Most people expected an electoral budget from the federal government this week and that’s exactly what Canadians got. But for the agri-food sector, the budget was underwhelming at best and provided little hope for the near future.
Let’s start with supply management.
The Liberal government opted to do exactly what the previous Conservative government did in the middle of the last election campaign in 2015.
The Conservatives announced an out-of-nowhere $4-billion compensation package for supply-managed sectors, while signing the Trans-Pacific Partnership (TPP) agreement, now known as Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Coming in the middle of an election campaign, the Conservatives’ program was largely improvised.
Similarly, the Liberals have provided no hint about how they intend to make Canada’s supply-managed agriculture sectors more competitive. Monies will be allocated based on speculation and presumptions, just to buy peace, since no timeline for the compensation was provided.
This time, $3.9 billion in funding is budgeted, with $2.15 billion in direct compensation. There’s $1.5 billion for a Quota Value Guarantee Program to be applied on an on-demand basis when the quota has been sold.
So Canadians will be acquiring back from farmers the quotas that were given to them years ago at no charge. The attempt to procure votes in Quebec is extremely obvious.
To do this right, the budget should have looked beyond supply management to support other sectors that are similarly impacted by trade.
Instead, the Liberals have decided we will keep an outdated system while subsidizing farmers who have prided themselves for years on not accepting public subsidies. Compensating farmers without a plan for the future of supply management is the worst possible scenario for everyone, starting with the farmers.
Farmers will only see their sector shrink further, especially in dairy, and many more farms will disappear with no strategy for less populous regions in the country, like the Prairies and the Atlantic. This will be a slow and painful way to go.
Nothing is planned for other commodities, including canola, pulses and others affected by quasi-embargoes and trade disputes.
There is a small budget, at least, to deal with African swine fever, a disaster-in-waiting for the hog sector. It’s just a matter of time before the disease hits North America. Once it does, we’ll need to brace for another mad-cow type of scenario.
The budget’s supply-management compensation program doesn’t extend to concessions made under the new United States-Mexico-Canada Agreement on trade. This is likely the Liberals’ way of saying the deal is damaging for many agricultural sectors and therefore stands little or no chance of being ratified. It’s also probably the only thing that made sense for the agri-food sector in this budget.
Some provisions were made in the budget for a food strategy. If we want to make good on the aspirations of our newly-minted Canada’s Food Guide, our agricultural landscape will need to change. We need to grow more fruits and vegetables in this country. However, a budget of $134 million over five years provides virtually no help.
Quebec, with a population of about 8.4 million, has just adopted its own food strategy. It’s spending more than double the federal amount this year alone. So essentially, Ottawa has no idea what it takes to give the country a robust food strategy.
On the rural broadband Internet front, the government intends to invest $1.7 billion in new infrastructure and satellite technology. This is obviously long overdue. But that sum will be spent over 10 years and requires support from the private sector. By 2030, who knows if the technology will be adequate for farmers to connect with the modern world?
The food processing sector – the largest manufacturing sector in the country – was given peanuts. The budget offers $100 million to support innovation and plant upkeep projects. Given that the cradle of food innovation has always been food processing, that’s almost insulting to the 250,000 people working in this sector.
A total of $24 million is dedicated to food fraud, in support of Canadian Food Inspection Agency efforts to crack down on cheaters. It’s estimated that food fraud costs the agri-food sector $10 billion to $30 billion a year. The problem is massive and CFIA needs all the help it can get.
Largely forgotten in the budget were the export targets suggested by the Agriculture and Agri-Food Economic Strategy released last September. Shockingly, not one cent was allocated to support the sector reaching its ambitious $85-billion export goal by 2025.
This budget doesn’t accomplish much for agri-food other than admitting that the new trade agreement is bad. But everyone knew that already.
It feels like the Liberals, an urban-focused government, are simply checking boxes to please a sector that it barely understands.
Canadians are smarter than that.
Sylvain Charlebois is scientific director of the Canadian Agrifood Foresight Institute, a professor in food distribution and policy at Dalhousie University, and a senior fellow with the Atlantic Institute for Market Studies.