your operation is, you're responsible for containing it. If you are larger, you must file manure management plans, for example, and there are things you have to do. The bottom line is that anyone can be asked to comply with those regulations if they have been negligent in any way.

In Manitoba, we believe the regulations are in place. Maybe the provincial government is not doing an adequate job of monitoring it, but that's different. I think there's a role for FCC and for others to be supportive of that. Maybe we should be after insurance companies as well. If you have a nice, clean, environmentally friendly farm, maybe they should offer to lower your insurance rates as well. I think that can work.

Mr. Stan Eby: Just to pick up on the last part about insurance rates, I don't think the rates in Ontario, through the mutual systems, have adjusted. I know they're very cognizant of the concern and the liability exposure. We may see some rating differences on that.

I share Murray's concern about the large farms having control structures in place to protect the environment. In the smaller operations—and they'll always be there—it is a difficult one to address, whether it be in Ontario or any other province. Livestock are exposed to streams and that type of thing. The cattle industry is coming out with some best management practices on that very issue.

Once again, we're getting back into the food safety issues, along with the environmental issues, and there's definitely a need for capital there. I don't know what the product should look like, but we have to recognize that there is a need there.

The Chair: Thanks, Murray.

Howard.

Mr. Howard Hilstrom: Let's quickly talk for a short time here.

Don, you're quite familiar with MACC.

Susan, that's the provincial agriculture corporation. Those corporations are the same as the FCC. I'll make that broad statement, but they're not. They're there to finance agriculture.

Susan, do the credit unions have a relationship with the provincial credit corporations, which are designed for the primary producer? Is it the same as the FCC's?

Don, what's your experience in representing a farm organization? Are the provincial farm credit corporations filling a need? Are they active or kind of inactive?

Could I have just a quick comment on that issue?

Ms. Susan Murray: Our quick comment is that I'm not aware of any, but that doesn't mean they don't exist, as I say, because we have—

Mr. Howard Hilstrom: You don't work with them, then.

Ms. Susan Murray: No.

Mr. Howard Hilstrom: Don, what about the MACC specifically?

Mr. Donald Dewar: MACC has some programs that are unique. It has the young farmers' rebate, so that's something that is available and that the government supports. It has net worth limits, so they focus on smaller farms, but they also do things like the stocker loans for the feeder associations, which have allowed that industry to expand. In its own way, it's meeting unique needs and it also provides some of that long-term stability. I think it goes as high as 25 years as well, if an individual wants it, with a stabilized interest rate.

Mr. Howard Hilstrom: My last quick comment is just simply that as farmers and ranchers, all this talk of credit makes us sweat because we have to pay it all back sometime—

Mr. Donald Dewar: Be thankful you're not a grain farmer.

Mr. Howard Hilstrom: It's fine that everybody's giving us money, but I know we have to pay it back.

Thank you, Mr. Chairman, and thank you, witnesses.

The Chair: We'll hear a couple of responses before you go.

Don, I'll start with you. Then we'll hear from Stan.

Mr. Donald Dewar: Thanks very much.

• 1045

I just wanted to take this opportunity to say that one of the other things I do is work with farm debt mediation. There have been a couple of suggestions that FCC doesn't deal with these people in a proper manner.

FCC created some of its own problems in the eighties and dealt with them very reasonably in the early nineties. Of all the organizations we deal with in Manitoba, the provincial organization and FCC are among the best in trying to work with the producers to come to an amicable and successful conclusion. The credit unions are a part of that. I'm not going to leave them out.

To suggest that FCC has been the cold-hearted banker just isn't the experience I've seen.

The Chair: Thanks, Don.

Stan, do you have a comment?

Mr. Stan Eby: I had the privilege of listening to the deputy minister, Samy Watson, speak on agriculture and where it should be in the future, where we want to take it.

One of his comments was that agriculture for some reason has positioned itself as a cost centre in our economy, when it's actually a contribution centre. I think FCC has a responsibility to change that position and truly show that agriculture is a contributor to the economy of this country, not a cost centre.

