Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 6 - Evidence of February 8, 2005
OTTAWA, Tuesday, February 8, 2005
The Standing Senate Committee on Agriculture and Forestry met this day at 6:05 p.m. to study the present state and future of agriculture and forestry in Canada.
Senator Joyce Fairbairn (Chairman) in the chair.
[English]
The Chairman: Honourable senators, we have a quorum. We are ready to begin our hearings tonight. I want to welcome our guests who will take us tonight through a very interesting topic in connection with our agriculture studies. This is Dr. Yvon Martel, who is the chief scientist of international issues on research in the area of agriculture in Canada. With him is Dr. Bruce Archibald, who is the assistant deputy minister of the branch in Agriculture and Agri- Food Canada.
As some of our audience will know, over the recent weeks and months, we have been very much focused on the BSE situation in this country and have also put out a report, most recently, on value-added agricultural issues.
Everywhere we turn we see the issue of research, the importance and the abundance of it. We thought it would help in all of our discussions here if we could have you give us a presentation on exactly how the Canadian government is approaching the issue, and the depth and strength of our research policy.
[Translation]
Dr. Bruce A. Archibald, Assistant Deputy Minister, Research Branch, Agriculture and Agri-Food Canada: Honourable senators, good day, and thank you for this opportunity to describe the work done by Agriculture and Agri-Food Canada over the past few years.
[English]
It is a rare opportunity for me to come to talk about research. There are many issues facing agriculture. It is a critical time. There have been many reports in the press about the direction that we are taking in terms of science and innovation strategy and the concerns have been expressed. I would like to take advantage of this opportunity to share with you the department's plan for a comprehensive framework for managing science and innovation efforts that will help the agri-food sector overcome the challenges it faces and take advantage of new opportunities.
In my role as the assistant deputy minister for research within the department, I have been discussing with my federal colleagues in other departments, granting agencies, deans of agriculture and veterinary colleges, provincial colleagues and agriculture organizations how to prioritize and direct research for the benefit of the sector. I read with interest the Senate report on value-added agriculture in Canada. I am pleased to mention that the framework being developed within the department is consistent with the research and recommendations in your report. I have a short presentation to walk through quickly for the committee and then I will address questions.
As you know, our national government is fully committed to research and development. The Government of Canada has set itself an ambitious goal to make Canada one of the top five nations for research and development performance by 2010. More recently, the Prime Minister appointed a national science adviser and a parliamentary secretary with emphasis on science and small business. The 2004 Speech from the Throne reaffirmed the government's commitment to research and development. It also recognized the importance of investing in science and technology to foster a technologically advanced agricultural sector to make competitiveness for Canadian farmers and the safety of our food second to none.
There is a tremendous amount of momentum, enthusiasm and commitment within the federal government to making the fundamental changes and investments needed to ensure that Canada is at the leading edge for the 21st century.
If we are to ensure that Canada is at the leading edge, we must continue to make changes and address challenges. On a global scale, Canada has a relatively small economy and cannot match the S&T expenditures of larger nations. The S&T issues we face are becoming increasingly complex, requiring multidisciplinary approaches and state-of-the-art equipment, facilities and skills. Like other sectors of the economy, agriculture science and technology face a number of challenges in terms of increasing retirements over the next decade, along with great competition for new scientists with those new state-of-the-art skills.
In addition, cutting-edge facilities and equipment are required to attract and retain the best and the brightest and these investments are costly. These changes and challenges clearly highlight the growing need for a concerted effort to manage science and technology resources and activities.
To be competitive, Canada must explore new ways to integrate and manage science and technology efforts and resources and ensure that its strategic investments are focused and delivering results. We need to build a national science innovation capacity for agriculture and the agri-food sector. We must find innovative ways to build and sustain successful partnerships with all providers of science and technology across the agri-food continuum.
In the last Speech from the Throne, the government mandated the National Science Advisor, Dr. Arthur Carty, to ensure that science and technology investments are strategic, focused and delivering results, and to bring about a fuller integration of government in-house science and technology activities.
As you already know, agriculture is a shared jurisdiction. Agriculture and Agri-Food Canada has committed, under the agri-food policy framework, to work with others to build a national science capacity for agriculture and agri-food. To deliver on this commitment, we have been working on the development of a framework.
The department has identified three strategic priorities to guide our actions that are consistent with the national policy agenda defined in the Agricultural Policy Framework. Those three are the security of the food system, the health of the environment and innovation for growth. Agriculture and Agri-Food Canada's realignment of research within these national priorities has been the focus over the last couple of years and is consistent with your recommendation to focus on areas specific to the public interest, such as food health and safety and the environment.
In the spring of 2003, we put together a science advisory panel to review the strategic direction of science within the department. This panel confirmed that the science is fully integrated into the department and it supports the key role of government in performing science and technology. However, they identified areas for improvement and made 11 recommendations.
The science advisory panel report is the foundation on which we are beginning to develop a comprehensive framework for how to manage science. We want to strengthen Canada's science capacity for agriculture and food, we want to ensure an ongoing ability of the government and the department to fulfil their roles and responsibilities, and we want to protect and enhance Canada's current and future competitive advantage in the global market.
I would like to share with you some of the key elements in this strategy. The first is ensuring that we are on the right track. To do this, we have put in place a number of processes. We have established an external science advisory board comprised of scientific expertise that reviews the direction of the department's research and science, we have created commodity round tables that bring together government and industry representatives across the value chain to tell us how and where research can assist in delivering on sector priorities, and we are establishing a culture of peer review, both internally and externally, on key research areas. Eight such reviews will be conducted in this fiscal year, including a review of our cereal breeding, which will take place in March 2005.
