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A surprise federal cut to a program that protects farmers’ bottom lines has left two major Ontario farming groups hot under the collar.
On the heels of the newly announced $3-billion Canadian Agriculture Partnership, the Grain Farmers of Ontario and the Ontario Federation of Agriculture are seeing red over reductions to the AgriInvest program, a fund many farmers turn to when times get tough.
“We need those safety net programs like AgriInvest to be as good as they can be to help support us,” said Keith Currie, president of the Ontario Federation of Agriculture, which represents 36,000 farm families in the province.
“With the wet weather that we’ve had right across the province, there’s a lot of people who are going to be hurting at the end of this year.”
Though both groups are cheering other moves announced at the a recent federal-provincial agriculture ministers’ meeting, they’re sure the government made the wrong one by cutting AgriInvest.
“With the exception of crop insurance, AgriInvest is the only program, within the suite of risk-management programs, that works well for our farmer members,” said Mark Brock, chairperson of the Grain Farmers of Ontario.
The organization represents 28,000 grain farmers in Ontario, many of whom farm in Southwestern Ontario’s productive farm belt.
When markets take a downturn, or weather throws them for a loop, AgriInvest helps farmers manage small drops in income. It’s not meant to be a big-ticket boost, but modest cash flow support to help farmers bounce back from declines.
Farmers make annual deposits based on their net sales and receive matching contributions from federal and provincial governments on one per cent of their total.
But starting in 2018, the feds will reduce the contribution cap by $500,000, an unexpected cut that’s not sitting well with Currie.
“There really wasn’t any consultation on it. There wasn’t any discussion amongst the provincial agriculture ministers,” he said.
Agriculture and Agri-Food Canada is changing the program to free up funding for AgriStability, another risk-management program that Brock said doesn’t meet the needs of many farmers.
“Grain and oilseed producers tend not to ever trigger a payment,” he said.
“We almost have to be at a 50 percent loss in income before we’d ever even get a dollar.”
The federal government, with its provincial partners, plans a full review of its risk management-programs, but made the AgriInvest cuts anyway.
“It seems to fly in the face of co-operation when, meanwhile, they start monkeying with the programs before we even get to the review process,” said Brock.
The federal Agriculture Department said the early changes to AgriInvest are needed not only to expand other loss-mitigation programs, but to get producers the coverage they need.
“Governments also wanted producers to benefit from the improvements to BRM (business risk management) programs, and other industry-wide and farm-specific gains,” wrote spokesperson James Watson in an email, “rather than wait for the results of a review.”
It’s not clear whether the year-long program analysis will change Ottawa’s mind on AgriInvest, but Currie isn’t holding his breath.
“I don’t hold out a whole lot of hope that they’ll change it back to the full funding level. I suspect that this is a done deal and we’re moving forward,” he said.
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Changes to AgriInvest
Effective April 2018
Maximum contribution from farmers reduced to $1 million from $1.5 million
Maximum government payments reduced to $10,000 per account from $15,000
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