Will the Committee of Supply please come to order. This section of the Committee of Supply will be considering the Estimates of the Department of Agriculture. Does the honourable Minister of Agriculture have an opening statement?
Hon. Harry Enns (Minister of Agriculture): Mr. Chairperson, yes, I do have an opening statement. In fact, I want to make a more formal opening statement than I normally make because of the changes that are occurring in agriculture and the scale to which these changes impact on all of us here in Manitoba.
So I am very pleased to introduce these 1998-99 Estimates for the Manitoba Department of Agriculture. It is an honour for my department and myself to serve our province's agriculture and food sector. A prosperous, dynamic and sustainable agrifood industry is vital to Manitoba's overall economy and accordingly contributes to the improved quality of life for all Manitobans. I would like to briefly comment on the farm income situation in our province.
In 1997, farm cash receipts in Manitoba were estimated at some $3.3 billion, the highest on record in current dollars. Receipts from crop production rose by 7 percent to a record of $1.7 billion mainly because the increased marketings of most crops more than offset the decreased prices of almost all crops in 1997. These are 1997 full year figures, of course. I appreciate that we are in 1998, but for the completion of figures, honourable members will appreciate that I have to use the figures for the last completed year for which the data is available. There was an 8 percent increase in livestock receipts to a new record of almost $1.2 billion. Lower program payments were more than offset by higher crop insurance, freight cost pooling assistance and flood compensation programs, resulting in a doubling of direct payments to Manitoba producers which rose from $56 million in 1996 to $129 million in the year 1997.
Members of this committee are no doubt aware that our agrifood industry makes a significant contribution to Manitoba's economy. Given this awareness, I believe that we have a special role to remind all Manitobans, especially those who are not directly involved in this industry, of our agrifood sector's critical importance to our province's economy and well-being. For example, our agrifood sector accounted for approximately 12.9 percent of Manitoba's gross domestic product in 1996. Over 24,000 farm units operated by families provide the foundation of our province's agriculture and food industry, as well as the backbone of Manitoba's rural economy.
The viability and prosperity of Manitoba's family farms are important to the growth and stability of this important industry to our province's economy. Although our farm families only represent 3 percent of Manitoba's population, they affect the lives and incomes of Manitobans far beyond their small number. Farm families are the foundation for this province's agrifood sector, making major contributions to Manitoba's economy. For example, for every nine jobs created on farms in 1996, five jobs were created in other areas of our province's economy. More than one in nine jobs in our province was the result of agricultural production, with approximately 60,000 persons directly and indirectly being employed by agriculture.
In 1996, agriculture directly or indirectly accounted for 21.8 percent of the total added value for the goods-producing sector in Manitoba. The food and beverage processing industry alone produced about $2.3 billion worth of goods and services, accounting for almost one-quarter of Manitoba's total manufacturing output. I remind honourable members of the committee, all of this stems from 3 percent population base of the province of those of us directly involved in agriculture. For every dollar of net income produced by a primary agricultural producer, over $1.70 is generated in Manitoba's overall economy. Agriculture accounted for more than $1.08 of production in Manitoba's economy in 1996.
Farms in Manitoba are almost entirely owned and controlled by individuals and families. Farm families will continue to be the predominant decision-making units in agriculture and will continue to be a major focus of Manitoba Agriculture's programming and services.
I would like to share a few thoughts on new economic realities facing our industry. With a reduction of international trade distortions and implementation of grain transportation reforms, Manitoba's agrifood industry is shifting towards a level playing field with our competitors from across the world and across Canada. In doing so, our province's agrifood industry has a significant mix of advantages, giving it an edge over our out-of-province competition. Some of the advantages involve a reputation for high-quality agrifood products and relatively low cost of production, our well-educated and technically up-to-date producers, our high standards for food quality and safety, our highly skilled workforce, a competitive tax regime, our large sustainable agricultural land base, a central location in the heart of North America, low-cost feed grains, a strong and modern infrastructure, reasonable land costs, and reasonable and balanced environmental regulations. Our industry producers and processors have been and will continue to take advantage of the new realities of a level playing field. We can and we will successfully compete in an open international and national marketplace free of significant trade distortions.
Mr. Peter Dyck, Acting Chairperson, in the Chair
The Agri-Food Research and Development Initiative, ARDI, which is now underway, provides a new tool for our agriculture and industry to successfully compete within new economic realities of today. The overall budget commitments for this program is some 19 millions of dollars. ARDI is designed to initiate, encourage, promote and conduct innovative research and development projects that will contribute to the economic well-being of Manitobans. By focusing on diversification, value-added production, processing and exporting higher-value products from Manitoba, ARDI will enhance the agrifood industry's ability to adapt within the changing global market environment.
Because funding is limited, access to ARDI will be competitive. Priority will be given to those proposals with significant industry involvement and financial support. Projects accepted for ARDI funding assistance must demonstrate a return on investment dollars, facilitate adaptation in the industry, and address identified research needs. Projects must also be committed to the principles of sustainable development.
ARDI has come at a time when innovation is essential to enhancing value-added activity in Manitoba and strengthening our competition in the global marketplace. The introduction of this program also complements recommendations provided by the Working for Value Task Force in 1997, which encouraged the establishment of a research and development fund for these purposes. Our government, in partnership with the federal government, is pleased to bring just such a program to Manitoba's agriculture and food sector.
In facing our new economic realities, we are witnessing some encouraging in-province diversification trends within our crops sector. For example, over the past two years, our province's area seeded to potatoes increased by some 12,000 acres, now totalling some 72,000 acres in the year 1997. This expanded acreage is driven by the increasing supply needs of McCain Foods in Portage la Prairie and the Midwest Food Products company in Carberry, our major processors in the province.
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For Manitoba, expansion of our potato production has positive economic ramifications. The value of potatoes produced in our province has dramatically increased in recent years. In 1991, the value of potato production at the farm gate was some $51 million. By 1996, just five years later, this number had grown to over a hundred million, $110 million. This is value at the farm gate. Add to this the processing of these potatoes, and you have an industry that is valued at some $260 million here in Manitoba in the year 1996. That is no small potatoes, as my very talented scriptwriter tells me.
The potato industry is also an important source of jobs in our economy. About 1,700 people are currently involved in the production of potatoes in Manitoba, and more than 1,200 people are employed in processing in the aspect of potato production. Not only is the area in Manitoba seeded to potatoes increasing, but it is anticipated that in the next few years, producers will greatly increase the irrigation of Manitoba's potato acreage. Manitoba's total land use for potato production will approach some 80,000 acres upon completion of our potato industry's expansion. Our province has an enormous capacity for this expansion or any other additional expansion. Soil surveys indicate that there are more than 2.5 million acres rated as good to excellent for irrigated potato production here in Manitoba.
