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COMMITTEE OF SUPPLY
(Concurrent Sections)
AGRICULTURE
Mr. Deputy Chairperson (Ben Sveinson): Will the Committee of Supply please come to order. This section of the Committee of Supply will be considering the Estimates of the Department of Agriculture. Does the honourable Minister of Agriculture have an opening statement?
Hon. Harry Enns (Minister of Agriculture): Mr. Chairman and members of the committee, I am pleased to once again be able to introduce for examination by the legislative committee of Manitoba, the spending Estimates for the year '95-96 of the Manitoba Department of Agriculture.
I suppose I should express my appreciation, Mr. Chairman, to the electors of Lakeside for making it possible for me to do so and my appreciation to my First Minister for again allowing me to have stewardship over the Department of Agriculture. It is a department that I have a great deal of respect for and a great deal of affection for in terms of the role that it plays in providing the services to the farm community in Manitoba.
Mr. Chairman, I want to, right at the outset, indicate to the critic from the official opposition that I am advised by staff, and senior staff will join me shortly, that in fact there are no changes of substance at all in the administration, in the staffing, in the dollar figures throughout the department. The member will note a significant decrease of some $7 million in the printed Estimates, but that is accounted for pretty well in its entirety by the changes and fluctuations in the crop insurance premiums and in some of the transfers associated with as we move out of the former tripartite support programs into the current NISA style program and I would point that out to the honourable members that that accounts for the changes in the printed Estimates that are presented to you and members of the committee are, of course, welcome to pursue this matter further with the Crop Insurance people when they are here.
Mr. Chairman, just while I am on that point, I wonder if I can, in fact, appeal to members of the committee. I will have different officials from different parts of the department available for more detailed answers, but with me this morning I have the senior administration of the Crop Insurance people here. If it would be suitable to have--if the members wish, it is entirely in their hands, to deal with crop insurance and related items, including the GRIP program, the safety net programs and so forth. It is just a suggestion that I make. I do not know where they stand in the printed order. It is just that you will have noticed, Mr. Chair, that my staff has been ready and eager and willing to present ourselves to this committee for the last two days.
The Crop Insurance Corporation is, of course, headquartered in Portage La Prairie. The Manitoba Agricultural Credit Corporation is headquartered in Brandon, so that it is not that easy for me to have senior staff here at all times, but the general manager and the senior people from the Crop Insurance along with other senior staff are here with me this morning.
Mr. Chairman, I am well aware that the winds of change that are sweeping all facets of our life tend to be focused on those changes in health or in education or in other matters as we spend our time debating these issues in the Chamber, in the Legislature. Certainly I know the member for Swan River will be very much aware that there are very fundamental, very massive changes occurring in agriculture. I suppose if you had to put a focus on what is bringing about some of the challenges and the changes at this current time in agriculture, it is, of course, the significant changes that the federal government has announced to the grain transportation and its funding, the WGTA or more commonly known as the Crow.
Members of the committee will be aware, of course, that effective August 1, 1995--that is only two short months from now--the government will terminate payment to the railways. Termination of this program probably brings to an end one of the longest-standing agricultural support programs that the prairie region has had, while the WGTA program in itself had its origins, I believe, in the early '80s--'83, '84 as the current piece of legislation on the books. The principle that it entailed, the benefits that it entailed for prairie cereal grain growers, of course, goes back firstly to the formation of this part of the country, to 1897. It is a program of that long standing.
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I invite the honourable members of the committee to debate with me or to put on the record their concerns, their thoughts with respect to the changes that they feel the department and Manitoba farmers will have to make as a result of this withdrawal of programming from agriculture. I want to point out to them at this stage that they are significant. I have a generally optimistic outlook about the future, in the post-WGTA era, but I do not for one moment make light of the fact that for the individual producers, for producers not only of cereal crops that are immediately and directly impacted by the very substantive changes in the transportation and, more importantly, in the freight support to be able to move grain.
While it impacts most directly on those primary producers in farming, it will impact on the entire agricultural industry as we know it. Livestock, processing, the need and the drive for continued agricultural research to forever find alternative cropping opportunities, and, of course, all of that having to keep in mind the fact that from a province like Manitoba, as indeed we do from most of the prairie region, we export. We grow to export. Our farmers need open markets. Our farmers need access to markets, and so much of the future welfare of much of our farming will depend on how successfully we as a provincial government in concert with the federal government can provide access for our primary farming producers.
Mr. Chair, I will cease and desist from giving an overly lengthy overview of all that has transpired in the year '94, that has just passed, and the opportunities and the challenges that face us in '95. Let me simply point out to the honourable members that while we have seen some pressures on some of the livestock prices, by and large the livestock portion of our agricultural industry is vigorous. There could always be some stronger price support from time to time, but our beef numbers this year, '95, will likely surpass the all-time record of beef cows that we have had, that was established back in the year 1974.
Hog production continues to make significant gains, again despite the fact the pork prices have been under some pressure for the past little while, certainly since last October-November. There has been a recovery, but I am advised there is in effect virtually a 10 to 15 percent increase in capacity in production this year. Again, that is indicating to us that Manitoba farmers, Manitoba producers are maximizing their efforts in pork production.
Mr. Chairman, one of the brightest opportunities in agriculture has been in our thriving potato industry. Manitoba is fast becoming Canada's premier potato producer. We are now, I believe, in second place in terms of overall potato production. This comes as a shock and as a surprise to some of my Maritime friends, but the opportunities continue to exist for considerable growth in that part of our industry. What makes it so particularly attractive is that fully 90 percent of it is exported on to the international trade. Our potatoes are being recognized, our potato products are being recognized as world-class quality, and it would appear the challenges for us in agriculture will be to convince an increasing number of growers that there are good economic opportunities in potato production. We will have to challenge our institutions, private and public, to provide the necessary capital to get into this kind of intensive farming, and it is intensive, from a capital point of view, to traditional farming.
We will have to address the issue of water and water management because it is becoming more and more evident that the kind of potato production that I speak of is available to us only through some form of supplementary water, you know, through irrigation. We experience again this spring the dilemma that we have on the Prairies and here in Manitoba in particular, where we see such an abundant flow of water coming through our city here in Winnipeg and damaging farmland, you know, on the way to its final source, Lake Winnipeg, up in the upper reaches between Brandon, Russell, right to the Saskatchewan border where a considerable amount of acreage is still under water and will undoubtedly not be put into crop this year. If we accept the challenge of harnessing and managing some of that water more wisely then we can secure for future diversified agricultural production through the years when moisture is less abundant.
Mr. Chairperson, with those few comments, I commend these Estimates for the deliberations and consideration by members of the committee and look forward to their comments and their advice.
Mr. Deputy Chairperson: We thank the Minister of Agriculture for those comments. Does the official opposition critic, the honourable member for Swan River, have any opening statement?
Ms. Rosann Wowchuk (Swan River): Mr. Chair, I would like to begin my comments first of all by apologizing to the minister and his staff who were here yesterday and had hoped to start Estimates. Unfortunately, circumstances unexpected came up and we were not able to start yesterday afternoon. I would be quite happy to do the--although we had not planned to do the Crop Insurance one, we would be prepared to skip over and do Crop Insurance this morning, and in that way enable his staff to not have to wait till Monday or come back again on Monday.
I would also like to begin by thanking, as the minister did, my constituents for the opportunity to come back to this Legislature and represent them. I am pleased that I have again been given the responsibility of the critic for the Agriculture portfolio. It is a very important part of the economy of this province and it is an industry that is going through a tremendous amount of change.
I think in years to come, as we look back at 1994/95, farmers will reflect on this as one of the years where the industry will change the most and where we have seen some of the real backbone, the fundamentals of the industry changing and farmers having to adjust to those changes. I think in the process of that change, there are many farmers who are going to suffer and I hope that the consequences will not be too severe.
In particular, I am very concerned with the change by the federal government to end the Crow benefit. It was a discussion that we had many times as to whether or not the Crow benefit should be paid to the producer or whether it should be paid to the farmers. Unfortunately, that discussion was taken away from us and I think the way it has been handled is a big mistake. I firmly believe that the Crow benefit should have stayed in place but if the federal government was going to choose to end it, that it should have been phased out over a period of time not to have created the problems that we have right now as to who should be getting the money, landowners or operators.
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The next burden that has been added to that is the change to the pooling which we had anticipated would be a year later and, again, we have a change but no plan in place as to how it is going to be dealt with. This added cost, along with increased input cost that farmers are facing right now, I believe, is going to cause some serious hardship for people. I hope they can adjust and find products that can be grown and that markets can be developed. That is a big responsibility that people are going to have work on together, federally and provincially, to ensure that there are markets for the products that are going to be grown.
The minister talks about potatoes, and I am pleased that product is becoming so successful in southern Manitoba and that people are able to earn a living, but much more has to be done on research on how we can help people in other areas. We hear discussion about moving into livestock and hogs and, again, I believe those are changes we are going to see but again, for those changes to happen, we do not want to see the production increase at a rate faster than the markets develop where we have farmers producing, raising livestock at a very low price.
When you have the increased farm costs that we have right now with higher fuel costs and chemical and fertilizer costs, some farmers are going to be caught in the position where they are working for very little and that, I think, is something we have to work along with farmers to ensure that there are markets developed.
We met with the cattle producers the other day and they see a very bright future. They see that there is a tremendous market out there, and I believe it is the role of government to work with those producers to develop those markets. I am sure that the minister will be doing those kinds of things.
There have been other areas that are under attack or looking at being changed that we will want to address with the minister: the whole issue of the single-desk selling of hogs and other commodities, we will want to know what direction the government is taking on that; the issue of again hog production and how those hog and livestock predictions fit in with the other people that live in the community; the whole issue of pollution of water and what steps the government is taking to ensure that along with increased production we are not affecting the quality of life of the other people who are living in the area. So we have to look for balance between production and the sustainability of the rural community and the sustainability of the environment. One of the keys in that is the water supply which is one of the key issues that often causes concern.
I want to say that we were extremely pleased in the last year that the Canadian Wheat Board was able to survive the test, when we had the media and a small group of people attempting to break down the monopoly of this institute that has served farmers so long over the many years. I was pleased with the election of the Wheat Board, and I hope that we will see support for this institution which has served farmers very well.
As I say, it is one of the areas that is still under attack and we still see people wanting to undermine it, but our support is very strong for the Wheat Board and we will be looking to hear that same kind of support from the minister.