To deliver on our priorities, we need three critical elements: people, infrastructure and funding mechanisms. Our long-term human resource strategy is focused on identifying critical areas of scientific expertise that will be needed to support and sustain profitable agriculture in the future.
We will be pursuing partnerships with other science and research providers, both nationally and internationally, to ensure we have those skills. Of course, an HR strategy cannot be developed without considering the investment, facilities, equipment and infrastructure that will be needed to house and equip our scientists. We are working with our partners to develop an integrated national science capital plan that is in line with our national HR strategy.
We all know that the achievement of these ambitious goals depends on our ability to forge strategic partnerships, and we have been exploring in the last few months new approaches to partnerships that will leverage and optimize research investment for the benefit of Canadian farmers and the agri-food sector.
The need to accelerate the adoption of commercialization of science and technology is undeniable. Just as important, the policy environment surrounding how we deal with intellectual property is key in ensuring the promotion of research and innovation and encouraging and protecting our investment. We are working to develop a policy and programs in this area in consultation with stakeholders along the value chain to create the necessary conditions for sustainable and long-term growth.
An international research partnership strategy linked to our trade strategy is an important ingredient in creating greater opportunities for Canada. We are actively engaged in over 50 international science and research partnerships in a number of key markets, including China, Japan and the European Union, and we are recognized worldwide as having expertise in the area of dairy, water management, bio-controls, genomics and bio-products, just to name a few.
What does this all mean to Canadian farmers? It means a world-leading capacity to address the increasingly complex issues that require a multidisciplinary approach. It means research that can lead to transformational changes, new markets and new value-added opportunities. It means maintaining profitability and growth for Canadian farmers and securing their competitive advantage in the global economy.
An example of a specific initiative is Soy 20/20, wherein there are partnerships among two levels of government, universities and growers, to look at new value-added opportunities for that particular commodity.
Another example of moving forward in partnerships is a unique exercise we are undertaking in conjunction with the National Research Council and the University of Prince Edward Island to form a partnership in the area of nutraceuticals and functional foods. We are trying to find ways to discover new materials in agricultural commodities that can serve as bioactive ingredients and functional foods that will benefit human and animal health and be a potential new market for the agri-food sector.
In the area of coordinating research, our department, along with the Canadian Food Inspection Agency, Health Canada and the Public Health Agency of Canada, has been very much involved in the creation of the new Network of Centres of Excellence for BSE and TSE. While the NCE is aimed at building capacity in universities and teaching hospitals, we are working to ensure that our resources, along with those of the NCE, will be used to help attract world- class researchers, to develop a multidisciplinary approach and to accelerate the results to the benefit of our clients.
In summary, the efforts we have made over the past few years to build a comprehensive and integrated framework for managing science efforts provide a solid foundation to help strengthen Canada's science capacity for the agriculture and agri-food sector. While this framework provides a road map to build national capacity to help the sector overcome the challenges it faces and take advantage of new opportunities, its success depends on our ability to engage various players in developing a national science innovation agenda and to make the changes that are required.
Senator Gustafson: I want to thank you for appearing here. One of the problems of Canadian farmers is that we are selling mostly into Third World markets that cannot afford to pay big prices.
I am sure you are well aware of the issue of Roundup Ready wheat, for instance.
We currently have a glut of grain because we have been able to produce more than we can sell. The problem is that the price is going down. I am all for the research, but until we can find a way to trade this grain and get the money into farmers' hands we will be in big trouble. I just had a call from a corn farmer in Ontario who expressed the fact that he cannot recover his input costs.
Specifically from a research standpoint, where do you stand on Roundup Ready wheat?
Mr. Archibald: The decision was made by the company, Monsanto, to actually withdraw from further pursuit of registration of that particular kind of wheat. We have discontinued all of our research on the development of Roundup Ready wheat. We will not pursue any further activities in that area at this time.
Senator Gustafson: In other words, you will not move until it is politically acceptable.
Mr. Archibald: From my perspective, there was an interesting lesson in the whole issue surrounding Roundup Ready wheat, which was an understanding of the technology that can be used to improve various traits in different commodities as well as making sure that we do not forget about socio-economic considerations and the impact of technology in terms of markets. When it was clear that there were all kinds of concerns over this technology entering into the wheat grain market, the company realized that it did not want to pursue it and so it withdrew. It was a good lesson for all of us to ensure that we consider all of those areas as we develop new technologies.
Senator Gustafson: Where do you stand on the matter of energy credits, environmentally? Where should the credits go, to the farmer?
Mr. Archibald: We have been doing a fair amount work in our environmental program to better understand how agriculture contributes to greenhouse gas emissions, the ways that we can actually mitigate those effects by sequestering carbon and techniques along those lines. I would like to say, senator, that although agriculture is often depicted as being a troubled industry, it can provide many solutions to nutrition, to food safety and to environmental challenges. We can do that through understanding how we can better capture greenhouse gas emissions using agricultural commodities and developing programs that could provide economic benefits to producers. We are interested from a science point of view in identifying those opportunities and quantifying them.
Last week we met with the Canadian Space Agency in St. Hubert, Quebec, to look at their various technologies, such as radar work, whereby they can look down on fields from space as a potential monitor. If someone says they will put something into a permanent cover, this could potentially be a technology to verify that at a low cost. There could be some benefit back to a producer. From a science point of view, we are keen to understand agriculture's role in dealing with the challenges of greenhouse gas emissions and helping Canada meet Kyoto commitments. As a department, there is significant interest in looking at ways that we can actually have this benefit for producers.
Senator Gustafson: Both the Americans and the Europeans have gone to a program whereby they are working toward putting rural development, environment and agriculture under one caption. Do you think that Canada should move in a similar direction?
