Federal, provincial and territorial agriculture ministers today finalized a three-year framework agreement on farm income safety nets, worth up to $5.5 billion to the country's farmers.
The new framework, which will offer more stability to the agriculture sector, was signed on the first day of the minister's annual meeting and follows many months of intense discussion between federal government, provinces and farm representatives. The deal will see an investment of up to $3.3 billion in federal funding over three years. Provinces would provide up to $2.2 billion. These jointly agreed-to programs will be cost shared under the traditional 60-40 federal provincial arrangement, targeted to need and free from potential trade challenge.
Agriculture and Forestry Minister, Mitch Murphy said that Prince Edward Island is pleased to be a signatory to the agreement. "These programs are an important part of our agricultural policy in Prince Edward Island. Volatility in the markets and adverse weather conditions mean producers need tools to manage the impact of these risks. We now have a predictable program base in place," said Murphy.
The framework signed today provides the basis for federal and provincial core safety net programs comprising fall cash advances, Net Income Stabilization Account (NISA), Crop Insurance, province-specific programs and, for the first time, an ongoing income disaster protection component, which farm groups have asked to be included. The ministers said this long-term security means the agricultural industry can continue making major contributions to the quality of rural life in Canada.
Provincial allocations of federal funding for core safety net programs will be based on the size of the industry in each province. Minister Murphy explained that, for PEI, the federal contribution to safety net programs such as NISA and Crop Insurance will increase from $5.7 million per year to $7.2 million and the provincial contribution from $3.8 million to $4.8 million. Disaster programming or "Box 2" programs will be funded on a "demand driven" basis.
Minister Murphy added, "Agriculture and food production is the most important industry in our province. This Agreement is consistent with the program priorities expressed by our producers and maintains the flexibility the province needs to include program elements like enhanced NISA and negative margin coverage in disaster program." To this end, ministers will follow a consultative and coordinated approach to changes to the design of programs in the safety net package.
An important component of the new agreement is that ministers will work in collaboration on any future program changes. The agreement contains provisions for reviewing the impact on programs for producers on an on-going basis.