News release
FEDERAL GOVERNMENT TO DEFER COLLECTION OF OVERPAYMENTS TO FARMERS
CALGARY, Alberta, May 5, 2006 - Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board Chuck Strahl announced today that effective immediately, the department will defer collection of overpayments made to individual farmers under the Canadian Agricultural Income Stabilization (CAIS) program. In addition, interest will not be charged on overpayments until January 1, 2007.
"I'm pleased to announce today that where we deliver CAIS, we will not collect on CAIS overpayments until we've sorted out how much more money each farmer is eligible for as a result of our changes," said Minister Strahl. "It just makes good sense and good business sense to not give with one hand to take with another."
This announcement applies where the federal government delivers the CAIS program: British Columbia, Saskatchewan, Manitoba, Nova Scotia, New Brunswick, Newfoundland and Labrador and the Yukon Territory.
In Budget 2006, the government announced an adjusted method of inventory valuation and expanded negative margin coverage that will result in a significant increase in money flowing to farmers. These adjustments represent a down payment on a new income stabilization program that will replace CAIS and which will be simpler, responsive, and bankable.
"One of the things I heard loud and clear when meeting farmers across the country was that the CAIS program isn't working for producers," added Minister Strahl. "What we've done is taken the decision to pursue a new direction that will take us to a stable and prosperous future."
The initiatives announced in this Budget will bring about more responsive income stabilization; create new and innovative support for farm family incomes; enhance disaster assistance and separate it from income stabilization; and invest in future opportunities in the sector through investment in biomass science, support for a bio-fuels strategy, and new opportunities for agriculture through value-added products.
Budget 2006 provides an increase of $1.5 billion for the farm sector in the current fiscal year.
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Producers can call the toll free line at 1-866-367-8506. For more information, media may contact:
Media Relations
Agriculture and Agri-Food Canada
(613) 759-7972
1-866-345-7972
Jeff Howard
Press Secretary
Minister Strahl's Office
(613) 759-1059
Backgrounder
COLLECTION OF CAIS OVERPAYMENTS DEFERRED
In provinces and territories where the Government of Canada delivers the Canadian Agricultural Income Stabilization (CAIS) program, collection of overpayments to farmers made under CAIS is being deferred and interest will not be charged on overpayments until January 1, 2007.
In Budget 2006, the government announced one time federal funding to shift to a better method of valuing inventory under CAIS, which will make the program more responsive to the needs of producers. Changes to inventory valuation under the program will be applied retroactively for previous program years. Producer applications for previous years will be recalculated and as a result, some producers may have their overpayments reduced or eliminated. For this reason, the recovery of overpayments from other program payments or through collection methods will be deferred until applications for previous program years have been recalculated and producer accounts have been revised.
Producers who are in an overpayment situation will receive a letter from the administration confirming details on the deferral of overpayments. If producers have further questions after receiving the letter, they may wish to contact the program toll free line at 1-866-367-8506.
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