When we look at the changes to the Crow benefit and the changes to pooling, I had mentioned that there was going to be increased costs, and in fact in my part of the province there is going to be some of the highest costs of shipping wheat from that area. We believe that one of the most important things for the people of the Parklands area is to develop trade through the Port of Churchill and enhance shipping of grain through there, and we will be looking for the minister's comments on that. The minister had indicated that he will be going to Ottawa to make presentations on the changes to the transportation issues and we would hope to spend some time discussing that issue as well.
So there are various issues that we want to discuss with the minister. I think we have to look at the ways we can work together to best enhance the agricultural industry and give the opportunity to people to continue in the industry and along with the industry, the survival of the rural communities.
I am particularly concerned about young farmers and support for young farmers and how they are going to get started in the industry, financial support, and also with farmers who are seniors who have invested all their savings over the years, their farm being their retirement package, and now with the changes to the Crow benefit and others, but particularly the Crow benefit, the fear that the price of land is going to go down, and these people will be losing part of their retirement package.
There are many issues to discuss under this department, and we look forward to that. I want to indicate to the minister that we would be quite prepared to move straight to the Crop Insurance section, if that would be suitable, and then do that, and then move back to the other area.
I would also like to say that we have the representative from the Liberal Party here, and we would be quite prepared to have them have opening comments as well.
Mr. Deputy Chairperson: We thank the critic from the official opposition for those remarks. Is there unanimous consent for the member for St. Boniface (Mr. Gaudry) to make an opening statement? Leave has been granted.
Mr. Neil Gaudry (St. Boniface): Mr. Chairman, I would like to thank the member for Swan River (Ms. Wowchuk) and the minister for allowing me to put my comments. Firstly, I would like to say thank you to my constituents and what they have done to be back here and to be given again the critic portfolio for Agriculture.
Agriculture is one of the industries that is very important to Manitoba. There is a lot to be discussed, and I think the minister, who has been there for quite a few years, a number of years before, in his early years of serving Manitoba, I think we have always been proud to have the Minister of Agriculture, being one of his constituents at one time. His staff have always been very co-operative, and I would like to thank the staff that he has had in the past and the newcomers, if there are any, for the co-operation they have shown in the past. I will be looking forward to going over the Estimates with the minister and his staff in upcoming days. Like I say, I am prepared to participate in the debates with the minister and his staff.
Again, thank you very much for allowing me to say a few comments, Mr. Chairman.
Mr. Deputy Chairperson: We thank the honourable member for St. Boniface (Mr. Gaudry) for his remarks.
Under Manitoba practice, debate of the Minister's Salary is traditionally the last item considered for the Estimates of a department. Accordingly, we shall defer consideration of this item and now proceed with consideration of the next line or that which we will decide right away.
Is there unanimous consent from the committee to deal with the Estimates lines dealing with the Manitoba Crop Insurance Corporation first? [agreed] Leave has been granted. At this time we invite the minister's staff to join us at the table, and we ask that the minister introduce his staff present.
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Mr. Enns: Mr. Chairman, it is my pleasure to introduce the senior management of the Manitoba Crop Insurance Corporation. Right next to me is the General Manager, Mr. Brian Manning; Mr. Neil Hamilton, Director of Research; Mr. Henry Dribnenky, Director of Finance and Administration of Manitoba Crop Insurance Corporation. I would like to, as well, at this time introduce my two assistant deputy ministers. Mr. Dave Donaghy is, of course, our Deputy Minister of Agricultural Development and Marketing, and Craig Lee, Assistant Deputy Minister of our Policy and Economics division. Mr. Les Baseraba, another assistant deputy minister of ours is in the back, whom I will introduce at maybe a later stage.
Missing, of course, from my line-up of senior staff is the Deputy Minister, Mr. Greg Lacomy. Mr. Lacomy underwent very major and serious heart surgery at the beginning of April. I am pleased to report that he is, to my best understanding, making a good recovery. We are in contact with him from time to time, and he is calling back to find out what is happening in the shop and in the office. That is always a good sign, but he will not be able to return to active duty for possibly another couple of months. He will be taking that kind of necessary time to recover from what was very major and serious open-heart surgery that he underwent at the beginning of the year. I know that members of the committee will want me to wish him well and a speedy recovery.
With those few comments, let me just introduce the subject matter of crop insurance. Crop insurance continues to be the major and premium safety net program, if you like. I know that we speak a lot about safety net programs. Let me just indicate to honourable members of the committee the scale of what this program has provided in times of need for our farmers. Just over the last few years, for instance, 1991 to 1994, over one billion and four million dollars have been paid out to Manitoba farmers in the various forms of insurance provided by this corporation, in the GRIP program, in the general crop insurance program--that is a major, major stabilization to a volatile industry.
It, of course, takes in some years where we had very serious pricing problems in our major cereal grains. We are certainly not out of those pricing problems yet, but there are more encouraging signs generally speaking in terms of world stocks of wheat and continuing demand for our edible oil crops--canola, of course. Nonetheless, this corporation has provided that kind of stability to our farmers and continues to do so. Crop insurance is a risky business; it is more of an art than it is a science. I say that despite the fact that we have some of the best actuarial researchers in the country on the subject matter, but it is still a very difficult and imprecise science to try to do several things--to make the best guesstimates on price which is part of it, make the best guesstimates on weather which controls yield, make the best guesstimates that the management is there on the field, that disease will not cripple a major portion of the crop. All of those factors make the business of providing an actuarially sound crop insurance program a demanding challenge.
Our Crop Insurance Corporation in Manitoba can stand up and in most instances stands considerably taller than sister organizations across this country. I only find that out when I meet with and visit with my colleagues from across Canada, particularly prairie Canada, to make me realize that we by and large provide, in Manitoba, a program better suited to the needs of farmers and in most instances more generous. I know the member for Swan River (Ms. Wowchuk), perhaps even the member for Dauphin (Mr. Struthers), who reside closer to our sister province of Saskatchewan, certainly would be aware of the fact that benefits provided under our programs have been substantially better than, for instance, in the big wheat and cereal growing crop of Saskatchewan.
Mr. Chairperson, with those few comments I invite any questions that members may have with respect to the crop insurance program as being offered to the Manitoba farmers. The agency is also responsible for the GRIP program so I would invite questions on that score, too.
Might I just, before I leave the table open for questions, make one further introduction, although he hardly needs any introduction. He is a colleague of all of ours. I am delighted to have the honourable member for Morris (Mr. Pitura) to have been appointed as legislative assistant to the Department of Agriculture and to myself as minister. The honourable member for Morris brings a unique insight into the Department of Agriculture having served in a very distinguished way for many years as senior ag rep in the Red River Valley. I am just delighted to have you on board, Frank, to help us in these deliberations and to help us generally make the department as responsive as we try to make it be to the real needs that Manitoba farmers have. Thank you, Mr. Chairperson.
Mr. Deputy Chairperson: For our new members, we are on page 15 of the blue Estimates book and on page 30 in the yellow Estimates book.
2. Manitoba Crop Insurance Corporation (a) Administration $4,738,900.
Ms. Wowchuk: Mr. Chair, I would just like to also welcome Mr. Pitura to his new portfolio or new position, I should say, as assistant. I hope he enjoys it, and I am sure that he will bring new insight. I was not aware that he was an ag rep in southern Manitoba.
I would also, on behalf of our caucus, like to extend our best wishes to him, it would be very much appreciated, and I would again like to apologize to the staff for the delay yesterday for not being able to get started in ag Estimates. That was something that came up on my part, and I apologize and hope you do not have to make too many more trips back to Portage.
We have gotten into an area that is very important and we have several questions that we would like to ask on the Crop Insurance. One of the first questions I would like to ask is dealing with the delayed season of seeding that we have this year. The cutoff date for some of the crops, I believe, is June 5 or just around the corner. It is my understanding that in southern Manitoba the seeding has been very much delayed. We have been a little bit more fortunate in our part of the province that seeding is just about completed, so this is not going to affect the Parkland as much, but, with the difficult situation, the wet weather and flooding that we have seen in the southern and other parts of the province, I would like to ask the minister how his department is dealing with this.
Are there any plans to extend the dates for coverages and what would be the consequences of that? Are there increased costs or is it just a matter of extending the dates and is the department considering that?
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Mr. Enns: This is a matter that has caused the corporation some considerable concern. I am advised that the board of directors for the Crop Insurance Corporation discussed this at some length at their last board meeting. I must advise committee members though, that my advice, and it is advice that I have accepted, is that there be no changes to the seeding date lines that have been established and are familiar with them. These dates vary for the different types of crops but, just to give an example, June 15 for barley, June 15 for most of the wheats. There are some June 20 dates for some speciality crops. There are some earlier dates for, again, specialty crops like beans, June 5, particular variety of beans, some of the canola which is, of course, a major cropping requirement for Manitoba. They will vary between June 5 and the Polish variety, June 15, which a fair bit of it is grown.
Mr. Chairman, every day that we are getting this kind of weather is helping to resolve the problem. I am advised that in this kind of weather, we plant about 7 percent or 8 percent of the total crop a day in Manitoba with the kind of equipment that our farmers now have. So that, when we find that we have--some time ago, this was on--we have regions that are 60 percent and 70 percent and 80 percent completed these last few days. In most instances, we will see the deadline dates met.
Legal advice indicates that there is considerable difficulty in changing dates. We have become a more litigious society, and we have learned also to our regret, quite frankly, in crop insurance that you do not change the rules in the middle of the game. Honourable members, certainly the member for Swan River, will know what I refer to when I refer to the lentil case.
Our legal advice was that if we now, because of understandably some of the pressure that is on the Crop Insurance to change dates, we put ourselves at risk from those producers who went by these dates, perhaps maybe altered their seeding plans because they knew of these dates, but then if we were to extend the dates or change the dates, they could come back to the corporation and say, well, if I had known you would have done that I would have proceeded with my plan to plant this and this crop of which I have purchased the seed, of which I have put fertilizer in the ground and we were advised that those are the kind of situations that could have put the corporation in a difficult situation.
As well as the major one, the fundamental one, that is a concern to us. We are several weeks later this year than is normal and that exposes us, if we run into early frost in the latter part of the growing season and we have too much green crop, it could be a considerable liability on the corporation. We would accelerate that risk if we were to delay or set back further the seeding deadlines.
In 1993 crop insurance payments were some $105 million. I am advised that a killer frost in late August could cost us anywhere from $75 million to $100 million.
So the answer is, the deadline dates stand as published.
