LEGISLATIVE ASSEMBLY OF MANITOBA Monday, 12 May, 1980. Time - 8:00 p.m. CONCURRENT COMMITTEES OF SUPPLY SUPPLY - AGRICUL TURE MR. CH AIR MAN , Morris McGregor (Virden): Commit tee come to order. We're on Resolution 6, 1. (eX1) - the Member for St. George. MR. BILLIE URUSKI: Thank you, Mr. Chairman.

When we left at 4:30 for Private Members' Hour, we were discussing the type of research and investigations that the Minister and his department had done into the area of dome stic feed grain market performance as it relates to prices that farmers had received or, in actual fact, the farmers had lost over the last number of years in terms of the way the feed grain market is and has been set up and operating in western Canada.

I had asked the Minister whether or not it was his government's policy that they supported the present system of the pricing of feed grains in western Canada and we had statements coming from the Minister that he didn't support the policy of the way the pricing of wheat for milling purposes was being handled in Canada, but he really didn't indicate to us what he felt, and if he felt that he was not happy with the present system, whether he had any alternatives or what the position of the government of Manitoba was.

Obviously, we have had no commentary from the Minister whether or not he concurs with the studies that were done by the government of Saskatchewan, which have clearly indicated that western Canadian farmers, in the years August 1, 1976 to July 1, 19 79, have lost approximately 143 million in the way feed grains were marketed in Canada. In particular, Manitoba producers have lost over 30 million in terms of the way feed grains were marketed.

We have not had, anywhere that I am aware of, anyone - while they may not be happy - but anyone that will challenge the actual num bers tha t were presented by the Marketing Council of Saskatchewan and the analysis done, and to say that those figures somehow are out of whack, and give us the reasons. I would be particularly interested to know whether any research and analysis has been done by the government of Manitoba in terms of the study that has been available for, I believe now, approximately one month. I think it was published at least a month ago; the study was made public.

To my knowledge, while there probably has been a negative reaction from the grain trade, I have yet anyone to be able to get up and challenge the actual figures in terms of how the price mechanism works, and I would like some commentary from the Minister in this respect. MR. CHAIRMAN: The Honourable Minister. HON. JAMES E. DOWNEY (Arthur): First of all, Mr. Chairman, it is a federal government responsibility and as far as the member asking whether or not we support that particular policy, as I said before the dinner hour, there were a lot of things to be looked at.

I think what we have to work on in this particular area of marketing of feed grain, that we have to, as I said earlier, encourage our feeding industry with our feed grain policies. We have to encourage as many market opportunities as are available to the Western Canadian producers of feed grains. As the member has indicated, the study that is being done by the Saskatchewan Government has been acceptable to his particular party.

We have not had an opportunity or had time to go over it in any detail, and I think it is in the best interest of the Commit tee that we proceed off on this item without further deba ting the federal poli cies or other government stud ies, because it is in the best interests of this Committee's time, I think, to proceed on with the estimates. We can sit here and debate for many many hours of whether the federal government policy is right or wrong.

I indicated that we didn't agree with one of their policies last year; I made that known that nine provinces out of the ten of them disagreed with what the policy was, and they say, well, it is a good job they didn't agree with you, because it wasn't what our philosophy believes in. We can sit here, as I said, until we are blue in the face and debate federal government policy, and unless you have what I said earlier I felt was important, and that was to have direct input as a provincial government into the grain industry, then what is the point?

We can sit here, as I said earlier, and debate federal government policy. I haven't got any more comments to make in this particular area, Mr. Chairman. If members have other questions to ask about other policy studies, fine, but to continue down this line of debate, I don't think is in the best interest of the members' time. MR. URUSKI: Ob viously, Mr. Chairman, th e Minister either hasn't done his homework or, No. 2, is not prepared to enunciate a provincial government policy with respect to feed grains in the province of Manitoba.

Surely, a policy should be open to the scrutiny of not only members on this side, but to the farmers of the province of Manitoba. When the Mi nister, on one hand, says that he wants to encourage the feeding of grains in the west in terms of expanding livestock producti on, well, Mr .

Chairman, no one quarrels with that, but yet what is in effect in terms of national feed grains policy is exactly the opposite of that in terms of the way feed grains are being marketed to the detriment of the producers of western Canada, and the Minister says he has got no policy with respect to the present way feed grains are being marketed. On one hand, he also says he wants to play a

part in the marketing of grain in this country, yet he is not prepared to stand up and tell us where he stands on the marketing of grain. Is the government policy going to be that we, as Canadians, as farmers, and representatives of farmers in western Canada, should say that the Wheat Board, on behalf of all producers, should seek markets wherever they can seek 3543

Monday, 12 May, 1980. markets at the best price, and if those markets are export markets, then all the grain that is available on the basis of sales made should go to export markets and if there is a shortage of feed grains in eastern Canada and the price of feed grains, be it corn . . . MR. JAMES R. FERGUSON (Gladstone): You are not talking to a Farmers Union Meeting; why don't you get on with what is going on here? MR. URUSKI: Mr. Chairman, the honourable members don't like what they hear. I am only sorry that they don't like . . .

They don't want to believe that farmers of Manitoba have lost over 30 million; that is why they don't want to even . . . MR. LLOYD G. HYDE (Portage la Prairie): That is your opinion, man, that is your opinion. MR. URUSKI: Mr. Chairman, it is not my opinion. If the member doesn't want to do his homework, that is not my fault. The honourable members opposite say that it is our opinion; the facts of the matter are there, and they are in print. Mr. Chairman, it was done by the government of Saskatchewan; do we have any commentary from your Minister? No, you don't, Mr. Chairman. I want you to challenge those figures.

I want you to prove me wrong. I want you to tell me that Manitoba producers have not lost that much money; that Manitoba producers have not lost almost 50 cents for every bushel of wheat that was sold to domestic feed grain sales in eastern Canada. No, no one has said that is not the case; all they say is come on, let's get off this subject. Mr. Chairman, I don't believe that the farmers of Ma nitoba are deserving to get off a subject as important to them as 30 million of income in the last three years.

The mem bers in government may wish to downplay the losses that farmers have sustained, but they cannot escape the fact that that has been the case, and the fact of the matter is, it is because there has been no or a lacking in policy and direction with respect to feed grains in the province of Manitoba and western Canada. Has there been any support for orderly marketing with respect to the grains? No, there hasn't been.

There has been a comp lete attack on the orderly marketing system and the Minister of Agriculture says we want to have more involvement in the grain industry in this country and has he given us at least a hint in terms of what the feed grains policy of his government would be? All that he has said is that we made a proposal that feed grains should not go under quota in terms of the way they are being marketed as opposed to the selling of grains through the Canadian Wheat Board. Mr. Chairman, that would have caused chaos in terms of the proposals made to the Canadian Wheat Board on marketing on quota systems. Mr.

Chairman, it would have caused utter chaos. We, even now, have utter chaos at the Lakeh ead with respect to the loading up of the ports of non-Board grain with respect to the marketings of grain that the Wheat Board is not able to market and export. That is the kind of policy we have from the Minister of Agriculture. But to say that he does not have a feed grain policy is really to close a blind eye to what the producers of Manitoba have suffered. The producers of Manitoba can rightly get up and say, the Tories in Manitoba and Alberta have cost us, at least between Alberta and Manitoba, 100 million.

That has been the Conservative feed grains policy, to cost the producers 10 0 million. Do we have any move to say that no, the present system is wrong, that we at least believe that feed grains should be marketed at not a lower price, if we are going to feed our own feed grain. But Mr. Chairman, the fact of the matter is, the Wheat Board is compelled to fill orders; if the sales are there, even if the price is lower in eastern Canada, the Wheat Board is compelled to fill the orders of feed grain sales in eastern Canada. Mr.

Chairman, what the policy should be is that the Wheat Board should be selling grains on the export market, as high a price as possible. If there is a shortage of feed grains in eastern Canada, those grains, provided they are at a lower price, should come in from the U.S. to fill that vacuum. But that's not been the policy. We haven't heard of a policy from the Minister of Agriculture. He says he wants to encourage feed grains in the west. No one is op posed to that policy. I think that is a red herring.

I think he is sidestepping the crucial issue that incomes of western farmers and Manitob a farmers have been reduced by 30 million in the last three years. MR. CHAIRMAN: The Member for Rhineland. MR. ARNOLD BROWN: Thank you, Mr. Chairman. During the last while we've heard a lot of comments abou t how the Whe at Board and how the government is marketing grain, Wheat Board versus open market and so on, and I would just like to make a few comments in that regard.

First of all, the study tha t was made by Saskatchewan - and I'm not familiar with that study - now, I imagine that they took the Saskatchewan situation into mind when they made that study. I recently attended a meeting in Ottawa where we had people from Manitoba, where we had people from Saskatchewan, Alberta, Ontario, and Quebec. Now, it seems tha t the only people who ha ve a huge carryover of grain who are still carrying half of their 1978 crop, by and large, in their granaries are the people from Manitoba. And why is that so?

The reason why we, in Manitoba, are in a rather unique situation is that we have, first of all, continuous crop ping . Whe reas Saskatche wan will grow 40 bushels of barley, possibly, to the acre, we grow 70 and 80 bushels of barley;

whereas they have an awful lot of summer fallow over there, which they can market their grain against. We don't have summer fallow because we do continuous cropping. So we are in an entirely different situation over here as what the Saskatchewan farmer is. When I mentioned to the people over there that we still had a lot of '78 crop in our granaries, they couldn't believe it. They said, that's impossible. They said, we marketed our '78 crop a long time ago and we have very little carryover from year to year. We have a huge carryover in Manitoba, so we are in a different position.

I very much welcome the choice that we have, the Wheat Board and open market. At the end of the crop year, if I still have a lot of grain left over from two years ago, then I have to make up my mind in my operation, as to whether I'm going to 3544

Monday, 12 May, 1980. build more storage, whether I can afford to build more storage, am I going to borrow more money to carry over the crop that I have in my granary, and at today's high rate of interest, this certainly is not a very viable thing to do, so I am very glad, at that time, that I have the option of selling my grain on the open market. Now, there is no doubt in my mind that we are in a unique situation over here, and that something has to be done as far as Ottawa is concerned.

We are in an entirely different position as what Saskatchewan and Alb erta are, because we do continuous cropping, and we grow twice the amount of grain per acre as what they do. So we do need different treatment, and if we would get the same kind of treatment as what they are getting in Saskatchewan and Alberta where most of their grain is gone at the end of the crop year . . . I don't like selling on the open market; I'd much rather sell to the Wheat Board because I know that I'm going to get more money, your final payment through the Wheat Board.

But at the present time, I have no alternative, because I may be carrying two years of crop in my grain. -(Int erjection)- No, there is no alternative at the present time. The only alternative is the open market. And I want that choice, of whether I can sell my grain tor whatever I can get for it, or build more granaries and borrow more money. So in Manitoba, we have to have that alternative. Mr. Minister, when we're talking about research policy, I would just like to get on a little different tangent than what we've been on up to this present time.

Prior to 1969, we had the best plant breeding team anywhere in Canada, in Manitoba, at the University of Manitoba, under a Dr. Shebesky. After 1969, that team seemed to disintegrate. We have not come up with any really good sellers as tar as new varieties of grain are concerned. Prior to 1969, I sold most of my grain to United States as seed. There was a huge market over there for the seed that we were growing. Things have reversed since then. We are now pur chasing our seed, and I'm thinking particularly of barley which we have purchased for a number of years, from the United States. I'm wondering, Mr .

Minister, in your research policy, are you promoting that we again get a good plant breeding team at the university, so that we could promote new varieties of grain as we used to? MR. CHAIRMAN: The Member for Lac du Bonnet. MR. SAM USKIW: Mr. Chairman, on a point of order, it seems to me the member is on the next item, which is a grant to the Departm ent of Agriculture. MR. CHAIRMAN: The Member for Rhineland. MR. BROWN: On the same point of order, your grants to the University, by and large, are grants, and the University can do pretty well with them what they want.

