Thursday, October 26, 1995
LEGISLATIVE ASSEMBLY OF MANITOBA
THE STANDING COMMITTEE ON AGRICULTURE
Thursday, October 26, 1995
TIME -- 8 p.m.
LOCATION -- Winnipeg, Manitoba
CHAIRPERSON -- Mr. Jack Penner (Emerson)
ATTENDANCE - 11 -- QUORUM - 6
Members of the Committee present:
Hon. Messrs. Cummings, Enns
Messrs. Dyck, Helwer, Martindale, Penner, Pitura, Radcliffe, Santos, Struthers, Ms. Wowchuk
APPEARING:
Mr. Marcel Laurendeau, MLA for St. Norbert
WITNESSES:
Bill 27--The Cattle Producers Association Amendment Act
Mr. James Bezan, Manitoba Cattle Producers Association
Mr. Dale Smith, President, Manitoba Cattle Producers Association
Mr. Tony Riley, Private Citizen
Mr. Keith Proven, Private Citizen
Mr. Terry Drul, Manitoba Independent Agricultural Producers
Mr. Fred Tait, Regional Co-ordinator, National Farmers Union
Bill 15-- The Agricultural Producers' Organization Funding Amendment Act
Mr. Leslie Jacobson, President, Keystone Agricultural Producers
Mr. Mac McCorquodale, Administrative Secretary, Keystone Agricultural Producers
Mr. Bruce Dalgarno, President, Manitoba Canola Growers Association
Mr. Max Polon, Vice-President, Manitoba Canola Growers Association
Mr. Doug Jones, Manitoba Pulse Growers Association
Mr. Clayton Robins, President, Manitoba Sheep Association
Mr. Ed Guest, Western Grain Elevator Association
Mr. Andrew Paterson, Western Grain Elevator Association
Mr. Keith Proven, Private Citizen
Terry Drul, Manitoba Independent Agricultural Producers
Fred Tait, Regional Co-ordinator, National Farmers Union
WRITTEN SUBMISSIONS:
Bill 15--The Agricultural Producers' Organization Funding Amendment Act
George Penner, Private Citizen
Chris Todosichuk, Private Citizen
MATTERS UNDER DISCUSSION:
Bill 15--The Agricultural Producers' Organization Funding Amendment Act
Bill 27--The Cattle Producers Association Amendment Act
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Madam Clerk Assistant (Judy White): Good evening. Will the Standing Committee on Agriculture please come to order.
The first order of business for the committee tonight is to elect a Chairperson.
Mr. Edward Helwer (Gimli): I would like to nominate the member for Emerson, Jack Penner.
Madam Clerk Assistant: Mr. Penner has been nominated for Chairperson. Are there any other nominations? Seeing none, Mr. Penner, would you please take the Chair?
Mr. Chairperson: Thank you very much, committee members, for the honour. The next order of business is the nomination of a Vice-Chairperson.
Mr. Frank Pitura (Morris): I would like to nominate the member for Pembina, Mr. Dyck.
Mr. Chairperson: The member for Pembina has been nominated. Any other nominations? Agreed? Seeing no others, the honourable member for Pembina (Mr. Dyck) has been elected as Vice-Chairperson.
We have before us tonight two bills that we will consider: Bill 15, The Agricultural Producers' Organization Funding Amendment Act; and Bill 27, The Cattle Producers Association Amendment Act.
If any members do not have copies of their bills, there are extra bills, copies of the bills available behind me on the table here. Before we continue on with the business before the committee, there are a few matters to clarify at this point.
First, the committee has received a written submission to Bill 15 from Mr. George Penner, who was unable to make the committee tonight. Is it the will of the committee to accept this brief as a written submission and to have it printed in the Hansard transcript of this meeting? [agreed] The submission shall be distributed.
It is our custom to hear presentations from the public before the detailed consideration of bills. At this point, we have 16 people registered to speak on Bills 15 and 27. Is it the will of the committee to hear these presentations? [agreed]
At this point, I will read out the list of the names for both bills so that persons who have registered to speak to the bills can be assured that their name is on the list.
The presenters are: Leslie Jacobson, President, Keystone Agricultural Producers Inc.; Bruce Dalgarno, Manitoba Canola Growers Association; Doug Jones or Don Kuhl, Manitoba Pulse Growers Association--which one is here? I see Don Kuhl there--Clayton Robins, President, Manitoba Sheep Association; Ed Guest and Andrew Paterson of the Western Grain Elevator Association; Tony Riley, Private Citizen; Doug Gamey, Private Citizen; Keith Proven, Private Citizen; Terry Drul, Manitoba Independent Agricultural Producers; Fred Tait, Regional co-ordinator, National Farmers Union.
Those were the presenters for Bill 15.
For Bill 27, The Cattle Producers Association Amendment Act, the presenters will be James Bezan, Manitoba Cattle Producers Association; Tony Riley, Private Citizen; Doug Gamey, Private Citizen; Keith Proven, Private Citizen; Terry Drul, Manitoba Independent Agricultural Producers; Fred Tait, Regional Co-ordinator, National Farmers Union.
What is the wish of the committee? Which bill would you want to consider first?
Mr. Helwer: Mr. Chairman, I think we could deal with all presenters on both bills prior to clause by clause of both bills. I think we could deal with all of them together.
Mr. Chairperson: Is that the will of the committee? Which presenters do you want to hear first, Bill 15 presenters or Bill 27 presenters?
Hon. Harry Enns (Minister of Agriculture): Mr. Chairman, just on that matter, inasmuch as that the principle contained in both bills is similar, I think it would be appropriate that we can hear the presentations on both bills before the committee deals with the bills clause by clause. I would bow to the Clerk's Office, perhaps, to see which list we call first. Was there any way that they came up--or the will of the committee.
Mr. Chairperson: If it is the wish of the committee, I would suggest that we deal with presenters on Bill 27 first and presenters with Bill 15 second. Most of them are the same presenters, but we will deal with it in that manner. Is that agreed to? [agreed]
Okay, thank you. I will then ask, are there any members here or people here that wish to be presenters whose names have not appeared on the list that I mentioned? Seeing none, we will proceed then, and I will call James Bezan, Manitoba Cattle Producers Association.
Mr. Helwer: Before we proceed, perhaps--we normally deal with some of the out-of-town presenters first that would like to leave early or something of that nature. Is it--
Mr. Chairperson: That is the normal procedure. I looked at the list, and I know virtually all the people on the list. There are two people in town; the rest are all from out of town. So I took the prerogative to deal with the list as presented.
Ms. Rosann Wowchuk (Swan River): Mr. Chairman, I have no objection to the bills being heard in either or--either 15 or 27, first, but I do have a concern that these bills are relating to issues that deal with people in rural Manitoba, and there are many people who would like to make presentations on this bill but are not able to do it. I think that it is very important that these people have the opportunity.
So, I move that this committee recommend that hearings on Bills 15 and 27 be held in rural Manitoba as well as the committee and that those hearings be held in Neepawa this weekend.
Mr. Chairperson: It has been moved by the honourable member for Swan River that this committee hold hearings outside of the committee.
What is the will of the committee?
Mr. Enns: Mr. Chairman and colleagues on the committee, it is known to certainly all of the members on this committee and all members of the Legislature, and, I would suggest, to a good portion of the farm community that it has been the intention of this government to pass these two particular bills. As a matter of fact, they were both introduced to the Legislature prior to the adjournment for the April election. I would like to think that there perhaps is no better time for farm interest to be expressed than at a time of a general election when in fact we are all in their communities throughout the province of Manitoba. So these two particular bills come as no surprise to the farm community, and they have had an ample opportunity to voice their concerns about them.
So, Mr. Chairman, I respectfully suggest that the motion by the member for Swan River (Ms. Wowchuk) is not one that the committee should adopt.
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Ms. Wowchuk: I respect the minister for his views, but I do not believe that the--he says that rural Manitobans and producers across the province are well aware of this legislation. That, in fact, is not an accurate statement.
These two bills were not part of the election platform. We did not hear very much about it. I think it would show great respect for the people of rural Manitoba if the minister would support this motion that would see the committee hold hearings in Neepawa, which is a very central part of the province, and give more people the opportunity to participate and put their comments on the record on this bill.
Mr. Mike Radcliffe (River Heights): I call for the question, Mr. Chairman.
Mr. Chairperson: The question has been called for. What is the will of the committee?
All those in favour of taking the committee to locations in rural Manitoba for hearings, would you say yea.
Some Honourable Members: Yea.
Mr. Chairperson: Those opposed, would you say nay.
Some Honourable Members: Nay.
Mr. Chairperson: I suggest to you that the Nays have it.
We shall then proceed with the next--before we proceed, should we establish a time limit for the presenters? What is the will of the committee, a 20-minute time limit? Is that agreed to? [agreed]
So we will ask presenters then to limit their presentations to 20 minutes if that is at all possible.
I call then once again the name of Mr. James Bezan, Manitoba Cattle Producers. Mr. Bezan, would you come forward, please.
Bill 27--The Cattle Producers Association Amendment Act
Mr. James Bezan (Manitoba Cattle Producers Association): It is with great pleasure that we are here to address you today, Mr. Chairman and honourable committee members, ladies and gentlemen.
Mr. Chairperson: Excuse me, Mr. Bezan, have you a written--
Mr. Bezan: Yes, right here.
Mr. Chairperson: We will distribute them to the members of the committee. Mr. Bezan, you may proceed.
Mr. Bezan: I would like to introduce representatives of the Manitoba Cattle Producers Association who are accompanying me here today. Our president, Dale Smith, from Snowflake. Our vice-president, Marlin Beever, from Rivers and our past president, Sid Wilkinson from Ridgeville. I am a staffer for the Manitoba Cattle Producers Association and also a farmer in the Inglis area.
The document I presented to you is--I am not going to go through the entire document. A lot of it is there for information. Behind the brief is a letter from the Manitoba Livestock Dealers Association with their comments on Bill 27. Our annual report follows that, a statistical beef handbook, which we thought would be of interest to the members of the committee, and also our magazine, Manitoba Beef.
It has been over 40 years since the first group of cattle producers got together to establish the Manitoba Stock Growers Association. On that important day, in December 1955, ranchers, seedstock producers and cattle feeders agreed that the provincial cattle industry needed a proactive voice that could explain the needs and desires of its industry to the Manitoba public. The need for a cattle organization in Manitoba is still necessary and ever gaining in its importance.
It is with great pleasure that we have the opportunity to address you today and discuss what is happening in the cattle industry, what efforts MCPA has undertaken and what the future holds for cattle producers in Manitoba. Over 12,000 producers are members of MCPA. This represents over 82 percent of all producers in Manitoba. Today these producers enjoy benefits of over $50 per calf marketed because of our activities. It is a firm belief of the members of the MCPA that having a strong association will assist producers in navigating the difficult waters that our industry encounters and will better enable producers to help themselves.
Manitoba's cattle herd on July 1 was estimated by StatsCan to be 1.42 million head. These cows were up 3 percent over 1994 at 525,000 mother cows. This is the largest cow herd on record. Heifers held back for replacement were 110,000 females, up 10 percent from last year. This brings the total breeding herd to a record 635,000 head. Steers and heifers on feed increased by 31.5 percent, with over 57,000 heifers on feed for slaughter and 110,000 steers being fed in Manitoba lots. The number of steers on feed is up a whopping 37.5 percent from 1994. In 1994 over 154,000 slaughter cattle were exported to the U.S. and a further 22,000 head of slaughter cattle were shipped to other provinces, mainly Ontario. A total of 37,000 cattle were processed in Manitoba facilities. This brings the total number of slaughter cattle for Manitoba, including cows and bulls, to over 210,700 head.