Ms. Wowchuk: Mr. Chair, I can appreciate that, because certainly at the other end of the scale you will be exposing to a lot more risk. I guess the question is, the board has made a decision, and have there been a lot of requests for extension? Have there been a lot of people who are looking for an extension of the deadline?
Mr. Enns: I am advised that the only specific request the corporation has had comes from the pulse growers for peas and the corn growers.
(Mr. Frank Pitura, Acting Chairperson, in the Chair)
Mr. Enns: I have personally, along with I suspect some of your other MLAs, received calls and concerns about that, although not many, and there is an issue that is quite separate and apart and that has to do with some of the badly flooded lands on the upper Assiniboine that will have to be dealt with in a different manner, not impacting on crop insurance.
It seems to be one area. Our new colleague from Turtle Mountain, Mr. Tweed, his area has more crops than others. Members will appreciate that the difficulty that we have in responding to that, we have had excess moisture in different parts of the province.
The other point also is, there has been available and continues to be available, insurance for unseeded acreage. You can, in other words, buy yourself some protection for not being able to seed for any given reason. I acknowledge that, regrettably, not too many producers buy that insurance. I am advised that in the last few years there has been some greater takeup, particularly in the Red River Valley, because of the two or three years of excessive moisture that they experienced.
Further to your specific question, the corporation advised me that they will discuss with the people that are growing peas for review of their requirements for the coming 1996 crop year, but, again, it is not the intention to make any changes in the year that we are in, '95.
Ms. Wowchuk: The minister touched on probably part of the answer to my next question that we would talk about insurance for unseeded acreage. What I want to know is, what will be the impact on a person's crop insurance if they cannot seed that acreage? Does it just drop out and if they have applied for it they do not have to pay the premium? What is the impact on their GRIP coverage if they, through no fault of their own, have been unable to complete their seeding because of unforeseen weather conditions?
(Mr. Deputy Chairperson in the Chair)
Mr. Enns: I am advised that there is no premium charged. If that can be substantiated that that is the case that no crop was put in. If no premium is charged it should not actuarially affect his year.
Ms. Wowchuk: Could the minister explain a bit about this unseeded acreage coverage? I have to admit that I am not familiar with it. If a person is allowed to get coverage on land that they cannot seed, could you explain that, please?
Mr. Enns: You get $30 an acre coverage if you avail yourself of the unseeded land insurance option. The lands cannot be seeded before June 15 or June 20. On August 31 of the previous year he has to provide this kind of information to the corporation.
Ms. Wowchuk: Just for clarification here, the minister is saying that as of August 31, 1994, they would have had to make a decision as to whether they were going to have unseeded acreage. If that is accurate, then that is of no benefit to the people who might be caught in the situation now where it was unforseen to them that they would not be able to seed certain lands. So in actual fact those people who were not able to seed on that land this year cannot get any coverage.
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Mr. Enns: Mr. Chairman, I think you were in the House when we had that suggestion coming from a member from the opposite side that crop insurance ought to be able to be purchased retroactively, like if you did not really want to buy the insurance now or lay out the premium dollars now, but if, after a crop failure or after you could not get on your land to seed your land, that is when you want to buy the insurance policy. I think it was a Mr. Evans from the Liberal Party that suggested that that would be an appropriate way to look at crop insurance. I do not mean to make light of a very serious situation. This is part of the problem. This is the insurance--it is a modest, I think it is, about 56 cents an acre. This is kind of a broad-stroke liability program.
If a farmer believes that he is prone to moisture or flooding problem from time to time, he should avail himself of this program. The fact of the matter is that they do not, you know, and is perhaps something that we ought to look at and review. One of the difficulties, particularly in the situations like the upper Assiniboine Valley, most of those farmers have a combination of land out of the valley, high land, and some of their lands are on the flood plain areas of the river itself. They are not worried about flood insurance on their high land, and yet, to qualify or to enrol in this kind of program, they have to buy it for the entire farm.
Experience has shown, you know, that we have very few contracts that include that coverage. Just for general information, we had some 11,096 individual contracts, crop insurance contracts, in the year '94. We expect it to be in the same order, likely, in the coming year in '95. Might I just ask the corporation: Out of those 11,000, how many accounts would carry the unseeded flood protection that we are talking about? Two hundred and ninety-eight of the 11,000 contract holders avail themselves of this unseeded land insurance option.
Ms. Wowchuk: Can the minister indicate if this is a planning decision that a farmer has to make? I would assume that it does not only deal with flooding or wetlands, that if a farmer would decide that he has some, and this may be a hypothetical situation, but supposing he has some land that is quite weed infested, and he decides that he is not going to seed that land, can he take out this uninsured coverage on that, and what percentage of his claim can be uninsured? Can a farmer decide that he is not going to seed anything and buy coverage on all his land on this uninsured, and use it as a tool to clean up his land?
Mr. Enns: Mr. Chairman, I am advised that the corporation program as designed will only pay on a claim for the circumstance where a producer has not been able to seed because of weather reasons. If the producer chooses to simply fallow his land or, for other reasons, not crop his land, this program is not available to him.
Ms. Wowchuk: So it is actually, Mr. Minister, an extra coverage that you are buying. It is a risk package that you are buying, just in case the weather is bad, and you insure only those areas that you think you might not be able to get onto, and have the extra coverage there.
Mr. Enns: That, I suspect, is part of the problem, why the take-up of this program is relatively light. You do have to insure your entire farm. So a farmer that is cropping maybe a thousand acres, but only 40 or 50 or 100 are at risk because of their positioning either at the low level in the flood plain of a river bottom, he has to insure the 950 as well. That is not being done. I am prepared to challenge the corporation to see what, if anything, we can do to make this program more attractive to producers.
In the final analysis, they have to have some actuarial integrity and, as well, I remind honourable members from the committee that we are not the sole partner of this program. The federal government is very much a partner in the crop insurance provided in our country and, as such, we have to negotiate or get the federal government's concurrence to any program changes that we may think are desirable, but we need their concurrence to effect a change to the program in itself.
Ms. Wowchuk: Just one more question for clarification, and I am also assuming that a person who is registered in GRIP but not in crop insurance would not be able to get this coverage. You have to have crop insurance. Is that accurate?
Mr. Enns: Mr. Chair, the member is correct. You have to be in the crop insurance program to get this program. You cannot have it attached just simply to the GRIP program.
Ms. Wowchuk: It sounds like it would be a good insurance, and I would hope that the minister would encourage the corporation to look at ways to make farmers more aware of it, because I quite honestly was not aware that program was there. It seems that there would be farmers who may want to take more up on it.
The minister--or I should say, I just mentioned GRIP, and I want to ask the minister if he can tell us what he believes the future of GRIP is in Manitoba. It is my understanding that Alberta is considering or has decided to pull out of the program. Saskatchewan is not in it any more. That leaves us as probably the only western province in the program. This started out as a national program, and we had hoped that when it was designed that it would be a program that would be equal across the provinces. So I would like to ask the minister for his views on it. Does he believe that GRIP can survive, and what does he see as the future and what kind of coverage does he anticipate over the next year, if the program survives?
Mr. Enns: Mr. Chairperson, the income insurance program, or we call it the GRIP program, as all members will be aware, was originally introduced to Manitoba as a five-year program. We were compelled, not compelled, but we were persuaded to extend the GRIP program and drop the sunset clause which was in the original agreement.
We did that for several specific reasons. Number one, that although the program--and I have to acknowledge the work of a lot of people in the Department of Agriculture both within the corporation and more directly, as well, from within the staff throughout the various agricultural representative offices, in its initial introduction a great deal of extension work was involved. It was not universally acclaimed. Nonetheless, it has performed, I would have to say, in a way that exceeded expectations and was a major, you know, proponent or portion of that significant support that grain producers received during these past five years.
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I am not unaware of the developments taking place in other parts of the country, the fact that Saskatchewan has eliminated and opted out of its GRIP program entirely. As the member reminds me, Alberta is probably in the last stages of a GRIP program. The formal commitment that we have by having eliminated the sunset clause is that either party can serve notice, and the terms of the agreement that we have with Ottawa is a two-year notice period that we have to serve when and if we should want to terminate the program. We have no plans of doing that at this particular time, but having said that, this is a changing world that we live in and the other major partner, the federal people, may well want to review their continued participation in a program like GRIP, particularly if Manitoba becomes one of the few or the only player in western Canada.
The federal government has and continues its emphasis on what the federal minister, Minister Goodale, calls the whole farm program, which we support and in fact have embraced to some extent by making the NISA-type program more available to other commodity groups, more than prepared to talk about the NISA program which we have extended and is in effect replacing the old tripartite support programs that different commodities had. It could well be that some further emphasis or some enhanced program of that kind could replace a GRIP program in the not-too-distant future.
The member asked my personal preferences, and one that I am trying my best to persuade the executive and the management at Manitoba Crop Insurance--and I should couch that somewhat different. It is not a question of me persuading them. One that I think that I detect a considerable enthusiasm for within the management of crop insurance is to concentrate on our basic crop insurance program and see what it is that we can do to enhance it, what can we do to make the crop insurance program as currently offered by the Crop Insurance Corporation, which has a long-standing record of performance--established in 1959, 1960. So it is a corporation that has served the farm interest for these past 24 or 25 years.
I am troubled by the fact that the participation rate in some regions is not where I would like it to be. That, of course, is what brings the kind of added pressure on governments for ad-hoc programs of support. I am a realist enough to realize that those days of ad-hoc support coming from either the federal government or from provincial governments are just not going to be there anymore.
The priorities of dollars on all governments--and I, as Minister of Agriculture and as a member of the present cabinet, support fully the priorities of my government as expressed over and over again by the people that we serve, and they are Health, they are Education, they are Family Services. That kind of appeal that the farm community has been able to make in the past, in a difficult year, in a drought year, from that mean guy that used to be our Prime Minister--what was his name? Mulroney, Mulroney, Mulroney, it just slips my mind, when he came up with a billion dollars in a hurry, when the price collapsed or something like that. Those kinds of what I call ad hoc support programs, in my opinion, are not going to be forthcoming from the present federal government and/or from individual provinces.
I think we should be concentrating our efforts and we should try to use those dollars that are currently in place in agriculture support programs like the GRIP program, and see what could Manitoba Crop Insurance do with it if we took some of those dollars and they were able to enhance the program that they are offering to Manitoba producers so that we could have next to full participation in crop insurance.