When it's policy that we are dictating, then thi s is the item on which the Minister is dictating policy. MR. USKIW: Mr. Chairman, I'm just asking for gu idance. It seems to me the me mb er is not debating his topic on the present item, that it should properly be done under a different section. MR. DOWNEY: On this particular point, Mr .

Chairman, the member may be suggesting that under policy studies, it is possible that he's recommending that we should do, with this policy studies money, a review of what research is taking place as a special study, to see if it's adequate to meet the needs of the agriculture community, and that would be the way in which it could be debated at this particular time. MR. USKIW: That's not what he said. MR. DOWNEY: I think that in speaking to that, and I would suggest that I believe that it is certainly the responsibility of government to . . . MR. CHAIRMAN: The Member for Lac du Bonnet, on a point of order. MR.

USKIW: On a point of order, I raise the point of order, the Minister has contributed to that point by suggesting that in a certain way of presentation the Mem ber for Rhi neland might be prope rly debating this item under this heading. And then he went on to deal with the questions in the debate. I don't think that he can do that on the point of order. I think the Member for Rhineland has the floor. He has not yielded the floor, to my knowledge. If he has, then I thought I was next. MR. CHAIRMAN: The Honourable Minister. MR. DOWNEY: On that same point of order, Mr.

Chairman, I think it should be up to you to rule on the point of order and control this meeting. MR. USKIW: That is correct. MR. CHAIRMAN: All right. I think the Chair has been fairly flexible. Even this afternoon, we did get off, considerably away from policy, so probably a word of caution to stick with the item, and if we are finished with policy, then we will go on to the research, if it is desired .. The Member for Rhineland. MR. BROWN: On a po int of order, it is my unde rstanding, Mr.

Chairman, tha t under your agricultural research grant to the University of Manitoba, you give a grant to the University of Manitoba and they see fit as to where they're going to spend that grant on policy studies. That is where the Minister states the policies that he would like to see followed, and that's the item that I'm speaking on, right now, (e)(1). MR. CHAIRMAN: The Member for Rhineland may continue. MR. BROWN: So I'm asking the Minister what he is doing in order to get the University to promote new varieties of grain. What is he doing to get a plant breeding team the kind that we used to have?

I would like to see what direction the Minister is taking. 3545

Monday, 12 May, 1980. MR. DOWNEY: Mr. Chairman, if you want me to deal with it at this particular time, then I will proceed to discuss the policies. I believe that, first of all, it is our responsibility as government to strengthen the development of crops or different varieties for the agriculture community, and I would also say that we have had some top-notch people, not only in the area of cereal grain production in Dr.

Sheb esky, who has retired as Dean of the Agriculture Faculty, been a very well known, worldwide and renowned researcher; that in fact, in the other areas such as oil seed production and variety development, we have seen Dr. Stefansson, who has been a very important individual in the overall development of our different rapeseed varieties.

We have planned, to some degree, to expand and to move into that particular area in a little more aggressive way, and that is through some of the programs that we've introduced under the federal­ provincial agreement known as AgroMan, and it's in the estimates to be dealt with somewhat a little later, but we have been dealing with that specific developme nt of different varieties under tha t program.

We have re-identified or restated the Faculty of Agriculture being the research arm of the Department of Agriculture, and hope to be able to continue to strengthen that, as the member has indicated the need for that kind of support. I am quite familiar with the history of some of the grains that we have marketed into the United States. For exam ple, Selkirk Wh eat was an excellent example of the kinds of varieties that have been developed here in this particular province, and have in fact found a very wide acceptance down into the United States market.

I think it is a matter of government funding the university and keeping the people involved in the research development so that the farmers do have the proper varieties that do in fact open up markets in other areas. I believe that, as far as I am concerned, it is a top priority to continue in that particular area. MR. USKIW: Mr.

Chairman, the Minister obviously is in an awkward position to deal with this problem, because he knows in his own mind that if he was to square with this committee, with factual information based on departmental studies, that that information would confirm what we have been telling him in this committee, and that is that the present Canadian feed grain marketing policy has been a bad thing, has been a money loser for the farmers of the prairies, to the extent of 143 million over a period of three years. -(I nterjection)- Mr. Chairman, the Member for Rhineland suggests that the grain would still be in the granary.

That is not correct, Mr. Chairman, because that grain was fed to livestock in eastern Canada, and th erefore it had to be consumed regardless of how it was marketed. The only reason there was a loss of 143 million, Mr. Chairman, is because the western feed grain producer was denied the right to realize what was then a competitive market value for his product, simply because of a decision of the government of Canada. It is because it is a governmental decision, Mr.

Chairman, that this Minister has a role to play, because while this Minister wants to argue that we are discussing federal policy, he is quite right, but he also has to appreciate the fact that the government of Canada meets with the provinces once a year, at least once a year, to discuss these kinds of issues, whether we have Wheat Board marketing, or non­ board marketing, or a combination of board and non-board price-se tting mechanisms, subsidy mechanisms, all of things are matters for discussion at federal-provi ncial conferences.

Certainly the Minister can't deny that he has a responsibility in putting forward Manitoba's position on this question when the question is debated before the conference next July. Surely he is not telling this committee that he is going to go to that conference unprepared to deal with whether or not we should continue with the present Canadian feed grain marketing policy. If he is saying that, Mr. Chairman, he might as well wrap it up right now, because he is not doing his job for his constituency.

Surely his farmer members must have the confidence that he is going to put their interests forward on this issue when it is up for discussion at the next federal-provincial conference. It is just not good enough to say this is a federal matter. It is a federal-provincial matter, Mr. Chairman, and federal policies will result largely from federal-provincial consideration of this issue, not unilaterally on the basis of what the government of Canada wants to do, although that may their wish.

But usually these policies result from a great deal of discussion of that have taken place within the industry and inter-governmentally. The big question is, should western feed grains be sold at a discount to American corn, Mr. Chairman. I don't know why they should be sold at a discount to American corn. I don't know why western grains shouldn't be sold at a premium from time to time if there is a shortage of the commodity.

If the world market is such that it makes sense to supply the world market with western Canadian grain, which results in a hi gher return to western Canadian farmers than it would if they shipped this same grain to Quebec and Ontario, or the Maritimes, at corn competitive prices, then I say we have got to sell our grain to the world market, Mr. Chairman.

You know, the way the system has been operating, is that if there is a surplus of western Canadian grain, we find that this results in a depressed price to the western grain producer, without the eastern feeder getting the benefit of that depressed price, under the present policy. As a matter of fact - well, I shouldn't say without, not entirely at his advantage. Some 40 million, in the last study peri od, was syphoned off by middlemen who were profiteering in the grain trade, Mr. Chairman, people that not need be involved in the area of marketing feed grains in Canada.

The other 10 7 mill ion was a direct benefit to livestock producers of eastern Canada, but which put them at an advantage over western Canadians, Mr. Chairman. It put them at a 10 7 million advantage over western Canadians. So, Mr.

Chairman, it seems to me that the Minister has a lot of catching up to do and that's why we say to him that he has a research budget, and I would hope that if he is going to go to federal-provincial conferences to decide these kinds of issues, that he is armed with all the facts and figures and research material that would allow him to present Manitoba's case in its best light, along with Saskatchewan and 3546

Monday, 12 May, 1980. Alberta, so that the praine provinces would realize full value for their production and their effort and in essence would enhance the economy of the prairie region. There is no logic whatever, Mr. Chairman, in dictating to the Canadian Wheat Board, which is now the case under the present policy, that they must sell grain at a fixed price to eastern livestock producers if they are able to sell it for more money elsewhere. I don't know where that logic is, Mr. Chairman, but that is the present feed grain policy. It means that if the east is short, the west must sell at a discount.

If the west is in surplus, it must also sell at a discount. We lose on both ends, Mr. Chairman, and I don't really believe that this Minister condones that. I just believe that he doesn't know what is happening.

Therefore I plead with him that he use his staff, and he has got competent staff, to take a look at this question, to examine the studies that have been done by other jurisdictions, and he doesn't have to entirely conform to their position, but at least he should be aware of the facts, so that when this issue is decided upon again, and it will be because this is currently an open question, the federal government is now in a position of saying, well, where do we go from here with feed grain pol icy? They, Mr.

Chairman, are in a position of flexibility on this issue and I don't think that we should let another year go by without trying to restore for the prairies what is rightfully theirs and what should have never been taken away from them, Mr. Chairman, and that is your responsibility, Mr. Minister. MR. DOWNEY: In responding to the Members for Lac du Bonnet and St. George, as I said, I feel that it is an area of federal government debate but I am quite prepared -(Int erjection)- If he would give me an opportunity, I would suggest that I am quite prepared to address it.

They are sitting here suggesting that through some other form of magic, that they could get more money for western grain producers, and the Member for Rhineland was quite right - he said the grain would be sitting in the bins in western Canada, which is quite true. Mr. Chairman, can you tell me that the farmers of Ontario and the livestock feeders of eastern Canada are going to pay more money for the grain in western Canada than they can buy grain from the United States.

I am sitting here tonight hearing members of the Opposition suggesting that Ontario livestock feeders are going to pay more money to western Canadian feed grain producers and leave the United States grain sit at less money. That is what they are sitting here telling us, that we are going to force eastern Canadian feedlot people to buy our western grain when they in fact can buy the grain from the United States. In fact, the grain would sit in western Canada.

All we have been doing, by imposing quotas and restricting those feeders from that western grain has been, in fact, not helping the total agricultural commun ity. That's numb er one, I think, Mr. Chairman, that we have to -(I nterjection)- The Member for Lac du Bonnet says it's not true. It's very true. You know, they are not going to pay a bonus for western Canadian grain if they can buy it from the United States, so then the grain would sit in western Canada. -(I nterjection)- They say no. I don't know what's going to happen to it if it doesn't, because the system has been so clogged, Mr.

Chairman, tha t they haven't been able to move the grain in any other way, that in fact the grain would sit in western Canada, like the members opposite would like to see happen. You put it through one tube that is plugged and they don't make very good sense. We are sitting here debating studies, what happens, and I would just like to quote from a speech that the federal Minister of Agriculture has just given. I think it is maybe not the right time, but I think it should be put on the record, what he has just said. -(I nterjection)- Well, I'll read the whole thing.

I quo te: The Quebec Feed Freight Assistance Adjustment Program, with a budget of more than 33 million over five years, and all of that federal money, is helping farmers to build or purchase grain and forage storages, grain harvesting equipment, and to expand seed cleaning plants. Under the Agriculture Subsidia ry Agreement, funded 60 percent by the federal Department of Regional Economic Expansion, great improvements have been made to drain land and make it more productive, allowing producers to grow feed grains and horticulture crops.

OREE has spent about 60 million in Quebec for agriculture projects since 1965 and a good part of this has been in tile drainage. I'll skip over a part and I'll get into one of the other areas that he has talked about. The fourth point: In fact, federal Transportation Programs have gre atly contribute d to the growth of the livestock production and processing in Quebec. The Crow's Nest rate . . ., and this should ring a bell with the Member for Ste. Rose, ...

The Crow's Nest rate, and the Feed Freight Assistance Program have reduced the cost of grain shipped into Quebec and thus lowered the cost of producing hogs and poultry. These subsidies have resulted in benefits for western grain growers but they have also decreased the natu ral comp arative advantage for livestock production on the prairies and given assistance to the livestock producers in the east. Mr. Chairman, I have openly said that I am a firm believer in policies that will encourage and develop the feeding industry in western Canada.

There's no question about it, it's a matter of making the best use of the agricultural goods that are grown, where they are grown. Mr. Chairman, I think it is a matter that the federal government has recognized some of the debate that has taken place, that the freight rates have not been fair as far as the equality between the processed and the non-processed goods out of western Canada are concerned.

