Proceedings of the Standing Senate Committee on
Agriculture and
Forestry
Issue 7 - Evidence
OTTAWA, Thursday, June 13, 1996
The Standing Senate Committee on Agriculture and Forestry met this day, at 9:00 a.m., to consider future business of the committee.
Senator Leonard J. Gustafson (Chairman) in the Chair.
[English]
The Chairman: Honourable senators, the clerk of the committee has circulated an agenda upon which we would like some discussion and action.
Under the heading "Other Business," the Bankers Association has requested that they bring a witness to our committee. A letter came to my office last week regarding statements made and directions given by the Standing Senate Committee on Banking, Trade, and Commerce with respect to farm credit. That association wishes to appear before the committee to put forth its position.
Do senators wish to place other orders of business on the agenda?
Senator Riel: Yes. I would like to discuss the raw milk issue.
Senator Hays: Mr. Chairman, we were to have heard today from the Ontario Cattlemen's Association. I appreciate that there is no time to reschedule for the spring, but it is something we should not forget. Perhaps we should seek some witnesses when we return to our work in the fall.
The Chairman: It might be wise if we first called the National Cattlemen's Association to get an overall perspective on this issue.
Senator Hays: We will find varying points of view from different regions. I think it would be better to have those views aired in a public forum. I am not sure anything can be done about it, but I think it would be a good idea to hear from people and let them express their concerns. Maybe something will come of it, but I cannot say that without having heard anything.
The Chairman: The fact-finding trip to the Canadian Wheat Board is the first item on the agenda.
Senator Hays: We are expecting a report from the panel commissioned by the Minister of Agriculture to make recommendations on, among other things, the future of the Canadian Wheat Board. That panel is due to report later this month. I am not sure anyone really knows what it will recommend.
I had the benefit of a long discussion with one of the members, a Mr. Duke from Saskatchewan. I shared with him some of the things this committee had talked about in terms of its report on that subject following our last visit to Winnipeg. I do not think there is much point in visiting until that report has been circulated. The appropriate time to go would be when we return.
In the steering committee yesterday, we talked about possibly making that visit before the Senate resumed sitting in September or some time much later in the year. We have budgeted for the trip. It is a good idea; it is an important issue. I hope we can find the time to make that trip in the fall.
Senator Rossiter: I assume we will be getting copies of the panel report.
Senator Hays: I will ask the clerk to ensure that we do.
The Chairman: Would you care to make a motion to that effect, senator?
Senator Hays: I do not have a specific date to include in the motion, Mr. Chairman.
The Chairman: The schedule is later this fall.
Senator Hays: I move that we proceed with our plan to visit the Canadian Wheat Board in Winnipeg, and hear other witnesses, as appropriate, in the fall of the year.
The Chairman: Is it agreed?
Hon. Senators: Agreed.
The Chairman: Carried.
The next item on the agenda is a fact-finding trip to Washington, D.C.
It was discussed at the steering committee that there may be some question about the feasibility of having a good hearing there, given that the election is taking place in the fall. If we went to Washington in the middle of October, they may so obsessed with their election that we would not accomplish much.
Senator Rossiter: Perhaps we should defer until the spring.
The Chairman: Are you making a motion?
Senator Rossiter: Yes. I move that we postpone the fact-finding trip to Washington until well after the election, probably early spring or late winter.
The Chairman: Or early winter, but most definitely after the election.
Senator Rossiter: Yes.
The Chairman: Is it agreed?
Hon. Senators: Agreed.
The Chairman: Carried.
The next item next on the agenda is forestry. Senator Spivak will be here shortly. I am also expecting Senator Taylor. Perhaps we could leave that item until the end of the meeting.
The next item on the agenda is the Winnipeg conference.
Senator Rossiter: We agreed that Ms Dewetering would go to the conference.
The Chairman: Yes. Senator Hays wishes to go as well.
Senator Hays: I would like to go, but I find a number of conflicts with the events that I should attend in Calgary involving Canada Day. I will try to attend at least some portion of the conference. I gather the important days will be Thursday and Friday.
Ms June Dewetering, Researcher, Library of Parliament: Thursday morning will be important.