The Chair: Thank you, Stan.

With that, we'll conclude this portion of our meeting. I would ask members to stay briefly for a couple of considerations.

To the witnesses, thank you for coming here today. Our committee certainly will review your presentations and look at them as we look at the clause-by-clause of Bill C-25 tomorrow afternoon.

We would ask those having conversations to move outside, please.

We have several issues to look at this morning. First of all, in terms of future business, it appears, anyhow, that the Minister of Agriculture and Food from Manitoba has confirmed that she will be coming here on June 5. The clerk is working towards having the three western ministers of agriculture come to committee on June 5.

• 1050

With that also I've said that if it's possible we'd invite the three critics from those provinces—in other words, whatever the official opposition is, invite their critic on agriculture, which would make at least six.

In terms of our looking at grains and oilseeds with witnesses, we have a motion from Mr. Hilstrom to invite organic producers. On that, Howard, after discussing it a bit with the clerk, it was our intention to invite them. Do you have particular people who you would suggest? The clerk and the chair are still open to lists of names of people to invite. So unless other members have objections, the organic grain farmers would be invited to one of those meetings.

Mr. Howard Hilstrom: Are you in fact giving it to me to undertake that organic producers involved in an organization and/or as individuals would be brought here to appear as witnesses of the committee?

The Chair: Can I go a small step beyond that, just coming back to it?

We would like to move this morning approval of approximately $30,000 to pay for witnesses to attend. Now I'm looking for a motion on this, and then I'll have to go to the liaison committee to get the money.

The ministers of some provinces have wanted to bring farmers with them. My own observation with the clerk is that we would not pay for a group of people to come with the ministers. But if on the other hand members have suggestions for witnesses to come before one of those meetings, we would look at those witnesses as a committee and decide which to invite.

An hon. member: Sure.

The Chair: The committee normally pays for witnesses. I was told it's usually between $1,000 and $1,500 per witness when they come before committee. When we pay their return air fare and their overnight expenses, it runs to about this much per witness.

According to her calculations, it would be roughly $28,500 for witnesses and about $1,500 for other things the committee may incur during hearings on those two subjects—grains and oilseeds, and the system of trade, or our marketing system, in dairy and in feathers.

Feathers okay with you, Murray?

Some hon. members: Oh, oh!

Mr. Murray Calder: Can't forget feathers.

The Chair: Howard, does this answer your question?

Mr. Howard Hilstrom: It partially answers my question. As for the money required to bring these witnesses here, we'd certainly agree to the appropriation of those funds.

I have to be given an undertaking before I proceed with this motion. Is the issue in fact that the organic farmers and their organizations have to be presenting here at the same time as Ken Ritter of the Canadian Wheat Board is sitting at the table?

The questions to be asked surrounding these issues involve both of those organizations and their commodities. Members on both sides will need the opportunity to ask them questions. Depending on the answer to a given question, other questions may be needed for clarification, to help us sort out exactly what is going on. I've been less than successful in the House of Commons with having Minister Goodale detail exactly what is going on there, so we need to do it.

If you will give me the undertaking that they'll appear at the same time—not for some kind of a WWF wrestling match, but to lay out the facts to us—

Some hon. members: Oh, oh!

Mr. Howard Hilstrom: —I won't put my motion. Otherwise I will put the motion to the committee.

• 1055

The Chair: As chair, I'm not sure I can give you that undertaking for two reasons. First of all, the committee should approve the format as it is developed. Second, whether or not those witnesses would be available at the same time may be another problem.

The committee is the master of its own destiny. If we want to put it this way, we can—at least we can try to do it this way.

Mr. Howard Hilstrom: I'd like to move the motion then, Mr. Chairman.

Everyone has a copy of it; it was delivered in time in both French and English. It may not be necessary to read it out, because it's on the back of your information sheet for today.

