Mr. Chairman, my first words in speaking on the agricultural estimates are to express my appreciation to the former minister of agriculture for the important legislation that he was responsible for implementing during his term as minister of agriculture. I also wish to compliment the present Minister of Agriculture on his appointment to this important post. It was my pleasure a few years ago to attend a conference with the hon. gentleman and at that time I was intrigued by his knowledge and understanding of the problems facing farmers. I am particularly pleased that he now occupies a position which will enable him to implement some of the ideas he gained from that conference.
My remarks at this time will pertain to the agricultural conditions in western Canada with which I am quite familiar and I hope hon. members will not think that I am being sectional in my outlook because we have hon. members from other areas in Canada who are well qualified to speak of the conditions in the regions they represent. While reference has previously been made to measures taken by this government to reduce the disparity between costs of production and prices received by farmers for their products, I think I could enumerate a few of them again without being accused of boastfulness. For instance, there are the increase in compensation to livestock producers for cattle slaughtered in the control of contagious diseases; cash advances on farm-stored grain free of interest; the amendments to the Veterans' Land Act to enable veterans to obtain increased loans; the greatly improved Farm Credit Act; the long-awaited amendments to the Prairie Farm Assistance Act, which have removed many of the inequities in the making of payments and broadened the coverage; the acreage payments to western farmers amounting to over $82 million; and the provision of funds through the Colombo plan on long terms to assist India and Ceylon to purchase wheat and flour.
I feel I should also make reference to the recent sale of wheat to China and the opening of an office in Tokyo, Japan, whose main function it will be to promote the sale of grain; and the announcement by the Prime Minister that jurisdiction over the Canadian
wheat board and the board of grain commissioners be transferred from the Department of Trade and Commerce to the Department of Agriculture. I feel certain that this action on the part of the government will prove to be of inestimable value to grain producers in the coming years owing to the fact that the marketing of grain is so closely associated with the Department of Agriculture.
I have referred to only a few of the items of legislation that have been enacted by this government to assist agriculture. I am certain that western farmers are encouraged by the action of the government to implement a comprehensive agricultural policy that will enable farmers to help themselves. However, farmers are still confronted with the cost-price squeeze. This particular kind of squeeze has come about because the farm industry's costs are rising steadily and the prices which farmers receive for their products are still falling; hence the squeeze. As hon. members know, I have not made many speeches in this chamber and I am only prompted to do so now owing to the inequitable position in which agriculture finds itself. It is reasonable to expect that the financial position of farmers in the federal constituency of Dauphin is similar to that of farmers throughout the prairie provinces.
The present position of agriculture is not one that has developed since this government took office; rather it is the result of steadily increasing costs of production and the low prices for agriculture produce received by farmers since world war II. The problem had its beginning during world war II partly as a result of the British wheat agreement entered into by the Liberal government. A paragraph from the Searle Grain News of May 7, 1958, explains the situation as follows:
The unwinding of the wheat marketing problem in the future is going to require not only the patience, courage and understanding of all concerned, whatever their personal views, but also a willingness on the part of the Canadian taxpayer to accept, if necessary, any temporary financial burden that may arise. Such a burden, since the early days of world war II, has been shouldered by the western wheat grower, for the benefit of the Canadian people at large. Before long, perhaps, it may be necessary for the population as a whole to assume some part of it.
Another problem closely associated with agriculture is that of unemployment which is so frequently mentioned in this chamber. It seems to me that when we are looking for markets for the products of our factories to help the employment situation, we are overlooking our most important market here at home. By increasing the purchasing power of our farmers, we would create employment all
along the line from the mines to the railroads to the factories back to the transportation systems and offices, et cetera.
While farmers are usually regarded as producers, they are also the largest purchasers of goods of all kinds of any segment of our society. As further evidence of the recognition of farmers as an important market, I will quote from a submission made to the government on June 25, 1958 by a delegation of unemployed from Ontario and Quebec. They suggested an imaginative trade policy for moving wheat that would include long term credits to enable such countries as India, Asia and Africa to buy Canadian grain. In their brief they went on to say:
Call it subsidization if you will, but at least it is priming the most necessary pump-our farm economy. Restore purchasing power to the farmers, and you have gone a long way toward restoring it across the nation.