Senator Hays: Are any other members going? Are you going, Mr. Chairman?
The Chairman: I would like to go.
Senator Hays: It would be great if any member of the committee could go. I have a conflict because of my involvement with the first Calgary hosting of the Rotary International Convention. If I were to attend on Wednesday and Thursday, would I cover the most important parts?
Ms Dewetering: Tuesday tonight is simply registration and an opening reception.
Senator Hays: I will try to reschedule and then advise the clerk. If I can possibly attend, I will.
The Chairman: The researcher advises me that this will be a rather large convention.
Ms Dewetering: Yes, approximately 1,600 people were invited.
The Chairman: There will likely be general discussion on all aspects of agriculture. There is much optimism in agriculture today, triggered mainly by increased prices in the grain industry and in some other industries. The cattle industry is the exception. There are many international challenges for Canada.
The honourable minister did mention one concern about the input costs, such as the costs of fertilizer, which is also getting very high as grain prices rise. Chemical companies seem to be pushing it to the limit. He suggested that we might look into increased input costs for farmers, both in machinery and fertilizer. I am sure that that will be the subject of some discussion in Winnipeg.
Senator Hays and I will try to attend. Ms Dewetering will bring us a full report.
We turn now to "Other Business."
Senator Hays: I gather we are waiting for Senators Spivak and Taylor to talk about item number 3.
While we wait, does anyone have an update on the unpasteurized milk issue which was raised by Senator Riel?
The Chairman: We had considerable discussions and testimony from the health department while you were away, Senator Hays. This has almost become a political issue. The health committee did admit that they were probably a bit negligent in informing the players in Quebec of their reasons before advancing.
I understand that there are objections coming from the provincial government in Quebec City. Is that right?
Senator Riel: Yes. As I have mentioned before, each time something happens which can be interpreted as an attack by the federal government on agriculture or any other industry in Quebec, the newspapers make a big issue of it.
In this case, the National Assembly has passed unanimous resolution "ordering" -- the word in French is that strong -- the federal government to withdraw their amendments.
It seems that the Bloc Québecois is taking credit for this all over the province. They held a reception and served cheese which was supposedly produced from raw milk. I am told that, at least in part, ordinary cheese was actually served which was not produced from raw milk. I have not checked into that.
Radio and television programs in Quebec held broadcasts with supposed experts to demonstrate that there is no difference in taste from cheese produced with raw milk and cheese produced with pasteurized milk. A lot of ruckus has been created.
I understand from testimony here that the federal health department has no knowledge of what is going on in the province of Quebec. Now they say they will have a new by-law passed to revise the existing one. A committee has been appointed by the provincial government and by the Department of Agriculture of Canada. I understand that the conclusion will be to allow the small producers in Quebec to go ahead.
The ruckus was created by cheese importers, as I understand it. Mr. Rivard has made it clear that the importers are licensed by the federal government. Three or four large players make a lot of money -- to which I have no objection, but they must respect the laws and by-laws protecting health in this province.
Apparently, 25 per cent of cheese imports are refused entry into Canada. That is a lot. The sale of cheese produced by raw milk in Quebec represents a small percentage of the cheese sold in the market. Mr. Rivard has said that the total product involved would equal that produced by one medium-sized farm in Quebec. Perhaps it is not so important.
It strikes me that the Department of Health does not seem to have a public relations adviser. They probably have no public relations department. In Quebec, every department, every minister, everyone in possession of job has a public relations officer. The mandate of the public relations officer is to be in contact with the media at all times and to feed them information.
The Chairman: Senator Riel, the department officials have admitted that the department is somewhat lax in public relations work.
Do you have recommendations with regard to follow up? I am not sure what the Senate committee could do at this point, other than to monitor the situation. If Quebec City has taken such a strong stance in requesting that there be a new approach, is there much that the committee can do until that transpires?
Senator Riel: First, we have heard no representatives from the Department of Agriculture. I do not know why they have not appeared here.
Second, there is no use in me making more noise about this, because it will certainly be corrected. I understand from Mr. Rivard and others that the small farmers will be protected and that the importers will be obliged to respect more drastic importing conditions.