During the next few years, we will be moving towards producing the largest volumes of potatoes in Canada. Today, we are the second, only to Prince Edward Island, in the area of potato production. Aided by our increasing global economy, our province's agrifood industry has successfully penetrated new and expanding international markets. We in Manitoba Agriculture are working with our strategic partners to build on and expand this trend. Recently, as a follow-up to the Team Canada trade mission to Latin America, our department just completed its own trade mission to the Mexican states of Nayarit, Chihuahua, Nuevo Leon, and Jalisco.
I had the opportunity of being a member of our department's team on this follow-up visit. Our Manitoba Agriculture mission was, in great part, a response to an earlier trade visit in October to Manitoba by Mexican cattle buyers, resulting in an initial cattle shipment to Mexico. Also, our short stay in Mexico further supported technology transfer and trade links being developed under agreements with both the Mexican states of Nayarit and Chihuahua.
During our recent visit, it was evident that there are considerable opportunities to market our province's agricultural commodities in Mexico. I visited a dairy operation in the Tepic area with a view to establishing a 2,000-head milk herd, and they want our dairy stock.
There is no reason why our province cannot take advantage of this opportunity by supplying this venture with some of our high-quality dairy cattle. With drought conditions easing and the need to rebuild cattle herds in northern Mexico, there is also a great opportunity to supply this area with Manitoba beef cattle. In the fall of this year. I will be leading a trade mission to the Expointer agricultural fair in Brazil. This trade event is one of the largest cattle shows in the world. Expointer '98 affords an excellent opportunity to showcase Manitoba beef and dairy breed stock to that area's important growing market.
The livestock industry represents a major opportunity for greater diversification and value-added production in Manitoba. In recent years the livestock industry has witnessed an enormous expansion with a sizable increase in livestock numbers. There has been, of course, a dramatic growth within our Manitoba hog sector. Between 1994 and 1997, our production increased from 2.6 million to almost 3.5 million, up 33 percent in just three years. Manitoba hog production is likely to reach between 3.7 million and 3.8 million head in the year of 1998 and between 3.9 million and 4 million head in the following year, in '99.
Manitoba is already Canada's third largest hog producing province with about 19 percent of the national production. Our potential to further increase hog production remains enormous. We expect hog production numbers will continue to rise significantly to meet the demand for fresh chilled pork for export to the Asian market, as well as pork products for elsewhere. In 1997 Manitoba exported pork and pork products to 17 countries around the world.
A recent study conducted by the George Morris Centre that compared five regions of Canada with four in the United States, with Argentina, Chile, Holland and Denmark, found that western Canada, here in Manitoba, and the eastern prairies in particular, possessed the lowest overall production costs for hogs. The study asserts that the major factor for this advantage was the relatively low cost of feed grains. I say relatively because it is our price in relation to that of our trading partners that is important and not the absolute level of feed grains prices. Accordingly, we are very optimistic that our province's hog numbers will continue to greatly increase in the years ahead. I want to reiterate that point, that increase need not occur at the expense of grain producers.
There is room in the relative pricing of competitors around the world and in the country for our grain producers to get adequate returns for their feed grains and still enjoy this market advantage in terms of cost of production. Manitoba Agricultural Credit Corporation's Diversification Loan Guarantee Program has played an important role in the expansion of the hog industry so far. To date over $12 million in hog financing has been guaranteed by this program, which, in addition, has guaranteed about $7 million in lending to other sectors, such as potatoes, dairy, bison and aquaculture.
We are enthusiastic about recent enhancement to this already successful program that will pave the way for diversification and value-added projects which may require out-of-province investing and the option of being located beyond the farm gate. Both accessibility and flexibility have been greatly enhanced. To facilitate and further encourage the phenomenal growth of our pork sector, the department has been pursuing the Manitoba Pork Advantage in partnership with the hog industry. The undertaking was launched in 1996 to support the growth in production, processing and the export market development of our provincial pork industry. The focus of the Manitoba Pork Advantage is to position the province to meet the expanding demand for pork in the international marketplace and into the 21st Century.
By demonstrating the superior quality of pork available from Manitoba to domestic and international clients, this initiative has the potential to contribute greatly to the Manitoba agrifood economy. The Manitoba Pork Advantage is a new, vital component of our department's partnership with the hog industry.
Mr. Chairperson in the Chair
The Manitoba Pork Advantage highlights Manitoba's strengths; its large land base capable of supporting an expanded pork industry, skilled producers, a flexible marketing system that is responsive to market signals, one of the lowest feed costs in North America, a quality product that meets market demand and a collaborative and close-working relationship between the pork industry and government. The Manitoba Pork Advantage has resulted in a number of marketing initiatives. The department was successful in having the Manitoba Pork Advantage featured at the World Pork Expo in Indianapolis in June of 1997. The department has also undertaken a number of trade missions to Europe and Asia. Very recently, department staff returned from a trade mission to Japan, Korea and Taiwan. Plans are currently being made to visit additional countries.
We are pleased to witness the further success of our hog industry in recent months. As you are no doubt very aware, Maple Leaf meats recently announced its plans to build a new hog processing facility in Brandon. This new state-of-the-art facility will cost some $112 million to construct and will eventually have the capacity to process up to 90,000 hogs a week. The new Brandon plant will require about 1,150 employees for its first shift and up to 2,200 employees when the second shift is added. The second shift is dependent on a sufficient supply of hogs becoming available. Construction of the new plant is expected to begin--I can indicate has already begun--in early 1998 and to be operational by the late summer of 1999.
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The reason cited for choosing Brandon as the location for the new plant focused on the rapidly expanding production of hogs in Manitoba, our skilled workforce and our relatively low costs of feed grains. It is anticipated that the Brandon plant will add an additional $500 million to the economic spinoffs to the economy of Manitoba.
I also want to mention that in 1997, Schneider's opened its new pork cutting facility in Winnipeg. The cost for the new plant was approximately $40 million. Schneider's set the goal of processing two million hogs a year and is making steady progress in that direction, currently cutting about 5,000 hogs per day. Schneider's has plans to add a kill floor when enough hogs become available within our province. I want honourable members of the committee to understand that the issue now is for production to catch up with the processing capacity. That was not the case just a very short while ago and indeed still is not the case, but when this capacity is in place, Brandon facility operating, that will be the demand on our production.
Overall, our pork industry generates major economic activity in Manitoba. Presently, 10,000 to 12,000 people are employed in the industry and over 500 million of farm sales are generated. The economic spinoff to the provincial economy is substantial, approaching the $1-billion mark. Remember, I remind honourable members, this is coming from a relatively small handful of primary producers, 1,500, 1,600 pork producers in the province, developing a billion-dollar economic benefit to the provincial economy.
Benefits to local Manitoba communities are significant. For example, the economic activity generated within a community by a 600-sow farrow-to-finish hog operation exceeds $2 million in construction and $1 million annually in goods and services. For every community, for every municipality that has one of these facilities, that is the kind of economic activity it generates annually in that municipality.
Increasing our hog numbers to 4 million head will result in additional employment opportunities for 5,000 to 6,000 people in Manitoba. Rural employment opportunities generated from our expanding hog industry will keep young people and their families in local communities. By doing so, the local community will become more vibrant. Young families with children support the local schools, the local businesses, which further augment the development of a strong local economy. As well as economic spinoffs for the entire economy, expansion of the hog industry also impacts for our grain farmers.