Interestingly enough, Americans are moving in this direction. They are making crop insurance compulsory if you want to participate in other farm programs. We know for a fact that, in many instances, lending institutions virtually make it compulsory now, that if you are expecting to get substantial credit from a credit union or from a bank for your farming operation, one of the first things that the lending agency will ask for is a copy of your crop insurance contract.
Those are some of my thoughts that I am pleased to put on the record. I would be delighted if the challenge to the corporation is, between now and the next year or so, particularly as--I do not want to put it in percentage terms--but there is the likelihood of the GRIP program not being here forever--that we use this in between time to try to fashion and try to craft, try to design the kind of enhanced basic crop insurance program that would find a higher level of acceptance than the program currently is to more farmers.
Ms. Wowchuk: I want to say that I am very pleased that the minister and the corporation are looking at enhancing the crop insurance program because when I have been out speaking to farmers, there have been people who have said that crop insurance is not what it used to be, that there is not the coverage. They would like to see a better crop insurance.
People are realizing that, as the minister has indicated, there are not going to be very many handouts from government and, certainly, what we have seen from the federal government with respect to agriculture, we are going to see less money. I believe people are looking for better programs. They are looking for better ways to insure themselves, and farmers that I have talked to have said that they are prepared to pay.
I know that there are not enough people carrying crop insurance right now, and maybe it is still a habit of the old style where government used to come in to bail out people when there was a difficult situation such as a drought or a flood. I believe we have to work at a better basic program, and I look forward to seeing the recommendations that come from the corporation and from the minister with respect to improving the program.
I guess I would ask the minister whether there is anybody working at designing new programs or enhancing the crop insurance programs right now.
Mr. Enns: I am sorry, I just did not get the last--
Ms. Wowchuk: The minister talked about his interest in developing a better crop insurance program, and I asked whether that is in the designing stages right now, whether there are any plans, or is it a matter of waiting until we find out what happens with GRIP and NISA and with those kinds of things.
Mr. Enns: Mr. Chair, yes, it is fair to say that it is being actively worked at, at the corporation. As I mentioned earlier, we have to constantly keep in mind that we are working with a federal partner in the design of a program like that, so the corporation has, at my direction, at their own initiation, been working on various different models that could provide for an enhanced program.
Just for some further general information, currently we are insuring some 6.3 million acres or 66 percent of the seeded acreage in the province in the crop insurance program. In the revenue, in the GRIP program, some 76 percent, or 7.6 million acres are covered, so you have that fluctuation of between 66 percent to 75 percent of the acreage. I do not know what that is necessarily in terms of individuals and people, and it varies of course.
I am aware that we do have some areas, some districts where the participation rate is in the 40s, and others, higher. I am told that in the Swan River Valley there is a pretty good participation rate in the valley, generally speaking. You have some peculiar and special-risk problems up there with respect to frost which your producers are well aware of.
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Nonetheless, that still leaves, at any given time, 35 percent of our farmers who are 30 or 35 or in some instances 40 percent who are not covered under any program. It is always a difficult question for whomever the government or whomever the minister is. It is a question of fairness. I mean if the program is available and on your farm you avail yourself of that protection, you pay the premium year in and year out, your neighbour does not, and then comes a year of calamity or price fall and you are treated kind of equally by government. That is not really quite fair, and yet that is what often is the case when governments provide these kinds of ad hoc support programs.
I think it is worth our while, as I said, and I will not repeat myself, to really challenge ourselves in this coming year to see whether we can develop a kind of a program that 90, 95, 98 percent of our producers would willingly want to enroll in. By comparison, Saskatchewan will probably be just around 50 percent participation in their crop insurance program. I am told that Alberta has lost a third of their acreage out of their crop insurance program from the years '94 to '95. So crop insurance programs are in some difficulty. Different provinces are approaching it in different ways.
Alberta looks to quite a different program, what they refer to as the GATT 70 program that tends to be a comprehensive income-based program that moves out of the kind of specific programming like the crop insurance program. Whether my colleague Minister Paszkowski succeeds in introducing that to the Alberta landscape is perhaps too early to tell.
Saskatchewan's crop insurance program, Saskatchewan has had some difficult cropping years, the drought years falling on some just bad harvest weather years, some of what we experienced. Their overall program and their corporation, I am advised and I do not want to speak ill of a sister corporation, but they are in fairly serious financial problems that have accumulated over the years.
As I said in the introduction, crop insurance is more of an art than a science. We can have some comfort in the fact that we have not accumulated unmanageable debts in our Crop Insurance Corporation. In fact, certainly by comparison to virtually all other Crown and government agencies of a similar nature across the land, we are running a pretty good ship.
I am pleased at the expressions of support from the honourable members opposite, and I am sure that senior management is pleased to hear this. It encourages us to continue moving in this direction and we will do so.
Ms. Wowchuk: I would like to thank the minister for that comparison of the different provinces, and I look forward to hearing what will develop with the new programs. Hopefully, when these new programs are being developed, the corporation will not only consult with the minister but will also consult with farmers because they are the people at the grassroots who have to be comfortable with the changes in the program if we are going to have any hope of increasing the uptake in the enrollment in the program. Just like we would like to see every homeowner have fire insurance, we would like to see the same thing in farming, where all farmers would carry some insurance so that we do not have to go through those peaks and valleys of ad hoc programs.
I want to revert a bit to the GRIP. The minister had talked about extending the extension and dropping the sunset clause. A question that has been put to me by farmers is the fact that they signed up for a five-year program and they did not opt out because they thought that the five-year program was the end of it. Now, with the extension, are farmers compelled to stay in GRIP because they did not opt out, when in actual fact it was a change made by government to make the extension?
Mr. Enns: I too have received some of those representations from individual farmers, although not many. I am reminded by the staff that in the 1993 crop year we made a special effort to remind the contract holders that if they were intending to leave the program at the end of the five years that they ought to make their declaration, apparently part of the agreement that in the third year you had to provide indication of leaving the program.
Some of them took advantage of that and notified the corporation and in fact are out of the program, but I must report that by in large, despite some of the initial and perhaps ongoing criticism over the program, the take-up of the program is significant, higher, for instance, than the regular crop insurance program.
Ms. Wowchuk: Can the minister indicate, and it may be in the book here but I have not found it, the financial status of GRIP? Are we in debt or are we ahead of the game? Where are we at on it?
Mr. Enns: My staff will find that in a moment, but just allow me to remind the honourable member that one of the motivating reasons for extending the GRIP program was because of the very significant payouts and deficit position that the program was in after the very difficult harvest experienced in 1993. Under the terms of the agreement, we would have had to substantially increase the premium for the last two years if we would have insisted on dropping the program in that five-year period. The terms of the agreement were, it was certainly the aim of the program to be in more or less a revenue-neutral position, and if it was not, then provincial and federal treasuries had to share in a preagreed-to formula. I think 35 percent might have been picked up directly by the province, 65 by the federal government. In the year ending '94, we had a $175.3 million deficit in the GRIP account. In the year ending this year, '95, March '95, that has been dramatically reduced to $55.4 million. In other words, we have retired $120 million of that $175-million debt, and it is our expectation or our hope, quite frankly, that all things being equal, we have normal cropping conditions, perhaps prices that are moving upwards. A combination of these events could, I am privately advised, leave this program in a revenue-neutral position if that came together in this coming year. What that would mean is that would then certainly leave us in a much better position to make some decisions respecting the future of GRIP.
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If we are by that time also convinced that we have designed and crafted a better basic crop insurance program, then we may well wish to initiate, as indeed did Saskatchewan and Alberta, leaving the GRIP program. We may be doing that mutually because if we are the only ones in the GRIP program here in the Prairies, our federal partners may be putting some gentle pressure on us to say, look, let us work something else out.
Ms. Wowchuk: Mr. Chair, the minister indicated that, I guess, the reason for the extension of GRIP was because of the deficit, and that was something that we had raised and we are aware of, that obviously the minister did not want to have to raise premiums at a time when farmers were in some difficult situations.
I guess I am looking here, and I am seeing the amount of revenue, the amount that is budgeted in the Estimates for GRIP being down some $10 million. I am wondering, is that because the corporation, the GRIP account is sitting in a better situation where there is not such a high deficit? Is it because coverage, the price of grain is down? Why do you anticipate that you will pay out--why are you estimating such a decrease in the budget for this program?
Mr. Enns: The member is correct. It is a combination of the deficit being substantially reduced and, perhaps even more so, the strengthening grain prices, which actuarially reflects on the level of payout that the program will have to make. I think the only other question--just to take a moment to ask staff--while there has been some dropping out of the program on the part of individual producers, to my best knowledge it is just not a significant amount. We are in essence still providing a program to roughly the same amount of contract holders.
Mr. Chairperson, I am advised that over the whole period of the program, going on to the fifth, sixth year, there are only about between 200 and 300 that have left the program. So that represents a pretty stable participation rate.
Ms. Wowchuk: If I am correct, did the minister say that there were some 11,000 participants to begin with, and of that we have only lost a couple of hundred?
Mr. Enns: Yes. Mr. Chairperson, for the year '94 we have some 11,104 contract holders in our all risk--that is our general crop insurance program--and in the Revenue Insurance Program for the year '94, 11,615. That compares to the year before, '93, in the GRIP program, 11,929. So there are about 300 fewer contracts from '93 to '94.
It has been pointed out to me that is not necessarily fewer farmers. There is always a certain degree of amalgamation, you know, partnerships forming, some farm amalgamation that continues to go on, and that accounts for some of these 300-odd fewer individual contracts.
To answer the member's direct question she asked me, in '93, if I am reading this right, we had 11,929 participants in the GRIP program. In the year ending, for which I am reporting, '94, that was 11,615. So there is a reduction of some 300-odd contracts.
Ms. Wowchuk: So then is there a comparison--the minister says it is amalgamation of land. Is there any indication as to the acreage, whether the amount of acreage has dropped?
Mr. Enns: Yes, in 1993 we covered some 7.7 million acres of land and that has dropped in the year '94 to 7.6. So there is some reduction of, roughly speaking, 100,000 acres.
Ms. Wowchuk: Mr. Chair, I am going to leave the whole area of GRIP--that section of GRIP. There are a few other areas of crop insurance that I would like to cover. Earlier on, the minister mentioned the lentil case, and as a result of changes that had taken place in the dates of crop insurance, there is a court case that is being challenged, and I understand that the decision has gone in favour of the producers in that case. Can the minister indicate to us the status of that and whether or not payment has been made to those producers who challenged the corporation?