The value of cattle produced, including an increase in inventory in 1994, was $390 million, 13.7 percent of the total value of agricultural production in the province. The production of cattle and calves in Manitoba is the second largest commodity in Manitoba with only wheat generating more value in this province. Although total value of cattle production was up 1 percent, farm cash receipts for cattle declined 19 percent to $296.7 million. The decline of farm cash receipts can be attributed to the major expansion of the female base and the retention of calves on farm for further feeding in 1994.
A total of 14,000 producers generated their livelihoods from Manitoba ranches, feedlots and farms. There was also another 3,000 part-time and full-time hard labour involved directly on these farms. These 14,000 operations had annual capital and operating expenditures in excess of $200 million and an annual feed requirement valued at $120 million. Of the 19.1 million acres of total agricultural land in Manitoba, over 26.7 percent of it is dedicated to raising cattle, 4.3 million acres are unimproved lands for pasture and hay, with another 800,000 acres of cultivated land and improved pasture and forages.
Through the study that we recently had commissioned by the Manitoba Red Meats Forum through the University of Manitoba, with the change in the Crow benefit it is estimated that 25 percent of all the remaining cultivated land in the province will be taken out of the grain monoculture. It is suggested that the majority of this will go into a forage-based industry that will primarily support the cattle industry.
The activities of our association over the past number of years has been mainly done through the different committees that we have, and I would like to review the activities of the committees on a one-by-one basis and quickly review what they have been able to accomplish over the past few years.
The All Breeds Committee, which has representation of 11 different breeds along with the elected directors of the MCPA board, have been very busy in market development for the seed stock industry. They have established a beef breeds display herd at the Gunton Bull Test Station, and we have really felt that this has been a very successful way to get our message out to incoming missions that we have excellent quality right here at home. We have also been involved most recently in a market development mission to Mexico and that has also reciprocated sales to that area and a group of cattle are being moved down on Monday to the state of Nayarit.
We are going to be more proactive at the Western Canadian Agribition and hopefully attract more people from that major agriculture show in Canada back to our province.
The Cow-Calf Committee has been very involved over the last number of years in Crown land issues. They have also been co-operating with Manitoba Wildlife Federation and the Crown Lands branch on the Operation Respect signage program which has gone over tremendously. Recently the Cow-Calf Committee has been working on developing extension courses with Manitoba Agriculture and the Assiniboine Community College which will help producer make the transition from grain-based industries into the cow-calf business or advance the skills that they currently have.
We are also working with the Manitoba Livestock Dealers Association and putting together a feeder cattle promotion. With rising cattle inventories across North America we want to make sure that feed lots that are purchasing their replacement feeder cattle do not forget about the high quality cattle that we have here at home.
We have also gotten more active in the Crown Lands Rangeland Management program that is funded through the Canada-Manitoba Agreement on Agricultural Sustainability and this is a joint project that we do with the Crown Lands branch of Manitoba Agriculture.
We have also been sitting on the Manitoba Crop Insurance Corporation Forage Insurance Review Committee. The Feedlot Committee is currently monitoring the fallout that is occurring from the WGTA Act changes and any trade actions, or the potential, that we might face from other countries that we deal with concerning our safety net position.
Manitoba Guaranteed Feeder Association Loans Program is a program that we strongly believe in, that we helped develop and is one that we feel has been extremely successful in helping to expand the cattle feeding industry that we have here at hone.
We have also been working on risk management initiatives with feedlot operators and one of the main initiatives that we have undertaken is the Cattle Options Pilot Program which has been held through seminars across this country, and we have been sponsoring those meetings here in Manitoba. We have also been working through this committee on developing distance education short courses with Manitoba Agriculture and Assiniboine Community College, and they are currently putting in place a promotion of Manitoba's custom feedlots since we now have some major cost benefits that we enjoy over other areas of Canada and the United States.
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The Producer Liaison Committee is a new committee that we have just recently established, and this committee is responsible for dealing with animal health issues, producer communications and hosting meetings and conventions. The Manitoba Beef magazine which we have enclosed for you is a magazine that for the last three years has been very effective in getting out technical information and policy issues that producers should be more aware of. We have also been involved in research initiatives at the U of M and at the Brandon Research Station. Summer tours and field days are being hosted by this committee across Manitoba and have been very well attended.
It was through the leadership of this committee that we decided that our annual meetings should no longer be held in the larger urban centres of Manitoba, and we have been concentrating at holding these meetings and conventions in rural areas. This year our annual meeting is in McCreary, and we invite all of you to be there.
Animal health issues such as tuberculosis and trichomoniasis are issues that this committee continues to monitor and provide advice to producers on how to deal with these problems. Animal welfare issues are also a major concern, and this committee has been empowered with the distribution of the code of practice for beef cattle production to Manitoba producers.
The Public Relations Committee continues to work with the Beef Information Centre at a national level. We have also been working in the Partners in Food Production group which is trying to increase urban awareness of Manitoba's agricultural and food industry in the urban centres of Manitoba. This committee was also involved in the development of the environmental guidelines for beef cattle producers, and right now they are also getting very involved in the provincial promotion of beef here in Manitoba and are really getting some great feedback from the Great Tastes of Manitoba that Manitoba Agriculture has been so kind to participate in that program with us and other commodity groups.
We have recently initiated a new award called The Environmental Stewardship Award which will help promote Manitoba producers to the public and show that ranchers, cattle feeders and seedstock growers are excellent stewards of the land and resources that we currently have. We are also conducting Stand Up! Speak Out! training seminars for our producers so they can better explain the benefits of our industry to the public and media.
Early in 1995 the federal government pulled out of the record of performance programs. Nationally this system has been privatized and has led to the establishment of Canadian Beef Improvement. In Manitoba we have taken over these services from the Manitoba Livestock Performance Testing Board. The Manitoba Swine Breeders Association has contracted our office to administrate the swine ROP program.
MCPA belongs to other organizations which have similar causes. We have been a long-time member of the Canadian Cattlemens Association. Their key priorities of access to markets and addressing government policy which enhances the competitive position of the Canadian cattle industry are reasons that we remain strong supporters of CCA. Their dealing on animal health issues, non-NAFTA beef imports and addressing the important role for government in the area of research and development will translate into stronger and improved federal services for Manitoba producers.
We are a financial contributor to the Beef Information Centre which is mandated to improve beef's image and its demand to domestic consumers. A study done by the University of Guelph proved that beef advertising has increased the price of cattle at the farm gate by 7 percent. Their concentration on developing quick and easy beef products and addressing the dietary concern about fat will continue to position beef as a meat of choice. A yearly tracking study conducted by BIC has confirmed that 95 percent of the Canadian population still eats beef.
On the international market development approach, we have been strong advocates of the Canada Beef Export Federation. The Canada Beef Export Federation is working to export the highest per kilo value beef in the world, concentrating on adding value in Canada. Increasing exports on all beef products increases demand for cattle, directly improving the bottom line for cattle producers in Manitoba and across Canada.
Canada has experienced great sales successes in Asia during 1994. Total Canadian beef and veal product shipments to Japan reached 8,400 tonnes, worth over $36 million, which is up 43 percent by volume and 39 percent by value since 1993. Total exports of Canadian beef and veal to Asia outside Japan increased 3,100 tonnes, worth over $12 million in 1994, 121 percent gain over '93. This demonstrates concretely that Asia markets outside Japan are now and will continue to be major sources of new growth for our industry. Total exports to Asia and Mexico reached 13,000 tonnes, worth over $51 million of beef in 1994, and this is equivalent of more than 78,000 fed cattle.
Sales statistics indicate that 1995 exports are once again increasing dramatically, up 69 percent by value during the first six months of this year. Since CBEF's establishment in October '89, annual sales of high-quality Canadian beef products to Asia have more than doubled on a volume basis and more than quadrupled on a value basis. The federation's goal is to export 115,000 tonnes, worth over $650 million of--
An Honourable Member: Time is up.
Mr. Bezan: Is it?
Mr. Chairperson: Carry on.
Mr. Bezan: Okay--beef and veal to Asia and Mexico by the year 2000. This is the equivalent of 690,000 fed cattle which would be purchased by Canadian packers to serve these growing markets.
We have been a driving force behind the establishment of the Manitoba Farm Animal Council. The goals of MFAC are to voluntarily implement changes to our management systems where needed, bringing the public onside by supporting farming in rural communities, recognize agriculture's invaluable economic contributions and maintain well-developed standards of management and animal care.
Most industry experts agree that the upcoming years for Manitoba cattle producers are going to be challenging but yet interesting and rewarding. The market outlook remains uncertain due to high levels of production, low feed grain supplies and an unstable Canadian dollar. Producers will increase their need for more information on market trends and production cycles so they can make better informed decisions that will affect their bottom and production line. Changing grain transportation policy will also create more questions for producers on how they can best utilize their land base. They still need access to data which will direct them down the best path for their farm operation.
A decline in federal and provincial treasuries will result in decreasing expenditures to the agriculture sector. Eroding political influence of the agriculture community, because of a decreasing number of people directly involved in agriculture production, will also require an increased role for farm organizations to promote themselves and their concerns to the media, governments and the public at large. Animal welfare and environmental concerns will continue to focus on how livestock producers are addressing these situations.
Over 82 percent of cattle producers in Manitoba are actively funding MCPA. When MCPA was originally granted a checkoff in 1979, the refundability of the checkoff proved to be popular with the majority of producers and was easily administered by livestock dealers.
Since 1989, when the opt-out was instituted, our membership has been putting forward resolutions to return to a refundable checkoff. This was reaffirmed at our annual meeting in 1994 in Melita. The vast majority of cattle producers in Manitoba support funding MCPA by paying their dues through a checkoff. Many producers opted out not knowing what they had done and now want to become members again.
Over 82 percent of cattle feeders and stock growers in Manitoba already belong to MCPA. This concretely documents our support base and negates the need for a plebiscite. Although the majority of producers are staunch MCPA supports, we still plan on working with the minority. MCPA needs to understand their problems and concerns so we can continue to grow as an organization and tackle the issues which are affecting our entire industry.
Since the inception of the opt-out checkoff, our 12,000 members have expressed their concern that producers who opt out of the organization never have to reconsider that decision. We have also realized that the collection of the checkoff for livestock dealers is administratively burdensome. This has resulted in the active solicitation by some livestock dealers to have producers opt out of the organization so they could reduce their paperwork responsibility. Luckily, this has only happened on a few occasions.
The current situation often forces the auction yard or dealer into providing the explanation of what MCPA does for cattle producers. This is especially an onerous task when producers are delivering cattle at a busy livestock yard and they are asking employees who are accepting cattle at the back gate what the MCPA checkoff is about. It has been agreed between MCPA and the Manitoba Livestock Marketing Association that the promotion and sales job of MCPA membership should be the responsibility of us, of MCPA. By implementing a refundable checkoff, producers will have to contact MCPA to get their money back which will provide us with the opportunity to answer any of their questions and promote the activities of our organization.
The information collection regulation will also be amended so that it would only require the submission of names of producers who have sold cattle to livestock dealers to be submitted on a annual basis. It is our suggestion that this information would be forwarded to MCPA during the summer months which is a slower season for livestock dealers and is a time in our office where we could easily administrate the updating of our membership list.
Over the past 12 years payment defaults to livestock producers on the sale of their cattle have averaged in excess of $85,900 per year. The recent foreclosure of East-West Packers and Western Beef in Beausejour are recent examples of the extent of the problems that can be encountered and the requirement for the vendor security program. MCPA has been a long-time advocate of a vendor security plan and would have--a great deal of effort and time into developing it over the past five years. Similar programs have been in existence in Ontario and Alberta and have proved to be highly successful and useful in covering the shortfall created by nonpayment from livestock dealers.