The production of 5 million market hogs will require one million tonnes of barley, or at 60 bushels an acre the barley produced from over 765,000 acres. This at a time when we are facing unacceptable freight rates as a result of the loss of the Crow, the need, the interest and the expansion of the hog industry is done as much for the grain farmers' point of view as it is for the hog industry's point of view.
Our cattle industry has also witnessed a substantial growth as of July 1, 1997. A new record was set for beef cow numbers in excess of half a million, 560,000 beef cow numbers currently make up the beef herd in Manitoba, a significant increase of 28 percent when compared to the figures of just four or five years ago in 1992. Similar to the Manitoba Pork Advantage our department is working with the cattle industry to create the Manitoba Beef Advantage. We are working closely with cattle stakeholders to generate and communicate information that will highlight the strengths and opportunities of Manitoba's beef industry. This initiative is designed to communicate Manitoba's advantages in adding value in such areas as retaining ownership through in-province backgrounding and/or finishing cattle when economically viable to do so.
This industry possesses many advantages which include low costs of production and a range of transportation options for moving products. Our cattle industry is currently in a position to encourage off-farm investment. For example, there is evidence of increased activity in co-operative feeding arrangements where ownership of the livestock may reside off the farm. In such situations, investors, processors and customers pay farmers on a contractual basis to rear animals to market weight. This option has the potential to encourage further investment into local processing and developing new products for domestic and export markets, generating additional economic activity in the province. With these advantages the beef industry in Manitoba is well positioned to move forward into the future
Manitoba Agriculture is in the early stages in the development of Manitoba's Forage Advantage. This initiative, similar to the Manitoba Pork and the Beef Advantage, would communicate the strengths and the opportunities of our forage sector. The Manitoba Forage Advantage will focus on the competitive advantage of producing and marketing forages. The initiative will highlight opportunities to utilize the abundant land area in Manitoba well suited for forage production. Allow me just to digress from my notes for a moment. This is an exciting aspect of an agricultural initiative in the province. We are sending quality forages to distant lands in the lucrative markets, dairy markets in the United States, and it is becoming a very attractive additional source of income for more and more of our producers.
In addition to promoting the traditional livestock industries, our department has also been supporting the growth of nontraditional livestock sectors. For example, there has and continues to be a great expansion in Manitoba's bison ranching industry. Although at present the Manitoba herd represents only about 3 percent of the North American commercial herd, this percentage will likely increase as the herd has been expanding at a rate of approximately 25 percent per year. Currently some 90 producers belong to the Manitoba Bison Association. Most herds consist of between 25 and 30 head. However, herds range from 5 to as many as 1,300, with the average herd being about 75 animals.
In response to the need of bison producers for financial assistance, Manitoba Agricultural Credit Corporation recently developed a bison Stocker Loan Program, initiated in January of 1998, the loan program designed to improve access to financing for feeder bison operators. The bison stocker loan has received encouraging comments from producers and other industry and partner players. More recently, Manitoba Agricultural Credit Corporation's direct loans for female bison breeding stock has been enhanced. Maximum loans for bred cows and heifers have been increased to $4,800 per animal and two new loan categories for younger stock have been introduced.
We are witnessing the take-off of our new elk farming industry, contributing further to the diversification of our province's agrifood sector. There are now 72 licensed elk farmers with over 800 elk on their farms. When you consider this industry just started off in the year '97, that is a remarkable accomplishment, and I congratulate and commend all them. Two hundred and forty-seven of these elk were dispersed by my department in December of last year as seed stock for the new entrance to the elk farming industry. Manitoba Agriculture and Manitoba Natural Resources are working closely together to allow for the production of elk in a controlled, humane, healthy and licensed manner. Both our departments will continue to do so in close co-operation and consultation with this new growing industry.
At this time, I would like to briefly comment on the new Manitoba Livestock Manure Management Initiative. The priority of this new undertaking is to find technical and commercial solutions to livestock environmental concerns and, where appropriate, to find research and development and to demonstrate projects where results appear promising.
Well, Mr. Chairman, my speechwriter got a little ahead of me. I put it in a simpler form. What I mean by this jargon is that I want to be able to drive on a hot summer evening with my good wife, Eleanor, down a country road past one of these big megahog barns, and I want my wife Eleanor to lean over and ask me, "Honey, what do you suppose is going on in there? Is that a raspberry jam plant?" Well, now, maybe that is asking for too much to convert manure and hog manure to that of raspberry jam, but, if we can put people on the moon and we can circle the globe in minutes, then we can sure as heck take the odour out of hog manure. That is what the hog manure management initiative is all about, and I have challenged the industry to do just that.
More specifically, this initiative will seek alternative ways of managing odour and manure and mitigating environmental impact. Further, this initiative will keep the public informed of efforts being made to manage this issue responsibly. The Manitoba government has committed $100,000 from the Sustainable Development Innovations Fund as seed money for this endeavour. In addition, and I am very pleased to note, our hog producers through the organization of Manitoba Pork has committed some $450,000 over a three-year period for this undertaking. It is anticipated that additional funding will be raised in 1998 under this initiative from the private sector.
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These are some personal comments about where the minister did not do so well, so I will skip over them. In closing, we in Manitoba Agriculture look forward to continuing and building on our close working relationship with our agrifood strategic partners. By working closely together, we can contribute towards creating a more vibrant and prosperous agrifood industry for the benefit of not only just the agrifood industry but for the benefit of all Manitobans. I look forward to discussing our Estimates with the members of this committee. Thank you, Mr. Chairman.
Mr. Chairperson: We thank the Minister of Agriculture for his opening comments. Does the critic for the official opposition, the honourable member for Swan River, have an opening statement?
Ms. Rosann Wowchuk (Swan River): Mr. Chairman, yes, I do have a brief opening statement, and rather than repeat all the numbers that the minister has put on the record about the different sectors of the agriculture industry, I want to say that I, too, believe that the agriculture industry is the backbone of the rural economy, and that although there is a very small percentage of people involved in the industry, it is important and sometimes does not get nearly the recognition that it should get for the role that it plays in the economy of this province.
I have to say that although the minister talked about the incomes of farm families, I find that his numbers, although I do not doubt his accuracy, I find that in what I have looked at, although the actual income of farmers has decreased, there may be more money there but higher input costs and other expenses, the net income for Manitoba farmers has decreased.
Although if you take into inflation and all of those other things, then farmers are facing real challenges, along with the fact that--and the minister is right that in 1997 there was extra money coming into farm hands, because there was an increase in direct payments. Those direct payments are now over, and I think that with low grain prices, with subsidy wars that are upon the horizon that we are hearing about, with the challenges that we are facing because of the weather and an end to direct payments that were coming to farmers, I think that many farmers are going to be facing real challenges in the next year.