I would have to go back to the Member for Lac du Bonnet, and I can't for the life of me see how they can sit here and suggest that we are anything but tied to a world grain market, that if in fact producers in eastern Canada - I have said this earlier and I'll say it again - if the producers in eastern Canada can buy corn cheaper than they can buy western feed grain, then in fact that's what they are going to buy. To dictate anything any different, whether it be handled through a Wheat Board or whether it be handled on the open market system, to go back to the Member for Rhineland's comment, there's is no 3547

Monday, 12 May, 1980. question that without that market available to the western feed grain producers, then in fact that grain would have been sitting in western Canada. Mr. Chairman, again I go back to the comments that we are thrashing straw as far as this committee is concerned. I don't believe that it is in the best interests of our time to continue on with the debate on what is federal responsibility. They are suggesting that I should put in place a study, to really get to their point, that we put in place a study.

They are referring to a Saskatchewan study which they have had prio r access to, tha t we have really - (I nterjection)- Well, Mr. Chairman, they are referring to another government study. I, at this particular time, haven't had the opportunity to go over it and to suggest whether the figures are right or wrong. If this is in fact the case, then I am certainly not very happy with it, but I think we have to look at both sides of the coin, and that's what we are trying to do here, as a government.

We are suggesting that if we did not move that grain through the system, then in fact it would sit on the backs of the farmers of western Canada, and how do you tabulate what that cost is? You have to use the cost of interest storage and the total story, as the Mem ber for Rhi neland has suggested. Again, to further debate it, I think is certainly in the interests of Manitoba farmers. I think the other thing we want to make sure we bring to the attention of the committee is that without these markets, what happ ens to the people who are relying on the livestock industry?

We have seen the results of lack of livestock for processing in this province. Again, I think it is a matter of having a policy in place that will support the livestock industry in western Canada, and that's basically what I will stick to. I think we have to, again, move on with the other items of the estimates this evening or we are not using our time to the best of our advantage. MR. USKIW: Mr. Chairman, with all due respect to the Minister, the Minister has not understood our argument. With all due respect to the Minister. - (I nterjection)- How about order. -(lnt erjection)­ There's no problem.

You can speak as many times as you want in committee, Jim. -(I nterjection)- No, the rules are. Mr. Chairman, I don't believe the Minister is being stu bborn on this issue; I believ e he doesn't understand or doesn't comprehend the argument that is being put forward. I really don't believe there is a significant difference of view on this issue between what we are saying and what his desires are. I just don't believe that he has researched the problem, Mr. Chairman.

The fact of the matter is that the present policy provides that if there is a western feed grain surplus, tha t the prices are allo wed to fall belo w corn competitive values. However, if there is a shortage of western feed grains, the Canadian Wheat Board is instructed by the government of Canada to sell that grain at corn competitive prices. So we lose on both ends, Mr. Chairman, that is all we are saying. - (Interjection)- No, the present open market is what is doing this, Mr. Chairman. It isn't an open market.

It is an open market but which is fortified by the fact that the Canadian government instructs the Wheat Board that if the open market doesn't supply the demand, then the Board grains must supply that demand at a reduced price; that is the objectionable part of it, Mr. Chairman. We have people in Canada who prefer to market all of their grain through the Canadian Wheat Board and we have people that prefer both options or the other option, Mr. Chairman. What have we here? We have a conundrum, Mr. Chairman.

We have the farmer who believes in supporting the Canadian Wheat Board 10 0 percent, delivering all of his grain to the Wheat Board, so that the Wheat Board would market that grain for that farmer, but then the people that believe in the off­ Board market fail to supply the off-Board market or the eastern market with feed grain, so the Government of Canada says, well, look, we can't allow a shortage in Eastern Canada, we are now going to force the guy that believes in orderly marketing to sell his product at a discount to cover up the failures of the open market; that is what is being done, Mr. Chairman.

It isn't an open market, quite frankly; it is a very controlled marke t and it is a perverse type of operation, Mr. Chairman. It is not what the Wheat Board was set up to do originally. The Wheat Board's responsibility originally was to achieve for the producers of grain the highest price available in the world market.

It has now been compromised in that area by the government from time to time, which requires the Wheat Board to sell its grain at a reduced price notwithstanding that the world market is higher, because of the failure of the open market to supply eastern feeders with sufficient quantities of off-Board grain. So what we have got here is insult to injury, Mr. Chairman; we have got insult to injury. Mr. Chairman, the Minister points out, and he read an excerpt out of a speech given by the Minister of Agriculture for Canada about advantages to eastern prod ucers over western producers because of cu rrent policy.

He is absolu tely correct, Mr. Chairman, but the fact is that is part of this . . . No, sorry, the fact is, Mr. Chairman, that the feed grain policy, when it was announced, was supposed to remove some of those advantages from eastern Canada; so what we have now is the advantages that the west had were removed, the advantages that the east had were sustained. They were promised to be removed, the subsidy and storage and freight and all of that in eastern Canada was supposed to be taken off, Mr. Chairman, with the new feed grain policy. That has never happened.

All that has happened is that we have provided grain to eastern feeders at reduced prices, which has compromised western Canada again. The whole sphere of the new feed grains policy was never implemented, Mr. Chairman. The whole scheme was a package. It was a tradeoff. The west had to give in on some areas and the east was going to have to give in. What we have now is that the west has given in and the east has retained what they had and got a little more. Mr.

Chairman, this is reason for this Minister to take this argument to his conference and to get redress, and I believe that the Minister would want to do that, excepting, Mr. Chairman, that he doesn't want to admit to this Committee that he has not to date been prepared because he is not knowledgeable as to what is happening around him. That is his problem, and it 3548

Monday, 12 May, 1980. seems to me if you have a budget for research . . . And you don't even need a research budget, Mr. Chairman, I can name dozens of competent people in his department that could get that information and assemble it for him, document it for him in the best form for him to make his case to the government of Canada. There is no reason why that can't be done. It is a matter of a couple of days of work at the most, Mr. Chairman, maybe even one day, gathering together the statistical information. His department has it all, so why this Minister is not equipped to deal with it, Mr.

Chairman, is something that I can't understand, because it is a problem to western Canada. MR. CHAIRMAN: Committee, I would just like to draw your attention, whether my rulings have been right; when I recognize a member from either side and the Minister answers some part of that question, I always go back to that same member, as I did Rhineland, recognized him first and went back to him twice. So I try to let each membe r fulfill tha t particular item or that phase of it and then go across to the other.

The Me mbe r for Gl adstone was annoyed, but I only recognized the Member for Lac du Bonnet once; he hadn't got his full question, so unless one monopolizes . . . If members don't like me ruling in that manner, now is the time and we will make a switch. I am ruling as honestly and as fairly as I know how. MR. USK IW: On your point of order, I would like to suggest to you that I would be most pleased if the Mem ber for Gladstone wou ld contribute to the debate, and I would yield the floor to him. I have no problem in yielding the floor. In fact, he enhances my contribution to the debate, Mr. Chairman. MR.

CHAIRMAN: The Member for Gladstone. MR. FERGUSON: I certainly didn't want to hurt the feelings of my friend, the Chairman. MR. CHAIRMAN: You didn't hurt me, I just wanted it to be right. MR. FERGUSON: In any event, I think that we have had quite a discussion on this particular matter. It has been going on for two days and I don't know as we have proved anything, except that we still, on both sides, are tied up to I guess what we basically feel are ideological positions.

My honourable friends across the way have brought forth -(I nterjection)- Then we will go back to the marketing of one bushel of barley, starting at my farm and going through the system. I have the option of putting it through the Wheat Board or I have the option of getting a producer . . . of selling it by truck and moving it down the spout, which ever way I want to do it. If the Wheat Board, and I am not basically criticizing . . . That one bushel of barley that goes into the channels is moved through export position and has to go through the Canadian Wheat Board. The eastern feeder is a different ball of wax.

Here again, we do have the option and if, as I say again, and my friends have been talking all afternoon about the Wheat Board is tied to a corn base formula with grain coming in from the United States, corn setting the basic price, which is correct. But No. 2 also is the right of the individual, which I feel that I am, to go down and interview an eastern feeder; I can lock in a price, I can get a producer car, or I can move it by truck.

If the system has become so encompassed with red tape and etc. that it can't move a product through its system in a direct manner to the feeders, and there is an alternate method available whereby the cash flow is coming into the hands of the producers, then it is their option to use whichever one th ere is, and to their advantage and to whichever one is going to supply the dollars to them. There are more things involved to quo tas, of course, and one of the reasons is it is off-Board grain.

The quotas have been so tight that in many cases farmers, including myself, have taken the option of going and making direct deals at a price, sold directly; we have the cash in our pocket. And when they talk about a 38 million loss, you start looking at a 20 percent interest rate and that grain probably backed up two or three years, and we, as farmers, have a pretty good idea of what happens when beetles get into it, water may run into the thing, you get a leak in the granary, but grain will not stay in condition for that long.

That is one of the things, I think, that our friends across the way have forgotten about. They feel that once you get a bushel of grain and store it, it is there for the next ten centuries. That hasn't been my experience. Through the regulations of the Canadian Wheat Board in establishing quotas on rapeseed and then not issuing extensions, my family and myself took a bath on a bin of rape to the tune of about 10 ,000. So we do appreciate the fact that in some cases, through the open market, we can forward a contract. We can contract dir ectly.

Over the past year we have delivered rapeseed to Lethbridge; we delivered rapeseed to Thunder Bay; we delivered flax to the United States; we delivered flax to Thunder Bay and we deliv ered barley through producer cars and through trucks, and I think that's our option. If, as our friends say, that we're upsetting the system, if they were doing the job it wouldn't be necessary. The Member for St. George the other day said that off-board grains plugged the system.

There was a report from Thunder Bay issued on May 7th, it is anticipated that most if not all the backlog of the grain that's in store in Fort William will be cleared within the next week, and his statement was, why was the government of Manitoba leasing 400 hopper cars, because the system was so plugged with off­ board grains that it wouldn't move. There it is right there, it will be moved within a week. That grain is in position. Thunder Bay will not be sitting in the position that they were last year where they didn't have four days' supply of grain on hand. They didn't have. This year they're in better shape.

For what reason? Because trucks have been delivering. The government of Manitoba is an example, at least 400 cars and the Member for St. George says, they're not doing their job, you needn't them. But all of a sudden, turn around and what is he complaining about? That the system is plugged with off-board grain. What a bunch of crap. If the system was doing the job, the outside things wouldn't be necessary. And let it be known ge ntlemen, that thes e particular programs are from the government of 3549

Monday, 12 May, 1980. Canada. They are being used by the grain producers, and in many cases the grain producers have asked them; the people that have been asking the most have been the Palliser Wheat Growers. I'd like to ask any one of you, who has done more for the grain marketing industry of Canada than the Palliser Wheat Growers? Nobody. Without them, the whole grain system had gone to sleep. They got the thing moving. All right, here we go back again to our original arugment of, nothing can be done except by bureaucrats and by control and etc. etc. I don't believe in that system.

I do believe in the handling of - we'll go back to the handling of wheat through the Wheat Board system, and you can go back to the first credit deal that was made. John Diefenbacker was ridiculed this afternoon by the Member for Ste. Rose. He was the first fellow that said, look, to communist Poland, we will finance a 12 million wheat deal. Numb er two was a 55 million wheat deal to China. -(I nterjection)- Okay, where was that great and glorious outfit called the Liberal government? -(Int erjection)- No, no, you couldn't finance a deal because it wouldn't be paid.

All those things were paying 100 cents on the dollar, but who took it on the chin to say well, look, we'll trust these people to pay, and they did. So I've got to go along with this present marketing system that we have.

I certainly don't under any circumstances, and let it be well known, I certainly would never want to see rape, rye, flax, corn, sunflowers, and the rest of it, tied in under the Canadian Wheat Board, because they've got a job bigger now than they can handle and they better stick to what they've got, and if they were doing the job that they supposedly should be doing, we wouldn't have to be using this outside stuff to do the job. MR. CHAIRMAN: The Member for St. George. MR. URUSKI: Thank you, Mr. Chairman.

