Canadian agriculture funding cut in the 2012 budget

by | Apr 2012

Apr. 2, 2012, Ottawa, ON - Responses are mixed on the agriculture side in response to Canada's Economic Action Plan 2012, introduced in late March by Finance Minister Jim Flaherty. On one hand, the government is cutting over $300 million from Agriculture and Agri-Food Canada (AAFC), but there are also a number of funding additions to encourage trade, food safety and reimbursement for flood damage.

The cuts

According to the 2012 budget, "[the] Agriculture and Agri-Food portfolio organizations will streamline their operations and reduce operating costs, while making sure services are provided to farmers and the agriculture industry in the most cost-effective and efficient way."

The description goes on to mention that the AAFC and the Canadian Food Inspection Agency (CFIA) will merge and integrate a variety of functions, including research goals, to make it "easier for farmers and industry to get the information on technological advances they need to succeed."

The CFIA saw its budget cut from current levels to decreases of $2.1 million in 2012-13, $10 million in 2013-14 and a staggering $56.1 million by 2015. These cuts will be accomplished by transforming how it interacts and delivers services to clients with regards to permits, licences and registration, as well as for the provision of technological, interpretive and specialized advice.

The document also states that the CFIA will have to change how they monitor and enforce non-health and safety food labelling regulations through the introduction of a web-based label verification tool that will allow customers to bring concerns directly to the approppriate companies and associations. Lastly, the budget states that, "the Government will also repeal regulations related to container standards to enable industry to take advantage of new packaging formats and technologies, while removing an unnecessary barrier for the importation of new products from international markets."

The additions

While there are a large number of cuts, some areas of the AAFC do receive a financial boost. For example, the budget proposes funding for the Canadian Grain Commission of $27 million in 2012-13 and $17 million in 2013-14. This will allow the commission to move to "a sustainable funding model" and realign its fee structure for services.

Food safety also received some attention in the budget, with $51.2 million being split between the Public Health Agency of Canada, Health Canada and the CFIA, to continue enhanced surveillance, early detection and improved response capabilities to foodborne illness emergencies.

"Time and time again we have demonstrated that food safety is a priority for this Government," added Minister Ritz in a press release from Marketwire. "Our Government's Budget, once again, reaffirms our strong commitment to consumers and the food industry."

Of great relief to many farmers that struggled in the 2011 floods was a $99.2 million commitment over three years to fund "permanent flood mitigation measures."

The budget also focused on international trade and partnerships to help expand and open export markets. It proposes to undertake the most ambitious trade expansion plan in Canadian history, strengthening trade with the United States, the European Union, Japan, India, China and many more to help reduce red tape and making it easier for farmers and industries to do business.

This will be accomplished by having the AAFC consolidating the delivery of grants and contributions programs out of only one branch.

What's next

With the budget only recently announced, there is a lot that is still unknown about where the cuts for the AAFC will come from. But, with the agriculture sector being one of the most stable and resilient during the economic downturn according to the budget, the future is uncertain whether these will help or hinder the industry.

Canadian 2012 Budget

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