A bill that would make it illegal to negotiate an increase in foreign access to Canada’s supply-managed farm sector in trade talks has made it to second reading in the Senate.
A small number of voices have loudly spoken up about how this shortsighted and politically motivated bill is a threat to the country’s future. Two brave Liberals MPs voted against it, as did a sizable rump of Conservative MPs from the West. But it passed on third reading in the House of Commons by a 262-51 vote, and its time in the Senate has been just as frictionless.
Its ultimate passage would set the stage for disaster in the potentially very fraught joint review of the Canada-United States-Mexico Agreement that has to happen in 2026. It could also prove to be deeply divisive, pitting dairy farmers in the East against beef farmers in the West, for example.
Yet to date, few of the MPs and senators who have set the bill in question on a rocket-like trajectory through Parliament seem to have thought these things through.
The bill, C-282, would prevent a Canadian negotiator working on a free-trade deal from agreeing to an increase in foreign access to the markets protected by supply management – dairy, eggs and poultry – or to the lowering of existing tariffs on imports of products in those sectors that exceed quotas.
Supply management depends on a protected market. It combines high tariffs and strict import limits with quotas on domestic production, and then fixes the prices farmers get from processors and restaurants for their milk, eggs, chickens and turkeys.
The inevitable upshot for consumers is higher prices, and because of this supply management is often criticized as a Soviet-style command economy that has no place in a free market.
But a person doesn’t have to be philosophically opposed to supply management (although it helps) in order to see the folly of locking it out of future free-trade negotiations.
As critics of the bill keep saying, under the terms of CUSMA, Canada, the United States and Mexico are obligated to review the deal in 2026 before agreeing to its continuation for another 10 years.
Canada’s cloistered dairy industry was a huge bone of contention when CUSMA’s predecessor, the North American Free Trade Agreement, was reopened at the whimsy of former president Donald Trump in 2017.
Whether or not Mr. Trump is back in the White House in 2026, there can be no doubt that dairy, and supply management in general, will be sticking points again. Making those things untouchable will tie the hands of the government as it seeks greater access for Canadian farmers and manufacturers to Mexican and U.S. markets, and could even prove to be a breaking point in the negotiations.
It would also be terribly unfair to other sectors of Canada’s economy as they are offered up in exchange for market access, while dairy, egg and poultry farmers sit protected behind a legislated wall.
Canada’s negotiating position would have to be, go ahead and target our beef market, our aluminum market, our lumber market … because we can’t give you even one dollar’s worth of greater access to our supply-managed markets. Either that, or CUSMA could be scrapped, which would be a disaster.
This defies rationality. But then the MPs who sent the bill sailing through the House and on to an all-too-compliant Senate aren’t thinking about 2026. They are thinking only about 2025, when the next federal election is scheduled to take place.
One of the unintended consequences of supply management has been to concentrate three-quarters of Canada’s dairy farms in Ontario and Quebec, where the next election will be won or lost. None of the main parties has ever dared in the past to challenge supply management for fear of losing votes in Ontario, and especially in Quebec, and Bill C-282 is having the same blinkering effect on them.
Even Conservative Leader Pierre Poilievre, that avowed enemy of “gatekeepers,” voted in favour of putting the gatekeeping supply management system behind an even higher and more impenetrable barricade.
Parliament is about to make a huge mistake that could harm the country’s economic future, and no one has yet had the courage or foresight to put a stop to it.