Mr. Enns: The member's information is correct. The individual producers took the matter to court and succeeded. We then chose to honour and extend the court decision to all contract holders that were impacted in that way in that year. On January 9, 1995, cheques were issued to some 963 Manitoba producers who had lentil contracts with the corporation covering some 176,000 acres. The net payout was some $5,900,000 to the corporation, so it was a significant payout that the corporation made at that time. It impacted, it called, in terms of federal and provincial premiums--well, I better not get into that.
Ms. Wowchuk: It is my understanding that the people who were involved with this were challenging the corporation as to whether or not they should have interest paid on this money. I would like to ask the minister whether or not that part of the case has been settled, and if so, what was the cost to the corporation on that?
Mr. Enns: Mr. Chairman, we and the corporation are certainly aware that the group of concerned growers, as they call themselves, have made this claim with respect to interest. They have registered a statement of claim requesting that interest be paid, but interest was not part of the original judgment and as of January 23, '95, the claim has not been filed. There is, at this point in time, no further action being taken, as I understand it.
Ms. Wowchuk: I did not hear the minister. Is the minister indicating that those producers have dropped that part of it?
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Mr. Enns: I cannot say what their intentions are. We are aware that a statement of claim has been filed with the courts with respect to asking us to provide interest payments on the money owed. We take the position that the interest was not referred to or mentioned in the judgment against the corporation, and are not offering to pay the interest. This action, I take it, the statement was filed some time ago. There has been no further action with respect to that claim by these individuals.
Ms. Wowchuk: Can the minister indicate what the cost would be if the interest claim was made, what the cost would be to the corporation, and can the minister also indicate what the costs were of this court case to the corporation.
Mr. Enns: Staff advises that the estimate would be in the range of $500,000 to $600,000.
Ms. Wowchuk: On interest and on the court case?
Mr. Enns: Pardon, I did not understand that.
Ms. Wowchuk: I guess what I was looking for is what did this whole ordeal cost the corporation, and the part I am looking for is the legal costs in this case. Is there a legal cost to this and is this also accounted to the Gross Revenue Insurance account?
Mr. Enns: Mr. Chairman, I am advised that we have of course on an ongoing basis legal capacity within crop insurance, and so for us it was no additional legal cost in defending in this instance this losing case. I am being advised that some $4,400 was part of the costs involved in the case that the corporation had to pay for the other people, I imagine, court costs, because of the fact that the corporation was on this occasion the loser.
Ms. Wowchuk: The other area, a group of people looking at a court challenge are the people in Risk Area 12 who were not happy with the situation that had arisen there with the kind of coverage that they were getting in that area.
Can the minister indicate whether or not there is a court challenge there, and what steps the corporation is taking to address the concerns of the people in the Risk Area 12?
Mr. Enns: Mr. Chairman, I would like to, first of all, indicate that the corporation has in fact addressed some of the initial complaints of the producers in Risk Area 12 in the Red River Corridor. What is at issue here is as well the question of retroactivity and what in the minds of certain of the producers at least is, was in fact an indication that retroactivity would be addressed. We are reasonably confident that our position with the actions, particularly with the actions that have been taken to address some of the situations that were highlighted as a result of a review group that studied the matter, that our position is strong.
I can only indicate to the honourable members, not wishing to deal too specifically with an issue that may indeed end up before the courts, that the claim is before the courts. We had moved a motion just not so recently to set aside the claim because of its lack of detail or its vagueness. However, Judge Darichuk, on April 4, which is just a short while ago, of this spring, dismissed that motion that was made on our behalf, but I am advised that will be appealed. So the issue is still very much alive and, regrettably, in the courts. We take no pleasure in being in the courts with any of our clients and producers, but they feel strongly enough that they continue to pursue this issue.
Ms. Wowchuk: I would like to ask the minister if this issue has resulted in a drop off in applicants or people who are applying for crop insurance in GRIP in this area.
The second question I have is, when there is a challenge by a group of people, usually there is a cost figure. Can the minister's staff or people at the corporation look at what the impact of this would be if these people should win this case and the corporation should end up paying retroactive pay? What would be the implications?
Mr. Enns: Mr. Chairperson, I am advised that in answer to the member's question with respect to ongoing participation in Risk Area 12 that it is one of the stable areas of participation and there has been no noticeable, you know, drop-off in the number of farmers availing themselves of the crop insurance program. The overall costs, should there be a ruling favourable to the group of producers that are taking action against the corporation, could be in the range of $7.5 million to $10 million, but that is a cost that is then shared by all contract holders across the provinces. Your neighbours and your farmers, you know, in Dauphin and in Swan River and mine in the Interlake will pick up the difference through higher premium costs.
What is at issue here is, they maintain that they are in effect not being, you know, actuarially fairly dealt with relative to the yields and to the actual experience that they have had over the number of years. Again, we have different zones, different crop areas, impact on the level of premiums based, again, on years of data that has been meticulously collected by the corporation. All that translates into the rate structures and the premiums that are being charged. The area group, Risk Area 12, maintains that they have been overcharged or underpaid in terms of the data that they maintain is there from that geographic land area. We have not ever acknowledged that in the full extent.
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We acknowledged that, I think, we made an adjustment in the range on which there was sufficient evidence, or we were led to that position, after the review committee I believe--was it Professor Kraft that was involved in the review committee that looked at that area? Pardon me, it was chaired by our own director of the Soils and Crops, Dr. Barry Todd, but people like, you know, Professor Kraft from the U of M were involved in this committee to look at this issue. Their findings, you know, I think it is fair to say, were instrumental in having crop insurance make an adjustment on that issue. So we believe that the issue itself is quite frankly resolved.
Crop insurance continues on a continual basis to try to refine and develop a better product. We are moving towards a program, and we are discussing this with producers to more accurately reflect today's cost of production, today's yields, to move to a ten-year average generally, and away from the 20-year averages. That is a significant move. It has some cost implications to both us the province and the federal government when we do that as major participants in the premium structure; but it would be, again, moving, I think, in the right direction, making the program itself more attractive to the participants, to get back to what we discussed earlier about doing everything we can to make this a better program and a more acceptable program.
Ms. Wowchuk: Part of the concern of the people in the Red River Valley, Risk Area 12, was the classification of soil and coverage they were getting. That same concern was raised when representatives of the corporation were in Swan River by the people of The Pas, who feel that there are problems that the soil quality has changed because of drainages that have improved, and they are not happy with the level of coverage. It has been raised with the corporation many times.
(Mr. Frank Pitura, Acting Chairperson, in the Chair)
I would ask the minister whether his staff, whether the corporation has looked at this issue of reclassification of the soil in The Pas. If they have not looked at it, when are they going to look at it and have they analyzed the impact that this will have on coverage and levels of payment, when there is a payment for the people who are farming in that area?
Mr. Enns: I can report to the committee and to the member directly that there has been, in my opinion, pretty expeditious response by the corporation to the issues that she raises on behalf of the farmers in The Pas. I can personally attest to it, having a good recall of a meeting that I had with a group of some 25 or 30 farmers from The Pas area at The Pas, just on or about March 17. I had in my company the Chairperson of the Manitoba Crop Insurance Corporation, Mr. Terry Johnson. We listened to these complaints very directly. In fact, it was one of the reasons that Mr. Johnson accompanied me to The Pas was because he was responding to that earlier request that I think the member for Swan River refers to, meeting at Swan River on February 6, 1995, that this issue was drawn to the attention of the Crop Insurance people.
I can further report that just as late as last week agronomists were at The Pas, on site, on May 25. They were asked to inspect 12 specific parcels of land. I am advised that inspection has taken place, that review has taken place. That resulted in five of the properties in which there will be a raising of their classification, and two will remain the same. Five parcels will be looked at in another two weeks from the time this inspection took place.
All in all, Mr. Chairman, Manitoba Crop Insurance, I am pleased to say, responded, as I would expect them to do, in addressing the issues that the farmers raised to the corporation and obviously raised directly with the member of Swan River at the very beginning of spring.
Ms. Wowchuk: I want to thank the minister and the representatives from the corporation for addressing that. It has been an issue that has been raised for the last couple of years by farmers in the area who felt that their classification just was not right.
What I want to ask now is, now that the classification has been changed, what will the difference be for the people there? Is it a matter of paying a higher premium, or will they be able to get a better coverage? What will be the impact on the bottom line for these people now that they have a change in classification?
Mr. Enns: It is a combination of things, but if the classification moves upward, the individual contract holder will be in a position to get greater benefits. Specifically, do we have an example? We could certainly provide one. One would have to go back to the detailed records of the particular land in question in order to do that. In essence, it is a combination that tries to reflect more fairly or accurately the relationship between premium and benefit coverage.
Ms. Wowchuk: I would appreciate it if the staff could provide some sort of comparison, for example, on those five parcels of land that have been done--what the change in classification means, how much of a variation of a classification there was, and what the end result for these producers will be in their coverage--if that would be possible to provide.
Mr. Enns: Mr. Chairman, I note that staff has taken note of the member's request, and I have no doubt that shortly we will supply her with that information.
Ms. Wowchuk: That was one of the issues that was raised, I believe, when the crop insurance review was done a couple of years ago, and I am pleased to see that that one has been addressed. I would like to question the minister on the crop insurance review. There were many recommendations. I do not have my book with me here right now because I was not anticipating getting into the crop insurance line today, but there were many recommendations that were made in that crop insurance review. I would like to ask what the status of the report is. How many of the recommendations have been implemented, and those that have not been implemented, are they being considered or are they considered dead issues by the corporation at this time?
Mr. Enns: Well, Mr. Chairman, I think I will just read into the record what has in fact transpired since that review committee's report was released on Friday, January 29, 1993, containing some 125 individual recommendations for consideration. I am advised that to date 52 percent of the recommendations or 65 in number have either been implemented in full or are in the process of being implemented at this present time. Another 24 percent of the recommendations or 30 are being further researched. They are of the kind that the corporation does not feel they can act on without considerably more research. Very often this would be a question of data collection as well in terms of how that impacts actuarially on the programs being offered.
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There were some 24 percent of the recommendations or another 30 that simply did not apply to the crop insurance. These were recommendations for add-ons, if you like, or ad hoc support programs. Again, bearing in mind that they would have related to some of the specific difficulties that a regional portion of the province may have had. So those will give you the idea of the response that the corporation has given to that program. Not having the review or the document in front of me, unless the member has some specific recommendations that she has in mind as to whether or not they are among those that have been implemented or are being implemented--but the crop insurance program, I know I repeat myself, I encourage the senior management of the Crop Insurance Corporation to continually consult with their clients. They cannot do that enough in my opinion. There needs to be an ongoing effort to maintain and to develop and to enhance the trust and the confidence that our producers need to have in a corporation.