This would be a voluntary program for producers. Questions have arisen on whether or not this approach is the best and fairest way of addressing the vendor security problem. The only other way to better institute vendor security would be to increase dealer bonding. However, this comes with substantial difficulties. First of all, many dealers would not be able to afford the larger bonds. Secondly, producers already pay for costs of bonding livestock dealers through commissions. If the cost of bonding was to rise due to increased bond levels, producers will pay for it, and it will probably be more expensive than the proposed vendor security plan. Finally, bonding is based on the previous year and does not reflect the financial stability or livestock volumes of dealers in a current year.
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Producers in Manitoba have repeatedly expressed their support for the MCPA and the excellent job and services that we provide on their behalf. Bill 27, which amends The Cattle Producers Association Act, enhances the ability of MCPA to address the needs and issues of our industry. The administration of MCPA has easily dealt with issues in the past and hopefully it will be able to deal with the concerns of the future. Any increased revenues that may be derived in changing our checkoff will be largely earmarked towards promotion, research, and market development efforts.
MCPA checkoff dollars have been well spent in the past. We do not believe there has been ever a larger return for your dollar attributed to membership in any organization as that found through the efforts that have been undertaken by MCPA. Through our promotion efforts and collaboration with BIC, retail prices of beef have increased 6 percent and farm cash receipts for cows and calves have increased 7 percent. The efforts of the CCA on controlling imports of non-NAFTA beef imports has contributed significantly to cattle prices. The effect of the European beef countervail has increased prices .59 percent or $2.95 on every $500 calf. The tariff rate quota system was established in 1994, creating a benefit of over 70 cents per hundredweight or $3.50 per calf. Our support of NAFTA has paid off by dropping tariffs and has increased revenues by $12 U.S. per head.
Efforts to increase our exportation of Canadian beef to Asia and Mexican markets have generated significant benefits to Manitoba producers. The ever-increasing beef production of this current cow cycle needs to have a home. Currently, Canada exports 42 percent of our beef production. With increasing import pressure and an expanding cattle herd, the need to find offshore homes for our production has never been more important.
The MCPA remains committed to enhance the profitability of Manitoba cattle producers and improve their profile in the public's eye. This is easily documented by the combined benefit of over $53 per head. A $1 per head membership fee definitely has its advantages. The MCPA has been, and will continue to be, the voice of the cattle industry in Manitoba.
If there are any questions, our president, vice-president and past-president will handle them.
Mr. Chairperson: Thank you very much, Mr. Bezan. I should inform you that you had about 20 seconds left. Well done. You certainly sped that up.
Let me just make one brief comment to the committee. I am going to open the floor to questions to the presenters, to Mr. Bezan, and if you have any questions, you can certainly put them. Let me remind you though very briefly and very delicately that this is not a time for debate. This is a time for getting more information from the organizations. So, if there are any questions--
Ms. Wowchuk: Mr. Bezan, you said that there are 12,000 producers that are members now, that you are representing 82 percent of the producers. Can you indicate then the balance, the 18 percent who are not members? Are those producers who chose to opt out? And if you are indicating that those are producers that have chosen to opt out, what do you anticipate that this legislation will do to your membership? Do you believe that your membership will increase or do you believe that you will still have an approximate 18 percent who will choose to drop out?
Mr. Bezan: Dale Smith, our president, will answer.
Mr. Dale Smith (President, Manitoba Cattle Producers Association): If that is acceptable to Mr. Chairman.
A certain amount of the producers who are opt-outs whom I have had a talk to on a one-to-one basis, who originally opted out, when you sit down with them and explain what you do, they are very, very intrigued and very happy with the job, and they would like to get back in. As far as the other 18 percent who are the opt-outs, that is going to be entirely up to them.
I we do not please the people out there when we are a grassroots organization who gets our direction from our 14 district meetings, if we do not please the people out there and do the job that they want us to, then they have most definitely a right to opt out.
Ms. Wowchuk: Mr. Chair, you--
Mr. Smith: Ask for their refund, yes, which is--
Ms. Wowchuk: You are saying that they will ask for their refund and--Just give me one moment here, you have distracted me.
Then you had said that those people that you talked to most often regret that they chose to opt out once they realize what the organization is doing for them. Do you not believe that then it would be more effective if you did your membership in such a way that you had contact with them and made people aware of what you were doing and then had them send in their membership instead of using this option of having somebody else do your checkoff for you without providing them with the information that they might require to make a decision as to whether or not they want to belong to the organization?
Mr. Smith: Under this system we will get close contact when they send in for their opt-out money. I think the relations with these people who are opt-outs will be far closer and far better. I believe this will be a better situation.
Ms. Wowchuk: You said at your annual meeting you had, the vast majority of the people at the annual meeting supported this proposal. About how many people--what was your attendance at your annual meeting?
Mr. Smith: The amount of people?
Ms. Wowchuk: Yes.
Mr. Smith: Our annual meetings in the last three years since we took them to the country and back to the local cowboy have averaged between 250 to 450 people.
Ms. Wowchuk: So in actual fact when there are somewhere around 15,000 livestock producers in Manitoba and if there are some 200 to 250 that have attended the annual meeting, that is a small percentage of the actual producers who gave your support to this.
What have you done to contact all cattle producers to ask them for their endorsement of this legislation?
Mr. Smith: You are saying the cattle producers on the opt-out?
Ms. Wowchuk: No, all producers.
Mr. Smith. All producers. We have a newsletter which is in here which goes out four times a year that goes to everyone who is not an opt-out in Manitoba, all producers.
Mr. Chairperson: Any other questions? Seeing none, thank you very much for the presentation. I will call next Mr. Tony Riley, private citizen.
Have you printed copies, Mr. Riley? I will ask the Page to distribute the copies. Would you proceed, Mr. Riley.
Mr. Tony Riley (Private Citizen): It is a shame the need arose for me to come all the way to Winnipeg to protest something so obviously wrong as a compulsory checkoff to finance farm organizations that intelligent farmers do not even want. If the Manitoba Cattle Producers Association and the Keystone Agricultural Producers were so desirable and appealing to farmers they would not need a forced contribution from the farmers.
The very fact that they intend to accept a compulsory checkoff tells me they know no sensible, intelligent farmer would of his own free will give them any money. The fact that the present provincial government is breaking the democratic law to give them that power tells me they are considered just a tool of this government.
Earlier this year I asked Premier Filmon if he believed in and supported the democracy concept. He assured me, very much so. Britannica Webster dictionary defines the meaning of democracy in a six-point form.
Point 1 is government by the people. Does a compulsory checkoff comply? No. The people had nothing to do with it.
Point 2--rule of the majority. Did the majority order a compulsory checkoff? No, they did not.
Point 3--government in which the supreme power is vested in the people and exercised by them directly or indirectly through representation. Did we the majority instruct our servants to impose a compulsory checkoff on us? No, certainly not.
Point 4--a political unit that has a democratic government. Does that provide for our servants to impose a compulsory checkoff on the farmers? No, it does not.
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Point 5--the absence of hereditary arbitrary class distinction or privileges. Does that give our servants the right to dictate who is going to speak for the farmer? No, it certainly does not. They really blew it this time by inflicting hereditary sovietism arbitrarily on the majority for a privileged minority. Some class. Some distinction.
Point 6--belief in or practice of social or economic equality for all people. Does a compulsory checkoff apply? No, quite the opposite. This clause definitely instructs our servants to make economic laws that serve all people, not a privileged few. This demands that the checkoff legislation be voluntary and open to any farmer organization that wishes to apply for it. This way, it is automatically an ongoing referendum of the farmers for which organization they want to support--no guessing, no denial of the freedom to choose, no building of a protected haven for crooks and traitors.
If our servants are allowed to abuse their position of power by passing such undemocratic legislation as this compulsory checkoff menace, the next step might be no more elections, and everybody contribute to their party. Of course, their reasoning will be who needs all these parties, and you can apply for your money back or at least some of it for awhile.
I am not surprised the Berlin Wall came down. It was not because we licked Sovietism but because it conquered us. The proof is in this state dictatorship oppressing the majority, and Bill 15 and Bill 27 are good examples.
Such legislation is an insult to our war veterans who thought they were fighting for freedom, lest you forget.
If you continue to insist on ramming these two bills through, you are guilty of nothing short of treason for which you ought to pay the appropriate penalty.
Mr. Chairperson: Thank you very much, Mr. Riley. Are there any questions of Mr. Riley?
Ms. Wowchuk: I would like to thank Mr. Riley for making the effort to come here this evening and put his views forward, and I would like to ask you, Mr. Riley, is your objection that there is no choice, or do you have an objection to people having the ability to form an organization, or what is your main objection?
Mr. Riley: The objection I have is it is compulsory, No. 1, that you pay into these organizations, and, No. 2, the legislation does not leave it open to any farm organization or farmers organization, which is even more important, to apply for that checkoff, and farmers having the opportunity, that agree with any one of those organizations that apply, to voluntarily give them funding fees--and that is the way I think it ought to be, that it is not tied to one--approved by the present-day provincial government. You know, it has to be just an organ of the government in that kind of a fashion.
Ms. Wowchuk: I want to tell you that I believe that a farmer should have a choice in which organization they belong to and that if we are going to have an organization representing farmers, all of them should have a say in whether or not there should be an organization.
Would you support a referendum, giving all farmers the opportunity to have input into whether or not they want to belong to that organization?
Mr. Riley: No, if we had a democratic government, which they like to try and kid us into believing this is a democratic government, that kind of thing should never happen. That legislation should be open to any farm organization, present-day or going to develop, to apply for that checkoff, and it should never be the government making the decision that we are the god here that are going to be nice fellows and even give you a referendum to make that decision.
Put the legislation through so it is open to everybody, and if the people want it, they will come to it. You will find out then, you do not need a referendum. Once you have this legislation in place, it is ongoing. Every year, every month, every week is a referendum by the numbers of people who are submitting money to the organization of their choice.
We do not need a referendum separately from this, just open legislation, democratic.
Mr. Chairperson: Any further questions of Mr. Riley?
Ms. Wowchuk: I just want to let you know, Mr. Riley, that we have had discussion on this legislation, and one of the points that has been brought to our attention is that it is very difficult for one organization to represent all farmers because farmers have diverse views and different interests. For example, cattle producers have different interests, grain producers. Cattle producers want high cattle prices. Grain producers want high grain prices.
Do you believe that it is possible for one organization to represent all farmers in the province and represent all of them fairly?
Mr. Riley: If it was voluntary, I expect likely the numbers would tell you the story. I have not heard either of these two organizations that are being favoured by this present-day government speaking intelligently for the majority of farmers.
Very definitely, they are doing great harm to the farm community with their very limited thinking, if you can call it thinking at all. There is nothing offered. So if you are going to compare it with these organizations together, I would say definitely not, there is no way they can do it, they are not going to do either. I am totally opposed to that.
If it turned out we had this voluntary legislation, and the majority of farmers were contributing to one organization because they believed that organization served them, then I would agree that that many farmers were willingly choosing that organization and, yes, that organization must be serving their need.
Ms. Wowchuk: So in actual fact, what you are saying is that we do not really need legislation, that if a farm organization is doing a good job, whichever farm organization is at that time representing, and the farmers appreciate the work that they are doing on behalf of the farmers, membership will come in and there is no need for this kind of legislation.
Mr. Riley: Well, I support the checkoff concept, but I want it totally voluntary and open to all organizations. I think that is a good idea, that is a good way of getting it, but I would recommend the checkoff be on your income tax form rather than bother all these organizations, grain and cattle and so on.
