Ag income support rumblings nothing new …… but there is a program that works

Two perennial issues that are never-ending concerns with agricultural producers are the weather and safety net income support programs.

There are two perennial issues that are never-ending concerns with agricultural producers – the weather and so-called safety net income support programs. The first is just part of food production and all that can be done is to just cope with it. The second concern has been a fixture of Canadian agriculture for the past 40 years and to this day has not been resolved to the satisfaction of producers or governments. It seems support programs were, by accident or design, developed to favour either the producer or the government. In both cases it meant that sooner or later the program was terminated because it was too successful (meaning too expensive for governments) or too narrow (meaning of no financial value to the producer).  That reality has seen over 200 provincial/federal farm support programs come and go over the past 40 years. Some of them were very specific designed to address a particular issue or disaster. But many of them were highly touted national programs designed to once and for all provide every producer with a life-long income safety support. If only that had been true.

 

Those with long memories might recall some grandiose support programs from the past; Western Grain Stabilization, Tripartite Stabilization, Net income Stabilization Account, Gross Revenue Insurance Plan, Canadian Agriculture Income Stabilization. Those morphed into present programs like AgriInsurance, AgriInvest, AgriStability, AgriRecovery and other AgriSomething schemes. Provincial governments tend to be partners with the feds in these various arrangements. But depending on the situation provinces like Alberta, Quebec, BC and Ontario were prepared to create support programs of their own. Quebec in particular and to the consternation of other provinces developed income programs that provided incentives to expand food production as a sort of national self-sufficiency policy. That all started in earnest 30 years ago with the election of the separatist Parti Quebecois. The underlying philosophy being that they wanted to be less reliant on the rest of Canada and have national control over their own food supply. That attitude continues to a lesser extent today, but it has probably cost the Quebec taxpayer billions in support dollars.  But I digress.

 

It does cause one to ponder that over all those years, all those myriad programs and the wisdom of hundreds of bureaucrats, experts and consultants why a functioning national program has not been created. But alas – no – we now find that producers and their organizations are once again questioning the effectiveness of the existing programs particularly AgriStability and AgriRecovery. Advocates for those programs are claiming, as they did in the past, that the programs are working its just that unique circumstances are causing isolated problems with pay outs. If history is any indication, governments will begin a review process and probably come up with another program that is supposed to fix the problems of the previous program. It seems at times that there is a cycle to this process – every new generation of government planners wants to create a better program which in the end repeats the mistakes of the past program – but just under a different name. Like so many issues in agriculture history loves to repeat itself.

 

Alberta has always been part of national safety-net programs, but has a history of its own support schemes. Must were specific like during the BSE crisis, but unlike the federal programs Alberta seems to have learned from history. Like other provinces Alberta has a self-sustaining crop insurance program which extends to pasture and hay. However a number of years ago the Agriculture Financial Services Corporation created a program that may well serve as a template for many commodities. AFSC created the cattle price insurance program for producers, it proved to be so successful that it was expanded to hog producers and eventually it became the Western Livestock Price Insurance program for producers in the four western provinces. What makes this program work where others have failed – well for starters its timely, consistent and producers know ahead what they are buying and what they are receiving – in a word the process is much less of a mystery than other schemes. Sure it can be stated that this program cannot be compared to others because the intent is different particularly with weather or disease calamities. But can’t this program formula somehow be used for other commodities rather than rely on an unworkable national universal whole farm program – that seems doomed. I would encourage discussion on a support scheme that already works rather trying to fix one that doesn’t.