This is not a corporation here that is trying to skim off our producers. Governments in question are not looking to crop insurance as a means of enhancing its revenues' position. It is a service program to the producers, a service that is intended to be delivered at the best possible cost and price, and a program that governments, both federal and provincial, are happy to be participants in as a way of providing that kind of support to agriculture.
Ms. Wowchuk: I would ask if the corporation would at some point be able to provide me with a list of the recommendations that have been implemented and the ones that they--I do not think that would be that difficult to just give me the numbers of the recommendations, and I can go through the book myself. I would appreciate that.
One of the recommendations was that the corporation make itself more accessible to the producers, and I want to commend the corporation on the process of holding public meetings and meeting with producers.
I know that at times it might be a little bit discouraging when you get a small turnout at these meetings, but it is like anything else. You have to start the process, and if there is a small turnout this year, maybe next year it will be a larger turnout. If you are making information available and making people feel more comfortable by coming forward, then that is all worth it. So I would hope that the corporation would not be discouraged by the turnouts that they have had at some of their meetings and would continue the process to go out and meet with the producers and make them more familiar with what is available and just make the program more user-friendly. I think that it is a good move that you have started to go out and meet with the public.
One of the issues that I want to raise that was in the review, I believe, was the accessibility of crop insurance to women. We have young women who are starting to farm. Women are going into different careers, but there have been several cases where they have been denied their own insurance because they are--they have to be identified with their spouse or their father, and this has created difficulty. I guess it does not only apply to young women. There are young men who might also feel the burden when they have to be tied to their father and are not able to get their own separate crop insurance.
There have been a few cases, a couple of cases specifically that I know about, but I would just like to ask the minister how the corporation is dealing with that whole issue of women going into untraditional careers and being able to access their own insurance.
Mr. Enns: Mr. Chairman, I am advised that the corporation is very much aware of this concern that the honourable member of Swan River raises (Ms. Wowchuk). They have revised their scoring system by which they grant contracts. I do not pretend to fully understand it, but it addresses that issue or has helped address that issue. I am told that of some 100, 105 requests in this area, there has only been one appeal from the rulings made by the corporation, so that is a pretty good indicator that only one appeal of about 100 or 105 of this nature--a young son or woman. I would think that the issue that was raised to the review committee in this instance is being addressed by the corporation.
Ms. Wowchuk: I do not know where the corporation keeps these kinds of records, but I would like to ask the minister if there are any numbers available, if there is a breakdown of numbers of women who have their own crop insurance records, and I do not know that the corporation would keep those kinds of numbers.
Mr. Enns: I am advised that we are a very politically correct organization, and we do not keep this kind of data that could in any way be at some point or other used in a manner that would indicate that we have gender biases. We just list them as contract holders. It is something that we might pursue at a later date.
Ms. Wowchuk: I recognize that there should not be this distinction, but I guess I am looking for young people, how many young people there are who are getting started farming but who have to tie their insurance to their father or someone else who has an existing contract because they might share equipment or do things like that, so they are forced then not to be able to get their own contract.
Mr. Enns: The general manager advises me, Mr. Chairman, that by again changing the scoring system we have made it more accessible, easier, for young farmers to get contracts; he also advises me that the participation rate of the younger farmer is relatively high. It does not surprise me that much because these would often be also people who are gaining entry into farming who are perhaps carrying a significant debt load with a lending institution. The lending institution is making it a condition that they so protect themselves.
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Ms. Wowchuk: The minister indicated that this is a very politically correct corporation. I want to ask if the minister, through his staff, can indicate to us whether there is an affirmative action hiring clause in this corporation and what the number of people on staff are, including inspectors and what proportion of those would be women.
Mr. Enns: Well, firstly, Mr. Chairman, I want just to leave the committee with a little bit more information. Our province, I have been advised, is the only province that, in this particular program, has our process with respect to the manner and way in which we make insurance coverage available to Manitoba citizens that has been looked at and approved by the Human Rights Commission from, I would take it, the perspective of some of the issues that the honourable member raises.
Our system has also been sent to other provinces by Canada, as an example of how other programs should be altered or changed or improved to be more receptive to the kind of questions that the honourable member raises.
Ms. Wowchuk: I just want to ask the minister for clarification. Is he talking about the scoring system that is used to address contracts, and if so, if that is what the minister is talking about, can you indicate when that scoring system changed from what it was before.
Mr. Enns: The scoring system was changed for 1995, so it is relatively recent changes that have been affected. I would take it, it is partly our response to the review committee's report that dealt with these kinds of recommendations, and I am advised that it is the scoring system that is being judged or looked at by organizations like the Human Rights Commission and/or as being applauded by our federal partner as being the most appropriate one in use, and it is being suggested that it should be applied to other jurisdictions where the federal government is co-partnering in insurance.
Ms. Wowchuk: I would then like, at some point, if the corporation could provide us with some information as a comparison with what the scoring system was and what the changes are. It is not necessary to go through it now, but if we could be provided with that and if there are any questions we can call back about them.
The other question that I had asked was on the percentages of women working in the corporation in management staff, if there is, and also in field inspectors.
Mr. Enns: I am sorry I was momentarily distracted, Mr. Chairman. I wonder if the honourable member could repeat the question.
Ms. Wowchuk: I was asking the minister if he could provide us with some numbers as to what the ratio is of women working in the corporation, or what the policy is on affirmative action in the corporation, not only women but other people, whether the ratio of the number of people who work as field inspectors with the corporation, whether there are efforts made to hire more women in that field.
Mr. Enns: Mr. Chairperson, I am aware that the issue is one that is being appropriately asked, no doubt, of all government departments. Our personnel services are very much aware of the importance of doing our utmost to comply with the standards that we as a government have set for ourselves in our different departments. I am advised that the ongoing difficulty that we have in the Department of Agriculture is the availability of persons in the different facets of agriculture that are attracted to agricultural work. That makes it more difficult for us than perhaps some other departments in meeting, you know, so-called targets or quotas. Just as a direct response to the question-- just cannot be real.
The corporation is way ahead of me. We have on our staffing an even 50-50 percent breakdown, male-female. If I am somewhat suspicious of these figures or members opposite are somewhat suspicious of these figures, they could be snowing me right now.
Ms. Wowchuk: We will have to check it out.
Mr. Enns: Then they tell me that in the supervisory, female staffing in the casual adjusters, the ratio is, as I would suspect, quite different, 146 male to 13 female. In the grading stations and the regional quarters, we have not been able to attract female employees to the corporation. All in all, in female staffing we have three in a supervisory area; we have seven in the technical area; and we have 29 further people in the clerical work for a total of 42 in the field operations group. So, yes, looking at these figures, I think the corporation has done very well in terms of gender balance in their staffing requirements.
Ms. Wowchuk: Mr. Chair, in fact I am very pleased to hear that is their representation on the staff. I want to ask the minister, there is also a board, what is the size of the board and what is the composition in that? What is the balance of representation on that board?
Mr. Enns: On the board of directors, I think, we have a membership of five. We have one female member on the board.
Ms. Wowchuk: The minister had indicated, before he realized how many women there were in the corporation, that there was a lack of interest on the part of women to get into the agricultural field of studies. I guess although this does not fall under crop insurance, I do not want to miss the opportunity to raise the comment.
I think something that the department has to look at is promoting agriculture as a more friendly environment and do whatever is necessary to encourage rather than discourage young women, as they choose their careers, to look at agriculture, because it can be a very rewarding career. Agriculture right now does not mean getting out in the tractor ploughing up a field. There are lots of opportunities, so I hope that we can do more to promote agriculture with our young women and men. That is an aside from where we are in crop insurance.
I want to ask about a couple of specific cases in crop insurance. We were talking about women who were having difficulty getting their claims processed or getting coverage. One of the women whom I had spoken to was Susan Crawford, and I believe that that may be settled. I wonder if the minister could advise me on what the status of that case is and whether or not Mrs. Crawford's situation has been resolved and if she has been able to get crop insurance and Gross Revenue Insurance independent of her husband's operation.
Mr. Enns: The general manager confirms with me that as far as we are aware, the issue has been resolved. Mrs. Crawford had legal help, the lawyer involved in the situation. But again, as on some other occasions, I would ask staff to make a note that we would specifically provide the member for Swan River (Ms. Wowchuk) with details as to how it was resolved.
Ms. Wowchuk: If that is the case, I have one other case that I would like more specific details on. That is the case of Mr. Alec Hrychuk from Fork River who had faced some real difficulties. I believe he had his insurance cancelled, and also it is my understanding he went through the appeal process and was denied there.
In just a recent phone call from Mr. Hrychuk just in the last couple of days, it is my understanding that the corporation has sent him back his premiums and is now asking him to pay back all the coverage he got--some $11,000, so along with having his coverage cancelled on a specific crop they are--and the reason he is being asked to refund this money, there was an error in the size of the field. The inspector who looked at the field did not measure the field, and then, in reassessing, Mr. Hrychuk was paying insurance on more acreage than was there and now is being asked to reimburse the money.
This is a person who is under extreme hardship as it is because of having had his insurance cancelled on a particular crop. Now he is being asked to pay a large amount of money back. I would ask that the staff look into that situation and advise me on what it is we can do to help this family who is indeed facing some very serious difficulties. In fact, it has resulted in this person having to rent out his land; he cannot continue to farm and is away working. If he has to pay this additional refund of $11,000 it will result, probably, in this farm family that has worked very hard and is contributing to a rural community maybe having to dispose of their land. It is a serious situation, and I would ask that the staff look into that and advise as to what we can do to help the Hrychuk family.
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Mr. Enns: The honourable member will appreciate, with some 12,000 individual clients it is difficult for staff to have at their fingertips the details of each and every one of the issues that may involve a particular client. But, again, we have no difficulty in making sure that perhaps as early as when next we meet we will have those details of these two specific former clients of crop insurance for the committee.
Ms. Wowchuk: I want to thank the minister for that. I can appreciate that the staff will not have those answers. At a time when it is convenient, particularly in the Hrychuk case, as soon as possible to get some answers on that situation will be very helpful to the family, and I look forward to hearing that response and how we can deal with the problem.
The hay insurance program--there is a new program for hay coverage. There was one program and now a new one has been developed. Is that accurate? There is a new program, and if so can the minister fill us in on the differences between the feed program that we had and the new program that we have now?
