Contributions to Expenditure Review Committee by Agriculture and Agri-Food Canada

The Expenditure Review Committee was established in December 2003 as part of a series of initiatives designed to strengthen the Government of Canada's financial management and accountability processes.

The ERC process has identified $12 billion over five years in federal spending that could be more effectively used by reallocating those funds to higher priority areas. Agriculture and Agri-Food Canada has identified $45 million that by 2008/09 will be reallocated annually in line with broader Government objectives. These initiatives will be phased in over the next five years (2005/06 – 2009/10), generating a cumulative total of $180 million for reallocation to Government-wide priorities.

Funding is being reallocated from these programs:

• Canadian Agricultural and Food International (CAFI)
• Canadian Farm Business Advisory Services (CFBAS)
• Community Pastures
• Environmental Stewardship
• Advancing Canada Agriculture & Agri-food
• Protein, Oil and Starch (POS) Pilot Plant
• Science Grants and Contributions
• Farm Improvement & Marketing Cooperatives Loan
• Environmental Technology for Assessment for Agriculture
• Science Sites

Programs

Canadian Agricultural and Food International (CAFI)

Description

The Canadian Agriculture and Food International Program (CAFI) provides funds to industry to support exports through building recognition for Canadian products and enhancing opportunities for export. Supported activities are usually cost-shared on a 50/50 basis with industry. CAFI will phase out export marketing support to individual companies while continuing to support industry associations with generic marketing assistance. A one-year $3M transition fund will be provided to support selected, company specific market development activities during 2005-06.

Canadian Farm Business Advisory Services (CFBAS)

Description

CFBAS provides farm business advisory services in areas of: farm business assessment; specialized business planning; and, value-added enterprises services. Although overall funding will be reduced, demand for the program can be met within the remaining funds and with the flexibility that exists within the Agriculture Policy Framework.

Community Pastures Program

Description

The Community Pastures Program provides grazing and breeding services to 3500 producers across Saskatchewan, Manitoba and Alberta. Already 75% of the program is cost-recovered. This proposal would move the program, over a 3 year period, to full cost-recovery.

AAFC will also invest $10 million, over 3 years, to increase the carrying capacity of the pastures, providing increased benefits to existing and future patrons and expanding the revenue base to minimize future fee increases.

Environmental Stewardship Programs

Description

The Environmental Stewardship Programs fund the development of individual environmental farm plans and support the adoption of environmentally-beneficial management practices by producers. Demand for the program can be met within the remaining funds and with the flexibility that exists within the Agriculture Policy Framework.

Advancing Canada Agriculture & Agri-food Program (focus on future needs)

Description of Proposal

This proposal would reduce national programming assistance under the Advancing Canada Agriculture & Agri-Food (ACAAF) Program from $16M/year to $13M/year. Funding for Regional ACCAF Councils will be maintained. There will still be sufficient funding in the current and subsequent years to pay for the ACCAF projects that are currently under consideration.

Protein, Oil and Starch (POS) Pilot Plant

Description

Currently the Government supports the development of value added processing for proteins, oils and starch, at a privately operated pilot plant. The original intent was that the plant would become financially self-sustaining after a period of time. The Government will continue to provide support until March 31, 2006 to assist the plant in its efforts to become financially self-sufficient.

Science Grants and Contributions

Description

Program provides funding to industry (e.g. wine, beans, biotech, etc.) to allow separate parts of a given value chain to join and explore/develop opportunities for higher value products (e.g. assist industries to move from innovation to commercialization of products). This proposal would reduce science & innovation contribution programs by 25% but the program will still be able to achieve its principle objectives within the remaining funding.

Farm Improvement & Marketing Cooperatives Loan Program

Description

The Farm Improvement & Marketing Cooperatives Loan Act (FIMCLA) Program guarantees 95% of the value of loans provided to farms and cooperatives by financial institutions. Current loans have guarantee periods up to 10 years for equipment and 15 years for land.

The Government will be discontinuing support under the FIMCLA Program. To allow the orderly processing of applications already in progress, loan applications submitted to Agriculture and Agri-Food Canada by March 3, 2005 will be eligible for consideration under the Program. All current guarantees under the program will remain in place.

This program began when private sector loans were difficult for producers to secure. Today, producers have increasing access to commercial lending institutions, which has reduced the need for the program.

Environmental Technology for Assessment for Agriculture Program

Description

The Environmental Technology for Assessment for Agriculture Program primarily supports private sector companies and industry associations to conduct research projects and applied research regarding new technologies such as energy co-generation and nutrient management. These organizations are well positioned to conduct this type of activity without government support.

As proposals have already been received for 2005-06, to facilitate transition, a number of these projects will still be funded.

Science Sites

Note: Minister Mitchell announced a national science review of science priorities on June 23, 2004. During the national review, AAFC will be putting a moratorium on all recently announced science location closures. Those sites are located in Nappan, Nova Scotia, St. John's Newfoundland, Kapuskasing, Ontario and Winnipeg, Manitoba

Description

Four science sites (Winnipeg; Kapuskasing; St-John’s; Nappan) will be closed over the next two years. The four facilities currently require more than $50 million in investment including health and safety upgrades. Research conducted at these facilities can be consolidated into existing facilities that already meet health and safety requirements or through new partnerships including other government departments, universities and other levels of government.