The Chairman: Perhaps our advisors could speak to that.
Mr. Jean-Denis Fréchette, Research Officer: Agriculture and Agri-Food Canada has nothing to do with the inspection of raw milk cheese. Health Canada has the authority to inspect raw milk cheese. That is why no one from Agriculture Canada appeared before the committee.
Senator Riel: My only purpose was to get information. Since March or April, we have not known what was going on and why decisions had been taken to proceed. I suppose that we could leave that matter until the fall and think about it during the summer.
I do not propose that the committee intervene, but perhaps we should give a general warning that something should be done before decisions are taken which could affect an important section of the public. They must come before a committee of the Senate, and it may be the Senate Committee on Agriculture and Forestry, to say what they will do and to explain the purpose of their actions.
The Chairman: Would you suggest that the committee officials prepare a letter to be sent to the Department of Health requesting that it look into the Quebec situation?
Senator Hays: Mr. Chairman, we might consider tabling a small report with some recommendations.
The Chairman: We had an excellent briefing from the Department of Health when they were here.
Senator Hays: We have had enough hearings in the committee. Perhaps we could prepare a short report with some recommendations.
Senator Riel: They will not come back with the final decision before the fall. Mr. Patterson said that they would probably prepare a report in July which they will study before presenting something else in the fall. That is why I suggested that the fall may be a better time. If we send a letter today with recommendations, it will be in the Quebec press tomorrow and will be interpreted as another invasion or another attack. I do not want to stir everything up.
The Chairman: What do you think of Senator Hay's suggestion of a report rather than a letter?
Senator Riel: That would be better.
Senator Hays: Our researchers may have some recommendations on what we might say to address the concerns which Senator Riel has raised and which we have studied quite successfully, I think. This may be helpful to the government in terms of how it proceeds with such things in the future and to ensure that it is not only a Bloc Québécois initiative.
The Chairman: Is it agreed that we prepare a report?
Senator Rossiter: Is it suggested that we do that now or that we wait for further information?
The Chairman: There are events which are to take place in the fall about which we should have knowledge before we finalize such a report.
Senator Riel: It should be drawn to the attention of the department that this committee takes active consideration of the issue of milk production in Canada.
We know that later this year, the Americans will push for the tariffs which are to be implemented according to NAFTA. It is important that we make the Departments of Agriculture and Health aware that we are very seriously considering the question of milk production in Canada and in Quebec.
Mr. Fréchette: Perhaps it would be wise for the committee to wait until the fall when the issue of raw milk cheese may have been dealt with. Health Canada is showing some sign of understanding. My recommendation to the committee is to wait until the fall.
You could perhaps send a personal letter to the Minister of Health asking the department to supply the committee with any new information during the summer; hence, in the fall, the committee members will have all of the documents that are published during the summer. In that way, the committee can make a decision in the fall about whether or not it is still appropriate to prepare a report with recommendations or to do something else.
Senator Hays: I agree with that.
Senator Rossiter: I would suggest that it be put at the top of the list for consideration.
Senator Landry: Are we exporting a lot of milk to the United States?
Senator Hays: I would say none.
The Chairman: I think they indicated that raw milk amounted to only 2 per cent of the total milk production.
Senator Hays: Senator Landry, I believe Senator Riel is referring to the NAFTA panel, which deals generally with supply-managed commodities, and, basically, an attack on our use of the high tariffs and the continued practice of supply management in those sectors. It is a big problem for us. However, it is not an export-import issue, other than the extent to which we can protect our industries and continue to have our supply-management system in place.
Senator Anderson: It was my understanding from the two gentlemen who were here from Health Canada that they were receiving submissions and briefs from all across Canada in this respect. I believe the middle of June is the deadline for receipt of those submissions. I still believe that this is an important issue. I have noted that the two witnesses indicated that there were 1,500 cases of serious illnesses from contaminated cheese in a few years, as well as 50 cases of brucellosis in Canada per year. It is not a small issue. It is something we should be concerned about.
I asked for a copy of those gentlemen's presentation.