Let me refer to a statement made by the Prime Minister as quoted on page 42 , of Hansard:
Those of us from western Canada know something of what the result was when the provinces of Saskatchewan and Alberta were devastated when drought hit us to such an extent that there was no purchasing power among the farmers, that there were no jobs in eastern Canada.
The farmer is sometimes underestimated in his value as a market for industrial products which find their way into his operation. According to the economics division of the Canada Department of Agriculture there are more than one million cars, trucks and tractors on Canadian farms and their annual expenses, excluding depreciation and financing, are more than $400 million. About 11,000 tons of pig iron go annually into the making of agricultural implements, and the implement manufacturing industry gives work to more than 10,000 employees, with a payroll of over $42 million. Farmers use $20 million worth of electric power annually and pay nearly $200 million for hired labour. They buy 900,000 tons of fertilizers valued at nearly $70 million, and they use over 600,000 tons of limestone. The cost of pest control each year amounts to $20 million. Farm operating expenditures and depreciation total $1.9 billion annually.
Moreover, an estimated one eighth of the total revenue from motor transport of commodities and about one fifth of the revenue from all carload freight involve agricultural products. The combined revenues total more than $225 million. Hundreds of millions of dollars are spent annually on the construction, maintenance and furnishing of half a million homes owned by farmers. With 17 per cent of the population living on farms, additional hundreds of millions are spent for clothing, recreation, health and education.
In 1958 there were over 9,000 establishments with more than a quarter of a million employees processing products of Canadian farm origin. The value of products from these establishments amounted to more than $4.5 billion, and the payroll of the employees was $763 million. While the number of farms declined from more than 700,000 to fewer than
600,000 between 1924 and 1958, this reduction was about equal to the increase in the number of employees processing or manufacturing products of farm origin. In addition to these, there are about 70,000 engaged in the food wholesaling and retailing.
I mention these statistics in order to indicate to hon. members the potential market we have in Canada if farmers have the purchasing power. I have had a large number of requests from farm organizations during the last few years for the government to take some positive action to reduce the disparity between costs of operation and prices received for agricultural produce. My own experience as a practical farmer indicates to me that these requests are fully justified. We frequently hear complaints about the costs of support for farm produce, and I would suggest to those who complain that the cost of supporting secondary industry in this country is high by protecting industry through tariffs. In a study of tariff costs made by a Yale economist for the Gordon commission on Canada's economic prospects, the cost of tariffs to Canadians was estimated at from $610 million to $735 million annually. When Canadians are willing to spend such a large amount to support industry, they should not complain about the small amount the government spends in assistance to agriculture.
As further evidence of the importance of government assistance to agriculture, I wish to quote at this time a statement by Prime Minister Macmillan of the United Kingdom, on June 21, 1960:
A system of price guarantees is not a subsidy to agriculture. It takes the place of tariffs by which manufacturing industry is helped by the government. British farming prosperity has been built up and will be sustained in the future by price guarantees. No country can be truly prosperous without a strong and healthy agricultural industry.
Let me repeat that there are many signs that the decline in western farm income has been a significant factor in causing the unemployment situation in the rest of Canada. I hope that this government will make whatever provisions are necessary to ensure that adequate returns are received by the farmers in the future in order to enable them to share in the general prosperity of Canada.
In conclusion, Mr. Chairman, I should like to make a very brief reference to the new system instituted last year in connection with the deficiency payments on hogs and eggs.
While we realize the difficulties confronting
the government under the offer to purchase method which created surpluses, the deficiency payment method has not provided the stability in western Canada that was expected. At intervals during the year the price would fall below the prescribed price, but owing to the higher price prevailing in eastern Canada the western producer would not qualify for deficiency payments. Now that the deficiency payment method has been in operation for over a year, I would recommend that the minister take a close look at the disparity in prices prevailing in western Canada with a view to working out a more equitable system in establishing floor prices for these products.
Topic: DEPARTMENT OP AGRICULTURE