Mr. Enns: There have been a number of changes in the various forage programs that have been operating for a number of years. We had, as the member will recall, a forage review committee look at the overall question of forage insurance. I just might indicate and remind the honourable member that on that committee we had a fairly wide range of people participating from the Keystone Agricultural Producers, Manitoba Cattle Producers' Association. Of course, from our own department Manitoba Agriculture we had grassland specialists, Agriculture Crown Lands, Manitoba Crop Insurance people, and the representation from the Manitoba Forage Council. They presented some very specific recommendations to us in the early part of this year, January 11. I can report to the committee that all of the recommendations of the committee have been implemented except for inclusion of an individualized native hay program, and we discussed that program at some length.
The committee's view was that, while recognizing that there were some difficulties in that program--certainly there were difficulties in the former program we had. It was becoming extremely expensive to administer and obviously not that attractive to a growing number of cattle producers, for the participation rate was falling off pretty dramatically. Nonetheless, I do acknowledge that the committee and the corporation were prepared to try to offer a native hay program, but, in the final analysis, the government felt that native hay is native hay. It is more subject to the vagaries of the weather, and we simply ought to rethink the idea of having an insurance program for that and have left that out.
I have, since making that decision, been able to visit with many cattle producers in the course of my responsibilities as Minister of Agriculture. I have made a particular point of attending the numerous well-attended cattle meetings. They are called different things in different parts of the province. You have Ag Days in Dauphin, for instance, a very successful coming together in a mini agriculture show of producers and people involved in the agricultural industry. In different parts of the province, in the southeastern part of the province, in Vita, they are called Beef Days. In the Interlake we had several days, one scheduled in the Teulon area in the south Interlake, one further north in the Eriksdale area, and on all occasions I had an occasion to meet with a significant number of cattle people.
(Mr. Deputy Chairperson in the Chair)
Our people were always present. Our Crop Insurance people were present in most instances to explain the kind of forage programs that were available. I must advise the honourable member that there have been very little or no complaints about the fact that we are not offering a native hay program, and at this point in time we see no particular reason for changing our mind on that.
Ms. Wowchuk: The minister covered off one part of the program that has been raised with me, and that is the fact that there is no coverage for native hay. Although there are not that many people, in a good portion of my constituency there are a lot of people who harvest native hay and who have expressed concern that they had hoped that there would be a way to get coverage for it. I guess, looking back at the other program and this program, I want to ask, was there coverage for native hay under the previous program? The second question is, since the program was just brought in this year, when is this cut-off date for sign up?
Mr. Enns: Under the old livestock feed assistance program there was an area-based program, and that was the program that quite frankly fell into disfavour, because it took in no account for the individual situation that the cattle person or rancher found himself in. What the review committee was wrestling with was the recommendation of a program that would zero in on the individual, much like the individual crop insurance program that is being offered to provide some type of coverage on native hay. I take full responsibility for not accepting that recommendation. I just was not convinced that it was the kind of a program we should be in.
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Ms. Wowchuk: The minister indicates that it was his decision not to go with the native hay, but I wonder if there might be ways to consider. If this program is based on individual averages and individual yields, if there were ways that farmers could manage that wild hay--although I know that is pretty risky at times, if they are going on individual averages and if they are prepared to pay the premiums, was there any consideration given to offering any kind of coverage perhaps if they paid a premium at a different rate than people do on their own cultivated hay?
Mr. Enns: Well, these were some of the kinds of considerations and debate that took place within the department and with my colleagues in caucus and cabinet. In the final analysis we simply felt that,
whereas with seeded or tame forages there was some criteria and there was some management involved, there was a data base that could be relied on, a reasonable amount of data that different organizations had collected over the impact of fertilizer application on forage, the kind of health of a forage stand, when it was appropriate to restock, reseed forages, in other words, those are more comfortable things that in my opinion can be assured against and measured against in terms of setting premium dollars. They have hay just by its very description. There is no management to native hay, it is native, it just stands there. So there is no way that you can make judgments as to management capacity of the individual contract holder that you are trying to insure, and it was felt, in my opinion, that it was just too loosey to try to provide an insurance coverage for that circumstance.
Ms. Wowchuk: This difficulty, Mr. Chair, that I have with this decision is, earlier on we were talking about going to more inclusive insurance where farmers would be able to take insurance on various things to protect themselves so that they do not have to depend on ad hoc programs.
Now we have a group of farmers who lived in a particular region of the province that, due to the landscape, the land that they farm on does not lend itself to cultivation, so we want to expand the cattle herds in the province.
The minister has indicated clearly that that is the direction that we are going in, but these people have to have some security too, and they are going to end up in a situation when there is a hay problem to come back to the province for support.
So I do not criticize the minister for his decision of not having accepted wild hay into the program, but I would ask that his staff review this and look at ways that we might be able to help these people that live in the fringe areas and work on land that is not suitable for cultivation and how we can also help them bring security into their bottom line.
With that, I also wanted to ask, the old program basically fell apart because the interest was not there, there was not the uptake in it. So now that we have a new program, what has been the sign-up rate? Is there a great interest expressed in this particular program, and do the fees range with soil classification across the province? I have a lot of questions so let us talk about the sign-up rate.
Mr. Enns: I am advised, Mr. Chairman, that the participation rate is not very high. Just going back to touch back on the earlier question with respect to native hay, the corporation advises me that they had many meetings earlier on in the year, some 40-odd meetings where crop insurance was being discussed with very low indication of producer interest in native hay coverage. Throughout these meetings they were able to identify less than a hundred potential people who indicated that they, if the program were to be offered, would consider buying it.
Well, Mr. Chairman, when you have less than 100 people interested in an insurance program, it gets difficult to write an actuarially sound program. We have had in the seeded forage acreage some 165 contract holders. That is down considerably from the year before when we had some 230 individual contract holders. But we will continue to offer that program and perhaps review it and modify it to see whether or not it can be more acceptable.
I want to just respond to the issue that the honourable member raises, and it is a legitimate one. I have, quite frankly, made another arbitrary decision. When I say arbitrary decision, ministers when possible certainly like to act in concert or in step with the commodity organizations that they are legislating or providing a program for, to the extent possible. That is not always possible because organizations do not always represent the same interests that the government of the day feels or in fact what may in fact be what the government of the day or the minister of the day's best judgment is in the interests of that industry.
I am referring specifically to my extending to all cattle producers in Manitoba the NISA program against the specific advice of the Manitoba Cattlemen's Association. I did so partly because of the very same reasons that the honourable member for Swan River (Ms. Wowchuk) just put on the record, that that in effect is a safety net program. That program is designed--it had some difficulties in its initial years and for the start-up farmer, but I have a lot of respect for the program. It becomes, if you like, an enhanced RRSP program for that individual farm operation. I am particularly attracted to the discipline that is in that program that is individually triggered.
Governments tend, particularly in agricultural programs, we tend to be wasteful of money, and money is hard to come by, when we apply it with a broad stroke over a region. When we decide that the southwest or this half of the province is in a drought condition and we give everybody in that area a drought payment and a flat out acreage payment, there is always a handful or a significant number of farmers who have had quite a good year. They have hit every little spot of rain that has come over and they have had an average or an above average year, the year that they are also getting from the public treasury a support payment because of the inability of this kind of programming to be focused.
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The NISA program is much more specifically focused to the individual farm operation and it, of course, is meant to be available to that individual farm operator when he faces a crash of some kind. It could be a price crash in cattle. It can be a disease problem that severely impacts on his income for a year or two. It could be a drought situation where his hay production is not what it normally should be and he has to go and purchase a fair bit of hay. You know, I think that providing that kind of support program for the particular cattleman in this case is an offsetting factor to the fact that they now have not available to them the need of hay insurance program in which they showed very, very low interest.
I was probably trying to avoid answering a question that you asked before I started this discussion. If there was a question that you asked I would entertain it in any event.
Ms. Wowchuk: I will defer to my colleague.
Mr. Stan Struthers (Dauphin): Mr. Chairperson, I am interested in getting from the minister an idea of this Livestock Feed Security Program. Throughout the province right now we have had several areas where due to high levels of water, the flooding situations, we have cattle producers who are forced into choosing between a couple of options and neither option is a very delightful one. I have had producers come to me and say that on the one hand they may be forced to buy feed for their livestock from outside and truck it in, or No. 2, they could be facing the option of selling off a percentage and sometimes a large percentage of their herd because of a shortage of feed. Is their any kind of assistance through this program for these producers in those kinds of situations?
Mr. Enns: Well I have to, you know, indicate to the honourable member for Dauphin, that that livestock security program he speaks of, that program was cancelled and is not available to producers in this coming year partly because of the low participation rate and the growing administrative expense in administering that account. Now, that has been replaced by the programs that we just discussed in respect to the Tame Hay Insurance Program which responds to the individual producer's requirements. None of that really addresses the issue that I am well aware of, which he raises. There is a critical situation in some cases that comes about because of the excessive moisture this year. In some cases it was a question of individual cattle producers having hay but they could not access it because of water conditions or the hay being damaged by water.
My understanding is that my colleague, the Minister of Government Services (Mr. Pallister), who among other things is responsible for the Manitoba Disaster Assistance Board--these kinds of costs, these kinds of losses will be compensated, will be covered by the Manitoba Disaster Assistance Board.
If a livestock producer has lost hay or has had to purchase hay for the reasons that we just mentioned, or, I am also advised that in some instances some pasture land particularly in the flood plain in the lower part of the valley will likely not be available for some of the producers this year, so that cattle may well have to be trucked out of the area to find--if the individual is fortunate enough to find pasture elsewhere--those kinds of costs would be covered by the Manitoba Disaster Board.
In other words, any and all tangible, physical costs like that will be accepted as within the criteria for compensation through that agency. I understand that Crown Lands is making available wherever possible alternate pasture opportunities. I know that under circumstances like that--although the department I had the privilege of being minister of prior to coming to Agriculture does not always do this with a great deal of enthusiasm, but we do under circumstances like that make available some of the wildlife management areas for emergency pasture use.
I encourage the honourable member, if he has calls of this nature, to contact our regional director of the department, Mr. Roger Chychota, who is resident in Dauphin, as I understand, and I am sure would be only too pleased to provide the kind of advice and details to which I am alluding.
Mr. Struthers: Mr. Deputy Chairperson, I wonder if the minister can tell me if only those ranchers who are insured under this program--are they the only ones who would get some type of compensation, or would it include others who were not included in the insurance?