Mr. Blair Armitage, Clerk of the Committee: I called my contact at Health Canada who informed me that they did not speak from specific notes but from the fact-finding sheets that we had. However, there was the list of cheeses that the fellow from Agriculture Canada brought forward. I have not been able to get my hands on it.
The Chairman: Would a letter to the minister or the officials from Health Canada from the Senate suffice for your purposes? What timing are you suggesting?
Senator Anderson: They indicated that the briefs and submissions dealing with this issue were to come in by June 13. They would then look at these and make some decisions. It is better for us to wait until they have a chance to look at that. It is not an issue that we should leave without indicating our concern.
Senator Rossiter: There is Senator Riel's concern as well that if anything is written, the media will have notice of it beforehand, which will embroil troubled waters further.
The Chairman: Perhaps we could send a letter to the minister or the department asking that they keep us informed.
Senator Anderson: Yes.
The Chairman: Is there agreement on that, Senior Riel?
Senator Riel: Yes.
The Chairman: That covers Senator Anderson's concerns in terms of the health issues, et cetera. That should not result in any political implications, where we would be interfering with the situation as far as Quebec is concerned.
Senators Taylor and Spivak, we have gone over the major issues on the agenda. With respect to the Saskatchewan Wheat Board trip to Winnipeg, it was suggested that we leave that matter until we receive a report from the committee.
Concerning the fact-finding trip to Washington, we have decided that it would not be wise to go to Washington while they are in the middle of an election. No one would want to give us any hearing. Therefore, we left that.
We have left the forestry issue until you were here.
Concerning the Winnipeg conference, Ms Dewetering will attend.
Senator Spivak: I do not know when it is.
The Chairman: There will be approximately 600 people converging on Winnipeg. This will take place on June 25, 26 and 27. Senator Hays and myself also want to attend. Since you are in Winnipeg, you would probably like to attend. I understand that there have been approximately 1,600 invitations sent out to farm groups and people.
Senator Spivak: Who is sponsoring it?
Senator Hays: Agriculture Canada.
The Chairman: Under "Other Business", we have dealt with the raw milk and the cattlemen. We have one other issue. The Canadian Bankers Association has sent us a letter requesting to appear before the committee on the issue of farm credit and the recommendations that were made by the Senate Banking Committee in relation thereto.
Does anyone have a suggestion in that area?
Senator Hays: If we hear from the Canadian Bankers Association, as I think we should, then I think we should also ask to hear from the Farm Credit Corporation, as well as one or two groups that represent users of the Farm Credit Corporation, as to how they would see the world unfolding in the event that the recommendation of our sister committee, the Banking Committee, is accepted by the government, that the Farm Credit Corporation, among other financial support organizations, is rolled into what was the Federal Business Development Bank.
The Chairman: That is a good point. My own personal feeling was much the same as that expressed by the Minister of Agriculture to our committee. He stated that it was all right that there be changes, as long as farm credit is strengthened and does not disappear.
Two representatives of the bankers association came to my office, one from the Bank of Montreal and one from the Canadian Imperial Bank of Commerce. Basically, they made the following points. First, they were having problems keeping their banks in smaller centres in rural Canada, something which we understand. They felt that there was unfair competition from the Farm Credit Corporation. I pointed out to them that in my opinion, the corporation had saved many farms and that they possibly did not realize that the land was not going anywhere -- it would not run away -- and that our farmers did have boom and bust cycles in which it was impossible for them to meet their payments. I also pointed out that the banks should be more considerate in that regard, as has the corporation been through the years, and that if they want a share of that business, that they should indicate that to the farmers. They accepted that -- at least, they said they did.
There is no question that the farmers have had more confidence in the government not taking their farms away when they have had bad years. I went as far as to suggest to them that, surely, the downturn in commercial real estate has taught them the lesson; that that is far more volatile than the farmers, who will not carry the land way.
They then mentioned provincial government interference in terms of protection for farmers and even went so far as to include homestead rights for the land on which the farmers lived. There was some discussion about the impact of divorce and the break-up of families on farms. Once a farm has been divided, it becomes almost impossible for that farm to be sustainable. That situation is having a major impact. It is more of a provincial matter.