Mr. Archibald: We should, and we are doing that. Under the Agriculture Policy Framework there were five pillars. Under those five pillars, one of the key areas was rural and environment, along with food safety, science innovation and business risk management. Those five pillars were a deliberate attempt to state that these things are interrelated and we should not look at them in isolation.
Senator Mercer: Thank you, gentlemen, for coming this evening. I am impressed with your presentation. I want to move on to the BSE crisis, which I put in the context of what you have told us tonight. We had hoped that we had just come through the BSE crisis, but I do not think we are there yet.
We have reviewed the new and exciting safeguards built into what you are doing and what may be done through the department to protect consumers, farmers and the reputation of Canada as a world producer of quality food products.
I would like you to comment on that and I will have a follow-up.
Mr. Archibald: In respect of BSE, there are a number of research areas that the department and government have been working toward. There will be the establishment of the national centre of excellence to try to better understand this particular disease and the science around folded proteins and how they are transmitted. How they operate is a critically important area for us to work on in science. From that, we can develop animal husbandry practices, regulations and marketing strategies that will help to ensure the safety of Canadians and the ability to manage these kinds of situations when they do occur.
The whole area of genetics is of great interest to the department. We have been working with our partners at the University of Alberta and talking about how we can better pool our resources to address this.
In the area of food safety and quality, within the department there has been considerable work on developing tracking and tracing systems, so that when incidents do occur, they will allow us to trace back more readily to the source and better understand where the problem occurred. In that way, we can take the appropriate action to mitigate negative results. Certainly, the Canadian Food Inspection Agency has been spending a great deal of time in that area because it is important and has generated much interest. There is substantial capacity across Canada to address this. I am optimistic that with the creation of the new centre for excellence, we will be able to bring together the expertise, whether from the University of Toronto, the University of British Columbia, Health Canada or Agriculture and Agri- Food Canada, to create a coordinated response to address the issue and truly make Canada a leader in understanding.
Senator Mercer: You mentioned three universities in your comments. I am concerned about the 19 regional research centres across the country and the status of their facilities. Has sufficient capital been invested in the upkeep of these research centres? The committee has heard testimony that the centres have been listed or classified as in good, fair and poor condition, based on the status of the infrastructure and other considerations. Is that classification a fact? If so, what happens to those that are rated as poor? As a senator from Nova Scotia, I am concerned about whether we can maintain our small but vital research centres in Atlantic Canada that specialize in products unique to the region. That is critical to our future.
Mr. Archibald: Certainly, infrastructure is an area on which we have spent considerable time and on which we continue to work. You are correct, senator, that we have 19 major centres. We have a number of smaller facilities and locations as well. We actually have 56 locations across Canada. We have over 30,000 hectares of land and over a thousand buildings, so there has been a sizable amount of infrastructure developed over the years across Canada to serve the needs of producers and the delivery of the science.
One of the things we have been doing is looking at how science and its delivery have changed. To see whether or not we have the required number of facilities to meet what we believe are key priorities, in terms of the research direction, we have done an assessment of them; and you are quite correct, they fall into those three categories. On average, a new lab facility usually has a lifespan of 25 years before you need to make some significant reinvestment to get it up to standard. About a third of our facilities are what we would call in very good condition, a third in good condition and a third are in poor condition.
However, that is not necessarily the criterion for deciding whether we need to retain a facility or not. We look at the science priorities and the locations that are best suited to do that kind of research, because Canada, as you know, is very large, with many different climatic zones and soil types. It is important that we cover that waterfront and deal with those significant regional differences, and that we look at the cost of maintaining all 56 locations — or the 19 centres that you mentioned — versus the opportunity cost of reducing the number of locations, not by way of cutting the overall science budget, but in actually taking those dollars and reinvesting them to create greater value for producers.
The reality is that once a building gets to a certain age, the ongoing maintenance costs increase dramatically year after year. Therefore, the dollars available to do actual research decrease over time. It has come to the point in a number of these locations where we need to examine that.
Having told you a little about our facilities, I should say we are doing this in partnership with our other research players around the country — agriculture, universities, veterinary colleges and provincial government facilities — to see where there is opportunity for synergy and bringing those resources together to better make use of our collective resource.
It is a critical issue for us right now. We need to begin by making sure we understand the science that we should continue to do and what locations we really need to do that type of work, so that looking at our facilities, we can develop a critical capital plan that lays out what investments are needed to bring our facilities up to the required level.
Whenever we get into these discussions and do these evaluations, senator, as you can imagine, it creates huge anxiety, because everyone automatically assumes that if you are on one list or the other, you will either continue to exist or not. I will say this is something we will work on in a pragmatic way, with plenty of opportunity for discussion.
Senator Mercer: I am a little anxious already. Do you foresee a time when most of the public research expenditures will be in the form of grants to universities and private firms as opposed to direct departmental expenditures?
Mr. Archibald: No. I very much hope that we will start to find a greater balance between investments in university teaching hospital capacity and federal science departmental capacity. The Department of Agriculture and Agri-food Canada represents about 47 per cent of the total agricultural research investment in Canada. I think it is important that we continue to play that major role. When you add in the other investments by the federal government and by provincial governments, publicly funded research accounts for about 83 per cent. Therefore, agriculture is a little different from other commodities. There is a tremendous need in terms of the public good. Our continued presence is essential and I do believe that we should maintain a strong capacity within science-based departments, as well as with our partners in universities. It does not have to be one or the other. There has been and continues to be a strong partnership and I want to see that grow.
