[UPDATED: June 28, 2021] The Ontario government is increasing its contribution to the compensation rate for AgriStability.
The move goes against the national consensus that was reached in March over the removal of the reference margin limit. However, a federal government proposal to increase the compensation rate from 80 per cent to 70 per cent was rejected by Prairie provinces.
It’s the provincial portion of the increase in compensation rate that Ontario announced on July 25 that it is providing. It called on the federal government to contribution its portion.
Why it matters: Use of the AgriStability program has been declining as farmers have found it too difficult to trigger a program payout during a crisis.
“Ontario farmers can’t wait any longer for improvements to the AgriStability program – so the Ontario government is taking action and also calling on the federal government and other provinces to step up as well,” said Lisa Thompson, minister of Agriculture, Food and Rural Affairs. “By enhancing the AgriStability program, we can better help those Ontario farmers who have been impacted by large income losses from factors outside of their control.”
AgriStability is paid into both by farmers and provinces and the federal government and aims to help provide a financial backstop when farm incomes drop quickly.
The $25 million in increased potential support through AgriStability is in addition to $50 million the province announced in July 2020, to increase its contribution to the Ontario Risk Management Program.
“I have been and will continue to be a tireless leader for improving the business management programs so that farmers can count on them – starting with AgriStability," said Marie-Claude Bibeau, federal minister of Agriculture and Agri-Food, in a statement.
"I am very proud of the work I did alongside Minister Thompson’s predecessor to advocate and secure changes with all provinces and territories to finally remove the margin limit from AgriStability, first introduced by a Conservative government in 2013. This was a big win for farmers, resulting in $95 million nationally into the pockets of farmers who need it most."
Bibeau says the federal offer is still on the table for the cost-shared improvements to the compensation rate, but that in order to make AgriStability changes at the national level a "strong majority" of provinces have to agree.
"The Prairie provinces need to step up to make this happen."
Extreme price volatility and processing slowdowns dramatically impacted our industry in 2020,” said John de Bruyn, Chair of Ontario Pork. “This change will help the most affected producers recover. We continue to urge the Federal Minister of Agriculture, Marie-Claude Bibeau to find a way to match these funds.”
“By choosing to increase the compensation rate from 70 per cent to 80 per cent on the provincial portion of approved AgriStability claims, more money will be paid out to the producers who need it most,” said Peggy Brekveld, president of Ontario Federation of Agriculture.
*Update: Includes comments from Minister Bibeau.