Senator Taylor: The solution to that is to give it all to the woman.
The Chairman: You must remember that there are many women whose parents left them a farm and the son-in-law perhaps tried to walk off with it.
Senator Rossiter: It is a two-way street.
The Chairman: That is right. I do not know the answer to that.
Senator Spivak: Do we have to worry about banks? Given how well they are doing, these farm problems could not be a big drain on them. Look at them. They are going from good to excellent. Do we not have to be cognizant of the fact that every force in the world is destroying the family farm? In fact, in the United States, from what I have read, they have basically given up on the family farm. They have nothing but huge operations. Should we not say to the banks that there are other factors involved?
What will be the impact of technology on the necessity of a bank having a physical presence?
The Chairman: I was chairman on the task force on drought for Western Canada when we had three years of severe drought. The farms that survived the best were not the big farms or even the corporate farms, but the medium-sized farms run by a farmer who did his own work; a real family farm.
A few years ago, the thinking was that a family farm was just a political statement. I have come to the conclusion that it is not. They are in fact the ones -- and Senator Hays or others may want to speak to this -- that have best survived through the difficult times.
This relates to foreign investment. I told the bankers about my grandfather coming here from Illinois and settling the farm in Saskatchewan in 1909. We sent the Americans home broke three times. The last one to leave was a farmer in our area who had 150 quarter sections. He sold everything and returned to the United States. He had accumulated 150 quarters. At his sale, he told me that in 1962, he started buying land -- which was cheap at that time. He bought quarter sections for as little as $4,000 a quarter.
In the 1920s, in Saskatchewan at least -- and it was the same in Manitoba and Alberta -- almost every half-section farm was owned by an American. When the 1930s came along, that land all went up for sale. They did not become family farmers.
This American farmer who just left told me that his son is not interested, that he does not know anything about farming, and that he will not come here and pay the price that it takes to be an active farmer.
You make a good point, Senator Spivak. I believe that governments must be cognizant of that. The minister strongly emphasized the importance of financing for a farmer who wants to diversify, for example, into a seed operation or other operations. This is what the banks object to, because you are talking not only about farms, but also you are starting to move into small business. The time has arrived where the two cannot be divided if farmers are to diversity to the point where they are be able to compete in the global economy.
I agree with Senator Spivak. No one is crying for the banks; they have made tremendous profits. On the other hand, it is true that our small communities are losing banks and that credit unions seem to be growing.
Senator Spivak: What is wrong with that? That is free enterprise.
The Chairman: I am told that in Estevan, a community of about 10,000 people, the credit unions are holding about 50 per cent of the accounts.
Senator Spivak: I do not see the point of this discussion. The banks will go into car leasing and insurance. If they have to get out of the rural economy, tough. That is free enterprise. If they cannot compete, they should get out and let the credit unions take over.
The Chairman: I told them that if they make their position known to the farmers, they will give them a service and will have consideration for them in difficult times, I do not see why they would have a problem.
Senator Spivak: What do they want to present to us here? What is their case?
The Chairman: I agree with what Senator Hays said earlier; namely, that in additional to hearing from the banking association, we should hear from Farm Credit and other interested parties.
Senator Spivak: That is an excellent idea.
The Chairman: Can we accept that?
Senator Hays: I do not need to say any more. That sounds good to me.
Senator Rossiter: Farm Credit is something that affects farmers all across Canada. Since my time here, we seem to deal mostly with agriculture in Western Canada.
Senator Spivak: That is true.
Senator Rossiter: It would be nice to let people know that there is another part of the country as well.
The Chairman: That point is well taken. We will discuss that when we get into forestry as well. I discussed this situation with Senator Anderson yesterday. There are probably some Maritime issues, and there is a lot more to agriculture than just wheat and beef. Horticulture and potato farming are big, as is forestry farming. Your point is well taken.
Senator Hays, would you care to make a motion on that, please?
Senator Hays: On the Farm Credit issue?
The Chairman: Yes.
Senator Hays: You put it very well a moment ago, Mr. Chairman.
