Mr. Jorgenson:

A fate worse than death.

Mr. W. H. Jorgenson (Provencher):

Mr. Speaker, the amendment and the subamendment now before the house ask the government to initiate policies that will bring about a fair relationship between the price that the producer receives for his product and his costs, but the debate that has followed has not indicated that the opposition knows precisely what they want in the way of policies. This is quite understandable because I have not yet heard a declaration of policy with respect to agriculture on the part of the opposition and I assume that they are still attempting to formulate a policy. They made no mention whatsoever of the broad agricultural program initiated by the government. They have singled out one point in the price stabilization legislation, the one applying to the deficiency payment program on hogs and eggs, and have attempted to convey the impression that this is the Conservative policy for agriculture.

This is grossly misleading because it is merely pointing the finger at one aspect of agricultural policy that is now in the process of adjustment and at the time that this policy was implemented I do not think anyone expected that there would be an immediate change and adjustment to the policy. It always takes time for farmers to adjust to a different method of price support. It takes

time to adjust to the different production pat-among other things, that terns and it takes time to bring supply in line legislative measures passed with demand.

Disparity of National Income

By this statement, the hon. member for by the central

ticularly

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Disparity of National Income to Farmers I propose tonight to the deal with the farm policy of the government in an effort to point out what we are attempting to do, how we are proposing to assist the farmer in such a way that he will become less dependent on the government and more dependent upon himself and his own initiative and ability. In doing this we must be guided first of all by what we want to do, by what the ultimate aim in agriculture should be. To put it briefly, to me it seems that our aim should be the'development of the agricultural industry by mobilizing all its resources, financial, human and land, to such a degree that the farmers are able to take care of themselves.

We must first of all diagnose the problem correctly. We must realize what is ailing agriculture today and then apply the proper remedies. I have no use for the type of talk we heard this afternoon. Members of the opposition are not diagnosing the problem correctly. They are attempting to create problems where none exist and they are attempting to apply remedies that cannot possibly be applied.

In the past agriculture and the problems of the farmer have been dealt with on a crisis to crisis basis. Farmers have been attempting to adjust to changes in technology, to changes in production and consumption patterns. Farmers have been attempting to get along by themselves, and if we allow ourselves to be placed in the position where the farmer is going to depend upon welfare measures, if we continue to regard the farmer as a welfare problem, then, of course, the only remedies that can be applied are welfare measures. I do not think there is a farmer in the world that wants that type of legislation to help him.

As I said, changes in technology have created some dislocations. Production patterns are changing as well which would indicate that it is necessary for us to produce those things for which the demand is increasing. We cannot afford to set the clock back. We cannot afford to think that we can expect farmers to continue to live under policies that might have been applicable years ago but have no place in broad agricultural policy today.

What are the policies of the government? They were stated in the election campaign in 1957 and, briefly, they fall into four major pieces of legislation; price stabilization, crop insurance, farm credit, soil conservation and rural development. Of these four major pieces of legislation three have already been implemented and the fourth is in its formative stage. There have also been changes, as was mentioned this afternoon by the hon. member for Acadia (Mr. Horner), in the Prairie Farm Assistance Act with respect to

cash advances and a host of others. I do not intend to go into these changes other than to mention the Prairie Farm Assistance Act because I think it illustrates the necessity of changing our thinking with regard to agriculture. .

I have no criticism to offer of the policy that was initiated at that time to assist farmers with crop losses because the problem that was intended to be met at that time was one of drought. The Prairie Farm Assistance Act, although it was four or five years late at the time it was implemented, was designed to take care of that condition but we have not been confronted with that condition of recent years. Increased costs have made it necessary that some other method be sought whereby we can assist farmers who suffer crop losses. I have in mind a fairly good example of what is wrong with the Prairie Farm Assistance Act this year.