The Member for Gladstone, I'm glad he indicated that somehow the information I gave to the committee about clogging the ports was wrong. Mr. Chairman, I want to read to you an

article that I received from the The Co-operator . MR. FERGUSON: From the Saskatchewan government? MR. URUSKI: No, Mr. Chairman, from the Manitoba Co-operator, entitled, Non-Boards Clog Lakehead. Mr. Chairman, it's dated from the paper, 1st of May 19 80: The grain transport authority has threatened to suspend future rail transportation of non-board grain and oil seeds to Thunder Bay if a serious congestion of rail cars at the port isn't soon cleared away.

CP rail at one point this week refused to spot grain company rail car allocations for next week because of a situation that has left some grain sitting in rail cars at the port for up to two months without being unloaded at terminals. Mr. Chairman, the director of the GT A said that a new grain transportation co-ord inating body had managed to persuade - persuade? - CP rail to reinstate spotting for almost 75 percent of the 480 cars it originally declined to place at rural elevators next week.

A spokesman for the grain industry said it was the first time they could remember a railway refusing to spot cars allocated to grain companies other than refusals to service certain lines at different times during the year. The situation appears to have resulted from a combination of events, the main one being lake vessels not being fully prepared for the early opening of navigation on Great Lakes, and a subsequent inadequate supply of arrivals to clear bulging grain terminals.

Terminal operators estimate that as many as 1, 000 loaded rail cars have been sitting at Thunder Bay terminals for some time without the opportunity for unload. They suggest the terminals are plugged with grain that should have been shipped earlier and the results have now started to back up into the system through rail operations and country elevator systems. The GT A director said 1,0 48 rail cars of non-pooled grain were at Thunder Bay terminals as of Monday this week, and that 80 percent belonged to CP rail. These consisted mainly of non-board feed grains, malting barley, rye, rapeseed and flax.

The terminals most affected are Pool No. Three, United Graingrowers and Cargill. If the situation doesn't improve soon, then we may have to reconsider a cutback in allocations. CP rail had originally refused to spot about 480 rail cars for week 41 of the cycle, which is next week, and the GT A persuaded the railway that a better supply of ships was expected before mid-May for large flax, sunflower, rapeseed and feedstocks which have built up at Thunder Bay.

Cars spotted at elevators in week 41 are not expected to begin arriving in bulk at Thunder Bay until about week 43 or 44, that is in the May 18 th to the 25th period. In other words, not this week, Mr. Chairman, but not for at least another week before they will start arriving. Mr. Chairman, the fact of the matter is, there has been a back-up at the Lakehead. There has been a congestion at the Lake Boards. This Minister has indicated that he felt that there was no problem in terms of grains that are shipped on the off-board to take quota space, Mr.

Chairman, that have been reallocated for other grains, and that in effect has caused the problem at the Lakehead. Mr. Chairman, the Member for Rhineland in his comments seemed to indicate, and the Minister has indicated, that the grain that was sold to the feed grain market in the east in Ontario, somehow would have been left to sit in grain bins, if it could not have been sold in the manner that it had been sold. Mr. Chairman, the exact opposite is true. I believe sincerely, now that the Minister has spoken this in his remarks this evening, that he really does not understand the problem.

It appears that he really has missed the point. The fact of the matter is, Mr. Chairman, the losses that we quoted from this side were on the basis that if that grain was sold on the corn competitive price, in other words, to compete with the US corn that the Member for Rhineland has talked about, had it been sold at that price to meet the corn competition; in other words, that they could have beat the corn competitive price from the US, they would have sold it under that pr ice. The difference between that price and what it was sold for is 143 million in these three years.

That's the point we were getting at, Mr. Chairman, and it has amounted to over 30 million to Manitoba producers. The Member for Gladstone indicated that there was an option that producers wanted to take, and 3550

Monday, 12 May, 1980. that was the area of marketing through producer car lots, if they could in fact gain markets in the east and ship directly to feeders and have a market of their own. Well, Mr. Chairman, taking the member at his word that farmers would want to use that, and have used that, and there were approximately 15 million bushels tha t were del ivered in produc er car ship ments which would lower this amount by approximately 5 percent of the total amount of feed grain that was marketed in that three-year period, given that premise, that would even put a worse light on the price differential, Mr.

Chairman. That would even place the grain companies in a worse light in terms of the excess profit-taking from the system that has occurred over the last three years. That would place Manitoba producers even in a worse position than it has.

Surely the Minister must realize that if we still haven't explained it properly and hope that we can get him to analyze the situation and make some representations at the next meeting of federal provincial Ministers, to say the least, and to make some statements now, to say look, we are not prepared to allow our feed grains to be sold at below the corn com petitive market, and not allo w a shortage of feed grains to be made up by the Wheat Board at lower prices than they could have sold the grain, because really that's what has happened, Mr. Chairman.

If the reverse was true, if there was a shortage of feed grains, and the Wheat Board in effect could have made the eastern market at a price higher than the corn competitive price, I assume there would have been no difficulty. The government wouldn't have worried about it. But the reverse has been true; the reverse has been true in the last three years, Mr. Chairman. There has been a net loss to the farmers of western Canada and Manitoba as well. Mr.

Chairman, the Minister as well said we want to encourage the production of livestock, and one of the other ways, and he quoted the Minister of Agriculture from Ottawa has indicated that one way of doing it is to reduce the feed grain subsidies and the grain transportation assistance that is being paid to eastern producers. Mr. Chairman, I hope the Minister has read a study that is done by the University. It's entitled Grain Freight Subsidies and the Location of Livestock and Meat Production in Canada, Mr. Chairman. It was done by Mr.

Tangrey and Leigh, of the University of Manitoba, and I hope the Minister was cognizant of their recommendations and of their findings. I would like to read the entire last paragraph of their findings about the grain freight subsidies. MR. DEPUTY CH AIRM AN, James R. Ferguson (Gladstone): The Minister on a point of order. MR. DOWNEY: Mr. Chairman, the member is referring directly to University grants. He's reading from the University Annual Report. Yes, he is, Mr. Chairman, and he's on (eX2) and you can't have it both ways in this comm ittee. Either you debate the issue that's before us ... MR. USKIW: Mr.

Chairman, on the same point of order. The member is using the University material as a reference . MR. DOWNEY: Well fine, then let's get into it. MR. US KI W: ... to the su bject tha t he is discussing and, Mr. Chairman, that is within the rules. MR. DOWNEY: protect you, Bill. It's a good job Sam's here to MR. URUSKI: Mr. Chairman, the type of protection that we've had in the last while is like being sold down the river with a ball and chain around one's neck ... MR. DEPUTY CHAIRMAN: Is the Member for St. George speaking on the point of order or is he back on his discussion? MR.

URUSKI: I'm sorry, I'm back on th e discussion, Mr. Chairman. MR. DEPUTY CHAIRMAN: I think in all due respect to all memb ers, th at we have discussed this particular item all Friday, and as of today, and I'm certainly not restricting discussions but I personally have heard the Member for St. George repeat the same argument at least ten times and I would hope that we would arrive at a concensus of opinion on this thing, which we won't of course get, but I think that we should move on to another article. MR. FILMON: Would the member care to rephrase his argument? MR. URUSKI: Not at all. MR.

DEPUTY CHAIRMAN: The Member for St. George. MR. UR USKI: Thank you, Mr. Chairman. Mr. Chairman, the point that I was trying to get at was the policy and the research that has been done by the go vernment.

The Mini ster ap pears to have missed the very points that have been raised in University studies with respect to statements that he has made in terms of increasing livestock, in terms of reducing the feed grain susbsidy and its impact on Manitoba, and I wanted to read to him the grain freight subsidies in relationship to what impact it will have on livestock production this province as it relates to eastern Canada, Mr. Chairman, and his statement saying tha t we have to encourage livestock production. One way of doing it is to get rid of the feed grain subsidies to eastern Canada. Mr.

Chairman, I was indicating and I quote from the study, page 9, The study also showed that Quebec's pork production would decrease with the elimination of grain freights policies. Quebec's beef production would also decline. In Manitoba there would be a different situation. Even with increased pig production resulting from the elimination of grain freight subsidies, the province would still face excess capacity in pig slaughter. Thus it is very likely that a considerable portion of the pork processing capacity in Manitoba would be closed down.

Manitoba's cattle slaughtering depends heavily on imported slaughter cattle from Saskatchewan. Yet, as the study shows, elimination of grain freight subsides, together with the increase in cattle slaughter capacity in Saskatchew an, would cause reduction in beef production in Manitoba. 3551

Monday, 12 May, 1980. MR. DOWNEY: Do you have to read a study to know that, Bill? MR. URUSKI: Mr. Chairman, the Minister indicates to us, asking us whether we have to read a study to come to that conclusion. Mr. Chairman, the policy of the Tory Government has been to elim inate the Crow rate, to elimi nate all transpor t subs idies, and especially the Crow rate, indicating that it has been a disincentive for livestock production in western Canada, and if that was done, Mr . Chairman, I believe it would wipe out the entire agricultural sector in western Canada and escpecially in Manitoba, Mr. Chairman.

There is no doubt that the reverse is true from what the Minister has been telling us with respect to his statements on the feed freight subsidies and the advantages that eastern producers have gained over the last number of years. He has indicated that if that advantage is taken away, somehow we, in Manitoba, would be better off. Taking that argument one step further to the Crow rate, it would even happen . . .

At least he happens to believe that it would strengthen his argument that if we did away with all transportation subsidies it would be to the benefit of Manitoba producers, when exactly the opposite is true, Mr. Chairman, exactly the opposite is true. Maybe the Minister has done some research, maybe hi s staff has analyzed tha t report to counteract the statements made in that report.

That is what we wanted to find out, whether there has been any research done by his · department to analyze the work that was done at the University and how it, in effect, contradicts Conservative Ministers' policies with respect to the feed grain situation in western Canada. If they can't contradict that, Mr. Chairman, then why do they continue the policy that all feed grain Crow rate and feed grain subsidies should be removed in terms of trying to enhance our livestock capacity in this province, which in effect would decline if that was done? MR. DEPUTY CH AIRMAN: The Mem ber for Rhineland. MR.

BROWN: Thank you, Mr. Chairman. As already has been mentioned, we have been debating this issue now for a long long time, and I think that what is emerging over there is really that our positions are not all that far apart. That is that if the Wheat Board can market our grain and so on, that there probably would be very little grain sold on the open market.

But the situation is this, that the Wheat Board is unable to market the grain, and if you are left at the end of the crop year not with only the previous year's production but half of the year prior to that, then you need an alternative in which to move your grain. I would like nothing better than to have the Wheat Board move the grain, because I don't mind selling grain through the Wheat Board because I have always found them to be fair, but it is their inability to move the grain that I am objecting to.

I think that if we would all join with our Minister over here and take into consideration this special position that Manitoba farmers find themselves in through growing larger crops and through continuous cropping, that special quotas be placed on Manitoba growers, then we would go a long way to alleviate the situation that we are in.

I certainly would like to see our Minister put a very strong case forward to the Federal Minister of Agriculture that whenever they have a 12 -bushel quota in Saskatchewan and so on, we should have a 24-bushel quota, because we grow twice and more than twice the amount of grain over here. If we were to get that type of recognition, Mr. Chairman, if we had that type of recognition, then we would be on an equal basis with Saskatchewan, with Alberta.

Ontario and Quebec do not have that particular problem because at that same meeting which I mentioned before, when we were discussing this, the Quebec growers were telling me that whatever they didn't need for themselves that they could sell right off the combi ne, they did n't ever have to store grain. Ontario growers may have to store for a little while, but they can always get rid of all the grain that they grow. But Manitoba is in the worst position of all the provinces in Canada, and for that reason I would say that we should ask for special consideration. MR. DEPUTY CHAIRMAN: The Member for Lac du Bonnet.