All it would take is one line on your income tax form that, yes, you are contributing so much money to the such and such organization. I think that would be more efficient; it would not bother the business people and it would be less paperwork. At least as far as I know, we are still going to fill out those income tax forms, so it would not be as though we were adopting anything new. I think that would be much more acceptable to the general public and the businesses and farmers themselves.
Ms. Wowchuk: Perhaps that might be something to consider, considering the fact that there are many times when farmers' incomes drop very low and these additional burdens of or checkoffs to organizations could cause them a burden, and that may be something to consider. Thank you.
Mr. Riley: It should be based on their ability to pay. That way it does not hurt if you are giving away money to something you believe in, that you have in excess of your needs.
Mr. Chairperson: Thank you very much, Mr. Riley, for your kind presentation.
Mr. Riley: Thank you.
Mr. Chairperson: By the way, Mr. Riley, before you leave, I saw on your presentation that this presentation was both to Bills 15 and 27.
Mr. Riley: Yes, that is right.
Mr. Chairperson: Thank you, then we will take your name off the other list.
Mr. Riley: Yes, that is fine with me, unless you would like to hear it twice.
Mr. Chairperson: Thank you very much.
We call next then Mr. Doug Gamey. Mr. Doug Gamey?
Mr. Riley: Yes, I should have told you when I was here that Doug Gamey had a death in his family and was unable to come. I was hoping to get his written brief to bring, to present to you, but I could not make contact with him. So maybe he could mail one in, could he?
Mr. Chairperson: Thank you, we would accept that, and please extend our condolences to Mr. Gamey.
Mr. Riley: Thank you.
Mr. Chairperson: We call then next Mr. Keith Proven. Mr. Proven?
I should tell the committee members, I really feel like calling most of these gentlemen by their first names, having known them so well in my past life.
You have a written presentation which is being distributed. I ask you then to proceed, Mr. Proven.
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Mr. Keith Proven (Private Citizen): Mr. Chairperson, members of the legislative committee, first let me say that I am a cattle producer. I have 140 cows. Also, I am a distance education instructor for Assiniboine Community College doing strictly beef programs. I used to come to these legislative committee meetings as a representative of National Farmers Union but at this point I am representing my cows, and certainly, I hope, a viewpoint of a number of farmers also.
This is, as Yogi Berra once said, déjà vu all over again--but in a strange perverted way. More than 20 years ago as a young owner of cattle and a farm organization member, I worked towards the formation of a beef marketing board in Manitoba. I felt there was a strong need that producers learn to market co-operatively and not in competition to each other.
At that time this proposal was denounced by both the Conservative opposition and some cattle producers, called the freedom fighters, led by the redoubtable Charlie Mayer. I am sure that Mr. Enns was also working against this proposal. [interjection] I am sorry, Mr. Downey, I know you were also there. Anybody else from the Conservative caucus that would feel slighted if I did not mention them? Glen is too young and Frank was a civil servant then.
I recount this story only because it will lead into where we are now. I have always supported checkoffs if they support a structure that increases the producer's power in the marketplace. I note with interest, and for those of you who have forgotten, that in the original cattle producers check-off legislation, it directly forbids the organization to become involved in marketing.
I thought at the time this was a shortsighted philosophically driven view; at this time I know it was just stupid. There are many things that we need as a cattle producer: salt, straw, hay, facilities, et cetera. I also need a strong marketing system that I control that works for the betterment of all cattle producers.
The original legislation, as you have said, Mr. Enns, is too loose, not because farmers can say no, but because it does not provide them with economic punch. This punch could certainly come from a collective, co-operative marketing approach.
The Manitoba Cattle Producers Association has fallen down in its leadership many times. This failure was not due to the lack of money--they collect over $350,000 a year--but due to the poor enabling legislation and a lack of farsighted leadership.
However, in the last couple of years, due to the leadership of James Bezan--and this is probably the kiss of death to James, I am saying it--I can see a change coming. I am not sure if it is legal or not.
The MCPA is supporting a closed co-op approach for a slaughtering plant that would serve Montana, North Dakota, South Dakota, Manitoba and Saskatchewan.
Now, when I was--and I might add that I am a member of the Manitoba Cattle Producers Association. I did not opt out. I can remember many times over many years, one of the first questions that the opposition would say, are you a member? Well, no I am not a member. I do not believe in it. I do not believe in the philosophy.
So I decided to take the opposite tack. If you ask me if I am a member, then I can say yes, and I can work within the organization to try and change it. So therefore you cannot be completely negative about the presentation or the approach that I might take.
Now the surprise that I had at the cattle producers meeting was the closed co-op approach to marketing. In recognition of what they have said, I was shocked. I was shocked indeed. It could have been my speech 15 years ago. It probably was. James is too young to remember but maybe he picked it up through the stars. Talking about a marketing system that gave farmers some control, and the reason that, as James outlined quite correctly, producers want to be able to form a slaughtering association, a plant and then do their own retailing was because of the corporate concentration in the United States of the three major packer producers, IBP, ConAgra, Excel. The need is there, but it is 15 years too late.
The reason that the kinds of things that are happening in the marketplace have happened is because somebody was too shortsighted to say we should have done it a long time ago. Now, I am not sure whether this can be done again, whether the cattle producers can, in their closed co-op, counter the strength of the corporations that do control the slaughtering facilities through vertical integration right to the retail in the States and certainly we have the same problem in Canada. That is why my criticism of the MCPA is so strong: that we have not as an organization, they have not as leaders moved in the direction of making it an effective marketing organization.
When I said, I wonder if this is illegal, I noted before that in the first legislation about the Manitoba Cattle Producers Association, the legislation said they must stay out of marketing. And, uh oh, all of a sudden they are talking about marketing, encouraging members to become part of this co-operative. You know, maybe there is going to be a court challenge to the MCPA in espousing co-operation and a battle against large corporate entities. This would be a shock, but it might be good for cattle producers.
I think up until this point our money has been wasted. In fact, it has been used against us. I am referring to the removal of the Crow rate. MCPA supported the removal of the Crow rate based on the idea that barley prices would go down. If we have no export market for barley, then they are hoping that the closed market within Canada, prices would go lower. We have seen in this last year our markets just go crazy due to weather, due to circumstances that are beyond the control of anyone. That does not make it right, to try and knock the protection and the necessary protection that one industry had, to try and better your own. You cannot make a better farm organization or a better cattle industry by trying to decrease the price of barley for yourself. The better way to look at it is to increase the product that you are selling, the final product.
What we need is a Canadian Wheat Board clone that works on the producers' behalf. To accomplish this, you need to rescind the old legislation and replace it with a new bill that does not just check off but provides economic leadership.
In ending, and this is in addition just because I was hoping that the committee, with some wisdom and looking at the number of rural members here, would recognize that it is important to go out to the rural community to hear what those farmers who do not have the same kind of means or the knowledge or the lack of fear of you learned gentlemen to come and present to you in this huge room.
The cattle producers have recognized as an organization that it is better to get the hell out of Winnipeg if you want a meeting, so they have gone to the rural areas. I am kind of disappointed that you were too frightened to go out and do the same. Thank you.
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Mr. Chairperson: Thank you very much, Mr. Proven. Are there any questions of Mr. Proven?
Ms. Wowchuk: I too would like to thank you for coming to make this presentation this evening and sharing some of your views with us. I want to ask you, you indicate that you are a member of Manitoba Cattle Producers. If there was no checkoff, do you feel strongly enough about being involved in the organization that you would be a member without the compulsory checkoff?
Mr. Proven: At this time in my career and the worry I have about the cattle industry, I would probably be a member voluntarily based on the need to restructure the industry. The last three or four years have been pretty good in the cattle industry. There is a recognition of that. So it is fairly easy to not say anything about marketing.
We are moving into an era, as James Bezan said, about cow numbers increasing to where the competition is going to be very, very difficult to fight. Those large packing companies, the vertically integrated packing companies, are going to have a field day. You have got more supply than can be easily gotten rid of, and the price goes down.
But also, when you have corporate concentration in three companies that slaughter and market 75 to 80 percent of the red meat in one country then you have an ability to hold the market and blackmail the market.
Now, the original question about--I do not usually like to fudge around politicians but I guess if you are around them long enough you learn how to do it. Voluntary checkoff would be my idea of being democratic and the best way to run the organization, that you would offer a philosophical approach, you would offer a practical approach, and you would say: This is what we are going to do for you for your money, this is what we are going to do. You can be checked off, but this is why you are going to be checked off. I am going to do this for you, and we as a collective are going to do this together.
It would be much, much easier to belong to an organization that did that than an organization that asked the government to legislate their checkoff for them.
Ms. Wowchuk: I have to say that I agree with you, and I have to agree with the comments that you made about holding hearings in rural Manitoba. I am very disappointed that this committee has decided that they will not go out and hear the views of the many people who do not have the ability to come to this committee.
I have a letter from a resident of my constituency who says that although this legislation is going to provide funds for an organization to operate, it provides that, but the legislation does not in any way offer any guidelines or restrictions on how this organization should be accountable to its members. Do you feel that there should be any more strength in an organization or restrictions on an organization that has legislation to allow it to collect fees to be accountable to the people who they are collecting fees from?
Mr. Proven: The inherent problem with legislating a checkoff so that it does in fact become compulsory is that farmers will not participate in the democratic process. The major failing within the MCPA and looking at what used to be the district meetings in the district that would represent me would be three or four people attending a district meeting. Now there are maybe 20-25 attending a district meeting out of--I am not sure how many producers within my district--but that is an extremely small percentage within the district, District 8.
If you look at other district meetings--and I have heard the turnout is extremely low as far as participating within the organization. If you look at the annual meeting and the positive thing of shifting it into the rural areas, you still have an extremely small percentage of the farmers. Every farmer is eligible to go to the annual meeting; there is no delegate structure. So, if you have the potential of 12,000 farmers and you get 250 attending the annual meeting and making and passing resolutions on that basis, then representation by population flies out the window.
Where is the fault in that? The fault is that really do you know? Can you honestly say you know what the average cattle producer is thinking or wanting to say about legislation that is being enacted about things that are happening, countervails, oceanic beef, animal welfare, animal rightists? Do you really know? That is the real problem. When you legislate a checkoff, it is not exactly a licence to print money, but it comes damn close, and you make sure, unfortunately, that farmers do not participate. You have to have the guts to go out and ask them.
Ms. Wowchuk: I believe that if an organization is doing a good job, they should be able to go out there. They have regional representation, and there should be a much greater effort made to reach the members. I also feel that if an organization is going to have a checkoff, they should give all producers the opportunity to have a say in it. I have asked the cattle producers why they do not send a ballot out to every producer to ensure that they understand what this organization is doing for them and then ask for their support on the ballot.
I would have no problem if the majority of the 12,000 producers--in fact, it is 12,000 that are members--there are some 17,000 cattle producers. Would you be in favour of the cattle producers taking that kind of action to ensure that all producers had the opportunity to know what their activities were and how they were representing them and giving them a vote as to whether or not they wanted to be members of this organization?
Mr. Proven: Yes, I think that is the only fair way. Contrary to what Minister Enns said, I cannot remember the Conservatives running this issue as part of the plank, as part of the platform. I cannot remember voting for or against. I did not see it in the plank in our area.
Ms. Wowchuk: I did not see it in our area and I only heard it discussed once at a farm debate, but those are my feelings, and I thank you for your presentation.
Mr. Chairperson: Any further questions to Mr. Proven? If not, thank you very much for your kind presentation, Mr. Proven.
Next, I call Mr. Terry Drul, Manitoba Independent Agricultural Producers. Mr. Drul, have you a written presentation?
Mr. Terry Drul (Manitoba Independent Agricultural Producers): I do have.