In my area farmers suffer more from excessive moisture than they have ever suffered from drought. This year was no exception. Farmers were unable to sow a good percentage of the crop. In one particular instance three farmers farming a section of land were able to sow only 65 acres of the whole section. The yield from the 65 acres was more than the amount needed to qualify for P.F.A.A., so in spite of the fact a greater percentage of that land was not sown because of the wet weather, these three farmers were unable to qualify for assistance. This illustrates the need for some changes in agricultural policy to take care of situations that do develop from time to time.

It is hoped that crop insurance will take care of that need. Although there was criticism here last year when this policy was introduced, I am happy to say that the province of Manitoba has embarked upon a program of crop insurance by setting out three test areas within the province. It is to be hoped that the establishment of these test areas will enable the province of Manitoba to develop a type of program that will assist farmers when they suffer crop losses. It is to be hoped as well that the other provinces will follow suit because it is my opinion that, without a sound actuarial system of crop insurance to assist farmers when they suffer crop losses a good many farmers are going to be unable to continue. Should higher production costs and mechanization create a condition where farm costs rise to a point where it is not possible to maintain a reasonable standard of income, then any year when income falls below that production cost the farmers are likely to go broke. I commend the government for the action they have taken in introducing the program of crop insurance.

The second aspect of our particular agricultural policy deals with price stabilization, and this is the point that was under criticism here this afternoon. Under the price stabilization act now in effect-it seems this is a point that is constantly being misinterpreted-there are three methods of supporting price: first, the delayed purchase method; second, the deficiency payment method; and then, third, the straight support method. This method of support for hogs and eggs, according to farm organizations, was creating the development of vertically integrated units. As a result of this the money that was being paid out for support was going more and more to the vertically integrated units, to the larger producers, and less and less into the pockets of the smaller farmers. At the request of these farm organizations, the Minister of Agriculture (Mr. Harkness) and this government changed the support price policy on hogs and eggs from the delayed purchase method to the straight deficiency payment method.

In making this change the government recognized that we were confronted with two problems. The first one I have mentioned already, that is the development of larger commercial units and, second, the crisis of a surplus supply in this country of these two products which was making it impossible for the government to dispose of these two products on our available markets. Obviously, and I do not think anyone will criticize this, something had to be done. The program that has been implemented has undergone a period of adjustment, and no one is going to deny that. No one is even critical of the fact that farmers had to experience this period of adjustment.

I have here a brief that was presented to the government the other day by the interprovincial farm union council. They do not criticize the deficiency payment program. They make some suggestions as to the development of regional areas for calculating deficiency payments, and they make a suggestion as to quarterly payments. I want to read this portion of the brief which indicates their thinking on the deficiency payment proposal. They say:

There is little doubt that the method oi providing market price supports on limitless quantities which was in effect lor such commodities as eggs and hogs until the introduction of the deficiency payments method, provided production incentives to large-scale commercial operations. In our efforts to promote policies which will stabilize the livelihood of the family farm, we have regarded the development of such commercial enterprises with a good deal of apprehension. As a result, farm unions have actively supported the principle of a deficiency payment program for farm commodities based on cost of production which would limit the amount of support payable to a basic volume of 79951-0-84

Disparity of National Income to Farmers each farmer's production. We believe that any support policy should have as its objective the welfare of the farm family.

The federal government apparently concurred in this point of view. The Minister of Agriculture announced in the House of Commons that deficiency payments would be used as a method of price support for both hogs and eggs. Emphasis was made by the minister at that time of the need to limit the amount of price support to large-scale commercial operations. Press reports which followed the minister's announcement reported that certain commercial operations had reacted immediately by severely cutting back the number of their contracts.

In other words, the policy that was implemented at that time, designed to cut back production in the larger units, was effective.

Some mention was made here this afternoon of correspondence between the federal Minister of Agriculture and the minister of agriculture for Manitoba. Essentially the recommendations made by the minister of agriculture for Manitoba are very similar to the recommendations that are made here by the interprovincial farm union council. He suggested that regional areas be established for the purpose of calculating deficiency payments in various parts of the country. Certainly this would appear, on the surface, to be a desirable method. But on closer examination I think you will find that very serious complications could develop as a result of the initiation of this policy.

