In an interview, Mr. Ritz said the Conservative government has made policy changes to focus more resources on research and development and new markets. “We want to make sure that farmers get their money from the marketplace not the mailbox,” he said.
To be sure, there are success stories. Canada has become a world leader in pulse crops, such as beans, lentils and peas, which are in huge demand in Asia. Wigmore Farms in Regina exports beans and peas to 30 countries, and annual sales for pulse processor Alliance Grain Traders Inc., also based in Regina, have jumped to $300-million from $12-million in four years. Others, like Edmonton’s Little Potato Company, have developed successful niche products.
But the overall situation is not so rosy; most Canadian farmers still rely on government payments to make ends meet. The figures are telling. Roughly 70 per cent of all government spending on agriculture goes toward so called “business risk management” initiatives, which are essentially income support payments. And the bulk of those payments go to farms many experts say are too small to compete internationally.
“A lot of people who have small farms do it as part of their lifestyle,” said David Sparling, chair of the Agri-Food Innovation and Regulation program at the University of Western Ontario. “They are a dentist, doctor or truck driver and the farm is just part of their life. I don’t have any problem with that. I’m just not sure that [taxpayers] really need to be supporting a lot of them.”
Studies by Prof. Sparling and others indicate that farms need about $250,000 in annual revenue to have the scale necessary to compete. According to figures compiled by Statistics Canada, that’s the point where farmers generally start to earn more money from farming than from off-farm sources. A farm that size would roughly be equivalent to an operation with 400 acres of corn, or 700 acres of canola, or 300 beef cows.
Most Canadian farms don’t come close to that. Of Canada’s roughly 230,000 farms, about 80 per cent have annual revenue below that amount, and more than half pull in less than $100,000. Just about every farm under $100,000 would lose money from farm operations, or barely break even, without government support payments. Put another way – 20 per cent of Canadian farms generate most of this country’s agriculture products.
“As Canadians we should be asking our government, you can spend this kind of money but what are we getting?” said Al Mussell, a researcher at George Morris Centre, based in Guelph, Ont. He believes governments have to find other ways to support small farmers aside from sinking more money into income support programs.
Many farmers say a big concern is the multitude of costly ad hoc government programs designed to help farmers deal with everything from drought and floods to beaver dams. While usually well intentioned, such programs often reward farmers who made bad decisions, such as not buying crop insurance. “You know, I don't blame those guys for getting the money, but it made the rest of us look like chumps for always covering our back end that way,” Ontario farmer Hugh Aerts told a parliamentary committee last year. “My Number 1 beef is that targeted programs do not work. They create more inequities than they solve.”
Governments are already facing the crunch. In Quebec, two recent government-sponsored studies recommended sweeping changes to the province’s farm income stabilization program, which spends nearly $1-billion annually. One report concluded that “the agriculture and agrifood sector has a system of laws, regulations, structures, and modes of operation that are so closed they are in danger of literally suffocating it.”
Prof. Sparling said it’s time government funding went toward other areas such as research and development and opening new export markets. Of the roughly $8-billion spent annually by federal and provincial governments on agriculture, just $156-million goes into research programs and only $140-million is spent on trade development. “I just would much rather see investments looking at the future rather than looking back.”
