March 21, 2013

Grain Growers of Canada comments on Budget 2013

OTTAWA, March 21, 2013 – Grain Growers of Canada is neutral on the 2013 federal budget. “We are reassured to see this year’s federal budget document does not include any further erosion to agricultural research infrastructure, but we will have to wait and see more details about how previous budget cuts are put into practice before we weigh in one way or the other,” says Stephen Vandervalk, President of the Grain Growers of Canada. “While we realise going forward we will need to work to maximize the research reach of private-public partnerships and cluster dollars, the Grain Growers continues to stress the importance of innovation and agriculture research to the federal government.”

One bright spot for farmers is a change to the Lifetime Capital Gains Exemption that increases the exemption amount by $50,000 so that it will apply on up to $800,000, which could prove helpful in succession planning. The capital gains exemption will be indexed to inflation for taxation years after 2014 and the new limit applies for all individuals, even those who have previously used this exemption.

Variety registration was not highlighted in the budget, but in fact needs a lot of work: “There is an urgent need for the cereals variety registration system to be reformed in the near future,” says Richard Phillips, Executive Director of the Grain Growers of Canada. “To unleash the power of private industry investment in cereals and wheat research we need to do a re-think of the current system. For innovation to happen, we need to be able to provide more certainty in the registration process.”

“We support Minister Ritz’ recent letter to the Prairie Grain Development Committee as we think removing the unnecessary regulatory burden will be the only way to move things forward for cereals research,” says Phillips.

Referenced in the budget were last year’s budgetary decisions relating to Growing Forward 2. “We appreciate the federal government’s ongoing market access efforts helping strengthen our current markets and opening new ones with an aggressive trade agenda,” says Vandervalk. Most future funding over the next five years has been committed in Growing Forward 2 which includes AgriInnovation, AgriMarketing, and AgriCompetitiveness programs. Vandervalk elaborates, “Canadian grain farmers are efficient, competitive and want to make their living from the marketplace. These programs are important because market access globally is crucial to farmers’ success.”

Another area that will need more work in the near future is the Canadian Grain Commission. “The legislation introduced last year was a good first step, but given the sweeping changes to the grain sector, more review needs to be done on the CGC’s structure and mandate. Also a neutral assessment of the public good component of the Grain Commission’s current activities should be examined to make sure Grain Commission is leaned out enough for farmers to afford the bill when full cost recovery goes into effect in August,” says Phillips.

Rail service is one more area that has become critical with service levels dramatically declining since January. The Rail Review legislation, Bill C-52, the Fair Rail Freight Service Act, is currently before Parliament. “We appreciate this legislation being introduced,” says Vandervalk. “And we encourage the federal government to seriously consider accepting the Coalition Rail Shippers six proposed amendments to help bring about the shipper, railway balance the government intended with this legislation.”

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