Senator Callbeck: Thank you for your presentation this evening. I was glad to hear you mention the new institute that Prince Edward Island will be getting. I want to ask you a question on that, because when it was announced there was a lot of talk about now there would be much collaboration between the research centre there, the vet college, the university, the food technology centre and this new institute. Has there been any more discussion about that, or has it moved beyond discussion?
Mr. Archibald: Thank you for bringing that forward, because to me that is an exciting opportunity that we will continue to work on aggressively. In fact, I was in Charlottetown about a week and a half ago for meetings with the people from the National Research Council, and I also met with the president and vice-president of research at the University of Prince Edward Island. We are excited about the opportunity to tie in some of the research that we do dealing with agricultural agronomy with some of the objectives of the National Research Council, and linking that with human health and with the veterinary school at UPI, which is in the process of upgrading its facilities dealing with elements of animal health.
There is no doubt that the department has confronted many issues in the last six months that have occupied a lot of people's time, and we may not have been able to give this as much attention as we might have liked, but we are committed to it. In fact, the gentleman sitting behind me is Ted Van Lunen, who comes from Charlottetown. He is currently on an acting assignment working with me, but as of March 1 will be going back to Prince Edward Island to work full time on this initiative. We want to give it a high priority. We see it as a phased approach, where we will initially move a small number of our researchers into the new facility, and in phase two we hope to move a larger number to that location. Given those three players, plus the Canadian Food Inspection Agency, which is also present there, we think it will be a powerful research engine for the province and for the Maritimes.
Senator Callbeck: That is great to hear.
Coming from an agricultural province as I do, I know there are some producers who feel that their needs are not really reflected in the research done by Agriculture Canada. How do you consult the producers? What input do they have?
Mr. Archibald: It comes from a variety of sources, senator. I think part of what we are hearing these days is the reality of getting used to a new way of doing business. In the past, every research centre had its own advisory group, so producers in Prince Edward Island would be able to go to that group and feel that they were having direct input into the work that was done in that centre. It was important and valuable.
We have gone to a national approach and created national strategies that bring actually greater resources to addressing the problems of producers in PEI and other locations. We are in the process of re-establishing those sorts of links back into the community to make sure that they have that ability to have input. At a high level, we have a science advisory board. At a more specific level, we have commodity value chain round tables. We are in the process of establishing advisory boards for four major national programs that will allow producers the opportunity to come forward to talk about their problems and challenges and also make sure that we are using the full resources of the department to address their needs.
While it is not the same as it had been in the past, I think it will actually be much more useful to producers in all locations. It is important that we do a better job of communicating the opportunity and our willingness — and eagerness — to get their input as we go forward.
Senator Callbeck: I am glad to hear that. I wonder about the time frame.
Mr. Archibald: Three of those items that I mentioned are in place now. The creation of the advisory groups for the four national programs will take place over the next six months. The first meeting of the science advisory board took place in December.
They spoke to us about their interest in greater communication and input into the process. We have been working with the provincial governments and university people on a mechanism called the Canadian Agri-Food Research Council, which has been in place for a number of years. We want to revamp and reinvigorate that. It is our hope to have that in place by June. The timeline is over the course of the next three to six months.
Senator Tkachuk: How much money do we spend? The Parliamentary Information and Research Service has provided us with some graphs that show Canadian and U.S. public research expenditures between 1990 and 2001. As a percentage of GDP, Canada's has actually decreased while the United States' has increased. Along with all of this, have we actually increased the amount of cash allocated for research?
Mr. Archibald: In the last five years, the budget has remained relatively stable. There was a small increase last year, but it has been relatively flat for the last five years.
Senator Tkachuk: You are talking about between 1999 and 2004?
Mr. Archibald: Yes.
Senator Tkachuk: We are at the same level as we were in 2001?
Mr. Archibald: Yes, approximately.
Senator Tkachuk: Which means that we are at the same level as we were in 1990?
Mr. Archibald: I am not sure about 1990.
Senator Tkachuk: That is probably correct. When the government talks about new ways to do things, to me that always means centralizing everything in one place. From what you said in response to Senator Callbeck's question, that looks like what you are doing.
The good thing about the research centres was that local producers were able to have discussions with the scientists and the people doing the work in their area. I just cannot see how you will do that on a national basis. Do you have breakdowns of the research money spent on grains, legumes, hogs, beef, eggs and poultry? Do you, by any chance, have those numbers here that we could look at to see how they compare over the last decade or so?
Mr. Archibald: I do not have them over the last decade, but we could get those for you, senator. I do have a breakdown of expenditures by commodities. For example, work in cereals takes about 15 per cent of the current budget. In terms of salary and operating dollars, that is about $28 million. I do not know whether you mentioned swine, but that amounts to $4.3 million or about 2.4 per cent of the overall operating budget. We do have a breakdown by commodity, by province and by facility.
I do not want to underestimate the value of local input to research centres, but the advantage of the system we have put in place is that we are now ensuring that, if we are working on an issue in dairy, we are working to benefit the industry using all the resources we have across the country in a coordinated way. In the past, there was not that level of coordination. The work being done at Lennoxville, Quebec, was not as closely linked with the work being done in B.C. as it could have been, even though they were addressing very similar problems, such as issues around animal welfare.
We have moved to ensure that we are making the best use of the resources we have on a national basis. When the dairy farmers of Canada say they need work in a particular area of nutrition, animal handling or whatever, we can bring a much more integrated and connected resource to try to address their needs.
We are trying to ensure that we are making the best use of the resource we have for the benefit of the group with which we are working.
Senator Tkachuk: How much freedom do the scientists have to do whatever research they want in agriculture?