Mr. Chairperson: I will ask the Clerk's Office to distribute. Would you proceed, Mr. Drul.
Mr. Drul: My comments are directed at both Bills 15 and 27.
Mr. Chairperson: Okay, thank you.
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Mr. Drul: Mr. Chairman, honourable members, I believe the amendments to The Agricultural Producers' Organization Funding Act and The Cattle Producers Association Act are totally undemocratic and a complete and total insult to Manitoba farmers. The proposed legislation is being promoted as strictly housekeeping in an effort to simplify collection of a checkoff, but in reality it strips Manitoba farmers of their rights to fund an organization of their choice. This is totally undemocratic and a blow to our basic right of freedom of association and is legislation that could be expected in communist regimes, certainly not in Manitoba.
Manitoba farmers must have the freedom to choose to fund an organization of their choice, not an organization that is being forced on them by government legislation. It is not a question of having the right to get your money back. It must be a right to choose whom you will fund up front. There is no reason for the government to be in the business of certifying organizations to represent farmers when that basic right should be in the hands of the producers and their own personal decision of who does or does not represent them or whom they will fund.
The question I have for you and this committee is, do you believe in democracy, yes or no? If your answer is yes, then these bills must be defeated and the right to choose returned to Manitoba farmers. These two proposed bills are an assault on the rights of Manitoba farmers and should not be tolerated by anyone.
If checkoff legislation is to remain in place, farmers must have an up-front choice of whom they fund and support or the choice to fund no one at all. Producers who do not support any organization could have monies go into a fund that would promote agriculture and the importance of agriculture in our province. Farmers would have a list of several general farm organizations where the money could go to, and it could be our choice, not yours.
I believe that farmers would support several organizations of their choice if given half the chance and would not feel herded by the government into legislation supporting a mouthpiece for the elite farmers. A government-sanctioned organization check-off legislation could be a powerful tool to help farmers organize because funding an organization is one of the impediments to getting an organization going.
So please stop and think. If legislation in this province forced you to fund only one political party or only one labour union, the public would not stand for it, but yet for farmers you have no qualms of forcing them to fund one organization and taking away our basic rights to choose who represents us. This is not just amendments to simplify collection; this is a question of rights and freedoms.
Mr. Chairperson: Thank you very much for your presentation, Mr. Drul. Are there any questions of Mr. Drul?
Ms. Wowchuk: I would just like to thank Mr. Drul for his comments. I want to say that I do believe that farmers should have a choice in which organization they want to belong to. I, quite frankly, like your suggestion that if farmers do not want to belong to an organization, perhaps their funding could go to something to do with agriculture research.
Other organizations have an option if they do not want to belong to the organization. Their funds can go to a charitable organization of their choice.
I would like to thank you for making your presentation.
Mr. Conrad Santos (Broadway): Mr. Chairperson, I would like to ask--I am interested in the organizational aspect of this problem and the issue. I have to preface my statement by saying that we are born free as human beings, and that is part of our integrity. The right of choice is essential for our integrity. Do you believe the same way?
Mr. Drul: Absolutely.
Mr. Santos: That the less your right to choose is invaded upon by some outside forces, the less you are a human being. Is that correct, Mr. Chairperson?
Mr. Drul: That is correct.
Mr. Santos: How then shall we reconcile the beginning of the first statement of Jean Jacques Rousseau in his work Du contrat social when he said, men are born free but everywhere he is in chains?
Mr. Drul: Well, I think that when you see legislation like we are looking at here tonight I think you can see the chains. That is absolutely that I feel that my freedoms are certainly being taken away. I think we are seeing this every day in more intrusion by government legislation which is taking away our freedoms.
Mr. Santos: But individuals, because they are individuals, are weak as individuals. But when they form themselves into a collectivity they become strong because the power is collected and integrated by the collectivity. In the process of doing so, each individual, he still has the choice to surrender some of his liberties to the collectivity. And still the choice is there if it is voluntarily agreed upon by the individuals. When the collectivities form with a greater power, what direction would the collectivity move?
Our democratic doctrines say it must move at the direction where the majority so chooses. But the trouble with real human organization is that it is often controlled by the few who are in command. They are always there at the top trying to direct the direction of the masses. These few will succeed themselves or choose people who are like themselves so that they can maintain control. That is called the iron law of oligarchy. Did you agree, or are you agreeable to this kind of thinking, Mr. Presenter?
Mr. Drul: Well, it is a little bit over my head. I do not know if I can debate philosophy with you or not. I am not knowledgeable enough.
Mr. Santos: Every one of us--
Mr. Chairperson: Mr. Santos, might I remind you that we want to acquire information from the presenters, so would you direct your questions in such a manner that we can understand them and that they are clearly addressed to the presenter?
Mr. Santos: I am trying to reconcile the collective need as against the individual needs. The promotion of the general interests of all the members can only happen when there is a strong collective collectivity. But the direction the collectivity will go should be dictated not by the few but by the majority of the membership inside the collectivity. Is that correct?
Mr. Drul: I could accept that.
Mr. Santos: But for purpose of convenience and for purpose of expediency and for purpose of efficiency, we sometimes have to resort to the use of compulsory methods. For example, we are compelled by law to pay our taxes. We are not given any choice. We are compelled by law to drive on the right side of the street, at least in this jurisdiction, unless you are in England or some other country where you drive on the left.
What I am saying is that whatever the rule is, whether it is on the left or the right, the democratic doctrine says it should be decided by the collectivity, the majority of the collectivity, not by the few. Is that correct?
Mr. Drul: When you refer to this particular legislation, it is really oppression by government is what it is, and it is really the dictation of the minority which has to drive the majority. We are getting this all backwards in this particular legislation.
Mr. Santos: Are you saying, sir, that it is the minority controlling this organization that is invoking now the power of the state to help them achieve the purposes which they themselves conceive for the rest of the membership?
Mr. Drul: That is right.
Mr. Santos: Thank you. That is all.
Mr. Chairperson: Thank you very much, Mr. Santos. Thank you very much for your kind presentation, Mr. Drul.
Mr. Enns: Mr. Drul, just a few questions to be absolutely sure that you understand the legislation that is before us. Neither Bills 15 nor 27 forces any farmer, any producer to be a member of any organization. Is that your understanding of the legislation?
Mr. Drul: It forces me to fund an organization.
Mr. Enns: Mr. Chairman, I am genuinely trying to seek information. That was the question that I asked. Neither of these bills force any farmer, any producer in Manitoba to be a member of any farm organization.
Mr. Drul: Well, it forces me to pay a membership into an organization. I can then get my money back--
Mr. Enns: And not be a member.
Mr. Drul: --and not be member, but I still am forced to fund that organization up front, which is against most democratic principles. It should be my choice up front whether I want to fund that organization or not.
Mr. Enns: Thank you, Mr. Drul. The only other question that I have is that while Bill 27 is specific to the cattle producers of Manitoba, it is your understanding that under Bill 15 it does not give, it does not authorize any farm organization to be the recipient of any checkoff.
That in fact under the farm organizations act as it now stands is determined by a committee headed by Dean Elliot from the Faculty of Agriculture, University of Manitoba, and I believe several other people, who determine whether or not an organization is indeed representative of the growers that they purport to represent before they in fact can access any of the checkoff. Is that also your understanding of the farm organizations.
Mr. Drul: I understand the legislation and I understand how it works, but it is still not democratic. It does not matter whether it is a committee that is arm's length from government that chooses to certify a particular organization. That should be up to the producers of this province. The producers of this province should have a choice of several farm organizations that they can belong to and can have their monies go to any of those organizations, and it should be their choice.
Mr. Enns: Thank you, Mr. Drul.
Mr. Chairperson: Are there any other questions of Mr. Drul? If not, thank you very kindly, Mr. Drul.
I call next then Mr. Fred Tait, Regional Co-ordinator, National Farmers Union. Mr. Tait, would you come forward, please. Welcome, Mr. Tait. Have you a written presentation to distribute?
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Mr. Fred Tait (Regional Co-ordinator, National Farmers Union): No, I have not, Mr. Chairman. In recognition that it is going to be a late evening, I will just base my comments on some of the information that has been before the meeting so far this evening.
The first comment that I would like to make to members of the committee is that I too am disappointed with this one meeting and this location. I have been within the realm of farm politics for long enough to know that if you want to limit input you hold your meetings in Winnipeg in the evening. There are several people who I have spoken to over the past two weeks who would have preferred to be here tonight but, when you are looking at 300- and 400-mile drive, they are not going to be here. There is an obvious reason for that.
In regard to some of the information that was put forward by Mr. Bezan, talking about the 18 percent of the producers who have opted out of the organization, they left the impression, I am pretty sure, with the committee that these producers have opted out at some past point and they need to be invited back. This is not an accurate description of the process. To opt out of the Manitoba Cattle Producers checkoff, you must do so at every point of sale. You have a personal identification number that must be put onto the bill of lading and that goes to the packer or the agent, the broker that is handling your cattle. It is at that point that your checkoff is not submitted to the organization so, in that case, Mr. Bezan's information was not totally correct that he gave to this meeting tonight.
In looking at this bill in a similar intent to the Keystone Agricultural's funding bill, it is comparable, in my mind, to the Rogers Communications fiasco in 1995. On that occasion, Rogers Communications expanded the level of cable television communication that entered into their subscribers' homes. If those subscribers did not want this service, they had to notify Rogers to delete it, otherwise they would be billed for it. During the public uproar over that issue, the Minister of Consumer Affairs (Mr. Ernst) in Manitoba was quoted in the Winnipeg Free Press as saying that he was so concerned about this issue that he would even consider introducing legislation to prohibit the practice of negative option marketing. The connection here is obvious.
We are also being told, a little note I made during the Cattle Producers presentation, that they have a strong history of championing the cause of a market driven agricultural society. Mr. Proven mentioned a championing of abandonment of the Crow rate as a vehicle to create lower grain prices to stimulate the cattle industry.
I am reminded of a speech that John Hansen of the Nebraska Farmers Union made last year in Edmonton. He said, if the solution to your problem is creating a problem for your neighbour, you have not found a solution. I think that is worth remembering.
Also, when we talk in today's term, we talk about, in the terms of efficiencies, reducing a bureaucracy and cost-efficiencies. It is hard for me in my mind to see how compelling me or any other farmer to commit a checkoff to the Manitoba Cattle Producers, having then to apply for a refund, having the paperwork trail go back and forth contributes to efficiency, how it reduces bureaucracy or how it becomes cost efficient. I would say that if those who so much favour a market driven economy, I find it contradictory that they do not also endorse market driven farm organizations.
My final observation here tonight too would be, some years ago I believe the Honourable Bill Uruski was Minister of Agriculture in this province. He amended the then compulsory checkoff of the Manitoba Cattle Producers in the 1980s. I do not remember the exact year. The result of that was the funding of the organization went virtually to zero. It is not possible to maintain, as Mr. Bezan did, that this organization has massive support amongst producers, because given the opportunity not to fund the organization, over 95 percent of them did not.
Any other questions--as I say, so much of this is going to be repetitive into the Keystone agricultural bill and I will save most of my comments for it.
Mr. Chairperson: Thank you very much, Mr. Tait. Are there any questions of Mr. Tait?
Ms. Wowchuk: Mr. Tait, I would really like some clarification on the point you made about opting out at point of sale. My impression from the first presentation was that in fact once you opted out you were not back in the organization. Are you saying then the cattle producers do not lose their number when they choose to opt out but they must continue year after year, or every time they sell cattle they have to opt out and if they do not they are back in as members again. They do not need a special invitation to be invited back in, they are there.
