Federal funding allocation creates more questions than answers

News Release
FOR IMMEDIATE RELEASE
August 27, 2002

(OTTAWA) - Last week the government announced how it would allocate $600 million in transitional funding to farmers. Now, one week later, farmers still have more questions than answers.

“The clear intention of the Prime Minister and his cabinet in approving transitional financial assistance to farmers was to aid areas of economic hurt. This allocation formula does not reflect the Prime Minister’s intent by limiting the ability to target the areas where the money is needed most,” said Bob Friesen, President of the Canadian Federation of Agriculture (CFA).

Following the CFA Semi-annual meeting in Windsor earlier this month, CFA membership presented the government with a unanimously-supported recommendation: the money should flow directly to provinces, to be apportioned by the provinces in consultation with provincial farm groups. Eligible net sales (ENS) were only to be used to determine what each province received. CFA strongly recommended against distributing federal funding directly to farmers through the National Income Stabilization Accounts (NISA).

CFA acknowledges that farmers appreciate the assistance, but cannot understand why Minister Vanclief rejected a unanimous recommendation from industry, a recommendation supported by the Minister’s own National Safety Nets Advisory Committee. “Industry provided the government with a solution to allocation that would make it a good news story for everyone. We made our recommendations for a very good reason: it would target the maximum money to the areas of maximum needs” said Friesen.

“This announcement has raised a number of new questions. If government chose to ignore the advice of the CFA and the Minister’s own Safety Nets Advisory Committee, clearly it must have answered these questions before making the announcement. Now farmers would like to hear those answers.”

CFA has the following questions concerning the distribution the federal funds through NISA:

• By distributing the money directly to farmers using ENS as a formula, the farmer with the healthiest ENS will get the most money. Can the minister explain how this formula will target the money to those facing the greatest economic hurt?
• How will the Minister ensure producer accessibility? Under current NISA regulations farmers who have had five bad years in a row and manage to make even just $100 more this year will not be able to trigger their NISA accounts. As well, farmers who have closed their NISA accounts in the past few years cannot reapply for a period of two years.
• When will the money begin to flow?

“In light of the past and current agriculture policy framework consultations, our biggest question must be: if the Minister is not listening to the recommendations of industry, his provincial counterparts and his own advisory committee, whose recommendations is he listening to?” asked Friesen. “This does not set a good precedent for future consultations, and for the allocation of future funding.”

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Founded in 1935 to provide Canada's farmers with a single voice in Ottawa, the Canadian Federation of Agriculture is the country's largest farmers' organization. Its members include provincial general farm organizations as well as national and inter-provincial commodity organizations from every province. Through its members, CFA represents over 200,000 Canadian farmers and farm families.

Contact:

Kieran Green, CFA Communications Coordinator, (613) 236-3633, info@cfafca.ca

Bob Friesen, CFA President, (204) 724-0824 (cell)

Brigid Rivoire, CFA Executive Director, (613) 236-3633 / (613) 715-3113 (cell)