Some farmers are addressing those well and are diversifying into many areas. We see an increase in hog production, increase in livestock production, and a diversity in the crops that farmers are growing. Even with that, I think that farmers will face real challenges and we will see--unfortunately, I believe that some farmers will be hitting a real crunch this year, and I hope that they will be able to make it through. In some cases, I see people prepared to throw up their hands and say, well, I cannot make a living at this, I am going to sell my farm out to some larger operator.
That does happen, unfortunately. I think we have to be really concerned about that, because every time we lose a family out of the rural community, there is a negative impact on that community if people decide to move out. Now, there should be some opportunities for employment with the diversification that is coming, but those diversifications are not going to be without challenges.
The minister talked about the increased hog production, and I think that the increased hog production is going to be good for Manitoba. It is a way for farmers to continue to make a living, for grain farmers to sell their grain. I hope that it will mean that grain farmers will get a fair return, that it will not mean that farmers, instead of paying freight to ship the grain to market, will be getting that same price minus the freight, that it will mean that prices of commodities will rise.
The increase in hog production is not going to be without its challenges. I encourage the minister to recognize those challenges that are there. One of the areas that I feel that there has been some perhaps lack of information--as the hog industry grows, the minister is well aware that it has not been without controversy. I believe that the departments, whether it be the Department of Agriculture, Department of Environment, all have to work together, Department of Natural Resources, to ensure that the information, the questions that people have are adequately asked, that there is adequate planning. This could be a very big challenge for our province.
We have a lot of land, there is a lot of room to grow, but we have to ensure that it happens in a sustainable way, and I think there are real opportunities for the Department of Agriculture and the Department of Environment, the Department of Natural Resources to work together to ensure that this growth happens in a sustainable way. We are going to need a tremendous amount of hogs.
The building of the plant, which is coming in Brandon with Maple Leaf, hopefully will mean a better return for producers. Hog producers at the present time, many of our hogs are leaving this province, going to the United States because there is a better price there. Hopefully, that price will be matched, and Maple Leaf and the other packing companies are going to have to do that, because once they build those plants they are going to want to fill them. So, hopefully, it will mean a better return, and a better return means a better living for people in rural Manitoba.
The industry does not come without challenges, as I have said, and the minister mentioned the one about the odour. I think that is a challenge, and I am pleased that the investment has been made into the research. I think that not only dealing with odour, odour is only one of the issues, and we have to deal with how we are going to manage the manure and turn it into a valuable product as well. It is a resource, a newer renewal resource that can be used. I have read about some projects that are going on in other areas where the wastes, manure are not being spread on fields for fertilizer but are being processed and packaged and sold and providing quite a generous income as well.
I think that the hog industry will grow, but we will have to look at diversifying into other livestock as well. Not every farmer is going to be a hog producer, but farmers have to have other opportunities. So the issue of diversifying into cattle is a good one. Again, challenges, and one of the challenges that the cattle producers are facing is in areas where there is a not enough marginal land; there have been attempts to acquire Crown lands to be used for pasture land, Crown lands to be used for harvesting of natural hay. Bands have been wanting to get some lands that they can expand into, whether it be into the bison or into the cattle industry, and one area when we get further down into the Estimates that I would want to have some discussion with the minister is the whole issue of distribution and the availability of agricultural Crown lands. Certainly we have to look at ways to diversify.
I think one of the areas that I do not believe the minster touched on, and that is the whole issue of crop insurance and safety nets that will have to be renegotiated, the federal government's commitment to agriculture.
The other areas that I would like to spend some time discussing are the legislation that the minister has brought forward, two pieces of legislation that I have some concerns about, one being the farm machineries act. The reasoning behind the changes that are being proposed there and also the changes to the crop insurance bill are ones that we, looking at the bill, do not agree with what the government is doing, and we look forward to having some discussion on these bills to ensure that we get the minister's views on it and put our thoughts on the record as to the reason for these changes.
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As well, I think that there is much more that we can be doing in the food processing industry. The minister talked about the potato industry growing, and that is only one. We grow a large variety of vegetables in this province, and there are opportunities, I believe, for growth in that area. I think there is room where the government could be showing more support to the food processing industry to help them and help that industry grow in this province.
With those few comments, I want to say that I believe very strongly in the agriculture industry. I believe that there is a strong role for government to play in this. Over the years, we have seen a decrease in support for agriculture on the provincial level. That has not happened this year, but we have seen agriculture basically abandoned by the federal government. When we hear the federal budget or throne speech and just basically, I think, once hear the word "agriculture," we recognize that the federal government does not feel that this is an important part of the economy. I think sometimes the federal government forgets that western Canada and the agriculture industry, the growth of the products in western Canada, played a very important role in putting Canada on the map as a producer of high-quality food, high-quality grains, and that is still important, but the federal government has forgotten about it. It is an industry in which there are many opportunities but also many challenges.
With those few comments, I am prepared to begin the Estimates.
Mr. Chairperson: We thank the honourable member for Swan River for her opening statements. I would remind members of the committee that debate on the Minister's Salary, item 1.(a), is deferred until all other items in the Estimates of this department are passed. At this time, we invite the minister's staff to take their place in the Chamber. Does the honourable minister wish to introduce his staff present at this time?
Mr. Enns: I certainly would, Mr. Chairperson, present to the committee members the Deputy Minister of Agriculture, Mr. Don Zasada, affectionately known in the department and in Agriculture as Dr. Z, Mr. Craig Lee, the deputy minister in Policy and Economics division, and Mr. Les Baseraba, assistant deputy minister, responsible for the Regional Services of the department throughout Manitoba.
Mr. Chairperson: Thank you, Mr. Minister. The item before the committee is item 3.1. Administration and Finance (b) Executive Support (1) Salaries and Employee Benefits.
Ms. Wowchuk: Mr. Chairman, one of the most important issues facing the farm community at this time is the future of farm safety nets. My understanding is that the memorandum of understanding that funds the farm safety nets from the federal government is coming to an end and a new agreement has to be negotiated. We talked about that briefly yesterday in the House.
I wonder if the minister can indicate to this House what is happening with that. Does the minister have a committee that is putting in place a proposal to take to the next round of discussions? Can he indicate who is on that committee, and at what stage his committee is at with respect to developing a proposal on safety nets?
Mr. Enns: We have two committees working to assist the department to put forward our positions as we negotiate with the other provinces and with Ottawa, of course, the next generation of safety net programs. We have, first of all, a provincial committee that is a pretty broad spectrum of people who have helped us and advised me personally in the direction of formulation of safety nets as we see them here in Manitoba. I can give you a number of names.
They include people like the former president of KAP, Mr. Les Jacobson, Barry Routledge, Russ Harder, Marlin Beever; the idea of the organizations that they represent, Keystone, KAP; National Farmers' Union; Manitoba Cattle Producers Association; Manitoba Pork; from Manitoba Pool Elevators, Mr. Ken Edie; Keystone Vegetable Producers Association, Mr. Gary Sloik; Ian Wishart from the Forage Council; Brian Fridfinnson from Manitoba Forage Seed Association; Ron Janzen from the Manitoba Corn Growers Association; Kevin Cutting, Manitoba Canola Growers Association; Ken Yuil, Manitoba Sugar Beet Producers Association--we should pause for a moment of silence there, I do not know whether the Sugar Beet Producers Association will be with us much longer.
