April 26, 1967 (27th Parliament, 1st Session)


Harry Andrew Moore

Progressive Conservative

Mr. Moore:

Mr. Chairman, I enjoyed the change of pace provided by my hon. friend from York-Humber and I am in complete sympathy with him, but I must return to the dairy policy and I would like to deal specifically with discrimination against two groups of Canadians. Those two groups are the ones who ship fluid milk and the people who drink it. This involves a lot of people, but the way things are going I am afraid both groups may become smaller.
Fluid milk shippers sell milk on a quota basis, and this quota is set by the needs of the pasteurizing plants, not by governments, commissions or what-have-you. However, they sell only a percentage of their total production. This amount varies from area to area, and it varies among shippers, even among shippers to the same plant.
I want to give an example, using specific figures which I obtained from Alberta. They happen to be figures from my district. I am interested in dairy problems all across Canada but, as I say, I have obtained these
April 26, 1967

figures from Alberta, and there might be a slight difference with respect to figures between the provinces.
These figures are based on a check for the last two weeks of March of this year. Tests of the milk in question happened to be 3.5 and since prices are based on 3.5 milk the figures give a good example. Out of a total of 15,618 pounds of milk sold by one farmer in two weeks, he received the quota price on 5,932 pounds, which was $5.60 a hundredweight. On the remaining 9,686 pounds he received the market price of $3.25 a hundredweight, making his average price $4.15 a hundredweight. This is a long way from the $4.65 that manufacturing milk shippers may receive this year.
[DOT] (10:10 p.m.)
The use of the word "may" in this case was intentional. I informed this man that he would receive no quota, having shipped some of his fluid milk. I must say that he would not believe me. He said, "This could not be possible." He said, "We got it last year and will get it this year." Unfortunately he will be disappointed. We are talking about fluid milk shippers or shippers of distribution milk; it is the same thing. They ship to a plant which pasteurizes and distributes milk on the street.
The minister states that these producers are under provincial jurisdiction. Certainly their quota portion is under provincial jurisdiction because the price is set by commissioners or milk boards or some similar body in each province. The manufacturing portion of their milk is not under provincial jurisdiction. The minister cannot show me evidence that it is or ever has been. To say that it is, is ridiculous. The minister, however, has said this in the house over and over again. Let us be kind and say that instead of being guilty of perpetrating a hoax he just does not know the facts.
If this is so, if what the minister says is so, why did the shippers receive some subsidy last year? What has happened? In other words, what arrangements have been made with the different provinces? I mean by this that each and every province in Canada then would have to pay a subsidy on the fluid milk shippers' surplus. If they did, what would the other shippers think of this? What would their neighbours think? Just consider that. The new dairy commission is to pay a subsidy by quota, and that quota will be the same as the amount on which the subsidy was paid last year. What would happen if the fluid milk shipper was forced to switch to selling manufacturing milk? I should like to know
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how much quota they then would have on which they would be paid a subsidy. Will it be just the amount they received last year over 120 per cent of their fluid quota? If so, it could be very very little; it could amount to just a few pounds difference.
How should one expand under this new quota system? Is any provision made? If there is, it certainly is not spelled out. I cannot find it either in the dairy policy or in the proclamation by the Canadian Dairy Commission. Fluid milk shippers are so discouraged that many are contemplating going out of business. To prove this, all that is necessary is that one look at any weekly publication in any place in Canada; but of course, I only know about the publications in my own area. In one little paper I noticed last week that there were seven dairy disposal sales. These were sales involving 31 head of cattle, 27 head of cattle and so on. I do not think this is something which is normal. However, this is the situation all over Canada. In order to stop this, the provincial boards-and I am speaking now of the boards which regulate the price of fluid milk-are increasing the price of fluid milk. The price goes up on the street, and what happens? If you do not think it is going up, read the papers. Every day you will find reports that milk is going up, that milk shippers are to receive more money, and so on. This certainly is true across Canada.
The price of beer, liquor and cigarettes can go up with no seeming effect on sales, but let the price of milk go up and sales immediately drop. We cannot change human nature, so we cannot do anything to manage this. When the sales drop on the street the fluid or distribution shipper sells less milk on quota. I believe this has been mentioned before, but I wish to emphasize it because it certainly is true. At the higher price he sells less on quota. Therefore he gains little or nothing.
A ridiculous situation is arising where a man who has more money invested and extremely higher production costs in comparison to other shippers, and who operates under very strict regulations and inspections of premises, can, and in many cases will, receive less than his neighbour who sells manufacturing milk. I am certainly in favour of additional income for the producer of manufacturing milk. In some places he may receive $4.65 per hundredweight; in other places he may realize much less than the $4.75 which is mentioned in the dairy policy. This figure of $4.75 may be taken by some to be a guaranteed price, but it is not: It is just a hope.

April 26, 1967
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In comparison to this, cream shippers will not receive a better break, but they will find the increased subsidy of last year very useful, I am sure, to say the least. However, they certainly will not realize $4.75 per hundredweight on the same basis as for milk. I have a question which I should like to ask the minister in respect of the dairy commission report which was sent out I think on April 14. At the top of the second page the report reads as follows:
The deduction for the export equalization fund will be made on all milk or cream delivered by quota holders each month, not just on the quota quantity.
I could argue with that statement, but what I should like to know is the situation in respect of the surplus milk from the fluid shipper on which he receives a subsidy. Is he supposed to pay this too? I would hope not. It says here that shippers are not eligible if any portion of their deliveries is used for fluid purposes. At the bottom of the page the report continues:
The quotas will be determined on an annual amount but will be allocated on a monthly basis related to the average percentage of manufacturing milk and cream delivered each month. Should payments under the monthly quota not reach the annual quota allocated to a producer, there will be a reconciliation at the end of the year.
That part is fair enough but the question which I should like to ask is this: Can a quota be increased? This would not seem to be the case. If one cannot increase the quota, then I do not see how we can bring a substandard unit up to a point where it is a paying unit, or whatever the terminology is that the government uses in respect of such a unit. Farmers are always being advised to work this up.
To sum up, Mr. Chairman, I should like to say that this is a discriminatory policy. I shall not presume to tell the government how much money they do have to spend in subsidizing dairies, but I do say that one group of dairymen should not be harmed. This policy most certainly does harm one group of dairymen. I might add that I hope this year the machinery for making the payments will function so that we do not get into the situation we had last year when payments in some cases were made months late. I know that the reason this happened has been explained; but the point is that it did happen and we hope that it will not happen again.
I urge the minister to have a look at the discriminatory features of this dairy policy before we lose more of our top flight dairymen, who will never be replaced. I say that

there is no continuity to the dairy policy year after year. What is right in respect of the dairy policy this year seems to be wrong in the next year. No one dares follow the advice of the government to expand into an economic unit, because the policy does not allow for any expansion.
[DOT] (10:20 p.m.)
I hope the minister will consider this very important and pertinent fact.

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