In the first place the establishment of regional areas would promote the movement of eggs from one region to another without any regard to the problem of creating a surplus in different areas. It has also been indicated by the Minister of Agriculture that this move would also necessitate the establishment of regional areas for the purpose of establishing price supports. In addition to this, of course, there is the tremendous problem that would be involved in the administration of this type of program.

Perhaps one of the most important pieces of legislation, so far as the farmer is concerned, that has ever been passed in this house is the one that deals with farm credit. Although this government has never attempted to convey the impression to anyone that a single one of these policies is going to be a cure-all for the problems of agriculture, we do say that each one of these policies, applied in the direction it is intended and doing the job it is intended to do, will work toward the common objective of creating in agriculture a situation whereby a farmer will be in a better position to realize that standard of income and that standard of living we all want to see the farmer enjoy.

There have been serious weaknesses in the farm credit legislation we have had in the past. First of all, we do have a number of

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Disparity of National Income to Farmers father to son transactions on farms. Under the old legislation it was not possible for a farmer to retire and have his son take over the farm. This new legislation that we have will facilitate the transfer of farms from fathers to sons. In addition to that, it will provide the younger farmers with an opportunity to get started in agriculture.

In the third place, it will enable farmers to enlarge the size of their operations, to diversify them or to do both. In addition to these three things, the legislation will provide something that I think is extremely important in the proper development of our agricultural economy, namely technical and farm management assistance. You need only to travel through the country today in order to see the amount of work that can be done by proper farm management practices in assisting farmers to take advantage of all the technology and all the know-how that we have in agriculture today.

We make no claim that the moment these policies are implemented they suddenly change the entire picture but we do say this. Given time to be operative, given time for farmers to take advantage of these policies, they are going to make a tremendous impact on the welfare of the farmer. They are going to do the job we hope they will do. We have never maintained that the mere passing of legislation is in itself enough. We have implemented the policy of cash advances and the following year we made some changes that appeared to be necessary. We have made several changes in the P.F.A.A. We have made changes in the price stabilization act.

It is important that as a government we continue to recognize that we are in a changing economy and that changing policies are necessary in order to keep pace with the development of this country. If we fail to do this, we will get ourselves into the very position that the hon. members of the opposition got themselves into from the years 1939 to 1957. They introduced a program of P.F.A.A. and then forgot about it. In 1945 they brought in price support legislation and for 13 long years they just sat there and never bothered to review it in order to see whether the program was working. They never bothered to see whether the policy was doing the job it was intended to do. They simply thought that because they had legislation on the statute books, that was enough.

We know today that we cannot continue to look at the problems of the farmer in the light of conditions that existed in the past. We must continue to keep abreast of these problems. We must continue to change our

legislation to the degree that it will be able to take care of the situations that are developing from year to year.

In conclusion, Mr. Speaker, I might say that the policies we have implemented since this government took office will require a few years to become operative in order that they may do the job we hope they will do. I must say that in the course of this debate there has not been a great deal of light thrown on this situation by the official opposition. I am rather surprised that during the entire course of the debate thus far no mention whatsoever has been made of these policies, except of the condition we find ourselves in today with respect to hogs and eggs. We know there is an adjustment taking place. They need not come to this house in order to tell us that. But I will say to them that this government is going to watch developments, will continue to keep a finger on the pulse of the people and will implement policies that are in keeping with the dignity of the people.

Mr. Jorgenson:

The third paragraph deals with the premiums that were suggested. It deals with questions raised by the commission as to what premium rates farmers might be prepared to pay under an insurance program. I do not intend to read it or to do other than to say that the farmers who made representation at that time, as indicated by the report, perhaps were not too fully aware themselves of what the premiums would be.

