Ontario's farm community responds to provincial government budget

Friday, May 2, 2014

by SUSAN MANN

The Ontario government’s 2014 budget received mixed reviews from the agricultural community, with some officials pleased with the $40 million annually earmarked for the food sector in a newly created jobs fund, while others were critical of the government’s increasing deficit.

And it’s still unclear whether the budget, and ultimately the minority Liberal government, will survive. Mark Wales, Ontario Federation of Agriculture president, says “I honestly don’t know how they (the New Democratic Party) will react. There are rumours every way. I expect we’ll get a fairly good read tomorrow on the NDP’s initial reaction.”

Erine Hardeman, Progressive Conservative agriculture critic, says the budget passed first reading 46-36 Thursday with the NDP members abstaining from voting and the Conservatives voting against it.

The Alliance of Ontario Food Processors says in a press release Ontario’s $2.5 billion Jobs and Prosperity Fund “will ignite job creation and creativity in Ontario’s agri-food sector.”

The new fund includes $40 million annually for the next 10 years dedicated to the food sector. The food processors alliance represents more than 3,000 companies in the food and beverage sector. Alliance members buy more than 65 per cent of products directly from Ontario’s farm families.

Premier and Agriculture Minister Kathleen Wynne says in a statement emailed by her spokesman, Mark Cripps, the Job and Prosperity Fund will help Ontario compete to attract new business and form partnerships to secure investments that would result in economic growth, innovation and jobs.

Wynne says the “future of agriculture, the agri-food industry and rural Ontario is important to me and I believe it is vitally linked to the future success of Ontario’s economy.” She adds she’s pleased with the support she has received from farm leaders and farmers “who believe as I do that agriculture deserves to be held up as a shining star in our economy.”

The agricultural industry and provincial government have made significant steps forward and “from farm to fork, budget 2014 will help us continue this progress together,” she says.

Wales says, “the more the processing sector grows, the more markets we have for what we (farmers) grow.” For farmers who do processing too, “there’s an opportunity” they can take advantage of as well.

Henry Van Ankum, Grain Farmers of Ontario chair, agrees the money earmarked for the processing sector was positive. “They are an important customer for the commodities that we grow.”

For infrastructure, the government has pledged $13.9 billion over 10 years for projects outside the Greater Toronto Area and Hamilton and $15 billion for the Greater Toronto and Hamilton regions. Wales says they’re hoping there’s money in the fund to pay for the expansion of natural gas infrastructure to rural Ontario. And the $13.9 billion infrastructure fund “is positive because that is essentially for rural infrastructure, which we’ve been asking for.” The money will likely go towards roads, bridges and culverts.

Another positive program in the budget is the decision to make permanent a $100 million fund for rural infrastructure, Wales says. It’s specifically for municipal road and bridge work for communities “with what they call challenging fiscal circumstances,” he says, noting they will have to see which municipalities can access that fund.

One concern the federation has is the cut to the Ontario Municipal Partnership Fund, which is the main transfer payment to municipalities. The government has been decreasing the fund, and in 2014 the total fund is $550 million. In 2015 it will be dropped to $525 million. “It’s designed to cover some of the costs that downloading dumped on the municipalities,” he says.

Wales says the impact of the decrease is less money for municipalities. Last year, in his municipality of Malahide Township they got $150,000 less from the fund than the previous year. “That directly affects the money we have to work with.”

As for an overall rating of the budget, Wales says they want to see the details on the infrastructure fund, but “we haven’t seen anything about agri-education or risk management program funding and part of our requests were about increasing the risk management program. Many commodities were asking for that as well.”

Van Ankum says they were disappointed there weren’t increased funds for the risk management program. The $100 million cap in place means “there’s just not enough funds available in the program and it would have been a great step to see an increase of funds.”

Lorne Small, Christian Farmers Federation of Ontario president, described the budget as “stand pat. There’s not much of immediate interest for the farm community.”

The budget includes confirmation the government is going ahead with the tax credit as part of the Local Food Act passed in November 2013 for farmers who donate produce to community food programs. The tax credit is worth 25 per cent of the value of the agricultural goods that are donated. Small says the confirmation is welcomed, “but I don’t know why they delayed it this long.”

Small says they also welcome the infrastructure funding for the GTA and Hamilton, which will partly go to improve transit and reduce traffic congestion. That’s “welcomed by everyone who has to travel on the major roads.”

Hardeman says he was very disappointed in the budget, describing it as a “tax and spend” document. The budget will increase provincial spending by $3.4 billion, while the deficit will increase to $12.5 billion for 2014/15 from $11.3 billion in 2013/14, he says. The province’s debt has climbed to $290 billion, the highest in the country, he adds.

John Vanthof, NDP agriculture critic, couldn’t be reached for comment. BF