Mr. Enns: No, this is available to all producers who are suffering. Now, let us be specific. We are talking about situations that can be attributed to flooding damage. I appreciate there has been some flooding damage in and around Lake Dauphin. The major portion of flooding damage, of course, is in the upreaches of the Assiniboine between the Shellmouth Dam structure and perhaps all the way down to virtually up to, you know, through to Brandon. But those are the areas where the Manitoba Disaster Board is pitching in. It would be all-inclusive regardless of whether you had insurance or not.
Mr. Struthers: That sort of leads into what I was getting to next. Other than floods then, for any other reason, should ranchers find themselves short of feed for the cattle, for any other reason other than the flooding, what is available to support the producer then?
Mr. Enns: Well, I wish I would follow my own advice but I do not, and that is that ranchers should of course always have at least a half a year's hay supply extra to his needs on hand. Is that not the kind of advice Mr. Member for Morris used to give to your cattlemen in Morris? We do not offer any particular programs that can help out in that circumstance.
I repeat that we are making every effort to provide additional lands for alternative pasture use through our Crown land agencies. We encourage our farmers, and I think you will see a fair bit of it in particularly some of those areas that are going to be too wet to seed in the regular cropping condition but who might well be advised to put in some green feed for forage requirements.
Certainly the member for Swan River (Ms. Wowchuk) and I know the hay production is very weather dependent, and I am hoping that at least in my part of the world, the Interlake--we are getting finally a combination of some heat and that, quite frankly, is what has been missing the last several summers. We have not had enough heat units to make our native hays grow, or our general weather conditions that made for maximum hay production. But ranchers are on their own in terms of finding the actual feed requirements that they require for the maintenance of their herds.
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I should add--and, again, I thank the department--the Department of Agriculture does provide a kind of a cataloguing, a reference, a hay listing program. Any individual, again, where farmers or ranchers, people not necessarily ranchers--there are a growing number of people who are living on acreages perhaps not farming at all but having hay made on it.
We have quite a few people that I know of in my area who are perhaps business people working in town or professionals, teachers, but they are living on a quarter or half section of land, which they have in alfalfa. They are not involved in regular farming and have that hay harvested on an annual basis. They get their share. They maybe get their taxes paid that way, but these people have been encouraged for the last number of years to list their hay with the ag rep's office, and at any given time, the department can direct a would-be purchaser of hay to a source of hay that is nearest to his area.
Ms. Wowchuk: I guess the minister just indicated how dependent we are on the weather. In some parts of the province, people cannot get onto the land. In other parts of the province, people are hoping that we will have a rain just so, with this warm weather, that hay crop will start to grow. Hopefully, it will all balance out, and there will be feed, so farmers do not have to end up disbursing those cattle herds that are very important to their well-being.
I want to just get back to the former program. Can I just ask, how long was that program in place, the Livestock Feed Security Program?
Mr. Enns: The program, Mr. Chairman, was started in 1984 as a test year, and so it was available from about the mid-'80s on, up until last year. I suspect it was also perhaps brought on by a drought year or a tight condition. We had at one point in time considerable participation, upwards of 600 participants, which, I would say, included a very high proportion of people engaged in livestock.
It became increasingly unpopular because of its area base format. It became a very difficult and a more and more costly program to administer. We ended up in some instances having more what we called monitors than we had participants in the program.
We had made arrangements with individual producers to act as a monitor for the program, so that we had some yardstick, some measurement, of the actual hay production on his property, and we had these scattered throughout the hay-producing areas of the province and it fell into disfavour. At the end we were down from the 6,600 contract holders in 1989. By the time we cancelled the program there were fewer than 800--759 participants in the program.
As I mentioned, the cost of administering a program related to the number of people we were covering was just no longer acceptable. The administrative costs were running in excess of $240,000. That is just the administration costs; that is not the premium costs. We did away with the program, and I must say, Mr. Chairman, one always has a reasonably good measure of the soundness of decisions when there was virtually no response to the cancellation of the program by the affected community.
Ms. Wowchuk: Mr. Chair, I have to tell the minister that I have not heard a great outcry of people asking him to bring that particular program back, but I have not heard very much discussion on the new program either.
One of the reasons I understand that this program came into disfavour with the farmers was the fact that premiums were quite high in return for what they were getting back. I want to ask the minister, since the program was in place for 10 years, what was the bottom line at the end of the program? Was there a surplus, and if there was a surplus, how much, and where did that money go?
Mr. Enns: We, at the end of the program, were $1,600,000 in deficit, and that was cost to the corporation.
Mr. Chairperson, I am advised that the corporation does not write off that indebtedness, that in effect that debt will be pursued and built into premium structures on future and existing forage and livestock programs.
Ms. Wowchuk: So I take it then that the minister means that you will be starting to build these costs into this new program and into the premiums. Is that accurate to say?
Mr. Enns: Yes.
Ms. Wowchuk: The minister indicates that is true. Then, can the minister indicate how the premiums compare in this new program that is on individual averages, the premiums and coverages versus the coverages under the old program? Are the farmers going to be getting a better coverage than they got under the old program or how would that be based?
Mr. Enns: Mr. Chairperson, I am advised that the programs are not that much different, the old, that is the cultivated forage program that we had and today's cultivated program we have. The major difference lies in the fact that we offer it on an individual farm basis. The premium structure is, I am advised, not that much different.
Ms. Wowchuk: Then, can the minister indicate whether there would be any people who would be disqualified from this program, or is everybody starting with a clean slate? I am looking at producers who do not use sound management practices and end up not getting the production that they should. Just as in crop insurance, people are disqualified. I guess I am looking at whether you are looking at back records, whether their management practices come into it.
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Mr. Enns: There is, I am advised, an indexing system that the Crop Insurance people will use. They will go to an individual producer and go back to year '90, go through his records and establish an appropriate type of program for that individual farm, taking into account his management practices, his capabilities as best they can be demonstrated. I do not think that there would be any automatic exclusion of anybody.
I think perhaps the honourable member is specifically questioning whether or not individuals who have had less than the best track record under the old program, is there a category or a number of them who are automatically excluded, and the director of research shakes his head at that. This indexing checklist, if you like, is no different than the kind of checklist or scoring that the Crop Insurance Corporation undertakes with all their clients in a regular crop insurance program to establish the appropriate ratio of premium and coverage that reflects the best data that we can have on that particular piece of property on that farm.
Ms. Wowchuk: I guess what I am looking for, Mr. Chair, is since this program also comes under the same department of crop insurance, whether there is any cross-referencing on a person's performance on their crop insurance, on their performance, if their yields are bad under crop insurance they are not using good farm management practices. Are those numbers or statistics looked at when a person is applying for the new hay program, and does that reflect on the level of the insurance that that individual will get?
Mr. Enns: I assure the honourable member that is not the case. We try our best to establish an appropriate program based on what we are insuring. In this case we are talking about forage.
Ms. Wowchuk: Continuing on with hay production and feed for livestock, the minister had indicated that in a situation where farmers may have shortages of feed this particular year, that they have the option of growing green feed.
I want to ask the minister: What will be the implications and how will that fit in with Gross Revenue Insurance, with crop insurance if people are required to take a certain amount of crop out of their production? I guess, with Gross Revenue Insurance it would have more of an impact if, because of their livestock, they have to lower their yield because they do not harvest the crop.
Mr. Enns: It is treated in a fairly straightforward way. If the crop is seeded by the deadline, for instance, that is one of the criteria that has to be applied. If he then wants to use it for green feed and cut it as green feed it will be appraised as such, and that is taken into account with the final coverage level for which insurance was purchased. If the party is not meeting the seeding date deadline and they expect, in some instances, this is going to be the situation, then it is simply an uninsured crop; it does not factor into either the GRIP or the crop insurance program as such. But it could be a valuable system nonetheless in breaching that feed shortage that some of the cattle people are facing.
Ms. Wowchuk: I guess then, if that is required, if there are those kinds of shortages, the individual should be then contacting their agent to make sure that the proper paperwork, or whatever is required, is done, but I am looking at people lowering their averages because of their yield. They are helping themselves out in one situation but I worry about them lowering the yield on it, and maybe it is not as big a problem as I see it.
Mr. Enns: Management assures me that there is no penalty applied to them in that case. They would normally appraise the field in terms of its yield capacity and that would not alter the long-term average or the changes to it, the fact that in this year or in a given year they chose to not harvest the grain but take green feed off instead without penalty.
Ms. Wowchuk: We will leave that area for a while. I want to touch on the wildlife crop compensation. When we were at a forum in Portage la Prairie, the minister indicated that there was some change to the wildlife compensation program, and in fact the concern that we had been raising for a few years about elk damage and farmers who are in areas along the forestry service who were losing a lot of crop and not being able to get coverage, that there has now been a change. I would ask that the minister outline to us what kind of changes have been made to that program.
Mr. Enns: Mr. Chairman, I am looking at the clock because I am fading fast. I think we adjourn at two o'clock. We have established a fairly comprehensive committee to review the question of wildlife damage, both waterfowl and big game. The current level of support for waterfowl is at 80 percent value of the crop and big game at 75 percent.
But we have brought together a host of people serving on a committee, Manitoba Forage association, Manitoba Municipalities, Ducks Unlimited, Manitoba Wildlife Federation, Manitoba Heritage Federation, PFRA, Canadian Wildlife Service, Parks Canada.
All of these people, many of whom are actively involved in the promotion of healthy and populous wildlife populations, and I make as strong a pitch as I can on any occasion that we are delighted to see healthy wildlife populations--when I say we, those of us in Agriculture--but it should not be borne on the backs of the farm population solely.
That is a societal responsibility that we support programs for conservation of our wildlife, for maintenance of healthy wildlife populations, so then we had better have in place the kind of support programs that, in my opinion, fully compensate the farmer for crop loss. This committee is at work. They are specifically charged to look at the funding levels, eligibility, compensation levels and also make further recommendations for better preventative measures.
A final draft is not expected until sometime this summer--it says here late summer--and what we would try to do is have some of these programs, some of these recommendations applicable to the program we are now offering by the '96 crop year, possibly the earliest. Again, it involves some multidepartments; it involves the federal government at some levels. But that is the position, generally speaking, on the wildlife damage.
I might just, for the member's information, indicate that the overall damages have increased considerably in these last few years. With the return to moister conditions across the Prairies, our bird populations are increasing. As I know the member is well aware, the big game are not decreasing anywhere in the province, and they are wreaking their damage on the fields.
Mr. Deputy Chairperson: Order, please. The hour is now 2 p.m. Committee rise.