ALDOBA

In a surprise announcement, Alberta Agriculture Minister George Groeneveld says he will introduce legislation to end non-refundable commodity checkoffs in Alberta.

This move affects only four organizations, Alberta Beef Producers, Alberta Pork, Alberta Lamb Producers and the Potato Growers of Alberta. Supply managed poultry and dairy boards are not affected. All other commodity groups with mandated producer levies now have refundable checkoffs.

In announcing the legislation, to be known as Bill 43, Groeneveld said, “It is important to have consistent legislation. This ensures producers all have the same fundamental right to choose how their hard-earned money is spent. If they feel their organization has not met their needs or provided value, they can ask for a refund. It is all about choice.”

Besides the Alberta Beef Producers, the other affected commodity groups all expressed their disappointment in the Minister’s decision to eliminate their nonrefundable checkoff without a plebiscite (see sidebar).

The Beef Industry Alliance (BIA), a consortium of the Alberta Cattle Feeders Association, the Beef Industry Initiative, Western Stock Growers Association and the Feeders Association of Alberta, said that they were in favour of the changes. “This legislative change represents choice for producers, accountability for the industry, and an exciting new direction forward in which all members of the beef value chain will be represented in the industry governance system,” said BIA Chairman Russ Pickett.

The BIA has lobbied for the changes to the cattle checkoff for some time, saying that since BSE, cattle producers have been forced by legislation to pay over $70 million in checkoff levies to ABP with little to show for their money. Pickett said, “A refundable checkoff is an enduring plebiscite that will mean that organizations will have to earn producers’ support every day. This is an important step to repair some of the fractures that have developed in our industry.

“We will be contacting ABP in the coming days to discuss how we can work together to implement these changes and improve the beef industry in Alberta for all.”

That contact may be easier said than done. The ABP in response to the decision said, “This action will aggravate the divisions that already exist within the cattle industry. The imposition of a refundable checkoff shifts control from a democratic system where each producer has an equal vote to a system where very large producers will have more influence as a result of controlling a greater amount of checkoff dollars.”

ABP chairman Rick Burton said, “I told the Minister that we should have a dialogue with BIA on this matter before a decision was made, but it seems we could never get anything meaningful going. I think the BIA felt that this was a done deal some time ago.”

The ABP had requested that a plebiscite be conducted to ascertain the democratic will of cattle producers. Some of the other affected groups have also made a similar request.

However the minister by his action seems to have ruled out that possibility. The only other avenue is to have the proposed legislation withdrawn or amended. ABP Chairman Burton said, “We are launching a media campaign to encourage cattle producers to contact their MLAs to demand that they be given the right to vote on this decision.”

While Alberta Beef Producers is the largest organization affected by the province’s plan to make commodity checkoffs refundable, pork, lamb and potato groups are expressing similar concerns.

However others, including the Alberta Cattle Feeders Association, say they are pleased with the proposed change.

Late last month, Agriculture Minister George Groeneveld announced introduction of Bill 43, which eliminates non-refundable checkoffs for non-supply managed commodity groups in Alberta.

“We’re quite concerned about this,” said Edzo Kok, executive director of the Potato Growers Association of Alberta (PGA). “It will have an impact on PGA and the amount of levies it collects. If any member asks for a refund, it will affect the finances we have for the organization.”

Members of the Potato Growers of Alberta have written letters to MLAs in potato growing regions, and have met with members of the government. “Unfortunately, our concerns seem to be falling on deaf ears,” said Kok by phone from his office in Taber.

Kok said PGA membership did not ask for this change. “It’s coming from a different group than the potato growers. We will continue to lobby all elected officials to withdraw this legislation,” he said.

He added that no potato producer has said that they’re in favour of what the Alberta government has put forward. “We weren’t consulted on this at all. We were advised two weeks ago by the deputy minister that it was in the pipeline. At that point, it was no longer up for debate. The decision had been made,” Kok said.

The Alberta Lamb Producers, which is also affected by the change, is disappointed. “We’re already looking at what strategies we can use to get on with business,” said Norine Moore, chair of the Alberta Lamb Producers, from her home in Stavely.

The Alberta Lamb Producers have only known about the legislation for about three weeks. Moore said the change to the checkoffs only comes into effect at the end of the year, which is September 2010 for the lamb producers.

“Our regulations for how the checkoff will work will need to be in place by January 2010,” said Moore. She said that the organization has not had a lot of time to figure out how the changes will affect them. “We have no way of projecting what percentage of producers will ask for a refund,” she said.

“We’re disappointed in the way this was handled,” said Paul Hodgman, executive director of Alberta Pork. “Our position was that the membership should determine where this goes. This has been imposed on us so it will have implications on what we’re doing. We have to figure out how to source founds from outside organizations,” he said. “We’re going to work with the system as best as we can.”

Rick Paskal of Picture Butte, chairman of the National Cattle Feeders Association and board member of the Alberta Cattle Feeders Association, says Bill 43 gives producers the flexibility to use their checkoffs to endorse or reject certain policies coming from Alberta Beef Producers (ABP).

The political structure of the ABP has been a long-standing concern for cattle feeders. Although the previous governance structure and mandatory checkoff were supported by most producers as a democratic system, it was to the contrary, said Paskal. There are 28,000 cow-calf producers in Alberta and 1,000 feedlot operators, both with different business agendas, he said.

“The cow-calf producer wants to sell high, which I totally respect, but my job is to buy as low as I can. How can one entity represent both interests?”

He says the feedlot operators contributed as much financially as the cow-calf producers, but their political representation was only 3.5 per cent on an individual basis. This means that many of the policies being generated were not representative of the entire industry’s interests.

“We, through the Beef Industry Alliance, lobbied the government very hard to recognize this imbalance,” says Paskal. “The Alberta government responded with Bill 43.”

“If Alberta Beef Producers introduces good policies that are reflective of the entire industry, than yes, I will absolutely keep my dollars in there,” says Paskal. “But if the policies are not reflective, then myself and others will probably ask for a refund.”

He credits the Alberta Beef Producers and Canadian Cattlemen’s Association with having some of the best staff working within those organizations, but says the industry will not move forward until the policies and governance are reflective of the whole industry.

“There’s now an arena for debate,” says Paskal. “The structure before made people divisive, but now everyone is going to have sit around table and look at each other, and come up with policies that work for everyone.”