Mr. Archibald: As a federal-based science department we are more mission driven than a university. In other words, we have research priorities that are of critical importance for us. An example would be fusarium, a disease that causes major economic loss and potential animal and human health problems in cereal grains like wheat and barley. The department has said that this is a major area that we need to address, and for the next five years we will have a concerted effort of our breeders and pathologists to find ways to either incorporate resistance into wheat varieties or techniques to manage this.
That is the focus, and we would direct our researchers to work in those areas. That is not to say that, as they are doing research to address that problem, if something else was discovered through serendipity, it could not be pursued. If it is something that might provide economic benefit to farmers, of course we would want to consider it, but we are more targeted than a university program that tends to allow more freedom for researchers to choose their programs. That is a difference between the science-based government department and academia.
Senator Tkachuk: Are you not concerned that there will be a lot of political pressure now that you have it nicely centralized? One thing about scattering the money is that there is less of a big pot. You know what I am talking about. There are a lot of seats in Ontario compared to Saskatchewan. We could be doing a lot of research on corn and the dairy business and not enough on the grain business or in the Okanagan Valley. Everyone there votes Conservative. There is not much chance of the Liberals winning there, so perhaps you should not bother with that. Are you not concerned about that? I certainly am.
Mr. Archibald: I do not want to give the impression that all research dollars are centralized.
Senator Tkachuk: You are telling me that. I just want to know for sure.
Mr. Archibald: I do not want to leave you with that impression. The research dollars are allocated to our various locations. We have four major national programs. The four directors general responsible for those programs are in four locations around the country. One is located in Summerland, one in Lethbridge, one in Ottawa and one in Kentville. We have 10 science directors, also at different locations around Canada, whose job it is to ensure that we deliver on the science in their particular area, be it plant breeding or animal husbandry. The direction, the dollars and the location of this work are actually spread around the country.
The difference, senator, is that in the past, every centre had a fair degree of autonomy to work on whatever their needs were, and it was not connected. We had 19 different locations, and that was not making the best possible use of the resources. Now, the science director responsible for breeding programs must ensure that those programs, whether they are taking place in P.E.I., Ontario, Saskatchewan or Alberta, are coordinated and connected to best serve the needs of those areas, because there is a lot of commonality in the skill sets we need.
I do not want to give the impression that it is all centrally controlled, because that is not the case.
Senator Tkachuk: Is there a deliberate policy to not fund research through the universities and other private institutions but rather to hire the scientists ourselves? Would it not give the government more flexibility if they did not have them in their own employ, or had less of them in their own employ, and had universities, business and others take up more of the research?
Mr. Archibald: We currently have no mechanism to support research scientists in universities per se. We are not a granting council; we do not have that ability.
We do have a program, called the Matching Investment Initiative, of just over $20 million annually. It is a program whereby we can match our dollars with industry dollars to work on areas of common interest. However, we do not have a similar program with universities or teaching hospitals around the country.
It is an area in which we are interested in trying to do better, so that when we actually get into these partnerships, for example, with the University of Prince Edward Island or University of Alberta, we can better manage the relationship. When we maintain ourselves as separate entities, it creates a number of challenges.
Senator Oliver: Senator Tkachuk and I have much in common. It seems he has asked a number of the questions I wanted to ask. I will just put one final, new twist on the main issues he was asking you about.
Given all of this research that you are doing across Canada, with many different researchers in many different labs on 30,000 different hectares of land working in many different research centres, what is your process for avoiding redundancy and duplication? Specifically, when you were giving a response to Senator Tkachuk, you used language such as, ``We are trying to make the best use of our resources and to bring a new, integrated approach.'' Neither of those expressions contains anything specific to help me understand how you are avoiding duplication in research in Nova Scotia or British Columbia, or in one of your new centres in Prince Edward Island.
Put some teeth in the language. You say you are making the best use of resources and are bringing an integrated approach, but what specifically are you doing to avoid duplication so that six scientists are not independently working on the same thing and wasting a lot of Canadian taxpayers' dollars?
Mr. Archibald: One thing we have put in place to address that is what we call ``outcome projects'' within the department. We have a specific outcome project dealing with winter wheat cultivar development, for example. We as a department say we will allocate, in this case, $1.9 million to that particular activity. We identify the skill sets we need across the country. To deliver on these kinds of activities, we will need breeders at these two or three locations, and pathologists and entomologists, and their funding, support and supervision are directed under this outcome project.
The department has 87 outcome projects in research. Within those, we identify the locations, the activities, the human resource, the operating dollars and the capital dollars associated with delivery on those projects. Whether it be animal welfare or organic farming and horticulture, just as examples, that is the process we have put in place to address that issue. That was one of the greatest opportunities the department has had in terms of better linking all the various players in the various locations and facilities in the country.
That establishment of priorities and budgets, and managing those budgets out to the facilities, so that they know that those dollars are there to carry out those activities, is a way to prevent either duplication or, even more important, eliminate gaps that may have occurred.
Senator Oliver: I was hoping you would tell us that you have been working on and already have some fairly sophisticated computer programs that can track the research that is being done, and even the levels, the degree and the extent of it, on a particular project. Are you not using computers to track those things and avoid duplication?
Mr. Archibald: Absolutely, senator. Thank you for pointing that out. We are in the process of developing something we call a ``decision support system'' that basically puts together all the key elements in managing projects. It puts together, obviously, the budget, the human resource elements, the performance measures and the milestones along the way, so that from a management point of view, we can look at the resource that was put in place and, after six months, expect these kinds of results. There should be some sort of reporting mechanism that the ADM for research or my colleagues in other places in the department can look at to see if we are on track. Are there problems? Have there been some extenuating circumstances so that we may need to reallocate resources and make some adjustments in terms of outcomes? That is the system we are moving to, to bring together the project management software with human resource, financial and other assets so that we can truly make the best use of public resources.
