Minister Uses Checkoff To Punish Opposition

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This arbitrary decision by the minister will have national and even international consequences on the cattle industry.

Alberta Agriculture Minister George Groeneveld has sent a clear message to livestock producers in this province – “It’s my way or the highway.”

In an unprecedented move, and without a producer plebiscite, he has introduced legislation to turn the compulsory Alberta Beef Producers (ABP) and other groups’ non-refundable checkoff into a refundable levy. This was after the minister on two occasions told this editor that the future of the cattle checkoff was in the hands of cattle producers and not him. It is now clear those hands belonged to his cattle producer political allies, the Beef Industry Alliance (BIA), and not the vast majority of cattle producers represented by the ABP.

The minister said his decision was to give “choice” to producers and was in line with the “choice” position the Alberta government maintains on the Canadian Wheat Board. Sorry Mr. Minister, no one believes you, offering choice never seemed to be a concern before unless it involved a plebiscite. This looks more like desperate grasping for an excuse.

The minister said his decision was also to deal with governance problems in the Alberta cattle industry. That may be wishful thinking. In the fractious world of Alberta cattle producer politics, “who governs” is a blood sport. Sectors of the industry are polarized by money and power issues and the ever-present tension between primary cow-calf producers and the powerful cattle feeders. This decision all but guarantees further power struggles as the minister is perceived to be favouring one producer group over another.

In a shameful attempt to legitimize this obvious attack on the ABP, he also eliminated the non-refundable checkoffs for Alberta Pork, Alberta Lamb Producers and the Potato Growers of Alberta. This would have come as a complete surprise to those groups who had deemed themselves to be on friendly terms with the minister. Ironically, the pork and lamb groups were even loyal supporters of the minister’s much-vaunted Livestock and Meat Strategy. It would seem those groups were caught in the crossfire between the minister and the ABP.

This will probably see the demise of Alberta Lamb Producers as a viable organization, being they could barely survive on the limited funds from their non-refundable checkoff.

No doubt the minister will trot out data that shows that the existing non-refundable boards and commissions have a very low refund level. Sorry, but a dime a bushel checkoff does not compare to three bucks a head. Besides, most of the other refundable groups in Alberta are not faced with multimillion dollar trade challenges and national and international marketing programs.

This arbitrary decision by the minister will have national and even international consequences on the cattle industry. The math is simple. Alberta, with the largest cattle industry in the country, is the main funding source for such groups as the Canadian Cattlemen’s Association. Alberta money also supports myriad cattle and beef industry promotions, animal welfare, lobbying and research efforts and organizations. All of that cash came from the ABP non-refundable checkoff. All of that good work will now be in jeopardy.

PAYING FOR TRADE CHALLENGES

A huge concern is that if the cattle industry is once again faced with an American trade challenge, the millions needed to fight that will not be available with a diminished ABP.

In the minister’s announcement no mention was made of the national cattle checkoff. This is a mandatory non-refundable national agreement to which Alberta is a signatory. It requires Alberta and the other provinces to submit one dollar in nonrefundable checkoff per head to fund groups like the Beef Information Centre, the Canada Beef Export Federation and the national cattle research fund. At present the national checkoff is collected by the ABP through its non-refundable provincial checkoff process. If the Alberta government does not agree to honour the non-refundable national cattle checkoff, it could see a reduction of millions in support to beef promotion and research organizations in Canada and in export marketing programs.

It would seem that the minister in his quest to rein in the ABP may have opened a whole new can of problems.

This decision also puts Canadian beef exports at a disadvantage. At the international level our competitors, the U. S., Australia, New Zealand are all well-supported by large non-refundable cattle checkoffs. This decision may even see the implementation of the compulsory levy on beef imports into Canada delayed.

This is a clear victory for the BIA, but if they think all those big future checkoff refunds will be redirected to their bank accounts instead of to the ABP, they need to be reminded of human nature. I expect that on the whole checkoff refunds will be viewed like tax refunds by producers and will be spent on some personal pleasures rather than being sent to some other producer lobby group. Perhaps the newly enriched BIA groups should now practice what they preach and offer their members the opportunity to request refunds on their annual fees if their organizations are not performing.

The expectation is that those opposed to the ABP will want checkoff refunds as a matter of principle. Cattle dealers and feedlot operators who live and die on narrow margins will also see checkoff refunds as a way to stem losses or increase margins. Who could blame them – if a $2,000 checkoff refund is the difference between profit and loss, that decision is easy.

I expect that there may also be a hidden agenda to the minister’s decision. His baby, the Alberta Livestock and Meat Agency (ALMA), is at present being funded by government grants. The time will come when that agency will have to stand on its own, what better way to fund ALMA than through a checkoff on livestock transactions? Heck it might even have to become a non-refundable checkoff like its Australian model. One might scoff at such connivance, but remember – what the minister takes away by law he can force back by law. You read it here first.

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