Wally Klassen from the Manitoba Chicken Producer Board; Harold Froese and Ross Ramage from Manitoba Egg Producers; Bill Swan, Manitoba Milk Producers; Robert Friesen, Manitoba Turkey Producers; Art Bergman, Manitoba Beekeepers' Association; Alan Chambers who sits on the national NISA committee; Charlie Mayer, current chairman of the Manitoba Crop Insurance Corporation; Ken Tjaden, Manitoba Pulse Growers Association; Graham Ranie and Randy Eros, Manitoba Sheep Association; Dave Loewen, Manitoba Broiler Egghatching Commission; Todd Giffen and Doug Connery, Vegetable Growers Association of Manitoba.
So, Mr. Chairman, this committee continues to provide a pretty inclusive sounding board for what the producers want, not just what the government may deem is important, but what producers see as significant and important in the terms and conditions that make up our safety net programs. In addition to that, we participate in the federal committee. There is a federal committee initially that Minister Goodale and now Minister Lyle Vanclief have in place, and our Manitoba representatives on that federal committee is a Mr. Dennis Tully, who represents Manitoba, from Agriculture Canada.
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Quickly, our associate deputy minister here is with us this afternoon representing the department, Manitoba Agriculture, and Mr. Lorne Martin and Mike Lesiuk, also from the departments that put forward our position as strong as we can on the the federal committee that is meeting concurrently with the provincial committee as we move towards resolving what the safety net programs will look like in the future. These committees have a mandate to provide some final recommendations to the ministers' conference, which this year is being held at Niagara-on-the-Lake in Ontario in the first week of July. So it is not very long from now that we will be dealing with this at the national ministerial level.
Ms. Wowchuk: Mr. Chairman, can the minister indicate what the recommendations are for his committee? As I understand it, through this transition period, the federal government has been putting in additional money, I believe $10 million a year, to help with safety net programs. I would like to ask the minister whether he has any assurances that that money is still there, whether the committee is making recommendations that there be additional funds put into the program, and whether the committee has made any recommendations for additional programs other than NISA and crop insurance and the programs that exist at the present time. Does the minister see any need for additional programs? For example, we used to have GRIP. That helped farmers out, but farmers also are facing the risk of disaster many times. Does the minister see or is he prepared to take forward proposals for any additional programs, and what would he foresee as being in that envelope of money that Manitoba will receive to carry on with safety net programs?
Mr. Enns: Mr. Chair, what our Manitoba committee, and that is that large group of people that I indicated just a little while ago, have strongly recommended to our negotiators, as we move into the final process of negotiating with the federal authorities, that we certainly maintain the basic and Enhanced Crop Insurance Program as we now know it. As I have indicated on different occasions in the Chamber, I am very pleased that we have in effect in excess of 80 percent of the eligible agricultural seeded acreage covered under some form of the crop insurance program. When I say that I recognize that that includes of course a significant portion of producers who are taking advantage of the relatively premium-free, if you like, 50 percent coverage that was made available when we made the improvements to the basic crop insurance program.
Committee members, my adviser is saying, that is bottom line; you have to keep that in place. They are saying to me that the NISA program, which, by the way, Mr. Chairman, as it is gaining maturity is becoming more appreciated by producers throughout the province. They are saying, therefore, keep the NISA program very much in place, hopefully with some improvements. I am continuing to get some requests from some of the special areas of agriculture, the horticultural group, for instance, that are difficult to provide for under basic crop insurance programs, very often because of the fewness, the numbers of producers, that you cannot mount an actuarially sound program. I am responsible for that. I would like to find some expansion, if you like, to the NISA program to make it more inclusive.
There are some requests for the kind of self-directed aspects of the NISA program to be added onto as a feature of our program. The third recommendation that the producers have, for which I do not have an answer today, is to impress upon the federal government and ourselves to examine some form of a disaster assistance program, which is not there at the present and obviously would require a significant dedication of additional resources on both our parts, federal and provincial, to make it happen.
Those are the kinds of recommendations that the producer groups that I alluded to earlier have advised the ministry into taking into consideration in their further discussions with the federal government as we finalize the future of the safety net programs.
Ms. Wowchuk: Mr. Chairman, the minister mentioned NISA. One of the criticisms of NISA is that many times it is the young farmers, the ones who are just getting started, who need the assistance of the federal government, who need that matching money from the federal government but do not have the ability to put the funds in because they are too busy paying the bank, paying the mortgage, those kinds of things. Although young farmers are told, oh, just go to the bank and borrow the money to make their NISA payments, as the Minister of Industry, Trade and Tourism (Mr. Downey) says, it is not that easy. Young farmers are not able to get the money to make the payment into NISA and as a result cannot access that federal money. Does the minister recognize this as a problem, and is it one of the issues that he would look to resolve and find a solution, so we can help our young farmers who are in, many times, desperate need of money?
Mr. Enns: Well, you know, as you can imagine I am under constant pressure from young farmers, like the member for Arthur-Virden (Mr. Downey), on this very issue. It is a problem, and we acknowledge that the entry of NISA, particularly for the young farmers, the start-up farmer, is sometimes difficult for them in those initial years to set aside the dollars to make the contribution. I suppose, Mr. Chairman, that is no different than anybody else. The same can be argued for anybody who is a young person who is starting off life, maybe a young married couple who are starting off life. The smart ones, they establish a savings pattern, they start putting some dollars away or an investment pattern early on, even at the time that they are facing, you know, probably high mortgage payments on their homes or on their vehicles or raising of a young family, and yet if they proceed to continue on that course, find themselves with the kind of security that the rest of us then envy when we find ourselves not having done that in our own personal lives.
The NISA program, as I said a little while ago, becomes more attractive as it matures, as the farm, you know, has established itself to the point where regular and consistent contributions can be made to it, interest can be earned at a reasonably attractive rate in terms of today's interest rate structure. Those producers, who have been in the program, established farmers, speak very highly of the program.
I do not know how--we have looked at it, we recognize what the honourable member says--whether or not we can make it somehow easier for the new entry or the young entry to start up in the program. The answer to that so far has eluded us. I will accept some advice that I will take on to Ottawa to see whether we can include that in the program.
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Ms. Wowchuk: I believe it is a really important issue. Still continuing with NISA, I wonder whether the minister or his committee has given any consideration to capping the amount of money that might be able to go to an individual farmer, because, as I understand the way the money from NISA is distributed, the majority of the money goes to a few of the larger operators versus the amount of money that goes to the smaller operators.
I wonder whether the minister or his staff has given any consideration to capping an amount of money and then having the better ability to distribute the money, and perhaps by doing this, there might be the ability to have the dollars that we need to help the beginning farmers get into the program.