Mr. Tait: That is right. The next cattle I ship out of my yard, if I do not put my personal exemption number on the bill of lading, I have made a contribution to the Manitoba Cattle Producers Association. We have in the past made some contributions but in the majority of cases we have not done.
Ms. Wowchuk: I have no further questions, but I just want to thank Mr. Tait for making us aware of that particular point. It is probably something that I should have known, but my impression was from the earlier presentation that there was a need to open the door again once a farmer chose to opt out.
I am pleased that has been clarified, and I want to say that I believe farmers should have a choice in whether or not they want to fund an organization. If an organization is doing a good job for them, they will put their money forward, and your comments about the drop in funding when the automatic checkoff was changed is very true. It is true that the funding for the organization dropped to a very low amount, and that is clear indication that farmers are belonging to the organization because they are being forced to belong to it, not because they are doing it by their own choice.
Mr. Chairperson: Thank you very much, Mr. Tait, unless there are any other questions from the committee.
Mr. Radcliffe: Mr. Tait, were you planning on making another submission on the next bill--
Mr. Chairperson: Mr. Radcliffe, would you please drop a mike so we can--
Mr. Radcliffe: I was just checking with Mr. Tait, that he is planning on making another submission on the second bill.
Mr. Tait: Yes.
Mr. Radcliffe: Thank you, sir, very much.
Mr. Chairperson: That is what I understood. Thank you, Mr. Tait. We look forward to your next presentation.
This concludes the list of presenters that I had for Bill 27. Unless there are any further presentations that have come in after--seeing none, we will continue on to Bill 15.
The first name I have on that list of presenters is Mr. Leslie Jacobson, president, Keystone Ag Producers Inc. Have you a printed copy of your presentation?
Bill 15--The Agricultural Producers' Organization Funding Amendment Act
Mr. Leslie Jacobson (President, Keystone Agricultural Producers): Yes, we do, Mr. Chairman.
Mr. Chairperson: I will ask the Clerk to distribute. Please continue.
Mr. Jacobson: Thank you, Mr. Chairman, and members of the committee.
Keystone Agricultural Producers, Manitoba's major farm policy organization, is pleased to appear before you to express our support for the adoption of Bill 15, The Agricultural Producers' Organization Funding Amendment Act.
Keystone Agricultural Producers, better known to Manitobans as KAP, was launched on June 15, 1984, as the result of a clear indication by agricultural producers in Manitoba during a series of rural meetings held by an ad hoc committee on farm organizations. It was that they desired an effective organization to represent general agriculture policy interests with governments and with other agencies. It was envisioned and desired by those farsighted producers who were the founders of KAP that all agricultural producers in Manitoba would have the opportunity to participate in its decision-making processes and to contribute to the funding required to carry out its representatives' activities.
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It was agreed at the inception stage that a single flat membership fee would be employed to facilitate initial membership solicitation activities, although the newly formed executive was also charged with working towards a development of a variable fee system which would recognize the differing size and profitability of individual farmers. After a number of years of operation, it became evident that, despite the best efforts of the elected officials and staff personnel, not all producers in Manitoba were being reached and offered the opportunity to join and participate in this new organization. To this end, legislated means of a membership collection fee for a province-wide general farm policy organization was sought.
As most of you will be well aware, Chapter A18, The Agricultural Producers' Organization Funding Act, was asserted to by the Legislative Assembly on December 20, 1988. This legislation was introduced by the government of the day at the request of the agricultural producers, with the intention of assisting them to provide themselves with the means to operate an effective, unified vehicle to represent them on matters of policy representing their livelihoods. You may also be well aware that KAP was first designated as a certified organization under The Agricultural Producers' Organization Funding Act in March of 1989 and it was done so for two years. This designation has been renewed every two years since, with KAP's current status as a certified organization extending until December 31, 1996.
The Agricultural Producers' Organization Funding Act was viewed by both the members of the Assembly and officials of KAP as being a vehicle intended to assist the farming community in Manitoba in providing itself with an effective representation on matters of policy affecting the livelihood and lifestyles of the farm families. The membership fee collection system prescribed by the act was not intended to be a compulsory checkoff as claimed by some but rather a means of making all agricultural producers aware of the certified organization, its goals and its objectives and its activities and to provide them with an efficient means of contributing to the success and work of the organization. Those not wishing to work with the fellow producers were provided with an opportunity for an opt-out.
The newly created legislation established a system whereby purchasers of agricultural commodities are obliged to provide information regarding who their customers are to the general farm policy organization which is certified as provided under this legislation. It is the responsibility of the certified organization to eliminate, to the best of its ability, any duplications of producer records and assign the farm units thus identified to various purchasers for the potential collection of membership fees from which proceeds of agricultural marketings are made.
At the same time as any producer is assigned for potential membership collection, the certified organization is required to inform that producer that such an assignment has been made and also to invite the producer to become a member of the certified organization by allowing the membership collection to take place as proposed, or, alternatively, by paying a membership fee by cheque or through the collection of an alternate purchaser to be specified by that producer.
Each producer unit contacted is also informed that they may opt out and not support the efforts of the certified organization. By so indicating in writing to the certified organization, those opting out then have their names removed from any collection list for a period of the next two years.
The legislation also provides that, following receipt of a listing of assigned membership collections, purchasers are obliged to collect the prescribed membership fee of the certified organization from the first sale proceedings of any production unit continuing to be listed as not having opted out from the certified organization.
This system was devised by the government of the day to provide virtually all producers in Manitoba with the opportunity to participate in the organization designed to represent their interests and to do so by paying membership fees through the means deemed to be the most efficient and least disruptive to the organizations and the operations of the farm community.
Membership fees were first collected under the system provided by the funding act for KAP's membership year, December 1, 1990, to November 30, 1991. As the certified organization, KAP believed it prudent to make the collection system operational one commodity grouping at a time. Because the grain industry appeared to be the largest economic grouping and also having a well-defined purchaser structure, it was chosen as the first industry to be brought on-line. Other commodities, such as hogs, milk and sugar beets, followed shortly.
The membership collection system provided by the act has worked with varying degrees of effectiveness. With agricultural purchasers at which membership fees have been collected at a central source--examples of this are the Manitoba Sugar Co., Manitoba Milk Producers, Manitoba Pork--the process has worked relatively smoothly and effectively.
In the case of the grain industry, however, where individual production units were assigned for collection to be specific to elevator points, the collection system proved to be less than effective. For a variety of reasons and despite excellent co-operation from senior management of most grain purchasing companies, the rate of membership collections at the elevator points continued to be disappointing, this despite being required by law as established under The Agricultural Producers' Organization Funding Act.
A tremendous amount of discussion and effort has gone into attempts to find a more effective, efficient and acceptable method of fee collection, not only for the general farm policy organization but also for other bodies representing various farm-produced commodities. Several years ago, almost all of the farm-related organizations in Manitoba agreed to appeal to the Minister of Agriculture to amend The Agricultural Producers' Organization Funding Act to provide for, and I quote, a universal but refundable levy provision on farm commodity sales to adequately fund the activities of farm representative bodies.
In discussion with representatives of the grain companies regarding ways of making the membership fee collection system act more efficiently, there were many instances in which the grain company officials pointed out that their companies were making automatic percentage deductions from grain purchases for various other organizations in other provinces with little or no controversy.
Grain company officials indicated on countless occasions that automatic deductions made on all grain purchases as a simple computer transaction would be more cost-effective and less disruptive to the administrative operations. It was believed that an automatic collection process would also accomplish the goal of making membership fee collections for a certified organization more efficient, thereby strengthening the effectiveness of the representative efforts.
As the organization currently certified under the act, KAP, with the encouragement from grain purchasers, has sought the amendments in Bill 15. KAP will be recommending to the certifying agency that the provisions in Bill 15 be applied at an early date to purchasers in the grain industry. Bill 15 simply represents an administrative amendment intended to enhance the ability of The Agricultural Producers' Organization Funding Act to more effectively serve the farming community as originally intended.
Officials of KAP, as the current certified organization under the act, continue to believe that agricultural producers in Manitoba require and deserve an effective vehicle, employing strength through unity, to ensure their voice is heard strongly on matters of policy which affect them.
Further to this, KAP officials believe the province benefits from the support of a strong, general farm policy organization in ensuring that dealings with other provinces and countries result in the policies which are beneficial to all Manitobans.
KAP views Bill 15 as an important step to establishing a fair membership fee collection system for producers in Manitoba, while strengthening the ability of the general farm policy organization to represent its constituency, which is the farm families in Manitoba, more effectively.
We would urge the members of the Assembly to support this amendment with a view to enhancing the ability of agricultural producers to participate more effectively in the process of developing sound agriculture policy for all Manitobans. Thank you, Mr. Chairperson.
Mr. Chairperson: Thank you, Mr. Jacobson, for your kind presentation.
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Mr. Enns: Mr. Jacobson, just one or two questions. You referred several times in your brief to the certifying agency which, I know you are aware of, is called for in the act; in fact, its membership is called for in the act. The government only has the choice of one person on that agency. It is chaired, for the benefit of members of the committee, by the Dean of Agriculture for the University of Manitoba.
Is it not a fact, Mr. Jacobson, that your organization has to appear before this certifying agency every two years to be recertified?
Mr. Jacobson: That is correct, Mr. Chairman.
Mr. Enns: The provisions of the act provide that if next year, when you have to appear before the committee, if an organization such as the Manitoba Independent Agricultural Producers organization or for that matter if the National Farmers Union were to organize themselves on a provincial basis, they quite conceivably certainly have the right to appear before that certifying agency and seek certification. Should that certification agency find them to be a more appropriate representative of the general farm community in Manitoba, then I would assume that they would be certified. Is that not possible under the act as it now stands?
Mr. Jacobson: If those conditions would be met, Mr. Minister, that in fact would be the case.
Mr. Enns: Thank you, Mr. Jacobson.
Ms. Wowchuk: Just following up a bit on that, you appear before the committee every two years? This legislation only allows for one committee to be certified at a time. Seeing that there are varying views amongst farmers and there are a possibility of other organizations, would you have any objection to more than one organization being certified under this legislation--not under this legislation, because it cannot happen under this legislation--but would you have any objection to having more than one organization being certified?
Mr. Jacobson: Under this current legislation it cannot happen so I think the honourable member that you are asking a hypothetical question. I guess further to that is that funding of an organization is the individual's choice and in this legislation it in fact gives them the choice.
Ms. Wowchuk: I realize that under this legislation there can only be one organization certified. What I was asking you is, what would your views be if the legislation were changed to allow for more than one organization to be certified?
Mr. Jacobson: I think what we are talking about is, again, a hypothetical situation where it is not under an act where we can have two organizations being certified and, in fact, the requirement of being certified is that you have to have the qualifications under the certification agency to be qualified in order to be on the list to be certified.
Ms. Wowchuk: I do not want to belabour the point but what I am asking is, we have heard people saying that they would like to have a choice of which organization they would belong to. What I am asking is, would you see it as a possibility in this province to have more than one organization certified so that farmers can have a choice in which organization would represent them?
Mr. Jacobson: I thank you for the question. I think what you are really asking me is what is my position on the opt-out proposal and the individual's right to belong to an organization. I think that that right is inherent in the act that we have in front of us.
Ms. Wowchuk: No, that was not what I was asking. What I was asking is whether you see it as a possibility for there to be more than one organization that farmers would have a choice of belonging to and having their funds going to different organizations. That is what I am asking. Do you see this as one way to address the concerns that we see farmers having, saying that they do not want to be forced into belonging to one organization? Do you see it as a possible solution that there be more than one organization that is certified and having the ability to collect funds from farmers?
