Payments that were supposed to help livestock producers have instead put a number of farms at risk, says the chairman of Alberta Pork.
Shortfalls in payments under the Alberta Farm Recovery Program are serious enough that there could be a shortage of hogs for processing, said Herman Simons, who farms north of Tees.
A number of beef and hog producers who were expecting a second round of payments through the provincial program are instead getting bills, Simons said.
Others are getting 40 per cent or less of what they expected in the second disbursement under the AFRP II program, which was announced last June.
Funded by Alberta Agriculture and Rural Development, the program has been administered through Agriculture Financial Services Corp., an arm of the provincial government.
Of the 25,000 or so beef and swine farmers who received initial payments, 163 have been asked to return money because they were overpaid, said Simons.
That includes about 60 of the province’s largest hog farmers, who are being asked to return a total of $6.1 million, he said.
“The majority of that, it seems to us, was larger producers, so it’s going to have a major impact,” said Simons.
The result, including a further loss of credibility with banks, means more Alberta hog farms could go under when the industry is already down 25 per cent from where it was two years ago, he said.
Hog producers tried to warn the province in November that trouble was brewing with the plan, said Simons.
He said he’s scheduled to meet with Agriculture Minister George Groeneveld on Monday, but doesn’t expect an immediate solution.
Wayne McDonald, senior manager of business risk management with AFSC, said about 5,000 producers applied for AFRP II support who had not previously submitted information about their operations under other programs. Still others provided revised information.
The result was more money being paid out than had been estimated.
About $210 million of the $300 million earmarked for AFRP II went out in the first payment.
A second problem, said McDonald, occurred when AFSC made payments on a priority basis to several hundred producers who were in urgent need of money.
These were incorrectly characterized as exempted income under the Canadian Agricultural Income Stabilization program, resulting in overpayments under that federal-provincial program.
These must now be repaid, said McDonald.
In some cases, money has been deducted from the second round of AFRP II payments or payments under the AgriStability program, which replaced CAIS.
McDonald said affected producers have two years to repay money that is still owing, with no interest charges.
They can also convert that obligation into an AFSC loan that will require no interest for two years and a discounted rate of interest thereafter.
“The government did look at this thing and did try to respond as quickly as possible in a favourable way to try to take away that initial hurt,” said McDonald.
Warren Brower, who farms in Southern Alberta, said cow-calf producers across Alberta are still furious with the province for what he described as the latest in 10 years of fiascoes.
He said he’s still paying for the assistance he got nearly seven years ago after the BSE scare.
“It was originally a CAIS payment, and then they changed the rules and they said now you’ve got to pay it all back.”
Brower said cattle feeders have benefited from the province’s programs, but people like him, who produce the calves they feed, are over a barrel again and thoroughly fed up.
Cow-calf producers are circulating a petition advising the minister that the province has not lived up to its promises.
“To me, I think people are mad enough to kick this government out if they don’t start listening. Frankly, they’ve pissed on us for the last 10 years.”
bkossowan@www.reddeeradvocate.com and hrichards@www.reddeeradvocate.com