Why should governments top up crop insurance coverage in a year where there’s a widespread disaster when they wouldn’t likely have the same response if the problem was regional?
Amazingly, last week’s annual meeting of federal and provincial agriculture ministers concluded with a detailed program announcement for flooded Prairie farmland.
Rarely do governments act so quickly and decisively, but the flood aid still leaves a lot of troubling questions.
The $30 an acre in compensation applies to both unseeded land as well as cropland that’s been flooded – a much more equitable approach than only providing compensation for unseeded ground.
It will provide some significant money without completely upsetting the balance between flooded land and the crop insurance coverage on crops that have survived.
The assistance will be relatively easy to calculate and money will be able to flow quickly to compliment the regular Unseeded Acreage Payments and Establishment Benefits available through crop insurance.
Prairie-wide, the program will deliver about $450 million, with $360 million of that slated for Saskatchewan. There will always be some who say the assistance should have been greater. That’s the stance being taken by NDP Leader Dwain Lingenfelter, who calls it a slap in the face.
Lingenfelter’s comments do echo the sentiments of a core group of producers who seem to believe that government assistance should provide farmers with an ironclad guarantee that they can’t experience a loss. No other business has the safety net protection of crop producers, but some still expect more.
Officially, this new money is an AgriRecovery program with the money justified by saying it’s to rehabilitate the flooded land. In reality, it augments the existing crop insurance programming.
That leads to another question. Why should governments top up crop insurance coverage in a year where there’s a widespread disaster when they wouldn’t likely have the same response if the problem was regional?
Shouldn’t crop insurance be adequate to start with, providing protection to individual producers no matter how many are affected?
The Western Canadian Wheat Growers Association says the experience this spring shows that Saskatchewan Crop Insurance needs to be strengthened. The group notes that Manitoba producers have the option to purchase unseeded acreage coverage at higher levels, while in Alberta coverage ranges from $25 to $70 an acre depending upon whether certain inputs such as fertilizer have already been applied.
In Saskatchewan, the coverage
is a flat $50 an acre. With the deductible and the formula for seeding and insurance intensity, the payment typically comes to a lot less than $50.
Interesting, the federal-provincial flood assistance is targeted at only crop producers. Livestock producers with flooded pasture and hay are not included.
The livestock industry has been suffering with low market prices and large losses for years, but government assistance has been meagre.
There was a belated AgriRecovery response to last year’s drought in Alberta and northwestern Saskatchewan with per head payments now being made to producers in designated counties and rural municipalities.
The criteria used for picking the drought region are not transparent and producers in some other regions say they should have also qualified.
By comparison, the flood response on cropland is far more equitable and timely. Crop producers have more safety net protection than livestock producers to start with, but they’re also much more likely to command additional money.
Farm support continues to be highly political. In addition to need, the size and strength of the lobby effort plays a big role.
Kevin Hursh is a consulting agrologist and farmer based in
Saskatoon. He can be reached at [email protected]