MPs have given speedy approval to legislation to double federal guarantees for farm loans to $500,000 and improve access to credit for co-operatives.

The bill just needs Senate approval and royal assent to become law and that should happen before Parliament breaks for the summer recess in late June.

Pierre Lemieux, the parliamentary secretary for agriculture, said the bill extends federal guarantees to new farmers which should help more of them get started. “We would like farmers to have the opportunity of these new measures before the summer and there is no need to make them wait until after the summer.”

Liberal Farm Critic Wayne Easter supported quick passage of the bill so that the funds can be made available as soon as it can be implemented after passage.

Greg Meredith, assistant deputy agriculture minister responsible for the Farm Financial Programs Branch told the Commons agriculture committee May 26 that the guarantee should be available as soon as the bill receives royal assent because there are no regulatory changes connected to the legislation.

He said that up to $1 billion is expected to be taken up by farmers and co-operatives under the bill. The department plans to promote the new program to make sure young farmers are aware of it.

The program will be delivered through banks and credit unions, he said. “The criteria for a young or beginning farmer are the same, in terms of loan criteria, it’s just for a young farmer you get up to 90 per cent rather than the 80 per cent that’s available to an established farmer.”

Anyone who has been farming for up to six years is eligible under the new farmer provisions, he added. An aspiring farmer who can show a workable business plan to a lending institution is also eligible. The program covers capital, land, equipment and also shares in a company for succession from one family generation to another.

Meredith said there are about 1,200 agriculture coops in Canada. Most of them are small operations and have a significant challenge “in accessing expansion capital and in accessing moneys on the scale that a larger equity-based company could do. I think it’s probably fair to say that this is going to be more beneficial for smaller co-ops because the limit is $3 million. A very large firm would probably have established operating lines and established access to capital markets that a small co-op wouldn’t benefit from.”