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Farmers urge government to invest in agriculture

With a federal budget to be presented on Tuesday, February 26th, the Canadian Federation of Agriculture (CFA) is calling on the federal government to invest in agriculture, citing good business practices and the need for prudent spending.


February 21, 2008
By Canadian Federation of Agriculture

02/18/08


OTTAWA –The Canadian Federation of Agriculture (CFA) is urging the government to make an investment in agriculture in the federal budget it presents February 26.
"Farmers are good businesspeople and they understand with the current economic warning signs a wise government must be prudent with its spending," said Bob Friesen, CFA President. "But prudent spending does not mean no spending. It means making an adequate investment in the sustainability and growth of industry sectors that make a significant contribution to the economy. Sectors like agriculture."

The CFA is making a number of budget recommendations that would help Canadian agriculture grow and continue to contribute to the economy, especially if there are lean years ahead. Those recommendations include:

1) Allocating funds and providing legislation to support the Canadian livestock industry through the financial crisis it is currently facing. The pork sector alone generates $2.5 billion in export dollars, billions more in domestic GDP, and employs tens of thousands of Canadians. If Canada does enter a period of economic slowdown it cannot afford to lose an industry making that kind of economic contribution.

2) Establishing a Cooperative Investment Plan (CIP). The CIP plan gives Co-op members and employees a tax deduction if they choose to invest capital into their cooperative. Across Canada there are more than 1,300 agricultural cooperatives, employing 36,000 people, generating over $19 billion/yr in revenue and channelling some $1.6 billion producer re-investment in the industry and rural communities. However with little to no access to outside capital and the inability for coop share capital to appreciate, cooperatives face disadvantages compared to private firms in raising capital. Quebec has had a provincial CIP-type program in place for two decades. The Quebec program plan has generated just under $400 million in new investments over a ten year period. A federal CIP program is estimated to cost the federal government $17-20 million per year and over several years will generate hundreds of millions of dollars in co-operative investment in rural communities.

3) Commit to working with industry to establish a ‘Grown in Canada’ food label system, backed with dollars earmarked for a national domestic marketing campaign to promote the label, and Canadian-grown foods, to Canadian consumers. A ‘Grown in Canada’ label will boost the agricultural economy by helping consumers clearly identify and choose Canadian-grown foods, keeping consumers’ food dollars here at home and increasing the demand for Canadian produce, which will benefit farm profitability.

4) Committing adequate funding to ensure the programs currently being developed under the ‘Growing Forward’ policy framework are a success.

"These measures we have outlined represent sound investments that will generate a beneficial return for Canada, whatever the fiscal future may bring," Friesen concluded. "Implementing these measures would also be a tangible demonstration the government is taking seriously the Minister of Agriculture’s philosophy of ‘farmers first’."