Mr. Enns: I suppose I am having a little bit of difficulty in the logic of capping, putting a cap on the larger contributors and withdrawers, if you like. I do not particularly see how that would necessarily help those whose contributions and whose subsequent withdrawal opportunities are less, how they impact on each other. It is not a pooled fund. These are individual accounts. I will provide some information that I am just getting from staff, at this particular time, as to how it looks in Manitoba.
In Manitoba, for instance, the number of--[interjection]--I am advised, there is in fact a cap of $250,000. But just some basic information, and it is rather interesting, that shows that the size of farm, and I have four categories here, zero to $50,000 in sales, $50,000 to $100,000, $100,000 to $200,000, $200,000 to $500,000 and then greater. All in all, we have some 18,000 individual farm families enrolled in the NISA program which, again, is pretty high when you consider that we estimate our overall farm family population of some 24,000-25,000.
In the zero to $50,000, for instance, we have 8,739 participants with average sales of $28,000, and the average account balance of some $5,000 or 18 percent of the sales, the eligible sales. Surprisingly, that is very much the same if you go to the higher category of the farm with $200,000 to half a million dollars with the sales, where we have some 1,500, 1,600, 1,694, about 1,700 farm families enrolled with average sales of in excess of $300,000, $327,000. Their average account balance is at $48,000 or 15 percent of their total sales.
So relatively speaking, the lower-income families with only $28,000 in sales, only $5,000 in the account, that figure is 18 percent of their eligible sales, whereas the larger farmer, the half-a-million-dollar farmer with sales in excess of $300,000, they have in their accounts 15 percent of their sales value. That is not a bad balance, Mr. Chairman, when you look at it in that light, and these are, as I indicated earlier, of course, individual accounts. There is not an advantage to be gained by the lower income farmer by placing any further restrictions or capping of the higher income earning farmers. All in all, all sizes combined, I just again, for information, say that we have some 18,764 subscribers to the NISA program. Their average sales of these 18,000 farms are just in excess of a hundred thousand dollars, $117,000. The average amount sitting in the accounts is some $17,000 or 14 percent of the eligible sales.
I can only indicate to the honourable member and other members of the committee that the program is, I would say, gaining in acceptance throughout Manitoba, particularly for those who have matured into the program.
Ms. Wowchuk: I wonder if the minister at some point may be able to provide that list of information that we can have for information as to the different levels of contributions by various members. If it is possible, I would like to have a copy of that.
I would like to ask the minister whether NISA is a national program that is treated the same in each province, or is each province different and are there any provinces that have caps? The reason I mention caps, the minister said it will not make any difference for the young farmers, but, if I understand it properly, all of the program--we get this envelope of money and out of that envelope of money we have to provide whatever safety net programs we can. What I was suggesting is that, if there is a limited amount of money that is available, then is there a way that we can cap the amount of money that goes to one individual to then be used for other programs? In particular, as I had indicated earlier, I am concerned with the young farmers, the beginning farmers, who have expressed an interest in NISA, but, as it stands right now, they do not believe it is a good program because they cannot participate. So I am looking at ways that we might be able to help these people.
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Mr. Enns: Mr. Chair, to answer the honourable member's question, yes, NISA is a national program, although it has different manifestations in some provinces. Alberta, for instance, has chosen not to participate provincially in the NISA program. In that province you have the federal government picking up the provincial share, but it is taken out of those allocated safety net dollars that are in their envelope for safety net purposes. Again, on the question of capping, there is, as I indicated earlier, an overall cap of $250,000 sales. We could do some rejigging of those figures to, in fact, enhance the start-up, the young farmer's contribution, and have his account grow faster. That is, I suppose, always a fair argument to make. It is, I must indicate, not a recommendation that I am to date getting from my producers' committee, but that is not to say it will not arrive at some point or other. Generally speaking, we try to watch very carefully, and that is the challenge to my officials, of course, and particularly to my associate deputy minister, Mr. Craig Lee here, that whatever the configuration of support programs are in a given province that we do not lose out in any way our fair share, our percentage of the national envelope, the national contribution. That is a big concern to us. We have to watch that very carefully.
The other day the honourable member asked me a question here in the Chamber with respect to crop insurance, whether or not we would consider changing to the higher value component of crops in crop insurance, which by the way is what Ontario is pressing for, quite frankly. I indicated to her that would not be in our interest, because it would tend to shift greater dollars of the overall available dollars to provinces like Ontario and British Columbia, which have higher-value horticultural bearing food crops and not recognize the higher risk crop of our prairie agriculture that we have here in Manitoba.
So that is our constant challenge that is before the officials when we negotiate these deals. Certainly, we will be very much kept in the forefront as we go into negotiations during the remainder of the year as we try to bring about, hopefully, another five-year renewal of safety net support programs for agriculture.
On the issue of preparing, I will ask my staff to make note. It has certainly been our practice. We will, without any problem, furnish additional information to the honourable member as she has requested. It has been our practice. We will do that in this case for the kind of figures that I just read into the record with respect to the NISA account holders. All she needs to do is to ask specifically, identify the kind of information that she wants, and, in the course of a few days, this information will be made available to her.
Ms. Wowchuk: Mr. Chairman, the minister indicated that we want Manitobans not to lose out. I would like to ask the minister then, is Manitoba being treated fairly now? Are we getting a fair percentage in comparison to other provinces? How is he going to ensure that we do get a fair share of the dollars that we need to address the risks that Manitoba's farmers face? Because Manitoba farmers face much different risks than farmers in Ontario, farmers in B.C. We just see a good example of that this week when we have the frost; in parts of the province, there is a possibility of drought. Our climate is just different. So, two questions: are we getting a fair share now in comparison to other provinces, and how is the minister going to ensure that we continue to get our fair share and ensure that Manitobans have the protection they need?
Mr. Enns: The honourable member has heard me from time to time indicate my satisfaction and, indeed, my pleasure that we have what I term to be very acceptable participation rate by our producers in, for instance, our basic programs of crop insurance and NISA. That possibly is one of the best guarantors of us getting our fair share in the sense that that is driven, our crop participation is high. The federal sharing stays at roughly 60-40--60 federal, 40 provincial--in these programs. I would have to say that we are getting all of our fair share. Some of the other provinces where the participation rate in such programs like basic crop insurance, the rate is considerably lower. They are devising other schemes to get their fair share of the federal safety net envelope.
That is what, for instance, to some extent I think was responsible for Alberta, not the only reason, I cannot speak, I would not want to speak of what motivates the Province of Alberta's Ministry of Agriculture developing their style of safety net programs, but they, for instance, have chosen quite a different program. They call it an all-risk program that clicks in when the overall, all-inclusive income of a farm falls below 70 percent of their five-year average earnings. Then a disaster type support program clicks in.
Now, part of the reason, I submit, why they have chosen that is because they have never been quite as successful as we have been in getting the basic crop insurance becoming as significant to their overall support programs for their producers, but that is just conjecture on my part.
