The federal government and all provinces and territories, including Alberta, have reached a partial deal on the AgriStability program.
On Thursday during a meeting of provincial, territorial and federal leaders, all parties agreed to a change to the program designed to help agricultural producers manage large income declines.
AgriStability is cost-shared, with the federal government covering 60 per cent and provinces chipping in the other 40 per cent. The federal government had proposed a couple changes to the program, including removing the reference margin limit and increasing the compensation rate. Both moves would have allowed the program to pay out more to farmers.
Federal Agriculture Minister Marie-Claude Bibeau said Thursday all provinces have signed on to remove the reference margin limit retroactive to 2020 – a change worth around $95 million per year to farmers. However, the provinces didn't agree to increase the compensation rate to farmers from 70 to 80 per cent, saying they wanted a better deal on who would deliver those increased payouts to farmers. If the provinces had agreed to this, they would have seen some $75 million in extra funding from the federal government for farmers, but would have had to increase their own commitment to the program accordingly.
The Prairie provinces proposed Thursday that the federal government increase its funding but allow provinces flexibility in the level of funding they provide, a move Alberta Minister of Agriculture Devin Dreeshen alluded to last week.
Last week, Dreeshen told Great West the province is in a tough spot financially and he “wouldn’t be surprised” if Canada's various provincial governments asked to chip in less for the program. Dreeshen said the two proposed changes to AgriStability could cost Alberta another $15 million, on top of the $300 million it pays out through the Business Risk Management (BRM) program, which includes AgriStability.
“It’s something that we as Alberta and other provinces are going to want to make sure that (we) get the best deal possible for their farmers,” Dreeshen said.
The minister said Albertan's financial situation needs to be taken into consideration, and while agriculture has been a bright spot in the economy, the province still needs to face its own fiscal reality.
“We've had a tremendous amount of fiscal adversity in the province of negative oil prices, the global recession and the $18-billion deficit that we had this last year,” Dreeshen said.
“We do have a financial reality in the province of two massive years of double-digit deficits.”
Dreeshen said Alberta also wants a commitment from the federal government and other provinces to overhaul the program, which is only used by 21 per cent of farmers in Alberta. Of those enrolled, only 12 per cent get payments from the program.
“It's really a dog of a program and it's something that we want to try to find improvements to,” Dreeshen said
In a news release earlier this month, Bibeau called on the provinces to make up their minds on the deal.
“It has been just over 110 days since we made the offer to the provinces to improve AgriStability. We are asking for a clear indication from the three Prairie provinces whether they will sign on or not,” Bibeau said
“We have had many discussions – Canadian farmers want us to act,” the release said.
Take the deal, farmers say
While the provinces want to look for a better deal, agriculture producers have been urging the provinces to take the original deal put on the table by the feds.
Bob Lowe, president of the Canadian Cattleman Association, who represents around 58,000 producers, said earlier this week that they want Alberta to agree to the terms in the deal.
Earlier this month when Bibeau held her press conference, dozens of agriculture organizations across the country released statements asking the provinces to sign on to the deal.
“It's the first time anything's ever changed on it. It's the first improvements that we've ever managed to get,” Lowe said before the vote on Thursday.
The long-time cow-calf producer said these changes won’t make the program perfect, and they hope to see bigger changes made in 2023, with the potential to overhaul the program, but in the meantime the proposal on the table right now is favoured by producers across the country.
Lowe said this is the first time all of the producers in Canada have come together, united by their struggles during COVID-19.
“As an industry, we need to know that we've got the backing of governments for things beyond our control,” Lowe said.
While grain farmers have other programs like crop insurance to help backstop their losses, AgriStability is the best bet for folks in the cow-calf industry who were hit hard by COVID-19.
Lynn Jacobson, president of the Alberta Federation of Agriculture, who is working with almost all of the agriculture groups in the province, also urged the province to accept the deal. Eleven agriculture sectors across the province had signed on to ask the government to take the deal original deal proposed by the federal government including sugar beet growers, potato farmers, beekeepers, barley growers, the provincial wheat commission and the pork and beef sectors.
“It's a temporary fix until they can negotiate the deals of the new program in 2023,” Jacobson said before the vote.
The agriculture advocate said while it is possible the province will be kicking in millions more dollars, they would only be paying if there were more claims made by farmers and more payouts from losses, and Jacobson said there's no certainty it will cost them that much more.
“We don't feel they're going to be spending that much more or they wouldn’t extend any more than they budgeted right now at this point in time,” Jacobson said earlier this week.
Erin Gowriluk, executive director of the Grain Growers of Canada, also called on the provinces earlier this week to accept the deal from the federal government and said the delay is political in nature.
“This is clearly an issue of politics. We're playing a game of politics. And it's at a time when, really, what farmers need from their politicians is for everyone to come together and do right by Canadian farmers,” Gowriluk said.
“There's no other reason why the agriculture ministers should not be accepting the federal minister's proposal here. It's a fair deal."
For farmers, the volatility of the markets, weather, border closures and international trade deals can either make or break a farming season, which is why programs like AgriStability are important to help protect them from going under after one bad year.
And while it may just be the beginning of spring and seed isn’t in the ground yet, farmers are already making decisions on how they are going to spend their money. They need to know what AgriStability is going to look like and if they should buy into the program, Jacobson said.
The deadline to enroll in the program has been extended to June 30.