In essence, it states that the organic industry is important to the future of agriculture in Canada, and a current issue exists involving the marketing of organic products. As a result, two big players affecting marketing are the producers themselves and the Canadian Wheat Board, due to its legislated authority to control exports—not only outside the country, but also within Canada—as to the movement of wheat and flour between provinces. So we have legislated interprovincial trade barriers, in essence, and we need to sort this out.

That's the motion. I move it, seconded by the member from Cypress Hills-Grasslands, David Anderson.

The Chair: For discussion then on the motion, Larry.

Mr. Larry McCormick (Hastings—Frontenac—Lennox and Addington, Lib.): Mr. Chair, let me say to Howard how happy I am with his motion. I see nothing wrong with—and everything right about—inviting these people here.

Some other organic producers' groups—there are two or three national ones.... Members of all parties met with some farm leaders on a tour here recently, and of course there was a very strong group from P.E.I. and so on.

Would it be possible for one or two other groups to be here at the same time? Otherwise, the organic movement is going to think we're trying to.... I respect where you are trying to go with the Canadian Wheat Board and people paying x amount of dollars for their own product, but I'm wondering if we have time.

Why couldn't we invite some other organic group at the same time?

Mr. Howard Hilstrom: When I was down at the farm shows, and the big fall show in Ontario, the organic organizations had booths. They could be identified as representatives. I know in the west they have an association, and the representatives from those organic associations—we're not talking umbrella farm groups—

Mr. Larry McCormick: No, organic.

Could we include them at the same time?

Mr. Howard Hilstrom: Of course, with the Wheat Board, the overall impact it has on farming in the designated area—Alberta, Saskatchewan, and Manitoba. The role of the Wheat Board in the future will be somewhat over and above the organic people, but it's obviously very important to this country, as stated by Minister Goodale.

The Chair: Clarify the thinking on this now for our committee. We have four meetings designated for two purposes. The idea was to have two meetings to deal with the government's role in the future of the grains and oilseeds and another two meetings to deal with trade issues and our marketing system. In looking at the first two meetings on grains and oilseeds, it was my understanding when you sent this in that you meant it to be part of those. Or did you mean another special meeting over and above the two meetings we set aside for grains and oilseeds?

Mr. Howard Hilstrom: Wasn't May 29 one day set aside for grains and oilseeds? That's why I put it into the motion.

The Chair: June 5 is the other one, when the ministers are coming.

Mr. Howard Hilstrom: May 29 is when the Wheat Board is here—that's why it's specifically for that.

The Chair: So really we're dealing mainly with wheat in terms of organic farming.

Mr. Howard Hilstrom: Wheat and barley.

The Chair: I mean grains.

Mr. Howard Hilstrom: Grains. If the grain growers are here at the same time—I'm not sure who was scheduled then. I would deal with those three for sure.

• 1100

The Chair: We're all clear now on the motion. It is that the organic people are being invited as part of our study on grains and oilseeds.

Mr. Howard Hilstrom: Yes, absolutely.

The Chair: Is there any further debate?

Dick.

Mr. Dick Proctor: Not debate, but clarification, I think. Howard has just said that the Wheat Board is supposed to be here on May 29 and I thought I heard you, Mr. Chairman, say that we didn't know whether we could get the Wheat Board there at the same time the organic growers would be here. So I'm looking for clarification. Is the Wheat Board supposed to be here on May 29?

The Chair: I haven't got the answer on that, and I don't think Suzanne has it either. They have been here recently, but they would be available, Larry, I would think. Somebody from the Wheat Board, I would think, would be here.

But again, the committee is suggesting witnesses, and I'm not sure what people....

Mr. Larry McCormick: I know you're concerned, Howard; we've heard it loud and clear. Is there an umbrella group that represents these people you're talking about?

