Thank you. It's a pleasure to be here.
Thank you, Mr. Chairman and members of the committee. I'm pleased to be here on behalf of the Canadian Federation of Agriculture to speak to you today about Bill C-18, the agricultural growth act.
My name is Humphrey Banack. I'm a grains and oilseeds producer from Alberta and vice-president of the Canadian Federation of Agriculture. The CFA represents through its member organizations more than 200,000 farm families from across Canada to promote the interests of Canadian agriculture and agrifood producers, and to ensure the continued development of a viable and vibrant agricultural and agrifood industry in Canada. We believe Bill C-18 will contribute to a more vibrant agriculture industry in Canada by modernizing a number of pieces of agricultural legislation. However, we will identify a few key points we believe should be addressed.
Due to time constraints I would like to focus my comments primarily on changes to the Plant Breeders' Rights Act and the advance payments program.
Despite signing onto UPOV in 1991, Canada has remained one of the few developed countries in the world not to ratify it through amended legislation. As you heard in the earlier presentation by Partners in Innovation, of which CFA is a member, this has limited investment in Canadian varietal development and prevented Canadian producers across a wide range of sectors from accessing the most up-to-date and innovative products.
CFA is a strong proponent of the introduction of updated plant breeders' rights legislation, and Partners in Innovation illustrates the broad industry support of these updates.
The issue boils down to making sure Canadian farmers are competitive and aren't falling behind other countries. We believe the legislation strikes a good balance between giving plant breeders the ability to receive a return on their investments in R and D while preserving the ability for farmers to save, store, and condition seed for their own use.
Although a number of concerns have been raised as to the effects that UPOV 91 will have on the diversity of breeders in Canada, international evidence suggests that the implementation of UPOV 91 will result in an increase in the diversity of Canadian breeders. I would also like to point to the fact that 45% of all the agriculture varieties currently protected under plant breeders' rights were developed at public institutions.
I must note our continued concerns with the recent shift away from public funding for basic varietal development, as it may very well reduce the presence of new, publicly funded varieties, and reduce competition from public entities. However, enhanced plant breeders' rights provide a platform for exciting new developments between producers and public institutions. With draft UPOV legislation now progressing through the House, we've already heard mention of a new research centre in Saskatoon, and partnerships between Canadian companies and international breeders. We continue to hear of groups exploring producer-led breeding initiatives in Canada. However, we believe increased funding for producer-public partnerships in this vein is needed in the future.
We see updated plant breeders' rights as a necessary step for the long-term competitiveness of Canadian agriculture, leading to increased investment in varietal development, and providing producers with access to the most up-to-date varieties.
I would like to comment on two specific components of the changes announced to the Plant Breeders' Rights Act: end point royalties and the farmers' privilege.
As already stated, Bill C-18 does not introduce end point royalties into Canada. Instead it creates a legislative framework through which end point royalty models can be developed through regulation. Our primary concern is that producers must have a significant role in future regulatory processes through robust consultation to ensure that any such royalties are reasonable and supported by our industry.
Similarly, we do not believe the term “farmers' privilege” is problematic as long as the legislative text behind it provides the necessary protections. In this vein, we are pleased to hear the minister suggest an amendment that would clarify the privilege to include farmers storing seed for future propagation.
With a wide range of products affected by this legislation, we recognize the need for regulatory authority to amend the privilege where there's industry consensus and it is desirable. It is an important point that we would like to see addressed in any future regulations.
Any regulations amending the farmers' privilege or developing end point royalties will require considerable consultation. We believe this process should require consultation with the plant breeders' rights advisory committee identified in this legislation. This advisory committee has mandatory producer representation, and we believe the consultation with this committee will ensure there is industry support for any amendments to the farmers' privilege or for the development of any end point royalty systems.
I would now like to shift my comments to the changes to the advance payments program. CFA members were pleased to see the changes in Bill C-18, as they reduce the red tape associated with getting an advance, they broaden access to the program for new products and new forms of security, and they provide producers with greater flexibility to market their products.
The ability to repay advances without proof of sale is an important amendment that will allow producers to market their products when it meets their needs rather than those of the program. We were pleased to see the government recently extend a stay of default to producers affected by the transportation difficulties last year, but these changes will provide much-needed flexibility around repayment deadlines for those unable or unwilling to move their product in the future. Similarly, multi-year agreements will reduce a lot of unnecessary paperwork for producers and administrators who were having to fill out the same information year after year. Coupled with the amendments allowing single administrators to offer advances on multiple commodities, this will streamline access for all producers.
While producers will benefit from these amendments, we believe any administrator expansion into new regions should require the approval of affected producers, via their producer groups. One of the benefits provided by smaller administrators in many areas is that they operate as service providers with in-depth knowledge of local regulations and the dynamics of the sectors they advance to. We must ensure that streamlining the program doesn't result in reduced service delivery.
Regulations should require administrators to consult with producers before any such expansion and impose guidelines that ensure that administrators are familiar with the relevant regulations in a particular province, such as collective marketing regulations in Quebec, which can have a number of implications for APP delivery.
Although we appreciate the wide range of improvements this legislation makes to the advance payments program, our members were disappointed to see the maximum advance limits not updated. The limits were last increased in 2006, but since that time the cost of farm inputs has risen dramatically. Farms selling more than $800,000 are increasingly common. For example, my fertilizer, rail freight, land costs, and crop protection costs now individually exceed $100,000, and my annual operating costs are closer to $600,000.
Although a relatively small percentage of all farmers, these farms represent a significant amount of Canadian production.