I move that the committee invite not only the Canadian Bankers Association, who requested an opportunity to appear before us, but also witnesses who would be representative of other points of view, namely, the Farm Credit Corporation and a group or groups representing users of the Farm Credit Corporation, so that we will have a balanced view of what we might recommend, if anything, on this possible change by the government that would involve elimination of FCC in favour of transferring its portfolio, et cetera, to the Business Development Bank of Canada.
Senator Taylor: Is the FCC doing business mainly in the west, or do they loan money in the Maritimes?
Senator Rossiter: Oh, yes.
Senator Hays: They are throughout Canada.
Senator Taylor: I thought most of their capital was tied to the west. Perhaps we should invite some of the provincial institutions as well, because they also lend to farmers. I do not know what Nova Scotia and New Brunswick have, but Alberta has its own organization.
Senator Hays: Alberta had the AADC, the Alberta Agricultural Development Corporation. I do not know whether it still exists. I think it does.
Senator Taylor: I was just wondering what the Manitoba and Saskatchewan governments have. I am almost certain that the Governments of Nova Scotia, Prince Edward Island and New Brunswick have a branch within their agriculture departments concerned with farm credit. Perhaps we should invite one or two, or maybe all, of them, if they wish to attend, to hear what they think.
The Chairman: I think Senator Hays' recommendation covers that.
Senator Hays: With respect to the depth of study we conduct, we need to wait until we hear some evidence. Everything might be fine; if not, perhaps we could look into the matter further.
Senator Spivak: With respect to that abortive study on the future of agriculture in Canada, I recall that when the minister testified, he talked about rural development. Were there not some proposals in terms of how that was to come about or how that was to be enhanced? I am not talking necessarily about farms; I am talking about rural development. We have forgotten about that issue, and it is happening all over in terms of off-farm income. I do not know that it relates directly to financing, but in a sense I think it does. It certainly relates to what the banks are doing. They are not just loaning money to farmers. Hopefully, they are loaning money to all kinds of businesses in the rural economy. We should not lose sight of that. Perhaps they have, but financing is the key. Do you remember that, Senator Hays?
Senator Hays: What you are recollecting, Senator Spivak, is that at the beginning of this government's term, we had decided to conduct a broad study on current day Canadian agriculture and its future in the context of rural development, along the House of Commons committee. We worked on that study, but we were effectively taken out of the picture. Now, the minister and the government is doing this instead of a parliamentary committee.
What do we do now? The government has another year-and-a-half in the normal course of a four-year term. It is rather late to undertake that large study.
Senator Spivak: I am not thinking of a large study at all. The government said it would do this. What progress has been made? What is happening in terms of financing?
Senator Hays: That is a question that I do not think we want to get into until we have heard witnesses. The question is this: To what extent is the Farm Credit Corporation an important vehicle in achieving our objectives for rural Canada?
Senator Spivak: What are the banks doing? We should not forget that point when we question them.
Senator Hays: We will not. However, that is jumping ahead of ourselves. We are attempting to answer questions when we do not have the facts.
The Chairman: The Standing Senate Committee on Energy, the Environment and Natural Resources is looking into some rural issues.
I recall that the rural municipalities, especially in Saskatchewan, made a very good report to the Senate committee.
Senator Spivak: Thank you for reminding me. May I get a copy of that report?
The Chairman: Yes. The witness was excellent.
Ms Dewetering informs me that she will be attending the rural development session at the conference in Winnipeg. It might be a good idea for you, honourable senators, to attend and to make suggestions at that time.
Senator Spivak: That is a good idea.
The Chairman: A number of issues, including the transportation issue and the demise of the Crow benefit, will have major impacts on rural Canada.
The Bankers Association also indicated that they held a lot of foreclosed land in Saskatchewan. The fact that they had this land for sale realized our fear.
Senator Taylor: I hope you told them not to choke on it.
The Chairman: Senator Spivak says that, because of the kind of money the banks earn, no one is crying on behalf of the banks.
I am overly defensive of farmers, being one myself. They do not run away. They are good citizens, and they will pay if they have something with which to pay.
The question is this: Is it important to our Canadian survival? I think we will go full cycle on this matter. Perhaps we will lose some important facets of our agricultural community before we come to our senses on the issue.