[Translation]
Senator Gill: I don't know whether this question has already been asked, but I would like to hear about the sorts of relations you have with Quebec, specifically — if there are any.
Second, I would like further details in connection with a question from Senator Tkachuk, about universities. What form of collaboration do you have with the universities for agriculture research projects?
[English]
Mr. Archibald: We have a strong relationship with a number of different organizations that operate out of Quebec. There has been work with the provincial government and with the research bodies that they have created to make sure that we are addressing the needs of producers in that particular province.
It is an area of great importance for us. We have a large research presence there. We have had a history of collaboration with universities. We are starting to look at ways to strengthen that in a number of locations. In the province of Quebec, for example, University of Laval has a strong dairy program, particularly dealing with dairy products and food safety issues. We work closely with them.
They also have a new centre for work on functional foods and neutraceutricals. We are looking at ways we can connect our research in those areas with the work at Laval.
We try to avoid duplication with our partners. As I mentioned, Laval is clearly recognized as a world centre in dairy and dairy products research. It is important, I think, that that program be supported but that we not duplicate it. We should work with them to make sure that that type of work continues to be supported and promoted; and there are other areas, such as environmental issues, in which we will perhaps play a stronger role in the province of Quebec.
[Translation]
Senator Gill: I noted in your documentation that Canada is highly dependent on foreign exports. I am aware that the market always fluctuates, but would like to hear about the sorts of problems we might encounter because of our dependency on other countries. Can this sort of thing be anticipated at the international level? There is a problem at the moment with beef exports. Is it possible to predict the areas in which problems might arise? Because people here need to align what they do with anticipated future needs. Have you done research into this?
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Mr. Archibald: Certainly, within the economics and policy area of the department there is a fair amount of research done on such things as market opportunities, market impacts and market trends.
From a research point of view, we are constantly looking at the emerging science issues that we should anticipate or be ready to address in a proactive way. On an annual basis, I get together with my counterparts in something called a ``tetrapartite'' meeting with the United States, France and England to look at emerging trends in science. We talk about issues where there are opportunities for future collaboration.
It is an area in which Dr. Martel has been doing a fair amount of work with us to put together a strategy for our international research, to do work collaboratively, but also to look at challenges that may be emerging and to ensure that we have good information prior to problems showing up.
It is an area that, from a marketing and economics point of view, the department does a fair amount of work on, and from a science point of view, we try to identify possible new issues or trends; things like invasive species, new diseases that we can try to get a jump start on to ensure that our producers have the best economic opportunity possible.
The Chairman: You mentioned at one point Lethbridge, which caused me to perk up, seeing as that is my hometown. It also is the home of one of our oldest research centres and now the largest in Canada. It is a centre of excellence, strangely enough, for beef.
Several years ago, when we were in a rather difficult financial situation in Canada, there was a great deal of anxiety that the number of research centres and facilities that had long been in place across Canada would be reduced. I believe that was when the current Minister of Finance, Ralph Goodale, was the Minister of Agriculture and Agri-Food. It was at that point, in trying to ensure the strength of the system across the country, that the centres of excellence were created. I paid attention because it happened that one of them was in my area of Lethbridge.
Could you take us quickly across the country and tell us how that has worked over what is now probably close to a decade? How has that improved our situation, not just internally but internationally, having this special focus on a variety of issues? Maybe you could take us through the other areas that were chosen to be centres of excellence.
Dr. Yvon Martel, Chief Scientist, International, Agriculture and Agri-Food Canada: Honourable senators, going back about 10 years, we looked at reorganizing the 19 centres to give them a specific national mandate. Lethbridge was focusing on beef, Lennoxville, in Quebec, was focusing on dairy, St-Hyacinthe was focusing on food, and Lacombe was focusing on a different mandate.
These mandates were looking at the national situation. At the same time, we were looking at working more closely with the industry. That was the beginning of the Matching Investment Initiative to connect industry with these research centres. It has worked well since the time it was put in place. Right now we are pushing this concept a step further by organizing the management of these beef scientists across the country into national programs.
What you see now is a continuation of that strategy of national centres of excellence to now connect the scientists together across the country to do the research at a higher level and be more efficient. It allows us to use the infrastructure in a better way and to avoid duplication between centres in different locations. We are a national association, and the strategy is to move to national programs for these centres.
The Chairman: At the same time, it does not restrict those centres of excellence from continuing with some of the fine work they had been doing. I think of, again, my area, where a great deal of research had to do with crops, but also one of the issues that will be a great challenge to our country, and certainly in Western Canada in not so many years to come, which is water.
The centres of excellence have not been so excellent that they have been unable to continue other kinds of research that are not perhaps particularly germane to their own areas, but which have a national impact.
Mr. Archibald: Absolutely. Your example of Lethbridge is a good one. Lethbridge is known for and continues to have great expertise and research capacity in beef. However, it is also developing a strong expertise in the environmental area and we are actually looking at ways to link up some of the work that we are doing with work at the University of Lethbridge, which has established a research chair in water, to understand the issues, the socio-economic considerations around water and how access to water affects business development in Southern Alberta and other areas.
You are absolutely right. Just because there was an identification of an area of particular prominence, it was not to the exclusion of being able to do research in other areas in the country or other areas in the department.
The Chairman: It is comforting to know that. In the Lethbridge area, as you look every morning toward the horizon and the mountains, you can see already that we are losing glaciers quickly. Some will be gone, I am told by the university, in my lifetime. It is nice to know that that research centre is up on these things.
