Vol. 150, No. 3 — February 10, 2016
SI/2016-3 February 10, 2016
AGRICULTURAL GROWTH ACT
Order Fixing February 5, 2016 as the Day on which Certain Provisions of the Act Come into Force
P.C. 2016-32 January 29, 2016
His Excellency the Governor General in Council, on the recommendation of the Minister of Agriculture and Agri-Food, pursuant to subsection 154(8) of the Agricultural Growth Act, chapter 2 of the Statutes of Canada, 2015, fixes February 5, 2016 as the day on which subsections 120(2) and (5), 124(1), 127(2) and 128(3) and (7), section 130, subsections 132(3) and (4) and 133(2) and 139 and 140 of that Act come into force.
(This note is not part of the Order.)
This Order, pursuant to section 154 of the Agricultural Growth Act (the Act), chapter 2 of the Statutes of Canada, 2015, fixes the day on which certain sections of the Act will come into force.
The purpose of this Order is to make improvements to the Advance Payments Program by bringing into force the elements of the Agricultural Growth Act which amend the Agricultural Marketing Programs Act. Together these amendments will make the Advance Payments Program more accessible and flexible, as well as streamline administration.
The Agricultural Marketing Programs Act was enacted in 1997 to establish programs for the marketing of agricultural products. This includes the Advance Payments Program, which provides short-term cash advances of up to $400,000 to producers, with the federal government covering the interest on the first $100,000. The objectives of the program are to improve cash flow and provide producers with the financial leeway to seek the best prices for their agricultural products.
A legislative review of the Agricultural Marketing Programs Act was completed in 2012. This review, which included consultations with stakeholders, assessed the relevance, impact, and delivery of the Advance Payments Program. The review found that the program continues to be relevant and well-liked by farmers. It also identified a number of areas where the program could be improved. These included a need to broaden program access, increase program flexibility, and improve and streamline program delivery.
These recommendations resulted in a number of amendments to the Agricultural Marketing Programs Act, which were included in the Agricultural Growth Act. The Agricultural Growth Act received royal assent on February 25, 2015.
On February 27, 2015, more than half of these amendments were brought into force. The changes were implemented to the Advance Payments Program for the 2015 program year. These changes included
- — The ability for producers to receive an advance on all of their commodities through one application with a single administrator;
- — The ability for subsidiary companies and producers with off-farm income to participate in the program; and
- — The ability for producers to repay an advance without proof of sale in certain circumstances.
The remainder of the amendments to the Agricultural Marketing Programs Act resulting from the Agricultural Growth Act could not be brought into force without first making changes to the Agricultural Marketing Programs Regulations.
Federal officials have worked, in consultation with the industry and third-party administrators, to draft the necessary regulatory amendments. They reflect the feedback received during the legislative and program review and are consistent with the legislative changes resulting from the Agricultural Growth Act. The regulatory amendments were published in Part I of the Canada Gazette on July 11, 2015, and will come into force at the same time as the provisions of the Agricultural Growth Act that are brought into force by this Order.
With the coming into force of the remaining amendments to the Agricultural Marketing Programs Act and the amendments to the Agricultural Marketing Programs Regulations, Agriculture and Agri-Food Canada and third-party administrators will implement the resulting changes to the Advance Payments Program. These changes will include
- — Expanding the types of agricultural products eligible under the program, including specific classes of breeding animals intended for market;
- — Increasing the classes of security that can be used to obtain an advance under the program; and
- — Clarify the rules under which producers are considered to be related for the purposes of applying the $400,000 and $100,000 limits.
With the implementation of these changes, producers and third-party administrators will be able to benefit from the full complement of changes to the Advance Payments Program that were made under the Agricultural Growth Act.
This means administrators and program participants will benefit from broader access to advances, increased flexibility in how they receive, secure and repay these advances, and more consistent and streamlined delivery. By improving access to advances under the program, it is expected that producers will have increased capacity to both deal with cash flow pressures and seek out better marketing opportunities for their commodities.
Any additional costs to the Government of Canada as a result of increasing access to the program have been offset by other cost-saving measures included in the legislative changes (e.g. improving the approach used to ensure due diligence by administrators in managing advances) and, therefore, the changes are expected to be cost neutral.
The amendments to the Agricultural Marketing Programs Act, resulting from the Agricultural Growth Act, were developed in consultation with stakeholders, including producers, farm organizations, third-party administrators and financial institutions.
Business Risk Management Program Development Directorate
Agriculture and Agri-Food Canada