MR. USKIW: Mr. Chairman, I would like to, first of all, remind the Member for Gladstone, who is now in the Chair, that in his contribution to this debate he perhaps doesn't realize it, but, Mr. Chairman, he contradicted himself on the point that he was trying to make. He said that he prefers and he alleged that farmers in Manitoba prefer to have the option to sell their grain through the Wheat Board or, if they chose, to sell their grain off-Board. I believe I am correct, and if I am incorrectly interpreting his remarks, I would hope, even though he is in the Chair, that he would correct me, Mr. Chairman.

I would give him that much latitude, and that it is really the right of the individual to chose one or the other op tion or a com bination of the two, or whatever. -(I nterjection)- Well, it confirms that my

interpretation is correct, Mr. Chairman. Let's examine those options, Mr. Chairman. I would like to believe that what he stated was actually happening but that is not what is happening, Mr. Chairman, and that is the basis of our complaint. Even if you accept the notion that there will be off­ Board grains and on-Board grains, the fact is that we have something worse than that. We have Farmer A who chooses to ship off-Board and on-Board, we have Farmer B who who chooses to ship through the Board only, and then we have Farmer C who chooses to ship off-Board only.

We have three possibilities here, three possiblities. Mr. Chairman, they are possibilities, okay? If the farmer chooses to ship through the Board, surely the Member for Gladstone and the Minister and his colleagues on the government side do not want to put the argument that he should be denied that right. If he chooses to ship through the Board, I ask mem bers opposite should that choice be denied to him? I don't think that the members believe that it should be. A MEMBER: Did they ever say that? 3552

Monday, 12 May, 1980. MR. USKIW: Let's examine what is happening, Mr. Chairman. Let us examine what is happening. The bulk of the people have chosen to deliver through the Board, Mr. Chairman. The Go vernment of Canada, in order to satisfy eastern Canadian feeders, has said, notwithstanding the fact that you had chosen to deliver it through the Canadian Wheat Board, we are going to tell your Wheat Board that they cannot charge the market price for your grain; they got to sell at the off-Board price if it is lower. That is right. What kind of an option have we got, Mr. Chairman?

We have the option for those that want to bypass the Board and we have a superficial option for those that want to sell through the Board, but who are undermined by the Government of Canada because the Government of Canada dictates to the Wheat Board that they must sell Board grains at below world market prices, Mr. Chairman. There are no options, excepting for the people that want to be off-Board. They have the best option.

Yes, because they know, and the people who want to buy off­ Board have the best option, that if the off-Board open market doesn 't deliver the grain that the Government of Canada will instruct the Wheat Board to deliver the grain at reduced prices to them. That is not what the Wheat Board was set up to do, Mr. Chairman, but that has been the net effect of the operations of the Wheat Board under Canada's five-year feed grain marketing policy. Mr.

Chairman, that is what has been going on and this I believe is not a free option, it is loaded dice against those in our society who wish to use the Canadian Wheat Board as their marketing agent. That is what is being complained about and if the government thinks that we have a free choice, Mr. Chairman, we have no free choice. There is only one way to go and that is you are going to sell off-Board whether you want to or not; one is willingly and the other is when the government instructs the Canadian Wheat Board to supply tha t market at off-Board prices, Mr. Chairman.

That is where we are and that is what has cost us 14 3 million in the last three years, Mr. Chairman. That is the shortfall of income to prairie grain producers over the last three years. Mr. Chairman, the Member for Gladstone, who is in the Chair, also was confused in his argument in that he said, that, well, if we didn't have that option we would have to pay high interest rate on storing that grain. Mr. Chairman, I am not talking about grain that isn't sold. We lost 143 million on grain that was sold, not in the storage bins, and would have been sold, Mr.

Chairman, at corn competitive prices, had the policy been to maintain it at that. That is not what is happening, Mr. Chairman. We are losing when we are in shor t sup ply, because the Government of Canada says you must not sell at the highest price obtainable, because we must look after these eastern feeders, and we are losing when we are in surplus production, when the world market is saturated. There are no winning days for western producers under this policy. It is not an argument of off-Board, on-Board, Mr. Chairman, anymore. It is much bigger than that. It is mu ch greater th an that.

It is eastern Canada exploiting western Canada; eastern feeders exploiting western grain producers, that is what it is. It is done, Mr. Chairman, through the Government of Canada in its instructions to the Canadian Wheat Board , and that is the most objectionable part of the new feed grains policy. Even if you gave in on the argument of options, Mr.

Chairman, what is objectionable is that when you choose the Board option and you shouldn't be circumvented in your decision by having the government say to you, notwithstanding the fact that the Wheat Board can get 50 cents a bushel more, it must sell at this price, because we have to supply it to these eastern feeders at that price. That is what is objectionable in the extreme and that is what this Min ister should be addr essing hi mself to, Mr. Chairman, without compromising his ideological position on marketing.

Straight practical common business sense would dictate that we should not take less for our grain than what the market is able to provide. That is all we are talking about in the main, Mr. Chairman; that is what we are talking about. I don't know why this Minister would want to argue that he would prefer tha t we should continue to subs idize eastern livestock production with grain priced, not by market demand in the world, but by dictate by a Minister of the Crown in Ottawa, Mr. Chairman. That is really what he is supporting, and I can't understanding why he is supporting that position. Mr.

Chairman, perhaps the Minister would want to respond to that. MR. DEPUTY CHAIRMAN: The Honourable Minister. MR. DOWNEY: Mr. Chairman, I said early in the debate on the special studies or the policy studies of the department, and really in what the Member for Lac du Bonnet is saying, he is supporting what I suggested earlier on. MR. USKIW: What are you talking about? MR. DOWNEY: Mr. Chairman, I have said from Day One -(Int erjection)- The Member for St. George suggests, do something about it.

I am really talking about the basic mechanism that is in place when it comes to the overall policy decisions for the western grain industry. I have said from hour one of this debate that I believe that we should, as provincial governments, have an ongoing mechanism to have input on policy decisions. -(I nterjection)- Okay, the Member for Lac du Bonnet agrees. We are debating the result of, or what happens when the wrong decision is made; policy decision is made by the federal government or th e Commissioners of the Canadian Wheat Board as it affects western Canada.

I have said from hour one, as I said, that that is not right, that there should be an ongoing ability for the provincial governments to have policy input where, in fact, today we don't have it. -(I nterjection)- Mr. Chairman, he says we have it. We haven't got in on a direct basis. I go through it again: The federal government appoint Commissioners to the Canadian Wheat Board. The federal authority, totally; the people who are appoin ted are appoi nted by the federal government. There is a producer advisory group elected by producers, Mr.

Chairman; they are an advisory body to the Commissioners of the Canadian Wheat Board. But there is a complete void as far as 3553

Monday, 12 May, 1980. ongoing input. -(I nterjection)- Well, Mr. Chairman, the Member for Lac du Bonnet says it's not a Wheat Board decision. There are Commis sioners of the Canadian Wheat Board that make policy for the operation of the Canadian Wheat Board. No, it moves further to that.

There are two main decision­ makers, one being the federal Minister, who they report to, and the other, there are certain policy issues that are developed by the Commissioners of the Canadian Wheat Board. -(I nterjection)- No, not this one, I agree, not this one; this is a federal policy, a federal Minister. -(I nterjection)- He says, Only deal with the federal-provincial conferences. This is not correct, Mr. Chairman, because the Canadian Wheat Board does not answer to the Federal Minister of Agriculture. -(In terjection)- Mr. Chairman, he says it's not a Wheat Board decision.

It is not a federal Minister of Agriculture's decision. Well, Mr. Chairman, they say, Yes, it is. The Canadian Wheat Board answers to a separate Minister altogether, not the Canadian Minister of Agriculture. Mr. Chairman, they do not report to the Canadian Minister of Agriculture. The policy direction comes totally from a separate Ministry. He is suggesting that I can go to the federal Minister of Agriculture at the Mi nister's conference and tell him what the Canadian Wheat Board should do. Mr. Chairman, he has been referring to the Ministerial meeting that is coming up in July.

I can indicate to the federal Minister of Agriculture all I like what I think should happen. It is the federal Minister responsible for the Canadian Wheat Board that has to be commu nicated to, okay. I just want to bring the committee back into really the perspective of what we are talking about. I have said from day one, at the beginning of these deba tes, tha t I believe th at the provi ncial governments have to have an opportunit y on an ongoing basis to have a direct input on the policies as they relate to the Canadian grain industry.

We have not enjoyed that, and it has caused some problems. -(Int erjection)- Well, the member says he doesn't know whether he trusts me there. I believe that if we are going to strengthen the position of the western grain farmers (Interjection)- Mr. Chairman, the members, as far as I am concerned, have to understand what I have said from the beginning in this whole debate on grain marketing is that we need provincial government input, as pol icy makers, to look after - (I nterjection)- He says we do have. We do not have, Mr. Chairman.

We can talk until we are Tory blue in the face and the ability for us to influence or non­ influence the federal government is whether they want to listen to us or not. MR. USKIW: When you get through with the Tory blue, you'll get a little pink and then you'll have it made. MR. DOWNEY: The difference between a little pink and a lot red is the difference between the Liberals and the Socialists. The Socialists are a lot red and the Liberals are a little pink. That's basically the difference, and blue doesn't mix very well.

The point I made, and I want to make it again to this comm ittee, is the fact that we have to, as western governments, have more input into the development of policy on an ongoing basis so that we can act in the best interests of the western grain producers, not sitting back taking cheap shots at the federal government, not sitting back taking cheap shots at the Canadian Wheat Board, like the members opposite are here tonight, suggesting that . . . They are sitting here taking shots at th e Canad ian Wheat Board.

They are sitting here suggesting the Wheat Board is not acting in the best interests of the Canadian farmers . . MR. USK IW: No, no, I never said that. Mr. Chairman, on a point of privilege. MR. DEPUTY CHAIRMAN, Robert Anderson (Springfield): The Member for Lac du Bonnet on a point of privilege. MR. USK IW: Mr. Chairman, no one on this comm ittee, in the course of these debates, of the debates on these estimates, has once alluded to the idea that the Canadian Wheat Board is in question here. We are dealing with Canadian government policy, not Wheat Board policy.

The Wheat Board is dictated to by the Canadian government on this issue. MR. DEPUTY CHAIRMAN: The Ho nourable Minister. MR. DOWNEY: Mr. Chairman, what they are doing is substantiating the argument that I put forward for two and a half years, that really the Canadian Wheat Board is not really acting at all times in the best interests of the western Canadian farmers. I believe there has to be more input -(I nterjection)- Mr.

Chairman, the members opposite are sitting here tonight, dir ectly taking on and atta cking th e Canadian Wheat Board and their feed grain policies, the federal government and the Canadian Wheat Board. They are sitting here in a direct attack. I am suggesting that could be corrected by having provincial input on policy matters, both input on an ongoing basis so that we wouldn't be sitting here making cheap shots, what I would call cheap shots by the members opposite at the Canadian Wheat Board, suggesting that there is a mechanism to have policy.

There is a mechanism to suggest policy, but not really to exercise any power in implementation of that policy. I am suggesting we should have a review of the marketing system in western Canada, in Canada, to once again make th e Canadian Wheat Board responsible to the farmers whom it is working on behalf, having provincial government input. I am not sitting here tonight recommending how best it should be handled, but I used an example earlier today.

The Australian Wheat Board, for example, has representation on it, on a direct basis, both at the federal level, to which they have had four people appointed, and each state, of which there are five provinces in Australia, have the abili ty and the authority to put two decision-makers from each of those provinces on the Australian Wheat Board. They work collectively and it is in the best interests of the producers, the provinces and the federal government to have that kind of input. 3554

Monday, 12 May, 1980. We are sitting here tonight debating the very thing that I have suggested should take place from day one, that we have to have more input from the producers, through the provincial Ministers, to the federal government. That, Mr. Chairman, is the nub of the whole problem, not the fact . . .