Others have talked about connections with learning institutions, universities and so forth. We have an excellent institution in Alberta, the Olds Agricultural College near Calgary. They have been conducting, I know from working with them on one set of issues, outstanding high-tech science with natural fibre from alpacas and similar things.
How much does your network connect with some of the work done in an institution like the Olds Agricultural College?
Mr. Archibald: You are quite right. Certainly, Olds Agricultural College is very advanced in terms of their approach and ability to go beyond just training students in agriculture and also take on applied research programs and those types of initiatives. Whenever there are opportunities for us to link up with places like Olds Agricultural College, we do so, for example, in our projects on bio-products and bioprocesses, which address things like you just mentioned: How do you find new uses for products and new uses for fibres? We try to establish and support those kinds of networks to move forward.
I am not 100 per cent certain, but I believe that in an initiative that we have been working on looking for new uses of flax, representatives from Olds were involved in the discussions. I am aware of the college. I know that they have a progressive program. Whenever those kinds of opportunities arise, we certainly look forward to working with those kinds of people.
Senator Gustafson: Do you have any interchange with companies like Monsanto?
Mr. Archibald: Are you referring to interchange in terms of staff?
Senator Gustafson: I am referring to research.
Mr. Archibald: We did have a Matching Investment Initiative dealing with Roundup Ready wheat with Monsanto. That has been discontinued. In my understanding, we do not have any programs currently with Monsanto.
Senator Gustafson: Have you done economic research on what is happening in the grain industry?
This year, I would say that farmers have a slim chance of recovering their input costs. Much of that money will go to companies like Monsanto. I am now talking about $25 per acre to buy the seed. Have you researched such a situation? Where is the grain industry headed in Canada? Where is the money going?
Mr. Archibald: The research branch per se does not do research in that area. However, our policy and program people do quite a lot of research on trends, input costs, tracking, modelling future returns and where the cut-off lines will be in those areas. The department has also helped to create something called the ``policy research institute,'' which was established to provide a place to address some of the issues that you have raised, such as the socio-economic challenges, and how to best address these issues as a sector.
It is clear that agriculture has gone through many years of great challenges. How do you position this industry? How do you provide the scientific research programs? How do you provide the support for producers in a way that will be defensible and provide the relief that is needed? The research branch does not do that, but certainly the policy and program people do a fair amount of research in that area.
Senator Gustafson: The mandate of this committee is to inquire into the present state and future of agriculture. We have had farm groups from Quebec appear before us. In my opinion, from what I have heard, they have the best agricultural system in Canada, bar none. However, it begins with the fact that they have 49 per cent of the dairy quota, whereas Saskatchewan has 3 per cent. They have a guarantee, but I am not trying to take that away from Quebec. When they testify before the committee, they tell us to get our act together. The Government of Quebec has put a great deal of money into agriculture. It is important to look at the state of agriculture in different regions of the country.
Saskatchewan is in big trouble, as are parts of Northern Alberta and Western Manitoba, especially where they have had frosts. Do you look at all areas across the country to determine where the major problems that should be dealt with are?
It is all economic, I suppose. Dr. Martel, as an international scientist you must be looking at the world situation and seeing what direction Canada should take.
From my observations, I cannot see any light at the end of the tunnel in respect of grain exports. Unless something changes, as in some country having a crop failure, we are in big trouble.
Mr. Archibald: Certainly, one of the advantages of taking a national approach to how the department operates and its research is that we are much better linked to information from our marketing, trade and policy people than we have been in the past. You are right, in that there are great challenges facing the grain and oil seed sector in this country. There are some opportunities for research to begin to provide some hope. For example, the whole pulse industry has grown tremendously in Western Canada. Our trade people tell us that there are real opportunities for chickpea exports to countries such as India and parts of the Middle East. The current varieties that we are growing in Canada are not to their liking because they do not fit their culinary needs or tastes. We take that kind of information back to our research programs and our breeders to see if we can develop varieties that will fit that market need. Hopefully some new market opportunities will be created so that some farmers in Saskatchewan can produce those crops. There may be some greater economic return from those than from the current crops.
Senator Gustafson: We have grown peas on our farm, as have some of our neighbours, but most of us are getting out of that crop because the Americans doubled their subsidy on peas two months ago. There is no way that a Canadian farmer growing peas would be able to compete with the U.S. on that basis.
Mr. Archibald: Senator, we want to determine whether there are areas where we could be ahead of the competition. If there is a market in India that has a true demand and we can develop a variety to fit that demand ahead of our competitors — ahead of the Americans or other chickpea producers — then at least an opportunity exists to capture a market and increase the return.
Senator Gustafson: We did that in canola for 20 years, but those days are over. Our canola prices have dropped from $8.50 per bushel to $5.35 per bushel. I just heard someone's prognosis of what we should be seeding, and farmers are looking at that now. Apparently we should be seeding flax. The whole flax crop in Saskatchewan and parts of Manitoba and Alberta froze. Flax is moving at $13 per bushel. However, there is a warning: If the amount of flaxseed is sown that they think will be sown, we will be getting about $6 per bushel because there will be a glut. It is easy to say that we must diversify; and we have gone through that.
Senator Oliver: Are there any other pulse crops that you could look at?
Senator Gustafson: We have looked at them all.
Senator Oliver: Name one that we have not tried to grow.
Senator Tkachuk: You could sell futures and pray.
Senator Gustafson: Thanks for the good advice.
Senator Kelleher: I cannot think of an area of trade that is more heavily politicized than agriculture. Unfortunately, I learned that economics is often thrown out with the dishwater. We do not necessarily apply good economics to our agricultural trade. Therefore, it is important to understand what is going on in the area of economics. Does your division liaise with the so-called trade sector within agriculture to ensure that you are not operating at cross purposes?