Mr. Jacobson: Directly, I guess the answer is that unless the act is going to be changed so that more than one organization could be funded, as some other provinces have done, we do not have that ability currently. I think that what is really important is that the farm community has a unified, strong voice that represents the community that is out there in order that we have effective farm policy coming forward for the government and for the opposition parties for the betterment of the farm families in rural Manitoba.
Ms. Wowchuk: Just on that, because there are different interests and we have heard about them this evening where, for example, cattle producers want high cattle prices, we have some farm organizations lobbying to see the Crow benefit taken away, grain producers wanting to have the Crow benefit stay, do you believe that one organization can speak with a strong voice and address all of those concerns? Can an organization speak to lobby to have members who lobby to have the grain prices lower so that the cattle industry will do better or the hog industry and represent the other group of farmers who want to have the supports for the grain industry there? Can an organization speak on behalf of all those organizations and be a strong organization, or does it just end up being a watered down organization that cannot take a strong position on those kinds of issues that differ in various parts of the farming community because you represent all groups in the farming industry?
Mr. Jacobson: I think the short answer to you is that Keystone Agricultural has been exactly the group that you are talking about.
We have 17 commodity groups in our organization. We have been an effective farm policy organization for well over 10 years right now. We have the umbrella situation with 17 commodity groups, and some are in the room tonight, where the effectiveness of the farm policy is an accumulation of all interests out in the rural economy to create effective policies for our rural economy.
A good example this year was the fact that Keystone Agricultural Producers, along with other groups in Manitoba, had good, long-term policy on transportation. It was developed on a consensus basis with all parties in Manitoba. Another issue is the safety net issue where we have had very strong policy towards a strong national safety net.
Keystone Agricultural Producers is also the spokesperson under the Canadian Federation of Agriculture where we get national representation. So not only are we looking at inside our borders, but we have effective, good communication on a national basis.
So I think your answer is that, yes, there is definitely the ability to have a strong organization. The trick is to make sure that the communication between the commodities and ourselves is as close as it can be so that when one commodity is looking for something, then we can be supportive of that industry.
There is a host of issues that Keystone Agricultural Producers is working on that our commodity groups tend to leave to Keystone but are still rural interests and need to be addressed, and that is the reason for requiring a strong organization to be able to speak for all producers.
Mr. Stan Struthers (Dauphin): Now, let me see if I have this right. KAP is a certified organization until the end of 1996. At that time, it has to approach a committee of some sort in order to continue to be the certified organization.
What are the criteria that committee would consider when looking at which of the many farm groups should receive this official certification?
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Mr. Jacobson: Mr. Chairman, that is a detail analysis of the certification agency. I will see if we have brought that type of information forward. But, in fact, there are a number of criteria in order that you qualify to be the qualified organization for them to make the decision of who is the certified organization.
That is the short answer, Mr. Chairman. If you require more detail, I am going to have to get some material to bring forward.
Mr. Struthers: Would numbers play into this? If KAP approached the committee and said, we have X number of numbers, and if the National Farmers Union approached and said, we have this number of numbers, and if the Manitoba Independent Agricultural Producers approached the committee and they had fewer numbers yet, would the committee look at the numbers and say, well, this certain group has the most members and that is going to be the official, the certified organization.
Mr. Jacobson: Mr. Chairman, could I have our information officer answer this question?
Mr. Mac McCorquodale (Admininstrative Secretary, Keystone Agricultural Producers): Mr. Chairman, the gentleman is quite right. In Section 22(1) of the act, I will just take section (b) of 22(1) that says "if 90 days after this Act comes into force, the agency has received more than one application under section 16(1), the agency shall, within 120 days after this Act comes into force, certify the qualified organization that in the opinion of the agency represents the greatest number of producers in Manitoba as the certified organization."
Mr. Struthers: So what you are asking us is to put in place legislation that will bump your numbers up ahead of other groups so that at the end of 1996 you come back to the official certification organization and say, we need to be certified again for two more years to take us to 1998, based on the numbers that have been set up by this government putting you in a favourable position? Am I off base on this or have I got this figured out?
Mr. Jacobson: Mr. Chairman, this is totally an incorrect statement. Keystone Agricultural Producers is the certified organization today, but this is an act that is operated under by the certification agency. You just heard the criteria to be qualified in order to become the certified agency.
Mr. Struthers: And one of those criteria was the numbers. If you have the most numbers, that is a criterion that says you should be the certified organization. Was that not what the fellow who is accompanying you explained to everybody?
Mr. Jacobson: That is right.
Mr. Struthers: In that case--well, maybe I am making an assumption here that maybe I should not be. Are you assuming that by coming up with this legislation, the numbers of the Keystone Agricultural Producers will increase or do you think they will decrease?
Mr. Jacobson: I think what it is going to do is give the opportunity for the producers that are out in Manitoba to in fact be collected by the system. We have also in your brief given you out some of the numbers that are Manitoba farms by category.
I will just give you some other details on our collection system. There are 2,080 direct memberships collected by Keystone Agricultural Producers. By a prepayment authorization there are 161. Under the milk system, we have 591. Under sugar, we have 189 plus seven. That is because there was a number that had to be added because other people wanted to belong to the organization, which is, in fact, true this year for milk, that originally there were only 551. There were 40 others that wanted to belong to the organization so they were added on in 1995. In pork, 569 members were sent out plus another 89 for a total of 3,686, for a total potential membership where there were opt-outs of only 84.
In the grain industry we have a total number of producers that went on the collection system of 4,652 with 222 opt-outs. That gives us a total potential membership out there for 4,430 members who did not have the ability to belong to this organization. That is a potential of 10 percent that were actually collected by the elevator system, and that is why the concern over the last number of years in the grain industry collection system.
Mr. Struthers: So, after all that is said and done, are you expecting an increase or a decrease once this legislation is passed?
Mr. Jacobson: I think what we are looking at is having those people to make the decision and the decision that they have made to date is that they want to belong to the organization but it has not been available to them on the membership collection system.
Mr. Struthers: I am assuming then that you are saying that you would like to see an increase in the membership.
Mr. Jacobson: Absolutely.
Mr. Struthers: Okay, so you get this increase in membership through this legislation and, in a year's time at the end of 1996, you approach this committee and you will say to this committee: We are the biggest farm group in Manitoba; here are the numbers that we have to prove it. We should be the certified organization again for two more years until the end of 1998.
Am I not correct in saying that?
Mr. Jacobson: That in fact would be the case. We are hoping that would be the case, but in case it is not, what we have in place is a yearly system where our members are put into place in each of the 12 districts. We have elections at our annual meeting on a yearly basis and if we are not doing the job, our members are going to be out there telling us that in fact.
Mr. Struthers: So, getting back to what I originally said, I was correct then in saying that the numbers play a part in the committee's decision. The legislation sets up KAP to get an increase in numbers and, for the National Farmers Union or for Manitoba Independent Agricultural Producers or any other group that wants to approach the committee, they are up against your group who has this special treatment from the government, a setup in which they can bump their numbers up, and they are expected to compete with you now to become the certified organization. What other monopolies are you in favour of, Mr. Jacobson?
Mr. Jacobson: How do you answer that question? I think, Mr. Chairman, it is self-explanatory that the act does not designate Keystone Agricultural Producers as the certified organization. We have to be qualified and have the qualifications in order for the certification agency to make the determination of who the certified organization will be for the next two years.
Mr. Chairperson: I will very closely monitor the direction in which the questioning and the debate is taking place. I suggest to you, honourable members, that we are not here to debate. We are here to ask questions of presenters.
Mr. Struthers: Mr. Chairperson, I will continue to ask questions of the presenter.
So in two years when KAP goes to the committee and is looking for certification as the No. 1 organization in this province, a group like the National Farmers Union or the Manitoba Independent Agricultural Producers would need to then lobby the Minister of Agriculture in order to change this legislation in order for them to become in the same position as your group and have the same advantages in looking to become that certified organization.
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Mr. Jacobson: I think you are right, honourable member, that Keystone Agricultural Producers is the No. 1 organization. If in fact the producers of Manitoba support the organization, then what in effect this bill will do is create it to be the certified organization after it has gone through due process of going through the certification agency.
Mr. Struthers: Could you give me an idea of what your membership would be say five years ago?
Mr. Jacobson: Roughly 6,000.
Mr. Struthers: That would be about 1990. What about 1984?
Mr. Jacobson: He is sure testing my memory. Mr. Chairman, 1984 was our inception year so it was a number that I would just, if you would allow me to make a guess, 3,000.
Mr. Struthers: This is a two-parter. What would be the highest membership you ever had and in what year did you attain that?
Mr. Jacobson: Mr. Chairman, that is in 1992.
Mr. Enns: Well, Mr. Chairman, I wonder if I could not just determine one or two facts. Firstly, is it not correct, and you have some staff around you, Mr. Jacobson, that Keystone, or KAP, went out and solicited and sold some 6,000 memberships prior to any checkoff legislation being in place?
Mr. Jacobson: Yes, Mr. Chairman. That is correct.
Mr. Enns: Is it not the case that this amendment or this legislation certainly does not guarantee any increase in membership for KAP? Producers, after all, simply have to choose to opt out and the membership could in fact decrease.
Mr. Jacobson: Mr. Chairman, that is another correct statement. If we do not do our job, they will opt out. If we in fact do a good job for the organization as we have in the past, we hope that the numbers will go up.
Mr. Enns: The short and simple answer to the questions that Mr. Struthers has been trying to solicit from you is that the legislation in itself does not create memberships for you. It is only the wilful determination of producers who voluntarily allow the checkoff to stay that would increase membership, but it could go either way if the organization is not fulfilling its function in the rural areas of Manitoba.
Mr. Jacobson: Mr. Chairman, that is totally correct. The certified organization will no longer cease to exist if the producers will not wish to fund it and opt out.
Mr. Enns: Thank you, Mr. Jacobson.
Mr. Struthers: Well, in that case, Mr. Jacobson, if I was a member of your organization I would be wondering what you were doing on my behalf pushing to have the membership decline in some way. It makes no sense to me that you would be pushing for something that would not increase the membership. I think it is total fallacy to try to claim in here that this is not going to increase the membership of one particular group, farm organization, over another.
Mr. Jacobson, would I be accurate or inaccurate in suggesting that the real reason that KAP has approached the government to come up with this legislation is that you are worried about the decline in your numbers and you want to find an easy way to bump that number back up?
Mr. Jacobson: Mr. Chairman, that is definitely not what we are intending. What we are intending to do is make the membership collection fee system work more effectively, which has not worked in the past.
Mr. Struthers: Well, then, why would we not do this for all groups and not just yours?
Mr. Jacobson: Mr. Chairman, as I indicated before, we are doing it for the certified organization which KAP currently has the ability to work under and be the certified organization for this two-year period.
Mr. Struthers: Which again gets us back into that whole circular argument about having the numbers being set up by the government and then coming back to this same government at the end of 1996 and looking for an extension of the--being this certification--
Point of Order
Mr. Radcliffe: On a point of order, Mr. Chairperson, I think the committee member, with great respect, is deteriorating into argument and debate with this presenter at this point in time. I think he has made his point, but I think that we are getting off the issue of either eliciting information or seeking clarity for his presentation, and I would urge you to point out to the committee member that this is only succeeding in delaying the presentations.
Mr. Chairperson: Mr. Radcliffe, I take very seriously your intervention, and I have been following very closely the questioning that has ensued, and I would ask that Mr. Struthers continue his question. I will monitor very closely whether he is debating or whether he is questioning.
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Mr. Struthers: Mr. Jacobson, do you feel that KAP is a strong, independent force for farmers. I stress the word "independent."
Mr. Jacobson: Yes, I do.
Mr. Struthers: Are you willing to sacrifice that by agreeing to this legislation that puts you under the thumb of the provincial government?
