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Reassessing Farm Income Assurance

Richard Bullock, elected president in 1977, noted in his 1978 Executive Report that the B.C.F.G.A. was waiting apprehensively for two reports: one from Dr. Hudson on the Farm Income Assurance program, and the other from the Select Standing Committee on Agriculture on the cost of tree fruit growing in British Columbia. Dr. Hudson's assessment of Farm Income Assurance was not a complete surprise when it was released in late 1977. However, there was a great outcry when he proposed making major changes to F.I.A. because it "distorted the market system." Pat Hibbert, President of the B.C. Federation of Agriculture, stated:

Claude Hudson . . . is a firm subscriber to the doctrine that holds that the marketplace is never wrong and the present Minister of Agriculture is making no bones about the fact that he agrees with him. . . . This would seem to indicate the impending end of the Income Assurance Program and a return to the system based upon the assumption that a "fair" return for any farm group is whatever the hungriest applicant is willing to take.

In January, 1978, the Peach Bowl Convention Centre in Penticton was crowded not only with tree fruit farmers, but also with cattlemen and vegetable growers, who had come to listen to the Minister of Agriculture, Jim Hewitt, reveal his modifications to the Hudson proposals. The farmers did not like government's proposals to cut back the scale of F.I.A.

The B.C.F.G.A., as part of the B.C. Federation of Agriculture, fought the government's inclination to eliminate F.I.A. Hewitt assured farmers that Farm Income Assurance had become an ongoing program, entrenched in government agricultural policy. Even so, there were changes. The program was no longer open-ended. A limit of $15,000 was placed upon individual indemnities. This resulted in some large farms being subdivided in order to make smaller units which would qualify for F.I.A. The intention was to encourage the family farm and to prevent excessive payments to large corporations. The new F.I.A. made book-keeping much more complicated for B.C.F.G.A. members and staff. From the end of 1978 onwards, F.I.A. coverage had to be renegotiated retroactively every year. Lengthy negotiations were needed to update cost models, and these could be achieved only after all returns from sales had been received. Therefore, there was sometimes as much as a two-year delay in payments. According to the B.C.F.G.A. Executive, the new F.I.A. led to "the imposition of quantity limits on family farm units and even more to dollar limits which become more restrictive every year.

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