If there is no further discussion on that matter, we will turn to the final issue on forestry.
Senator Spivak: Did everyone on this committee receive the document I circulated?
Mr. Armitage: Which document was that, senator?
Senator Spivak: The one relating to forestry.
Mr. Armitage: I am sorry; I did not think you wanted me to distribute it. I thought it was background material for me to help you with an order of reference.
Senator Spivak: It must be my fault; I thought it was to be distributed. It was just a one-page document sent to Internal Economy.
Senator Rossiter: The budget.
Mr. Armitage: I am sorry. I do not recall seeing it.
Senator Spivak: I apologize to the committee. There is a one-page document that Senator Taylor has seen, which I thought had been sent to everyone on the committee.
The Chairman: Perhaps the clerk could clarify this. The committee dealt with its budget, and it is now before Internal Economy.
Mr. Armitage: That is correct. Senator Spivak must attend Internal Economy this morning at 10:30 to speak about our budget.
Senator Taylor: Forestry is probably as big an issue as agriculture. Already, I have had presentations from other senators and MPs saying, "Are you leaving out B.C. and/or the Maritimes?" I do not think that you can conduct a fact-finding trip that will cover all of forestry in the summer and fall. We began with the boreal forest because it is the most recently developed forest, but it is not the oldest.
The Chairman: Whereabouts is that?
Senator Taylor: It runs parallel to the Canadian shield. It takes in northern Alberta, northern Saskatchewan, the top half of Manitoba, the top third of Ontario, and it slivers out into Quebec.
It is basically the aspen and poplar forest. For years, farmers treated them as weeds. It is only in the last few years that technology in pulp and lumber has advanced to make those trees useful. The boreal forest seeds itself in the roots of the tree. An aspen tree is probably the largest living organism that we have in the world. One can cover 100 acres with all sorts of vertical shoots. It is bigger than the mangrove tree.
The term "boreal" is derived from aurora borealis, the "northern lights". It is the largest forest in the world, extending through Canada and Russia, with reserves perhaps as great as the Amazon.
The provincial governments have made large concessions essentially to foreign-owned corporations, American and Japanese, mainly because they were in there first. These companies are converting this wood to pulp, wood and paper. There is a large world demand for paper.
However, this forest has different problems than those found in the forests of the maritimes or the west coast. Those forests serve mostly lumber markets, and pulp as well, but they have been managed for 100 years; the boreal forest is nature in the raw. It is in a similar stage to the buffalo resource in the early 1800s. The government and the public possibly can do something about setting systems into place to protect the resource for generations.
These forests are also now becoming more interesting for potential yield in the microbiological field, such as vaccines and new medicines, which are found in a forest which is 100 to 150 years old. Regrown forests are usually only 40 to 75 years old. In other words, when trees are cut, sometimes a whole ecology can be damaged. Very little investigation has been done on that. Naturally, the concession-holders, the lumber and paper companies, are not too interested in microbiological preservation down the road.
Last, we have the plain, old-fashioned view of this forest as lungs of the earth. It is the only great forest left in the northern hemisphere which helps to eat up pollution and acid rain. Mind you, a growing forest would eat that up, too.
I am trying to give you the general picture regarding the boreal forest. It is an entirely different type from the B.C. cordillera forest and the Maritime forests. In New Brunswick, for instance, 80 per cent of the trees are on private land.
Senator Spivak: I will pass around this map with the dark green area showing the boreal forest. Look at the size of it.
The Chairman: The committee is very privileged to have a couple of experts on this issue in Senators Taylor and Spivak. It is important to look at these areas. How does the committee proceed?
Senator Taylor: I do not know whether we should have a subcommittee. Perhaps we should walk before we run. You people have more experience than I. We could just go ahead with our trip in the fall to look at the boreal forest and return later with our focus. There are different types of forest.
The Chairman: My first challenge is to get the budget passed today. We cannot make many decisions until then. We are asking for a considerable sum, $76,000.
Senator Spivak: If the budget is passed, then we can prepare suggestions for the committee in terms of process.