Mr. Jacobson: It absolutely does not do that. Keystone Agricultural Producers is an entity that is brought together as an organization from the grassroots organization that is elected every year in the 12 districts of Manitoba, and on November 3 of this year we start a new round of district annual meetings, with an annual meeting coming up on January 15 to 17, where we hope, and as always, that there are a large number of producers coming out to those meetings, discussing the issues about the farm policy organization and ensuring that we are going to be a strong organization well into the future.
Mr. Struthers: Yet part of that plan to be a strong organization into the future is dependent on this government allowing this legislation to be passed, allowing you to check off farm memberships as farmers deliver grain.
Mr. Jacobson: Mr. Chairman, what I see this amendment doing is smoothing out the system that is already in place to make it easier, more efficient collection system that is both user- and purchaser-friendly, that was asked for by the grain industry itself when this first legislation was being put in.
Ms. Wowchuk: I just want to ask a couple of questions.
You were telling us what your membership was right now, and I was writing some numbers, but just before I ask my question, can you tell me what your membership is right now?
Mr. Jacobson: Approximately 3,900.
Ms. Wowchuk: You had indicated that in your first year, I believe in 1992, which was your highest membership, you did a membership drive and you had a membership of some 6,000 members. That appears to me to be a very effective way of getting memberships, by going out and talking to producers, telling them what you are all about, and it appeared to be very successful.
Why, then, would you not take that route of actually going out and seeing the producers, collecting the membership and delivering them your message, rather than relying on checkoff legislation to do your work for you?
Mr. Jacobson: Mr. Chairman, in fact what we are doing is exactly what you are saying, that we are always in touch with our producers. I just in a previous statement mentioned the fact of all the meetings that we are holding in our districts throughout the year. Of the 12 districts that we have, they hold monthly district meetings.
Now, what we are in the process of is going through our district annual meetings where every district is holding elections, and those elections are looking after replacing people on a yearly basis. Coming up at our annual meeting, it is under our by-laws that the presidents in the organization are up for re-election every year and cannot hold office for more than four years.
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Ms. Wowchuk: But what I am seeing from your numbers is a decline of some 35 percent from 6,000 memberships down to 3,900 members when you went to the checkoff system.
What I am asking is, why would you want to go to a system that is reducing your membership instead of following up on the method that you used when the organization first started, which was personal contact with producers or collection of membership dues at annual meetings, as organizations do? Why would you want to move to a system that is resulting in your organization having a lower membership?
Mr. Jacobson: What is in fact happening, and I can quote from the Canadian Federation of Agriculture rather than quoting our own statistics so we are not accused of creating numbers, is that numbers from 1971 to 1991 in the province of Manitoba, the number of producer-farmers has decreased from 35,000 to 25,000. Those are 1991 statistics. I think the honourable member realizes what the decline in rural population is even in her district.
It is happening right across our province. The numbers are going down dramatically, and that is no less a reason to have a strong farm policy organization, because the numbers are getting less and the people need a farm policy organization that is going to be effective for policy of them in rural Manitoba.
Ms. Wowchuk: I want to tell you, Mr. Jacobson, that I do believe that as producers we do need a strong organization. That is not an argument that I am having. I am talking about how--
Mr. Enns: Thank you, Rosann, you are coming on board. I always knew you would, you just needed a bit of coaxing.
Ms. Wowchuk: Thank you, Mr. Chair.
My concern is the process of how you are collecting memberships and questioning the real need for this legislation because as I see it, it has not had a positive effect on the numbers of people who join the organization.
Following on that, I want to ask the question--you said, I believe, that membership was not available to grain producers because it was not being checked off at the elevator. Do farmers, grain producers not have the option that if they want to belong to the organization, they can just mail you a cheque and be part of the organization?
Mr. Jacobson: Yes, they do, but, in fact, when they give us the information, as I told you in the submission, we have the ability to send their name to one collection point and when that name goes to the one collection point then they expect it to be taken off and what happens is it is not taken off. That is the problem for the decline in our membership.
Ms. Wowchuk: The question I am asking is that if the fee is not being taken off at the point of sale, that producer does have the option, if he wants to belong to the organization, to take out his cheque book and send you a cheque and say, yes, I want to be a member of KAP but I do not want my fees--my fees are not being docked off at the elevator. Here is my cheque. I want to be a member. He has that option, does he not?
Mr. Jacobson: They would have that option but what they are expecting, that this legislation should work, and what happens is the year keeps on going and by the time the end of the year comes, the purchaser has not checked off at the system of where an individual has a name at a certain grain company, so the collection cannot be made. Therefore, the numbers of producers who are belonging to the organization, in your own words, keeps going down. In effect, it is the legislation that we are talking about to be amended, to have the ability to make a smoother financial transaction on the membership fee collection system.
Ms. Wowchuk: I want to ask how much you anticipate your revenues will go up as a result of this legislation, because when I look back at when cattle producers had the checkoff, their revenues were $200,000 a year. When the checkoff was taken out, their revenues went down to $20,000 a year. That is a tremendous variation in revenues. What do you anticipate your revenues will increase to as a result of this legislation?
Mr. Jacobson: Mr. Chairman, we have not made that determination in any point of fact because, first of all, we have to become the certified organization. What happens there is that process is going to be an ongoing process, and we have not anticipated what the revenues would be.
Ms. Wowchuk: Just for clarification, Mr. Jacobson, you said that you cannot anticipate this because you have to become the certified organization. You are the certified organization. If this legislation passes, you will have the compulsory checkoff that people will have to opt out of, and statistics show us that when there is a negative option checkoff such as that, many more people do not opt out, and the organization that has that compulsory checkoff does have a great increase in revenue. So you must be anticipating a fair increase in your revenues because of this legislation.
Mr. Jacobson: I can go by the number of producers that we have currently set out membership collection fees for in 1995 and go on that kind of a number. The total was 3,686 that went out on the first portion, with 4,652 going to the grain sector, so at $100 per membership, I think you can do the calculation.
Ms. Wowchuk: I have no further questions. I just want to say that we have had this discussion many times, and I want to say to Mr. Jacobson, although I believe there should be strong farm organizations, I believe farmers should have a choice in who should represent them, and I think that farmers would feel that they had been treated much more fairly and the system would be much more democratic if they were given a ballot, given a vote, into whether or not they want this organization to be their representative.
I think that Keystone Agricultural Producers would be doing farmers a great service if they took that option and canvassed all the producers in this province and ask them for their support, and if they got the endorsement of 50 percent of the producers and they said they wanted it, there would be no difficulty, but we have not had that process in this province, and I think that farmers deserve that.
Mr. Pitura: Mr. Jacobson, just one quick question. We have been talking about memberships. Do you have memberships where there is more than one producer per membership?
Mr. Jacobson: Yes, we do. I am sorry, I did not address that question before.
As you know, the numbers of producers in Manitoba is going down, and what that relates to is the fact that the farm size is growing, and that relates to the fact that there is more than one producer on an individual farm, and, in fact, there are at least two on every farm, because there is a husband and a wife.
The other part of that is that there are partnerships and there are Hutterite colonies, in fact, that have one membership per colony where, on that type of farm, we have maybe up to 20 families that are represented by one membership. Therefore, in effect, there is a great number of producers in Manitoba that Keystone Agricultural Producers is representing.
Mr. Chairperson: Are there any further questions? If not, thank you very much for your presentation, Mr. Jacobson.
Mr. Jacobson: Thank you very much, Mr. Chairman and committee.
Mr. Chairperson: I call next Mr. Bruce Dalgarno, Manitoba Canola Growers Association. Is Mr. Dalgarno here? Yes, there he is. Have you a written presentation for distribution. We will ask the Clerk's Office to distribute. You may proceed, Mr. Dalgarno.
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Mr. Bruce Dalgarno (President, Manitoba Canola Growers Association): Mr. Chairman, Mr. Minister, honourable members, I would like to thank you for this opportunity to address the concerns of Bill 15 at this time.
I am president of the Manitoba Canola Growers Association, and at this time, I would like to introduce our vice-president, who came with us, Mr. Max Polon, and our treasurer and director, Charlie Froebe.
We appreciate this opportunity to comment on Bill 15 as it pertains to commodity groups, specifically the amendments to Part 4 of the existing Agricultural Producers' Organization Funding Act.
We heartily endorse the amendments proposed by the government because they address the changes to the act that we believe are essential to the successful operation of a canola checkoff in Manitoba.
The amendments will allow a canola checkoff, once established in this province, to operate in a similar fashion to those already in place in each of the other western provinces. This is important to ensuring that the money collected is in the most cost-effective manner possible so that the maximum amount of funds can be directed to canola programs while the costs associated with collecting the checkoff can be kept as low as possible.
A number of canola buyers, both crushers and country elevator companies, operate in more than one province. Legislation in Saskatchewan, Alberta and British Columbia is similar with respect to the method in which the check-off funds are collected. As a result, canola buyers have been able to develop administrative systems to collect the checkoffs that can be used in all provinces in which the companies operate.
Prior to the amendments proposed in Bill 15, if a checkoff had been implemented in Manitoba, these companies would have been required to develop a separate administrative system for Manitoba alone. In our discussions with canola buyers, it was made clear to us that they much prefer a universal, refundable system to the front-end, opt-out situation existing under the current legislation. Not only is a universal refundable system more administratively efficient, but it also allows canola buyers to remain neutral in the check-off process. Buyers do not want to be in the position of having to decide whether or not the check-off monies are to be deducted from their customers' cheques.
The universal refundable system has proven to be both workable and well accepted by canola growers in B.C., Alberta and Saskatchewan. With checkoff having been in place for between four and five years in these province, grower requests for refunds have been extremely low. Only 2 to 3.5 percent of the levy money collected has been refunded. The percentage of producers requesting refunds has been between 1.1 and 2.85 percent. It goes without saying that if growers' needs were not being met, the refund rate would be much higher.
A universal, refundable checkoff will allow the Manitoba Canola Growers Association to communicate regularly with all canola growers about the activities to which check-off monies are being directed. It will be possible to demonstrate the uses to which the funds are being put, and it would be hoped that those who might initially want a refund would reconsider when they see the benefits they are receiving. Under the current system, there is no opportunity for organizations receiving check-off funds to communicate with those who chose not to support the checkoff. Because growers can opt out for life, contact is lost with those growers once they do opt out.
We cannot stress enough the importance of implementing a canola checkoff in Manitoba. All the canola growing provinces in Canada have a checkoff, with the exception of Manitoba. Even Ontario has had a checkoff for six years, and that province's production equals only 2 percent of the canola produced in Manitoba.
If we look to the province directly to the west of us, canola growers in Saskatchewan benefit from research, extension and market development programs funded by nearly $1.4 million of canola growers' money last year. Just over $670,000 was directed to research projects alone in 1994-95. This cannot but help give Saskatchewan canola growers significant advantages in remaining competitive in canola production. In addition to funding canola production research, of general benefit to all growers, the availability of grower-directed provincial research dollars has allowed projects to be funded which address the specific needs of canola production in Saskatchewan. The existence of a pool of growers' funds has had other spin-offs. Without a doubt, grower funding in Saskatchewan has helped foster a research-friendly environment which has contributed to Saskatchewan becoming increasingly recognized as a major centre for canola breeding and development, particularly in the area of biotechnology.
Here in Manitoba, funds for basic canola breeding research at the University of Manitoba have declined by 63 percent over the past five years. Much of the breeding work now being done at the university is proprietary or company-funded research to develop immediately marketable products. Longer term research that does not have an immediate payback or an immediate application to the marketplace is still essential in keeping canola production in Manitoba on the leading edge. Part of basic research is agronomic research, the kind that leads to improved production practices which help