I think that is uderstandable. I do not think there is any criticism there. I recall that at that time I presented a brief myself and this question was asked me; and I shall state quite frankly that I was unable to say what I thought the premium rate in my own area would be. However, I think this is beside the point. What this bill is doing -and I think this is the important thing and that the point has been missed-or what this government is doing is providing an opportunity for a provincial government to draw up a program of crop insurance

suited to the particular needs of that province, and permitting the farmers in the area to make some contribution to the development of that program.

It has been stated by most of the commissions or bodies that have been studying this particular subject that one province attempting to go into a crop insurance program by itself would in all probability find itself in difficulties if it had a succession of failures in the early part of the program. Therefore the recommendations of the Manitoba commission, the Saskatchewan commission and of many of the reports that have been drawn up have been to the effect that the federal government must participate in this program. On no occasion has any of these commissions suggested that the federal government has to be in complete control of the development of the entire program.

What we are doing is simply providing financial assistance to the provinces in the event that they have crop failures in the initial stages of their program. In addition to this the government is paying 50 per cent of the administrative costs. The federal government is doing, in addition, something that has been suggested by no commission in connection with this program, in that the government is going to pay 20 per cent of the premiums of the farmers.

This is quite important. This suggestion has been criticized by the hon. member for Assiniboia. I have not been in this house too long, but those of us who have been here during the last two years know full well that it would not matter if the government paid 250 per cent of the premiums, the hon. member would still find something about which to complain.

I might say that I was in Manitoba just two weeks ago, and my attention has been called to the fact that the press gallery noted my absence on one particular night. At that time, in my particular part of the province, only 10 per cent of the land had been seeded because of flood conditions. The farmers arranged a series of meetings for me to attend, and at each of those meetings there was a considerable amount of interest in crop insurance. Although I was unable to give them details of the program at that time, I told them a crop insurance bill was being introduced and that it would be passed at this session.

They are anxious to have this bill put through this house. They are anxious that the provincial government in Manitoba develop a crop insurance program for that province so that next year, if the same situation exists in my constituency, they can be covered by a comprehensive crop insurance

Proposed Crop Insurance program. I did not find, amongst those farmers the attitude that was expressed by the hon. member for Assiniboia, that they are afraid to pay the premium rates. As indicated in this report of the Manitoba commission, the farmers are anxious to stand on their own feet. All they are looking for is an opportunity to take out a crop insurance policy so they can be protected from the hazards with which they are confronted from time to time.

Although we all know these things are not always perfect, I am satisfied that the bill is acceptable to the province of Manitoba. I am satisfied that as a result of this legislation we will have crop insurance in the province next year. I take a great deal of pleasure in participating, just briefly, in this debate. I should like to congratulate the minister upon bringing this measure forward and upon having the courage, despite all the procrastination that has occurred in connection with crop insurance over the years, to introduce a measure providing an opportunity for the provinces to develop programs suitable to the needs of their farmers. (Translation) :

Mr. Jorgenson:

As a result they have been unable to receive any payments under P.F.A.A. These are the people who during the year 1954, when the Manitoba crop insurance commission were travelling throughout the province holding hearings and receiving briefs from farmers and farm organizations, made representations to the commission. I might say that of the 45 briefs that were presented-and not all of them were written -24 favoured a system of crop insurance, 5 were opposed to it and 8 gave qualified support. I think this is an indication of the interest in crop insurance in the province of Manitoba.

I also want to say that at page 14 of the report, in the second paragraph, this is stated:

It was evident, however, that farmers were anxious to stand on their own feet and to pay for their own protection. They were fearful of extensive indemnity claims in the first few years of any crop insurance program that might be adopted, and the feeling was that if a plan was safely launched and a reserve built up, barring a succession of crop disasters, crop insurance should function successfully in Manitoba.

Mr. Jorgenson:

Will the hon. member indicate just what percentage of the premiums the hail insurance companies pay for the farmers and what percentage of the premiums the government pays on the life insurance and the fire insurance policies?