This article appeared in the Winter 2013 issue of Pulse Crop News.

A new five-year policy framework for the agriculture and agri-food sector comes into effect April 1, 2013, and with it will come changes to the government’s suite of business risk management programs, including AgriStability, AgriInvest, AgriInsurance, and AgriRecovery.

Approved by federal, provincial, and territorial agriculture ministers on September 14, Growing Forward 2 has received mixed reviews from industry stakeholders and producers, but despite any challenges with the new agreement, producers still need to understand how the changes will affect them, according to Leanne Fischbuch, Alberta Pulse Growers’ Executive Director.

“We understand that producers are concerned about some of the changes that Growing Forward 2 will bring, but as the program will be moving forward in April, producers need to be aware of how the changes will impact them directly,” said Fischbuch, who added that the consultation process over the summer included some of APG’s Commissioners.

While Growing Forward 2 will bring a number of changes, producers will see greatest change in two key areas: Business Risk Management Programs and government investment in innovation, competitiveness, and market development.

Business Risk Management Programs

The federal-provincial-territorial partnership remains committed to offering Business Risk Management Programs for producers, but when Growing Forward 2 comes into effect, producers will undoubtedly notice some changes to some programs – specifically to AgriStability and AgriInvest.

AgriStability is a risk management program that helps protect producers from large declines in farm income. Under AgriStability, a payment is triggered when a producer’s margin (allowable income minus allowable expenses) falls below the historical average margin. Previously, the payment would trigger once a producer’s margin fell below 85 per cent of the historical margin; now, the payment will not trigger until the margin falls below 70 per cent. Essentially, that means a producer will have to see a greater loss (30 per cent instead of 15 per cent) before a payment is triggered.

Another change to AgriStability will make it so a producer will receive payment based solely on that 70 per cent, regardless of how great the loss was. Previously, payments were tiered, and different levels of loss would receive different levels of support. Additionally, reference margins will be limited to the lower of historical reference margins or allowable expenses from previous years.

AgriStability’s fee will also be reduced to make the program more affordable for producers.

While this is not new for the program, producers should take note that, if you want to opt out of AgriStability, you must go to the AFSC web site at www.afsc.ca and fill out the AgriStability Opt Out Form by April 30 of the program year. Without receiving that form, AFSC administration will consider you an active participant in the program, and fees for that year will remain due.

AgriInvest allows producers to put money into a producer-government savings account and receive matching government funds. Money can be withdrawn at any time, helping offset small income losses. Previously, producers were able to deposit 1.5 per cent of Allowable Net Sales (sales of allowable commodities less purchases of allowable commodities); that number has now dropped to 1 per cent. The limit on matching government dollars has also decreased from $22,500 to $15,000.

Investment in research and market access

The new policy framework brings some positive changes to government support for research and market access. Growing Forward 2 will invest $3 billion into programming specifically related to innovation, competitiveness, and market development, which includes an increase of 50 per cent for cost-shared initiatives like the Agricultural Innovation Program and Agri-Science Clusters. This could be good news for organizations like the Alberta Pulse Growers, according to Fischbuch.

“So much of what we do relates to research and innovation to increase the sustainability and profitability of pulse growers,” she said. “A significant portion of our members’ levy dollars goes to research, and expanding this government funding may allow us to expand our research interests even further.”

Moving forward

While the new agreement seems to bring both positive and negative changes to the former policy framework, many producers remain concerned about the consultation process undertaken by the Government. Fischbuch encourages producers to look beyond the challenges of the process and focus on working with the new framework over the next five years.

“Ultimately, that’s what agriculture – and, indeed, Growing Forward – is about: moving forward to overcome challenges and seize opportunities for the betterment of the industry. As this new program unfolds, we will continue to offer our feedback to the government to ensure our members’ voices are heard.”

For more information about Growing Forward 2, please visit www4.agr.gc.ca/AAFC-AAC/display-afficher.do?id=1294780620963&lang=eng