Mr. Archibald: Absolutely. The department has created a series of boards. The purpose of the boards is to bring together branch heads and associated people working in those areas to talk about areas of common interest. There is a marketing and trade board and a food safety and quality board, of which I am a member, along with the ADM of policy, the ADM of international trade and marketing, and team leaders from food safety in trade and such areas. We bring all of the resources of the department together in one place to talk about the issues facing us. Obviously, my area looks at where the research gaps are so that we can help with the issues, but in a way that is not isolated or unconnected to the trade realities out there. Clearly, in those discussions there is an understanding of the emphasis and the level of subsidies that various jurisdictions put on research, of the kind of strategic directions they are taking, and of the areas of competitive advantage for Canada.
One of the great benefits of the management approach that we put in place is to link all those pieces and not deal with issues in isolation. That is where the power of the whole approach comes into play. We talk with people who work on trade, not only within the department, but also in other departments, such as International Trade, and those involved in science to ensure that the effort is as coordinated as possible.
The Chairman: We had quite interesting sessions during our discussions on value added. Those discussions began with Senator Oliver and Senator Gustafson, who chaired this committee before me. We heard about all sorts of areas that you do not necessarily hear that much about usually.
One group that was extremely enthusiastic and eager to develop further, but found that wherever they turned there was no door open to getting good advice on how their particular kind of farming would be able to grow in Canada, was the organic farmers. At a time when the consumer in this country, and certainly in the United States, is eager to have organic products, our farmers feel that there is a barrier for them, that they cannot get a seat at the table that would help them move ahead, which they want to do, knowing that there is a market out there that is currently being filled by products from the United States.
Through your research and policy systems, have you anything to offer us and them in terms of opportunities for that product in Canada at a time when we are in all sorts of trouble in our agricultural communities?
Mr. Archibald: I am glad you raised that issue. It is an area that I see as a real opportunity, and the department has been working on it on a number of different fronts.
We must first try to help the industry work toward standardized definitions and certifications and to ensure that these certifications are recognized in the United States and Europe so that there is some consistency to that approach. Our people in marketing and trade have been working aggressively in that area.
The policy and economics people have also done some research and there is clearly a big opportunity for import replacement in the area of organics. We all see the increased visibility of organic produce at the grocery store, and there is a real opportunity for Canadian producers to supply many of these markets.
From a research point of view, we are starting to look at this much more than we have in the past, particularly in horticultural crops, where there seems to be a fair amount of interest, but also in the more commodity-based grains and livestock sides of the business. As you point out, it is a real opportunity. It is also an area where I think there is opportunity for our work to link up with initiatives going on in other jurisdictions. The Nova Scotia Agricultural College in Truro is building a strong capacity in the area of organics, and we want to work with them along those lines.
We want to work on certification, on helping the industry better organize so they can move forward, on understanding the real market opportunities, and on understanding the production behind it that so that we can inform producers on how best to produce organic lettuce in this climate zone, or organic beef or whatever. It is a real opportunity in terms of import replacement and that is an economic advantage for Canadian farmers as well.
The Chairman: We might get our researchers to send you the names of people who appeared here who might like to be involved in this.
Senator Tkachuk: Dr. Martel, after your explanation I was not sure how the research decisions are made and how they will be made in the future.
I want to couple that with a question on things like BSE and avian flu. Do the budget numbers for research in the Department of Agriculture include research on BSE and avian flu? Do we do any of that or is that done by the Department of Health? How is all of that handled?
Mr. Martel: As indicated by Dr. Archibald, there is currently a Network of Centres of Excellence being created on BSE, with funding of $5 million. Our contribution to that will be participation. BSE research is not yet significant in Agriculture and Agri-Food Canada. It is currently being done more in the veterinarian colleges and by people dealing with animal diseases.
Senator Tkachuk: What about avian flu?
Mr. Martel: The same is true of that.
Senator Tkachuk: Will we have a centre of excellence on that? Did the $5 million come out of the regular budget or was it additional money?
Mr. Martel: The $5 million was announced in last year's budget to create one new National Centre of Excellence, of which I think there are 21 or 22 now. There will be one more, focusing on the science of BSE.
Senator Tkachuk: You talked earlier about these centres of excellence. Our chairman talked about Lethbridge, and you said that even though they are doing this, it does not mean they have discontinued research that they normally do.
Let me get this straight. If we have the same amount of cash as we had 5 or 10 years ago, as you said earlier, or maybe even less cash, how does this work? How do they do what they used to do as well as new work, or are you just stirring the pot and doing the same work in different places? There is nothing new here really. There is just an administrative framework to do the same things you were doing before, but calling it ``centres of excellence.''
Mr. Archibald: I know it is confusing, because we use the term ``National Centres of Excellence'' within the department, but the program we are talking about for BSE was funded by new dollars administered by Industry Canada. It is $5 million a year for the next seven years to work on BSE and TSE.
Senator Tkachuk: Is that $5 million per year?
Mr. Archibald: Yes, it $5 million per year for seven years, and it is directed toward building capacity in universities and teaching hospitals.
As Dr. Martel was saying, we want to align what we have to try to support that, so that it is connected to it. We cannot attract those dollars into the department, but we can certainly try to ensure that what work we do is complementary in terms of what we are trying to accomplish.
The Chairman: Thank you very much. This has been an excellent evening. I think we have all learned a lot. I hope that you will be free at some time to come back if we need you.
Mr. Archibald: I would be delighted to do so.
The Chairman: At this point, honourable senators, this part of our meeting will end.
The committee continued in camera.