COST OF PRODUCTION FUNDING TO BEGIN REACHING PRODUCERS

OTTAWA – On behalf of Agriculture Minister Chuck Strahl, Garry Breitkreuz, Member of Parliament for Yorkton-Melville, would like to advise all producers of an announcement made May 1. The $400 million in cost of production payments will begin to be paid out to farmers in June 2007. In addition, the Conservative government has committed an addition $100 million annually to be paid into producer savings accounts to help address increasing production costs.

Producers who provided their 2004 farming income and expense information for the Canadian Agricultural Income Stabilization (CAIS) program do not need to apply. Producers who did not provide their 2004 farming income and expense information for CAIS, or producers who began farming after 2004, are eligible but must send in an application. Applications will be made available in late May, and the deadline to apply is September 1, 2007.

Initial cheques will begin flowing in June and are expected to be complete by the end of October. For producers who farmed in 2004, the initial payment will be based on 2.36 percent of a producer’s net sales for 2000-2004. If funds remain, final payments will be made in December. For producers who began farming after 2004, payments will be based on 2.36 percent of an average of 2005 and 2006 net sales.

Producers can get more information by calling 1-866-367-8506 or by visiting the program website (www.agr.gc.ca/cop).

The $400 million was part of a $1 billion announcement made on a farm near Saskatoon in conjunction with the 2007 Budget. The March 9 agriculture announcement, made by Prime Minister Stephen Harper, marked the next important step in fulfilling our Conservative government’s commitment to replace the Canadian Agriculture Income Stabilization (CAIS) program.

Included in the $1 billion announcement was $600 million to kick-start the new savings account program. The new savings account program along with the disaster relief framework, improved production insurance, and an improved margin-based program represents the federal government’s proposal for the replacement of CAIS.

The replacement of CAIS remains contingent on agreement of the provinces and territories. Negotiations with the federal government, and provinces and territories continue.

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