The Conservative government, Canadians can expect to be told in Wednesday’s Throne Speech, is the consumer’s best friend.
Expected promises include caps on cellphone roaming fees, an end to paying for unwanted television channels and an airline-passenger bill of rights. All these are welcome measures, but what’s that got to do with the price of eggs?
We mean this quite literally. If the government wants to be committed to consumers, it should promise to reform one of this country’s most antiquated policies, one that hits consumers in the pocketbook every time they visit the grocery store: Canada’s supply management system.
It protects many agricultural sectors from competition and artificially drives up the cost of staples including milk, cheese, poultry and eggs. The problems are especially pronounced when it comes to dairy, where the system is essentially a cartel: Farmers are issued quotas for how much they can produce and supply is artificially limited. Their products are further protected from foreign competition through high tariffs. The result? In Canada, four litres of whole milk costs twice as much as in the United States. A recent report from the University of Calgary estimates the average family pays $200 a year more than they should for their milk, dairy products, chicken and eggs – all because of supply management.
This national system dates back to the 1970s, and was created to help dairy producers stabilize their incomes. Back then, there were about 145,000 dairy farms in Canada. Today, that number has shrunk to under 13,000, less than half of one per cent of Canada’s economy. A small number of farmers are benefiting disproportionately, at the expense of millions of Canadian consumers. The math defies logic. Supply management isn’t just hurting shoppers. It’s also throwing a roadblock in front of trade negotiations such as the Trans-Pacific Partnership. Other countries resent the high tariffs Canada imposes on their dairy, poultry and eggs. Canadian consumers should, too.
Ottawa: Do you want to be a true friend to consumers? Do them a solid. Scrap supply management.