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The Huron Expositor, 1989-09-27, Page 2222A — THE HURON EXPOSITOR, --SEPTEMBER 27, 1989- Sh. rt hi 'The 25;000=member :Ontario Core Pro- pueers' Association (DCPA) :teas voiced its major disappointment over °•;ietails of the Canadian Crop Drought -Assistance Program announced in -iearly August, and its .displeasure that expected changes to the Federal Crop Insurance Act will fall short of what is needed to •eliminate •sinillar "ad hoc" weather-related relief assistance in the future. The OCPA criticisms over the drought program arise on two accounts — firstly, that the payment calculation is substan- tially less than that promised by the Canadian government last fall, and secondly, that the appeal process has been deliberately structured to prevent inequities in the program from being corrected. "Grains and (liieeeds Minister, Charles Mayer, promised us clearly and unam- biguously, in front of over 14000 par- ticipants at the Canadian Agricultural Outlook Conference last December, that the formula would be a full 10 percent top up above average crop insurance sup- port levels —• 77 percent of historic average yields in Ontario, and 75 percent in the West," said Cliff Leach, OCPA president. "Mr. Mayer also assured us that this level of assigjance would be provided even if the total cost ran well above the $850 million initially estimated. "Now it's clear that the assistance ha>; been cut deliberately to meet this budgeted figure, even though provinces are apparently paying a portion of the bill," stated Mr. Leach. "The consequence has been a drop in the Ontario support level to a 73/4 percent top -up above a75.percent base level, with the net result being a $10 to $15 per acre decrease in assistance for thousands of Ontario corn fanners hit by last sum- mer's. severe weather. In some townships this cut has meant the elimination of drought assistance to corn producers entirely." - Mr. Leach noted that LIT: decrease in formula was not appiieo univ'rsallc across Canada. In Queoec, the 7 , pe - cent top -up was provided above a nigher base level of 80 percent. OCPA has calculated that this difference would. have F.urther steps on Pork Duty International Trade Minister John C. Crosbie and Agriculture Minister Don Mazankowski have announced -further steps by the federal government to de- fend Canada's pork industry in light of the U.S..government ruling that Canadian pork exports threatened to harm the American industry. The ruling put in place a countervailing duty of eight cents .a kilogram .on Canadian exports of fresh, chilled or frozen pork. "We are now requesting consultations with the U.S: under provisions of the General Agreement on Tariffs and Trade (GATT)," Mr. Crosbie .said. "We are challenging the GATT consistency of the automatic subsidy pass-through provision of U.S. law." The government, together with the Canadian Pork Council, the Canadian Meat . Council and the Province of Alber- ta, has already invoked' Chapter 19 of the Canada -U.S. Free Trade Agreement (CUSTA) to convene a binational . panel to review the final subsidy determination by the United States. Mr. Mazankowski said: "As well as joining with the industry in pursuing every available option to have this ruling overturned, the government is also sup- porting an industry -led initiative to ad- dress how best to manage the 'current crisis." This will take the form of a task force, made up of representatives of the Cana- dian Pork Council, the Canadian Meat Council and exporters. It may also look at developing, a .joint marketing strategy for the future. "As a further measure, Agriculture Canada is undertaking a comprehensive study of U.S. agricultural support pro- grams -at- the federal and state levels," Mr. Mazankowski continued. "This will provide us with a useful data base to prepare for any future U.S. initiatives to block imports from Canada. It will also give us a better .understanding of .the degree of subsidization of U.S. farm ex - poets to Canada." Canada will now formally request con- sultations with the United States under Article XXIII of GATT. Should these pro- ve to be inconclusive, Canada intends to request that the GATT Council establish an international panel to render a decision. Canada's CUSTA Chapter 19 action will challenge the U.S. goverrunent view that the Canadian -National Tripartite Hog Stabilization Pogrom is countervaiiable because it is commodity specific. The federal government is also challenging under CUSTA the applicability in this case of the automatic subsidy pass- through provision of U.S. law. Under Chapter 19 of CUSTA, the panel's decision will be binding on both .par -ties. -Panels are made up of five members . appointed by the two govern- ments and have 315 days to prepare a final decision. IM .hr' arnounted <to a -substantial 'difference -in the payment -level someema jor Ontario corn.producing -townships. The OCPA •president ‘also expressed major ,disappointment •over the .appeal procedure. OCPA -and other farm organizations have recommended repeatedly 'that -the appeal procedure be .designed so that special consideration be given to farmers who could prove, via -individual crop in- surance •records or other means, that they had been injured more severely by drought than the township -average yield data would indicate. ' Yet this avenue of appeal has been specifically blocked by the Canadian Government in procedural rules announced recently. OCPA intends to continue Its battle to have appeal procedures structured in a much more equitable manner, The Ontario Corn Producers' Associa- tion has also expressed major disappoint- ment over aspects of crop insurance reform — i.e., 'the reforms supposedly designed to eliminate future need for special ad-hoc weather-related relief pro- grams — at least as 'they were agreed upon at the recent meeting of Canadian agriculture ministers at Prince Albert, Saskatchewan, "While we are pleased that the reforms will include significant measures to im- prove -maximum .insurance coverage levels, we're deeply upset that no changes were made to make the program more affordable to farmers, and to pro- vide for a fully equitable sharing or premium costs by the two levels of government and farmers," said Mr. Leach. "Perhaps our expectations were ,built- up too high when .Canadian .agriculture minister Don Mazankowski told Ontario corn farmers last February that 'crop in- surance has to be improved,' that 'affor- dability' was a key issue, and that 'the federal government and producers .pay roughly 90 percent of crop insurance costs' and We are•going to have to in- crease the level of 'provincial support'," -said Mr. Leach. "However .the real federal agenda was laid out in the • April Federal Budget which stated the -government's intention to shift half of its crop insurance ss tar premium costs to the provincial govern- ments, thereby realizing 'a federal sav- ing' of about '$100 million annually, with no mention of premium cost changes for 'farmers," added Mr. Leach. The cost-sharing formula subsequently agreed •upon at Prince Albert was for a 25 percent:25 percent;50 percent ('federaltprovincial:producer: sharing of premium costs — "a major economic benefit to the federal government, 'but no better deal for growers," concluded Leach. "The Prince Albert agreement makes us suspicious of the motives of western provincial agricultural ministers," added Mr. Leach. "Why were they so willing to spend provincial money to reduce premium costs for the federal government, but not for farmers''" "What other `deals' were made to en- tice provincial ministers to accept such an obviously lop -sided and inequitable arrangement?" "Mid why can't federal and provincial ministers realize that high premium costs are a major reason for the low percen- tage of participation in crop insurance Le., a basic reason for • the specific ad hoc weather-related relief programs which have been required in Canadian agriculture in recent years?" asked Leach, Mr. Leach noted that his criticism should be tempered in the case of the On- tario Govermnent which proposed that crop insurance premium costs be paid in a full tri -partite (i.e., es: :1/3 ) manner among governments and producers. However, Leach urged the Ontario Government to be more forceful in pro- moting this position in its discussions with other provinces "Crop insurance is vital to the economic sustainability of producers 'who have no roofs to protect their enterprises from the ravages of bad weather," con- cluded Mr. Leach. 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