I have given a sheet of paper to Internal Economy setting out the main issues. There has been tremendous job loss in forestry and pressure about clearcutting and certification. The U.S. forest industry generates three or four times as many jobs as we do. That is the first issue.
This is from the researcher's suggestions. We will examine things like allowable cuts, cutting practices and stumpage fees. There has been a tremendous influx of plants into the boreal forest. Is that sustainable development?
I read in the Calgary Herald an article about a five-year northern river study. They cannot fish there any more because the fish are totally contaminated with mercury.
Senator Taylor: Mind you, that relates to the pioneer plant in the boreal forest. It has been there the longest.
Senator Spivak: The article was published on June 5, 1996, stating that fish unfit for human consumption have shown up in northern Alberta rivers and that the problem is so serious that Ottawa and Alberta should issue a health alert.
There is also terrific new technology. I was amazed by the rapid technology advances in the oil industry. There are closed-loop systems. I do not think Canada has taken the right approach in looking at best-available technology instead of continuous development, as is done in some countries like Sweden. In a closed-loop system, there is no effluent. Nothing from the oil industry enters the water system. This is now possible in the forestry industry.
There is also the climate change. On the map before you, the impact of climate change is already happening in certain areas. Aside from warming the whole earth, although that is happening, too, the impact is different in different places. Severity of weather is a result of climate change. It definitely is happening; they just do not know how often and how much. If climate change happens on the basis of present predictions, the boreal forest will not be able to move north fast enough. This is something that must be recognized.
The Chairman: Perhaps the committee could take this procedure. You and Senator Taylor will appear before the Internal Economy Committee today to make recommendations to the committee on how we will proceed in the fall with these issues.
Senator Spivak: Yes. This is simply fact-finding.
The Chairman: By that time, we will know how much money is available and lean on your expertise as to how to begin. As Senator Taylor said, this is a large and expansive subject; we cannot cover it across the country all at once. However, we have to begin somewhere with an eye to continuing.
Senator Taylor: I should warn the committee that this topic is fraught with a great deal of political problems because the forests are considered provincial assets, not federal ones.
The provinces and the forestry industries are elbowing each other in that they are seeking cash to use on other things. They also may be developing the forests a bit faster than society wants. They are also playing with their so-called royalty or stumpage rates to elbow each other out of the market.
Some foresters are telling governments to mind their own business. However, at the same time, we must consider the national interest.
I make those comments because you might see a headline in one of the more chauvinistic papers in Alberta or B.C. telling us to pack up our bags and get the hell out.
The Chairman: That is not much different from the situation in agriculture.
Senator Spivak: We must understand that the pulp industry has had to spend millions of dollars at the request of not the provinces but the national government because they are ruining the fish everywhere. That is a national responsibility, not to mention navigable waters and migratory birds.
The Chairman: Ms Dewetering makes a good point when she suggests that you two senators should report back to the steering committee. The steering committee could then make some recommendations as to giving our officials the time to prepare. Is there agreement to that?
Senator Spivak: Yes.
The Chairman: Will someone put forward a motion to the effect that the steering committee be authorized to deal with the timing on this subject to the best advantage of the committee?
Senator Taylor: I so move, Mr. Chairman.
Senator Spivak: Forest fires are a huge issue now because of climate change. That is the biggest thing.
The Chairman: I see that the B.C. government has sent a number of firefighters to Quebec.
Senator Spivak: The years 1994-95 were the hottest years on record. In the last few years, forest fires have doubled. Not only are there forest fires, but also there are crown fires. That is a direct result of global warming. It is costing us a fortune.
The Chairman: I am sure these issues would arise if we were to hear witnesses from the various players.
Senator Spivak: It is a big topic.
The Chairman: Our clerk would like to raise a couple of issues that have to be taken care of.
Mr. Armitage: The Chairman requires a motion authorizing him to report to the Senate, respectfully requesting them to empower the committee to engage the services of such counsel, technical, clerical and other personnel as may be necessary and to adjourn from place to place within and outside Canada for the purposes of such a study.
Senator Anderson: I so move.
The Chairman: Is it agreed?
Hon. Senators: Agreed.
The committee adjourned.