But inasmuch as programs like NISA and basic crop insurance are client or customer driven, if you like, if only 60 percent of my producers are involved in crop insurance, that is a draw-down on the figure of X number of dollars. If it is 70 or 80 percent it is obviously higher. It is in our interest to see that the participation rate is high. I might say that if it is not higher that does not mean that the dollars would be lost to the province of Manitoba. We would look then at some other companion way, and that is why they are called companion, of spending those dollars.
That is why, Mr. Chairman, I might just simply add, even though the honourable member and some members within the agricultural community have had some critical comment about when we were looking at the end of the day, there could be some dollars left on the table, federal dollars left on the table. Rather than see that happen I wanted to, I devised the program for agricultural research and development, the ARDI program, to use those dollars so that I can answer that question fully, the question that the member just put to me: are we using, are we getting our full allocated share of federal dollars and of course matching them with provincial dollars, which we have to do to access those dollars? So we have done that in the current year, and these Estimates reflect that.
Ms. Wowchuk: The minister has confused me a little bit. I just want to ask him if he could just explain this in a very short way. My understanding is that we get an envelope of money and that envelope of money has to be spent in the province on either safety nets or companion programs, but the minister seems to be indicating that if we have higher participation, we get more money? Or is it always in the envelope? Then my question, as far as percentage-wise, whether we are getting our fair share, I was asking whether we, in comparison to other provinces, get a percentage, but I do not understand the minister on the envelope, whether we can go over the amount if we have higher participation.
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Mr. Enns: I want to indicate to the honourable member for Swan River, it is entirely honourable and appropriate for me to do my best to confuse her because that is the way the adversarial business of politics get played. It is not all that honourable and appropriate when my staff, then, confuse me in trying to find the answer.
What I am suggesting is that this is a bit of a complicated thing. She is partly right and I am partly right when we say because of our higher participation through our agricultural extension work, our Crop Insurance Corporation work. We have done an adequate job in bringing out the education to our producers, and that results in higher participation. We, in effect, get a higher share of the dollars. Out of that envelope, 180, I am told, for instance, in straight basic crop insurance, out of that $650 million, that is, the $600 million that is the federal envelope, $180 million is dedicated to crop insurance. It is worked out on a three-year average--right about here is where it starts getting confusing.
The honourable member can see that if we have a higher participation rate, we draw from that $180 million first. Any residual dollars left over get paid out on the basis of cash receipts, you know, on sales. That is not our type of agriculture that much, that favours more the Ontario and British Columbia forms of agriculture, so that we do better by maximizing our access to these basic programs like crop insurance.
Ms. Wowchuk: I think we will leave that one for a little while and come back to it later.
I want to ask the minister on another subject. We talked about the increased hog production, livestock production, in this province, and with increased production, we are going to see more people working within the industry. We know that our records as far as farm safety are not good. We have a lot of accidents in the farming industry. I want to know: where does farm labour fit under, is it under labour standards? Who monitors what is happening within the agriculture industry as far as employment, and who has the responsibility to ensure that the workplace on the farm is safe?
Mr. Peter Dyck, Acting Chairperson, in the Chair
Mr. Enns: We, in the Department of Agriculture, of course, are very cognizant of the fact that, as the honourable member says, farming, regrettably, still maintains an unenviable record of being a hazardous workplace. We co-operate with different agencies to promote farm safety. We have designated a specific employee working out of our Portage office, Cathy Vanstone, who has specific responsibilities in the area of farm safety. We co-operate with private organizations in trying to promote the importance of farm safety wherever we can.
In addition to that, there is, of course, no question that any of the associated agriculture business operations, plants for processing, something like that, they come more directly under the regulations of the Workplace Safety and Health regulators in the Department of Labour, of which I am not fully familiar with.
There is still that gap. Certainly, this would be true too of some of the different styles and types of livestock operation. Larger barn units that you are seeing developing in the province, where people are hired, there will be eight, nine, 10 people working in the barn. They would more formally come under the normal Labour regulations of the province with respect to Workers Compensation, with respect to unemployment insurance and Workplace Safety and Health regulations. It does not, my understanding is, unless it is done voluntarily, cover the individual family farm unit. My understanding is that my own private family farm, I have to take the initiative. I am not required by law to provide Workers Compensation benefits, for instance, to my son or somebody that is working on my farm. I believe I have the option of voluntarily subscribing to it if I pay the appropriate premiums. So there is that gap that remains, and quite frankly, the take-up on the private individual family farms of what is available to them is not very high, is rather low.
Just a little further on that, the representation of Manitoba Agriculture's farm safety team on provincial, national and international committees is provided by farm safety team leader. This included preparation for the 1998 National Institute of Farm Safety conference is to be held in Winnipeg in June of 1998. This June, we are having a national farm safety conference here in Winnipeg. I invite the honourable member to come and participate in that conference.
Ms. Wowchuk: Mr. Chairperson, I invite the minister to provide us with details of that conference because I think it is very timely, and I think it is very important that we do address farm safety. It is, I believe, a major issue.
My question was, and I think the minister answered it then, when we have a hog operation that is built and there are employees there, then these people will fall under Workplace Safety and Health, and it will be Workplace Safety and Health that sets the standards that employers are required to meet for the safety of their employees.
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There are no requirements from the Department of Agriculture. Once there are employees there, it shifts over to Workplace Safety and Health, or is it an option that Workers Compensation be provided? I understand the part about the individual farmer not being covered, but I am wondering whether it is a requirement that the compensation be provided or whether it is an option.
Mr. Enns: I will undertake to get the information accurately on that one. There is some doubt in the minds of some of my officials and myself whether or not that is the case. It may be by choice, although from my little understanding, I know that once people are regularly employed, and this is what we are talking, you know, they are working 40 hours a week or whatever it is, you are automatically enrolled into such things like the unemployment insurance program.
I believe the employer would be automatically liable for and called upon to make the premium payments to Workers Compensation Board, and the operation would fall fully under the Workplace Safety and Health regulation of the Department of Labour. But I will undertake, I note my deputy minister, Dr. Z, here is making note of this. We will provide that information to the honourable member for Swan River (Ms. Wowchuk) when next we meet. You notice that puts a kind of romantic tone to that confrontation--when next we meet.
Ms. Wowchuk: I am not trying to wander into areas that do not fall under the Department of Agriculture, but I think it is a really important issue. It is a growing industry, and we are going to see more employees within these kind of facilities. I am wanting to find out what kind of protection and who is responsible for administering. My understanding was that it was found under the Department of Agriculture, and it is the Department of Agriculture that sets the standards on these kind of facilities. That is why I am wanting to check it out.
Mr. Enns: I certainly agree with the honourable member, and I do not want not to take this anything but very seriously, and we are in the Department of Agriculture. We have a significant committee working as an advisory council to Workplace Safety and Health. We are involving people from agriculture producers organizations, we have peoples involved from our community colleges, we have different commodity groups like the Dairy Producers Association.