The argument the Member for Lac du Bonnet makes is somewhat valid, that if people in their own way want to market solely through the Canadian Wheat Board, and there are some people that want to do that, are in fact being discriminated against because of the policy of the government, translated through to the Canadian Wheat Board. -(I nterject ion)- Well, sure it's translated through to the Canadian Wheat Board. - (I nterject ion)- Well, dictated to, ordered to, however, but it is still carried out by the Canadian Wheat Board.

We have Comm issioners appointed, who should represent the best interests of the Canadian farmers, grain farmers, because that's who the Canadian Wheat Board was set up to protect.

I'm suggesting, and it is one of a philosophy as well as a mechanism available, I am suggesting that because that is happening, that the farmers - and the Mem ber for Gladstone sugge sted the same approach - that because that particular situation is the way it is, that there is another way to market grain that doesn't force them to take the corn competitive price, that there is another mechanism available for them to sell their grain through. Now, that is totally on the domestic scene.

If we are talking on the international market, then the Canadian Wheat Board have the total control of all the sales. -(I nterjection)- Mr. Chairman, the member says it couldn't meet the commitments. The reason why, I gu ess, th ey couldn't meet th e commitments, some of the reasons have been the lack of transportation, having the ability to provide the grain to those markets. That's one of the major problems and I think that that is being alleviated.

I don't sit here and disagree with the Member for Lac du Bonnet on the point he makes, that those producers wanting to use the Wheat Board , and the Wheat Board solely, are being discriminated against. I haven't argued against that, that that is really some thing that has to be add ressed. (Interjection)- No, they do have the alternative, and that's the position we have taken. They have the alternative to use the other system. MR. USKIW: They don't want to use the other system. MR. DOWNEY: Okay, they don't want to use the other system, and you have made the example of the three different types.

There are some people that maybe don't want to use the Board system. So it is a position that - and I go back to my initial statement - that if, before these kinds of policies be put in place that don't work in the best interests of the western Canadian farmers, that it is too late after the policy is developed. I believe that on an ongoing basis that the provincial Ministers of Agriculture should have the mechanism or the ability, whether it is the appointment of a Comm issioner or whether it is some ability to have input when it comes to the policy and the marketing of western Canadian grains.

I think that's more the nub of the problem we are talking about, instead of the problem after it is created. MR. DEPUTY CHAIRMAN: The Member for Virden. MR. McGREGOR: Yes, Mr. Chairman. Certainly the discussion has been off-board versus Wheat Board. I was home on Thur sday last to perform a function at Virden. I hit the cafe about four in the afternoon and the phone was ringing. They know McG regor is in town; they know McGregor has got wheat and you know what? My local elevator is out of wheat. One more trainload and he'll be out. So I got into action on Friday and hauled grain. As you know, I wasn't here.

All right, Ttat buyer took sick, or had to go to the doctor. The guy from Oak Lake - this is off the C.P. main line - had to come and buy it Friday afternoon. His elevator is almost empty. Oakner to the north, two new, one Cargill, one Pool, 40 tank cars sitting there. They're in doubt if they can fill it. Now, we say we are not moving more grain with the two systems. I would like that proven. That is not so. Never in my life, in farming, were elevators empty at this time of year, unless it followed an extreme tragedy of hail or something. That's a fact.

One is the C.N. main line; one is the C.P. main line, and my own line is a branch line. And I follow the same thing. I have only, I believe, sold one load off-board. I have shipped several tanker cars of barley and that's my business. Before this plan came in, I have sold as far east as the Elie Hutt erite Colony for about one­ fifth of what the off-board price is today. I did it because I had payments to make.

I don't have that pressure today but there are many that do and it is much easier to sell a carload of wheat off-board to pay off that mortgage on the swather, combine, and we know farming is a devilish expensive business and it is far easier to ship a couple of carloads . . . Certainly that person would rather ship through the Wheat Board, but if it is making payments . . . I don't think there is anyone who would prefer off­ board alone. I couldn't see the common sense of it.

I just think the whole history of world prices, if the world gets ahold of it, that the elevators are empty in western Canada, you will find that has some influence on the world wheat agreement that is coming up in the months ahead. I just congratulate my Minister and his department for supplying those tanker cars. Now, I don't know the 40 at Oakner - I didn't go and see how many of them were the contract ones that my Minister, or what's ... I know that the other group that bought that bundle of cars, how many they've got on the track. But I say that this is moving more grain the way we are.

We keep comparing barley versus corn, but it is corn and soy bean, a combination thereof, that does put the competition to us. I just say, a farmer is an independent person and I would like to see him, if he desires to ship 10 carloads off-board to get his operation economic, to get his bank notes up to date, that's his right and I hope we'll always have that option. Also, it is just good for general . . . There's more money. If you could say, as the Member for Lac du Bonnet, we would have the same quota combined; it never has.

All the time I have been farming, I think one year it's a nine bushel or a twelve bushel, and no higher. This way, you can take that nine or twelve and still push 3555

Monday, 12 May, 1980. another six or seven or ten. I'll be several years before - and I have quit farming, this was the second year - and I'll be hauling wheat out as a normal farmer for . . . I thought maybe next year I would clear it, now it will be the year after next at least. So I say, I may be forced one day to haul some on the open market, that's my right. I don't think it is good business. It isn't good economic business, but if I had a bunch of notes paying, and interest -(I nterjection)- Well, you can only go to your potential quotas, as the Member for St.

George must know, and that helps, but not an awful lot in the expense of farm operations. So I just say, there is something good in the dual system. Thank you, Mr. Chairman. MR. DEPUTY CH AIRMAN: The Mem ber for Crescentwood. MR. WARREN STEEN: On the subject of research, I wanted to ask the Honourable Minister about the benefits and so on from his trip to Mexico of a year ago, and how did we in the field of agriculture gain from his experience down in Mexico of a year ago? MR. USKIW: Mr. Chairman, on a point of order, it is not under discussion at the moment. We are on Research, Policy and Research.

That's what we're on. MR. DOWNEY: Mr. Chairman, my response to the member would be that, very briefly, we had an excellent response from our . . . MR. DEPUTY CHAIRMAN: The Member for Lac du Bonnet on a point of order. MR. USKIW: I would like to raise the point that that matter comes up somewhere in the area of marketing. We are not yet there and probably will not be there today. We are still on Policy Studies Research, Item 1. (e), for the benefit of the Member for Crescentwood. MR. DEPUTY CHAIRMAN: The Mem ber for Crescentwood on the same point of order. MR. STEEN: Mr.

Chairman, on the same point of order, I would think that under the broad title of Research, that policy, marketing and so on, and if I read the description of Research, I can't see where that question should be ruled out of order. MR. USKIW: Absolutely. MR. STEEN: I asked the Minister how, in the area of Research and Marketing, what was the gain for the province of Manitoba. Is that out of order, to the Mem ber for Lac du Bonnet, th rough you, Mr . Chairman? MR. USKIW: Mr.

Chairman, on a point of order, there is Marketing, Research Marketing, and every kind of marketing under a separate item in the estimates, so that there is an area for discussion, but it is not at this time. MR. STEEN: Mr. Chairman, if you will allow me, the Leader of the Opposition and I thought I was in order; obviously there is a split in their caucus and there isn't in ours, and therefore I will waive to the Member for Lac du Bonnet and permit the Minister to answer the question at a later date.

But the Leader of the Opposition, who is a good friend of mine, and I, both thought that we would at this moment enquire as to the Minister's trip to Mexico and as to how the research in the area of agriculture was conducted. But the Member for Lac du Bonnet doesn't feel that that is in the area of Research and we'll leave it to Marketing. MR. DEPUTY CH AIRMAN: The Honourable Minister. MR. DOWNEY: On th at point of order, Mr.

Chairman, if the member of the government caucus and the Leader of the Opposition have agreed that we should wait until further on in the estimates, and that seems to be the consensus, I guess, I could answer it at that particular time. Otherwise, I could enter into ... MR. STEEN: Mr. Minister, I was just wondering who was looking after the farming end of the NOP caucus.

I was trying to occupy the leader for the last half hour here, his attention, and obviously I overdid the job of occupying his attention and I didn't get the Me mb er for Lac du Bon net's attent ion, and therefore, if I am in the wrong place, then I'll ask the question later. MR. DEPUTY CHAIRMAN: The Member for Ste. Rose. MR. A.R. (Pete) ADAM: Mr. Chairman, I want to correct first of all a statement that the Member for Gladstone made when he made his comments. I think he did it inadvertently. I'm sure he wouldn't want to leave it on the record, but he referred to the Mem ber for Ste.

Rose as insulting the late John Diefenbaker. The fact is I did not refer to the late John Diefenbaker. I was the first person to open the comm ittee, to speak when the committee came to order, but I did not refer to Mr. Diefenbaker at all and I would like that to be on the record. We have covered this quite extensively.

I think what we are asking the Minister to do is - the Minister has taken credit and he has spoken quite often on the fact that this government has been, in a large part, responsible for the movement of grain - what we are asking is, for the Minister to do the same thing in the matter of feed grain and what is happening to the farmers in Canada, we want you to speak up. Since you are able to - you seem to feel that you can't achieve anything insofar as provincial­ federal conferences, yet on the other hand the Minister indicates that he was successful to some extent in the movement of grain.

I'm not sure how much has moved. There were some reports that we had moved 3 percent more this year. This may have changed lately, I don't know. What we are asking the Minister to do is to use his good offices when he meets with his counterparts in the federal government in July, to bring this to the attention of the conference and to be prepared. That is why we have talked about this today, to bring to the Mi nister's attention what is happening in the 3556

Monday, 12 May, 1980. grain trade and the loss of income to Manitoba farmers. That is why we even referred to some of his own reports, to the report from the university, which indicates that if we do away with grain subsidies and subsidies on transportation, we could be seriously in trouble, even with our livestock production. That is why we are speaking here tonight, because we can see these things, and some of his own reports indicate that, some of the research that has taken place at the University of Manitoba.

So we bring this to his attention, because this could have serious ramifications on the agriculture picture in Manitoba. If doing away with the subsidy on grain transportation to the east is going to have a detrimental effect to Manitoba, what will the Crow Rate do, if we abandon that? That will have a disastrous effect, not only on many farmers going out of busi ness but businessmen going out of business as well because of the loss of income to farmers, because of the higher rates.

I have spoken, even last wee k, to people from th e Transport Commission - not the Transport Commission, but people working in the Transport Department in Ottawa, and they tell me, You don't have to worry; you are not going to get any money, any subsidies for transportation if the Crow Rate goes; there is no money. They don't care about how much the province will have to spend for upgrading roads and all that. They are not going to put any money; that's a provincial responsibility. I was talking to some people in the policy end of it in Ottawa.

They were down last week, and I happen to know them, and we discussed this matter. In fact, I showed the people the report from Saskatchewan, but they are not interested in provincial problems. I am saying, Mr. Chairman, that we must have more research done, because the Minister has to be very well armed when he goes to meet with his federal counterparts.

I am sure that if the provincial Ministers of Agriculture meet together and hammer out a policy - and we have brought a lot of information to the attention of the Mi nister this afternoon and yesterday on very crucial points - because the damages could be irreparable if we don't try and rectify them before it is too late. I would like to ask the Minster why we can't get the full documentation of these reports, these studies that have been made by some of the people, by some of the money that we are spending here now for research and polic y making.

We have an abridgement here in this report but we do not have the policy papers so we can study those. I would like to see those papers. We have nothing here; we have jus t really a generalizing of what really they discussed, and I would like to see an in-depth of what really was the full report of what has happened on the statutory prorates handling and the effect of the St. Lawrence Seaway and all the research that was do ne, and financing and operati on, the rehabilitation of rail lines. We want to see all that. MR. CHAIRMAN: The Minister on a point of order. MR.