Mr. Howard Hilstrom: Yes, of course, we have had a change in clerk here, but there is a group. I mentioned the names Carol and John Husband out in the west there, and, of course, Arnold Schmidt, who has sales made and is actually in the United States. That will give us a chance to talk about those issues and have the board say why they will or won't give export permits, or the cost of them.

Of course, do the organic farmers in Ontario and in Maritimes have to obtain those permits between provinces, and do they get them free of charge? Are the farmers who are paying the bills of the Canadian Wheat Board through the pool accounts paying for licences, export licences—these things all cost money—paying the bills for other users across the country?

These are issues that have to be asked, and it would be a good chance for the board to give the answers, and I'm sure they want to. It does very directly impact the future of farming. Obviously, the Wheat Board is a major, gigantic player in agriculture.

The Chair: Suzanne.

[Translation]

Mrs. Suzanne Tremblay: Mr. Chairman, I think I understand the nature of the problem the Canadian Grain Commission can have with organic farming. Yet, we should not think that the problems of organic farming are limited to what is happening in Western Canada. The problem is there across Canada.

I told you at the very beginning that organic farming was one of my priorities and that something should be done about it. The minister himself said that he tried to get everybody together and that we did not come to an agreement, which causes a serious prejudice to our organic producers who are exporting. Canada has not done what he should have done to be recognized on the level of world standards.

So I think that we should not deal with this problem lightly or let others believe that we are not interested in their problems. I personally feel that the motion is important in itself but that we should broaden the debate to help everybody, because there are problems everywhere.

As far as marketing is concerned, it becomes very urgent that we take an interest in it because there are major problems in milk and in chicken production. Everyone knows it, and we will have to do something about it because those problems are major.

Now, it would be unwise to plan our activities beyond June 8, even very unwise, because it could the session could end around that date. Unless we agree, considering the importance of our work, to devote a whole day to hear those witnesses. We could start at 9 a.m. and hear them until 6 p.m., for example, on a Monday, Friday or on a Wednesday or Thursday, or even on a Tuesday. What matters is that we devote a full day to hear everybody before the Summer recess. Or else, we agree to work for an extra day.

But these matters seem very important to me and, in my opinion, they should be examined before the end of the session.

[English]

The Chair: Suzanne, you didn't mention Sunday, but there's a movie on that, isn't there?

Paul.

Mrs. Suzanne Tremblay: That's the day I move from my riding.

• 1105

Mr. Paul Steckle: I believe that, based on the essence of time, we're moving on. Most of us have commitments to move further. I don't think anyone objects to what Howard is attempting to do in this motion.

Madame Tremblay wants to continue to further study the whole issue of organic, and I agree with that. But I think for the time being, in the essence of time, let's move on. Let's support in principle what Howard's going to do, and hopefully we can bring....

The Chair: So do we agree with that? Can I have a motion then for the chair to seek $30,000 for—

Mr. Howard Hilstrom: Do you want to vote on my motion first and then—

The Chair: I thought there were no objections. Do you want to vote on it?

Mr. Howard Hilstrom: If it has passed, then it has passed.

The Chair: Can we vote on the money now?

Ms. Suzanne Tremblay: I would move the motion.

The Chair: It's moved by Suzanne and seconded by David.

(Motion agreed to)

The Chair: With the minister coming, Secretary of State Mitchell, and with our ministers from the west coming, would the committee like those meetings on CPAC to go to the TV room up on the Hill to—

Mr. Paul Steckle: If possible.

The Chair: If possible. Everyone agrees?

Thank you. I'm sorry to have the meeting a little bit.... Suzanne.

[Translation]

Mrs. Suzanne Tremblay: When is it supposed to be the turn of the marketing system?

[English]

The Chair: It appears, Suzanne, that we're looking at May 31 and June 7, those two days—it appears. If you have suggestions—

Ms. Suzanne Tremblay: Do we have suggestions for witnesses?

The Chair: We're looking for those. And that would be our two days on trade.

Ms. Suzanne Tremblay: Fine.

The Chair: With that, we'll adjourn our meeting.