I am just reading out a list that we are involved with and that Agriculture is very much involved with that has to do with safety on the farm and in agriculture generally. I certainly want to indicate to the honourable member that that is an aspect of agriculture that quite frankly we ought not to be satisfied. I am offended that agriculture is, for instance, more dangerous than mining or than forestry. It is, I think, a call on all of us involved in agriculture, whether it is in the departments of Agriculture or the various agricultural commodity organizations, farm organizations, we ought to all collectively redouble our efforts to make farming a more safer vocation.
Ms. Wowchuk: I look forward to getting the information that the minister can provide on that, and after we get the information perhaps it will lead to further discussion. Under this section we have the Information Technology Services, and it says: to ensure that information technology systems are compliant to the year 2000 projects.
We have the various departments listed where it looks to be improvements made to the computer systems. I want to ask the minister, we have this whole new development of desktop and better methods, different systems brought in, and I would like to ask the minister if he can indicate what kind of cost that has been to his department, not necessarily the Crop Insurance and Agriculture Credit Corporation but just the various departments of Agriculture. What has this changeover to the new systems meant? Has it meant a substantial amount? What kind of dollars have been spent on Systemhouse for the desktop contracts?
Mr. Enns: The honourable member is correct. Significant funding is associated with the project of bringing our computers' capacity and systems up to speed. The department has identified funding for the transition year 1998-99, but also for the fiscal year 1999-2000. Funding has not quite been finalized. We are spreading the cost over several years. In the Estimates before you, we have some $488,875 allocated for this purpose. There are some offsetting reductions of $179,000, but all in all we will require an increase as identified in these Estimates of some $309,000.
The full cost, if I want to answer the honourable member's question, is in excess of--it is $1,145,000. That I am told will make the transition to the new computer system throughout the department province-wide involving in excess of 400-and-some computers in all the various regional offices and convert it all to the system that the government has now adopted.
Ms. Wowchuk: Can the minister indicate whether that is--we talked about the money--the cost of it is new money that is going to be allocated for this changeover, or is it money that is going to have to be found within the Agriculture budget?
Mr. Chairperson in the Chair
Mr. Enns: Staff was advising me that we would have been involved in this updating, if you like, or change, in any event. We would likely have taken a somewhat different time frame to do it, maybe spread that over a longer period, five, six years. We are currently compressing it into a period of two or three years. These are dollars that are--I do not know how you describe them--new dollars or old. These are dollars that normally are provided to the department for administration and for capital equipment charges.
The honourable member has not asked me yet whether I think it is improving the information flow any, and that is another question to be debated, but I have tried to provide her with the information that I can.
Ms. Wowchuk: Mr. Chairman, I understand that this changeover to a new system is quite complicated and it is going to take a lot of time. Can the minister indicate whether any staff from his department have been seconded to other departments to do work on getting ready for this changeover to the new systems?
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Mr. Enns: Well, actually this whole computer conversion is being forced on us by our Director of Marketing, one Ms. Dori Gingera. It is her baby, and she is kind of responsible for its smooth transition and introduction to the department. If it does not work, I will have quiet words with her sometime in the future.
Ms. Wowchuk: Is the minister indicating in that comment that I should be asking these questions under another section of the Estimates?
Mr. Enns: No, we have two staff that left the department and now work with Systemhouse. One of these SMYs was not wholly dedicated to desktop support prior to the contract with Systemhouse, but the SYs were refilled on a term basis. One of these is assigned to the year 2000 development project and the other works as the department's co-ordinator with Systemhouse, as well as other duties as time permits. In other words, we have staff people working directly with Systemhouse on behalf of our department to make this conversion as smooth as can be.
It is my hope that at the end of the day the system will be in place and we will have a system that--and it is important that we have a modern, flexible and up-to-date system in an increasingly computer-driven world. By that I do not mean just within government, but our clients, our farmers, our people that we are dealing with on a daily basis. You know, computers are very much a part of agriculture, and it is our hope that this will position the department in a way that can respond to these needs.
Ms. Wowchuk: Did the minister say that there were 400 computers that the department has, then, under the Systemhouse contract?
Mr. Enns: We have about 430 I am advised, Mr. Chairman.
Ms. Wowchuk: Can the minister indicate then, for example, Manitoba Agriculture Credit Corporation or Manitoba Crop Insurance, would those departments tie in directly with Systemhouse, or are there separate systems that are set up within those departments?
Mr. Enns: Well, they do not come under the general direction that we in government have come under to convert to Systemhouse. They have their own arrangements. In fact, our knowledge is such that in some instances they have been updating several years ago and are in the process in some instances right now and are ahead of us, if you like, and are not tied to the Systemhouse contract, in fact are not using Systemhouse.
Ms. Wowchuk: Can the minister indicate, then, who will provide the services when this whole system is up running? Will there be people within the department who will provide the service--I am speaking about the Systemhouse project--or will there be someone else that is providing it?
Mr. Enns: That in fact will be a combination. There will be some ongoing contractual obligations that the department, as the rest of the government, will have with Systemhouse to provide some of the ongoing maintenance and development of the system, but within the department ourselves we will also be doing and are getting much more computer literate. We will have staff people involved in the development of software specific to the programs that are important to us and ones that, from our experience, will be user friendly and of assistance to the farm community. So as we become familiar and experienced with the system, we will have some of our own staff people who will be in that area of providing software and providing developmental work on these computer systems.
Ms. Wowchuk: Again, I do not have a very broad knowledge of computers, but I want to ask the minister: does he foresee any problems with the Agriculture offices spread out as widely across the province as they are and with the commitment to Systemhouse? Does he see any difficulties in providing the services that will be needed within the offices outside the city of Winnipeg?
Mr. Enns: We are confident that with our regional structure that we have in place and well established over some years now, we will be connected with the modern computer systems that are now being put in place. I would hope that, if anything, the flow of information, communications, flow of data from head office to regional offices, from regional offices to regional offices should, if anything, be improved because one has to ask the question: why is Dori pushing us into this if we are not going to have a better communication system when it is all said and done?
An Honourable Member: Because it is good for you, Harry.
Mr. Enns: I am not quite convinced about that, but then I am also belying my age. You see, I am still in constant awe when I--honourable members of the committee may not believe me, but I can take this little plastic card, stick it in a machine, push a few buttons and $20 bills get kicked out at me. I mean it happens. It happens to me right here in Winnipeg. That is maybe understandable, but I can be in Mexico or in Chicago--and nobody knows me there in Monterrey or Chicago--I put this little plastic card in the machine, and I pushed a few buttons. I must acknowledge, it does not always work. Sometimes another little message comes on out there, sorry, not sufficient funds in place, or something like that. I stand in constant awe of the computer age that makes this possible.
So for the honourable member now to come down so heavy on me about whether or not this Systemhouse computer system that we are spending $1,114,320 on in Agriculture is going to work and going to solve all our of our communications problems, I think, Mr. Chairman, that is being a little unfair. I think that is taking advantage of a senior citizen here.
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Mr. Chairperson: The hour now being five o'clock, time for private members' hour. Committee rise.