DOWNEY: If the members want to get to that particular item, then we could pass the one we are on and get to what the member is referring to. MR. CHAIRMAN: 1. (eX1) - the Member for Lac du Bonnet. MR. USKIW: Mr. Chairman, the Minister pleaded moments ago that, really, he is not in a position to deal with the question of the present marketing system for feed grains in Canada because the system of marketing falls under the Ministry of the Canadian Wheat Board, and that the conference that he will be attending is an Ag. Minister's conference. Mr.

Chairman, I am sure he knows, but in the event that he doesn't and his staff doesn't know how to do it, let me explain to him how it is done. - (I nterject ion)- Mr. Chairman, the Mini ster is groaning now. He indicated he didn't think he could do this at the next conference. Mr. Chairman, I will show him how he can do this. No rmally, before a ministerial conference is convened, all of the provinces are asked to submit documentation as to the kinds of issues they want discussed and want put on the agenda. That is sent out to the government of Canada, or to CDA, Department of Agriculture. Normally, Mr.

Chairman, following that . . . MR. CHAIRMAN: The Minister on a point of order. MR. DOWNEY: In all fairness to the Member for Lac du Bonnet, he is getting a little elementary, I think, for the committee. I stated the fact that it was an Ag. Minister's conference -(Int erjection)- Mr. Chairman, if we have to sit here -(l nterjection)­ The point of order is that he is not dealing with the item as it is listed in this particular part of the estimates. MR. USKIW: Mr. Chairman, I sure am. I am responding to the Min ister's statements, Mr. Chairman. MR. CHAIRMAN: Well, we are on 1. (

e) Policy Studies. MR. DOWNEY: Exactly, we are dealing with policies of feed grain marketing, Mr. Chairman. MR. CHAIRMAN: To the committee, this is an item of 107,000 and, really, these are a lot of hours, and are we really stretching it to be on this item since Friday last and here it's late Monday night. The Member for Lac du Bonnet. MR. USKIW: Mr. Chairman, on your point of order, if there were zero dollars there, it would be worthy of as long a debate as we have already had, or longer, because it is an important policy area that we are discussing.

So the dollar amount has nothing to do with the substance of the item. It has to do with its importance to the prairie economy. MR. CHAIRMAN: The Member for Lac du Bonnet. MR. USKI W: Mr . Chairman, the Mi nister is preoccupied at the moment. MR. DOWNEY: I am sorry, Mr. Chairman. Would you mind repeating it? 3557

Monday, 12 May, 1980. MR. USKIW: I have plenty of time. Mr. Charman, I am suggesting to the Minister that if he wishes the federal gover nment to change their feed grain marketing policy, then he ought to give notice that he wants this item on the agenda of the next meeting of Ministers, at which time the federal Minister will invite the Minister in charge for the Canadian Wheat Board to sit in on that portion of the discussion, or that conference, dealing with this issue. If he does that, he will not be in a position to say that he was unable to deal with this issue because they were merely meeting with Ag.

Ministers and not the Minister of the Canadian Wheat Board. That is a very normal course of action, Mr. Chairman. All Ministers that have something to do with the interests of agriculture do participate at the Ag. Conferences each year, so that the Minister has ample opportunity to raise the matter.

I wish to ask him whether he will agree with me, and if he does, whether he will raise the matter at the conference, along with other Ministers who, I'm sure, are concerned about the same problem, is whether or not he will ask the government of Canada to amend their feed grain policy so that those producers who choose to sell to the Canadian Wheat Board are not circumvented by a Ministerial decision that puts their grains into the offboard arena or into the market at off-board prices. That is the key, Mr. Chairman.

Because if that can be achieved, then there is some credibility, at least, to the fact that there is an option, and that the person that wants to sell to the Canadian Wheat Board will be assured that person will receive the highest price attainable by the Canadian Wheat Board for his product and will not be undermined by the fact that the federal government will have instructed the Wheat Board to sell his grain at a reduced price in order to satisfy the needs of eastern Canadian consumers of feed grains.

It could very well be that this grain could be sold in Europe for 50 cents a bushel more, and that should not be denied to those people who wish to choose that option of marketing. If the eastern feeder is short of grain, we can rely on the off-board market to supply them, Mr. Chairman, if they are willing to supply all this grain at a reduced price. Heavens, why should we stand in their way? The Member for Virden is willing to ship ... Well, the Chairman, is willing to ship carloads of grain at distressed prices to supply that market, from time to time, or was willing; he no longer is willing, Mr. Chairman.

I'm glad to hear that. But he was willing at one time. He alleges that there are others that are willing. Mr. Chairman, God bless him, but let him not take away from the person who is not willing to sell in that kind of a market arena, you see, and who chose to use the instrument of the Canadian Wheat Board to market his product at the best price attainable. That should not be circumvented by any Ministerial decision, and if this Minister will give us a commitment, Mr.

Chairman, that yes, he agrees with that, he agrees with the options that if a person chooses this option, then that option should not be circumvented and that he will raise that matter at the Ministerial conference, that will satisfy me, Mr. Chairman. MR. DOWNEY: In response to the Member for Lac du Bonnet, in reviewing the feed grain policy, and looking at the federal government's dealing with it, it's really unfair to go back and suggest to the Member for Lac du Bonnet that he was the Minister that was responsible for the provincial Department of Agriculture when this policy was implemented.

Where was he -(Int erjection)- Here we are Mr. Chairman, he is sugge sting th at he has sat there - (Interjection)- Mr. Chairman, I was in the farm community trying to make a living under a socialist government and found out that it was impossible, so I had to get involved and try and change some of the policies. We're still in that process, Mr. Chairman. But getting back to the point that the member raises, we reviewed the pol icy last year, we discussed feed grain policy, parts of it. He suggests that we should review that.

We will be reviewing that on an ongoing basis, and will suggest, after meeting within the go vernment caucus and with the department, different proposals. I believe that to go to the federal government, that in fact we will go with some objective viewpoints; we will review it. Now, whether or not it will be put on the agenda will be something that a decision will have to be made on. I'm not sitting here tonight to make that decision, because we need, in fact, I believe, more discussion with th e other Ministers of Agricultur e on a prelimina ry basis.

As he has indicated, there is probably some other government or other provincial governments who may, in fact, put that on the agenda. I am as concerned that western Canadian feed grain producers get paid a maximum amount of money for their product as is available, and if it's a matter of . . . And I again go back to our position that we have to have the alternatives available to them to maximize that return.

Now, the point that he raises, will it be raised at the federal Minister level and have the federal Minister responsible for the Canadian Wheat Board as a part of that, those kind of recommendations are objective and will be taken into consideration. MR. USK IW: I would like to ask the Mi nister whether he agrees that there should be a genuine option on the part of the producer as to which metho d of marketing he wishes to market. - (I nterjection)- Well, he agrees there should.

And if there should, does he not agree that it should not be interfered with by the Canadian government or by the Manitoba goverment or by anybody. If the producer has chosen the Wheat Board as his marketing agent, then that board should have the right to market that person's production at the high est price att ainable in the world . (I nterjection)- Well, I know the Minister has said that. Will he take it up with the Minister of Canada, who has circumvented the rights of this individual by instructing the Canadian Wheat Board not to do that, Mr.

Chairman, but instead to offer grain, Canadian Wheat Board grain, to domestic users at lower prices than what can be obtained in the world market? So I merely ask the Minister to give us that commitment, that he will pursue the freedom of the individual to choo se how he wishes his gr ain marketed. 3558

Monday, 12 May, 1980. MR. DOWNEY: Yes, Mr. Chairman. MR. CHAIRMAN: The Member for Rock Lake. MR. HENRY J. EINARSON: Mr. Chairman, I didn't get the discussions earlier this evening, what brought about all this debate insofar as off-board grains versus Wheat Board prices. Now, if I understand the Member for Lac du Bonnet, who has said that the federal government has instructed the Canadian Wheat Board to buy grains or provide grains to a purchaser, that may be off-board grains; it could be any compa ny, Car gill, XCan, Pi oneer, or any company, could have bought grains on the off-board price.

I am not sure that I understood the Member for Lac du Bonnet, who had a responsible position at one time when he was the Minister of Agriculture. Is he telling us, Mr. Chairman, that the Canadian government, or the federal government of Canada, has instructed the Canadian Wheat Board to purchase off-board grains from Company A or Company B, whatever, to fulfill a market?

I'm asking, from what I understood the member to say awhile ago, the federal government would instruct the Canadian Wheat Board to provide grains to eastern consumers that was bought by any other private companies? -(I nterject ion)- Oh, board grains. I'm sorry. I thought he was talking about off­ board grains. That's fine. That could be anther matter, but they were talking earlier about board grains versus off-board grains. -(In terjection)- No, I listened to the Member for St.

George, who was talking about off-board grains as well, because in his questioning period last week in the House, he was talking about how much money the farmers had lost because they sold on the off­ board market. MR. USK IW: No, no, not because they sold on the off-board market. MR. EINARSON: Well, Mr. Chairman, I'm sorry, I missed some of the discussion, as I said, in the beginning, but I want to get this thing clear and make sure that I hav en't misun derstood th e members on the other side. MR. USKIW: I'll clarify it for you. MR. EINARSON: All right then, Mr.

Chairman, I'll yield the floor to the Member for Lac du Bonnet, because I want to make sure th at I haven 't misunderstood him when he says that a farmer sells on the off-board, that he's being penalized in losing money because he sells on the off-board. MR. DOWNEY: Mr.

Chairman, to the Member for Rock Lake, the discussion, as it relates to the policy studies of grain marketing, it was suggested by the Member for Lac du Bonnet and by the members opposite that the individuals who so wishes to market their grain solely through the Canadian Wheat Board, that they should not, in fact, be forced to sell that grain at a corn competitive price to the eastern feed grain market, if they are so desirous of marketing through the Canadian Wheat Board only. Mr.

Chairman, because of the federal government instructing the Canadian Wheat Board to market that grain to the domestic market in eastern Canada at the corn com petitive price, it is, in fact , discriminating against that individual who wants to sell to the Canadian Wheat Board. Mr. Chairman, my suggestion has been, and what we suggest is that the option has to be available to market, the option has to be available to market both on board and off-board, and the off-board removes that anomaly.

It still doesn't remove the fact whether you want to market or not to board or off­ board, if you still want to go one way, then you don't have the option. The option is there; whether you exercise it or not is your decision as an individual. But th e sugge stion prior to tha t was that I recommended and feel that we have to have more input on ongoing policy matters with the Canadian Wheat Board, as provincial governments; as policies are developed, we should have the input to the development of those policies, and we don't get in the situation that we're faced with right now.

The Mem ber for Lac du Bonnet was part of a government when in fact this particular policy was introduced, and allowed that to happen at the federal government level. -(I nterjection)- It happened, Mr. Chairman, as the Member for Lac du Bonnet was the Minister at the time, it happened. He didn't allow it to happen, or he didn't disallow it to happen; he didn't have the ability to stop that kind of policy. I'm suggesting that provincial governments should have a more direct way of having input on policy matters. MR. CHAIRMAN: The Member for Rock Lake did give up the floor to the Member for Lac du Bonnet.

If the Chair recognizes back and forth, when you give up the floor, I think I would recognize you down the line, in all fairness. But otherwise we will start something we can't live out. The Member for Lac du Bonnet. MR. USKIW: Mr. Chairman, on a point of order, the Member for Rock Lake gave up the floor to myself in order that we would enu nciate what our argument was, for clarification purposes. The Min ister took the floor, although he was not supposed to take the floor, as I understood it, Mr. Chairman. He interceded. MR. CH AIRMAN: The Chair recognized the Minister almost . MR. USK IW: Mr.

Chairman, I know, but the member yielded to myself in order that we would clarify our position. I don't know how the Minister can clarify our position, but he chose to do so and he didn't do a good job of it, Mr. Chairman. If I may have the floor, I would like to clarify that position for the benefit of the Member for Rock Lake.

We have compla ined tha t there were losses amounting to 14 3 million on the part of prairie grain producers because of the present feed grain marketing policy, and the nub of the complaint is that if there is a western feed grain surplus, the price is allowed to fall below corn competitive value; if there is a western feed gr ain shortage, the government of Canada instructs the Wheat Board to sell corn competitive value. So that the western grain producer loses on both sides of the ledger, and in 3559

Monday, 12 May, 1980. turn ends up subs idi zing eastern feeders. The present feed grain policy is a direct subsidy, or transfer of wealth from the prairie region to eastern Canada, and that is what we are objecting to.

And the other point that we are objecting to is the fact that if a farmer ships 10, 000 bushels of grain through the Canadian Wheat Board because he wants the Wheat Board to do its best to market that grain at the best price available in the world, that the Canadian Wheat Board should not be instructed by the government of Canada to dump that grain back on the eastern market at below world market prices in order to satisfy the demands of eastern feeders, which is the policy of the present government.

And we have asked this Minister to honour the rights of producers, that if they choose to ship through the Wheat Board, or if they choose to ship a portion of their grain to the Wheat Board, Wheat Board grain should not be sold on the basis of a directive from the Minister of the Canadian Wheat Board that that grain must be sold at below world market value anywhere, because we believe in the right of the producer to choose to market through that agency. MR. EINARSON: Mr. Chairman, now I have a little better understanding of what's taking place, and I think I have a favourable response that I'd like to make, Mr.

Chairman, to the Member for Lac du Bonnet. When he talks about how discreetly and unfavourably the western farmer has been treated by the federal government of Canada, and he's talking about and giving instructions to the present Minister of Agriculture, what he should do with a provincial federal conference with the Ministers of Agriculture, I would suggest, Mr. Chairman, that he had a much better opportunity when Joe Clark was in the helm of things in Ottawa than he has at the present time. I want to suggest to you, Mr.

Chairman, that it's appalling to me, when I listen to the Member for Lac du Bonnet, when he had eight years of sizing up the Li beral go vernment when th ey were in power. Eugene Whelan, whom I understand, the ex-Minister of Agriculture was a real friend, and got along very, very well, Mr. Chairman. I want to suggest to the members opposite right now, Mr. Chairman, that they would have done much better if they had supp orted the Conservative govern ment, their colleagues in Ottawa in the last election, rather than to assisting to defeat the Conservative government.

I think that they would have been much better, on a much more solid ground, to try to achieve what they are talking about right now than they ever will be when they are trying to sugges to the Minister of Agriculture who is there now. That doesn't mean to say that I don't hope that the Ministers of Agriculture aren't going to achieve some of the goals. I fully agree with the Member for Lac du Bonnet, what he's talking about; I didn't get the proper prospective of it, but I sure do now.

I'm going to charge the mem bers op posite, who, with their colleagues in Ottawa, did everything they could in Manitoba to defeat the Clark government of the day. They sure did. Mr. Chairman, they did everything in their power to defeat the Conservative government of Ottawa, who were the people, who were the friends of western Canada, once and for all, after 22 years of Liberal administration. The NOP in Ottawa did an awful lot, and I repeat, to help defeat the Conservative government, a government who was not only interested in eastern Canada, central Canada, but were also interested in western Canada as well.

I suggest, Mr. Chairman, that the Member for Lac du Bonnet should put his head in shame when he stands up and talks about the things that this Minister of Agriculture should be doing when he was one of the components, and his colleagues, who were out to defeat the very party that was out to do something for western Canada back just last year, in February of last, 19 80. I suggest, Mr. Chairman, that the Member for Lac du Bonnet, the Member for Ste. Rose, and the Member for St. George did an awful lot to destroy what they are now asking us to do. Mr.

Chairman, I hope this isn't going to prolong the debate all that much, but I want to say this, now that I understand what honourable members are trying to do, because they're up to their old tricks like they've been for the last nine, ten years, but they haven't changed one little bit. As far as I am concerned, Mr. Chairman, they are out to support the Liberal Party. The Liberal Party has never done anything to try to help the situation in western Canada, they've always been proponents for central and eastern Canada.

We know very well that the farmers in eastern Canada don't come under the jurisdiction of the Wheat Board. They'r e also being subsi dized by th e taxpayers, not only of eastern and central Canada but of western Canada as well, when it comes to marketing their grain. I suggest, Mr. Chairman, those are things that should be taken into account. I want to say, Mr. Chairman, that I wish my Min ister of Agricultur e wel l, and I hope, Mr.

Chairman, I want this for the record, and remind Pierre Elliott Trudeau, when the election results were final in February, that because he did not have any representation in western Canada, that we have to do something to listen to th e west and give consideration. I hope that when they do have their Minister's conference on Agriculture that Pierre Elliott Trudeau will put that into real meaning and listen to what they are going to say, and hopefully our Ministers of western Canada will have some positive results insofar as the farmers of western Canada are concerned. Thank you, Mr. Chairman. MR. URUSKI: Mr.

Chairman, the Member for Rock Lake certainly gave us an earful in terms of his analogy in western Canada as to who supported whom, Mr. Chairman. Supporting the Conservatives in Ottawa and the Liberals is like jumping from the frying pan into the fire, Mr. Chairman, in terms of their respected policies dealing with the issue that we have under discussion this evening, Mr. Chairman.

I wanted to ask the Minister specifically, could he outline to us what was specifically his government's policy with respect to the marketing of grains that he made to the Wheat Board, that he indicated that his policy was not listened to by the federal Minister. Could he give this committee an outline of the work and the research behind the policy, and the specific policy, the one specific area that he said he made a submission to, to the federal Minister that was not listened to. Could he give this committee some . 3560

Monday, 12 May, 1980. MR. DOWNEY: Mr. Chairman, as members of the committee are aware, the decision made last year to implement quotas on feed grains for eastern Canada, Mr. Chairman, nine provinces disagreed with the imposition of quotas on feed grains and one province supported it. That was the position that was taken by the provincial Ministers of Agriculture and it was also supported by the provinces and submitted to the federal government that the provinces have input on issues relating to agriculture policy on an ongoing basis. That was the positions that were put forward at that Minister's conference. MR.

URUSKI: Mr. Chairman, could the Minister tell us, was there any research done into the area of the policy position that he had made? What did he hope to accomplish, and what would the impact have been on the marketing system that exists? MR. DOWNEY: The freedom for producers to market grain directly to purchasers of feed grain in eastern Canada on a direct basis. The use of producer cars, without having quotas imposed upon them. Movement by truck, or ho wever, was a freedom of the producers to provide feed grains to eastern Canada without having quotas imposed upon them. MR. URUSKI: Mr.

Chairman, does the system not now provide for the movement of feed grains to eastern Canada, whether it be through the Wheat Board or throughout? MR. DOWNEY: It has quota restrictions on it, Mr. Chairman. MR. URUSKI: Mr. Chairman, could the Minister indicate what kind of quota restrictions are on the movement of feed grains? MR. DOWNEY: Mr. Chairman, as the Wheat Board see fit, they implement quotas, at whatever level they see is desirous of them to put in place.

The option to that, or the alternative to that, I should say, is to allow the producers to market any amount of feed grains they want into the eastern feed market , without having quotas imposed upon them. MR. URUSKI: Mr. Chairman, was the government position to totally bypass the Lakehead ports? MR. DOWNEY: Mr. Chairman, that really wasn't part of the policy as far as . . .

The decision was that, as far as two things, I said the imposition of quotas on feed grain movement into eastern Canada or into western Canada, into B.C., and also the ability for the provinces to have input on agricultural policy as it relates to the grain industry. I can table the communique; if the Member for St. George wasn't interested in the meeting at that particular time, then I would be quite happy to bring the communique from that particular meeting to his attention. I don't see what it has got to do with policy studies. MR. URUSKI: Mr. Chairman, that's my very point.

The Minister indicates he doesn't see what it has to do with policy studies. I asked the Minister, as part of my question, what the impact would have been in terms of the ability of farmers to market grains through the Wheat Board, if his policy of non-quotas would have gone through, and what research was done in terms of how it would affect the ports and the availability of grain to move in an orderly manner. We know, Mr. Chairman, what it has done now, where grains have been ship ped into the Lakehead on the open system, grains that had no quota restrictions on them.

We know that tho se grains have caused severe cloggings at the ports and we want to know what the dep artment has recommended to the Minister with respect to the impact on the ports and on the ability of farmers to market, if they desire to market' grain through the orderly marketing system: what im pact would it have on it? MR. DOWNEY: Mr. Chairman, the member is suggesting, what effect would it have on them?

I would guess the first effect is that if we hadn't seen the opening of feed grain quotas at the rate that we saw, then we would have seen somewhat of a restriction placed on the movement of producer cars and direct sales to eastern feeders. But we have seen a situation since the imposition of quotas that the off-board and the Wheat Board quotas have increased pretty much at the same time. As far as any major policy studies, they aren't necessary.

It was the feeling and the position of the Manitoba government not to have quotas imposed on the marketing of feed grain into eastern, or into extreme western parts of Canada. We don't need a major policy study or a review on that particular aspect, when the government takes a position collectively, as we have done. We felt it was in the best interest of our producers here in Manitoba, as did eight other provinces take that position, to allow them the dual marketing opportunties that we have deba ted here for the last several hours. Mr.

Chairman, I have no more to say on this particular item, and suggest that we might as well pass on to some of the other items, because there will be opportunities to debate this whole item again under marketing. If the members want to repeat the discussions at that particular time, I suppose they would be free to do so. But I see no benefit in sitting here tonight and thrashing straw, as the Member for St. George is prepared to do. MR. CHAIRMAN: I think it is true, if we are going into the marketing area, we do cover that in Resolution 11 . All right. 1. (e)(1) - the Member for St. George. MR.

URUSKI: Thank you, Mr. Chairman. I just wanted to ask the Minister, as a final question, does he not see that policy recommendation as being a complete reversal to his present statements to us tonight with respect to the cost implications and the downward pressure on prices that farmers have received in Ma nitoba? The very point of the Minister's policy recommendation to the Wheat Board has exasperated the problem that Manitoba produc ers have faced, in effect, the lowering of prices because of the grains that were marketed through the off-board market. No? Okay. 3561

Monday, 12 May, 1980. MR. USKIW: Mr. Chairman, I simpl y want to respond to the Member for Rock Lake, who suggested that on February 1 Bth the New Democrats helped defeat a Conservative government. I don't know what that had to do with research policy studies, but I assume it has something to do with it, Sir, because it was allowed to be discussed and his argument was presented to this committee. MR. CHAIRMAN: One member at a time. MR. USKI W: Mr. Chairman, I want to confirm to the Member for Rock Lake, that yes, we want to take some credit for bringing down th e Clark administration.

I don't want to deny that one bit, Mr. Chairman. I think we can take some credit and I'm pleased that we were able to succeed , Mr. Chairman. I would want to relate a little incident tha t occurred du ring the election campaign to demonstrate how this was achieved. MR. CHAIRMAN: The Minister on a point of order. MR. DOWNEY: On a point of order, what has this got to do with policy studies in the area of research? MR. USKIW: Mr. Chairman, you have allowed a certain amount of latitude to the Member for Rock Lake. I'm sure you wouldn't want to deny me the same amount of latitude. MR.

CHAIRMAN: The Member for Rock Lake on a point of order. MR. EINARSON: Mr. Chairman, on the point of order, I was sitting here listening to the Member for Lac du Bonnet, and I was not out of order, as far as I was concerned, I was responding to the comments the Member for Lac du Bonnet made. MR. USKIW: Mr. Chairman, I want to relate an incident that occurred during that election campaign. I met a fellow in a coffee shop in Lac du Bonnet, an ex-Tory. He was Tory up until then, and then he was becoming an ex-Tory. And he said to me, you know, I don't know what to do in this election.

I'm going to Hawaii for a vacation, I'm going to be away the date of the election, and I don't know what to do with my vote, and he was voting at the advance poll that day. Mr. Chairman, I gave him some advice. He told me he would never vote NOP, because he is a Conservative, but he wasn't going to vote for Clark and he just didn't know whether he should bother voting. He said to me what kind of advice would