CWB Directors Knew Assets Bought With Farmers’ Money Would Become Crown Property: Former CWB Director

Guest editorial by Henry Vos, a former Canadian Wheat Board director from Alberta.

Editor’s note: This week the Friends of the Canadian Wheat Board, a group that includes some former CWB directors, applied to have the Supreme Court hear their appeal to move ahead with a class action lawsuit against the federal government. The $17 billion claim seeks financial compensation for losses the group says were incurred as a result of the government’s decision to end the CWB’s single desk monopoly.

It is hard to fathom that just over two years ago Western Canadian farmers faced the prospect of jail time if they sold their wheat or export barley without permission from Canadian Wheat Board. A memory that is probably still fairly vivid for people like Jim Chatenay —  during his time in prison, fellow prisoners including some of the Hells Angels thought it was rather funny that a farmer was in prison for selling his own wheat. They did not know wheat was a controlled substance.

The Conservative government, from their first election into power, was clear of its intentions to make the Canadian Wheat Board voluntary. On August 1st, 2012 this occurred with the voluntary, and newly-named CWB, allowing freedom for farmers to market their wheat and barley to whomever they chose.

Part of the legislation change for the new CWB mandated its privatization by 2017. In addition the government would pay some $350 million to cover transition costs. It would not have been fair to make farmers pay for restructuring costs such as severances, pension liabilities and termination of contracts costs, etc.

The former Canadian Wheat Board and the new CWB are both agencies created by the crown — owned by the crown and upon termination, an asset or liability of the crown. This opinion was clearly defined in the files of the Board of Directors (BOD) by both internal legal counsel and by opinion from external counsel.

I resigned when it became clear the majority of that BOD would continue to waste farmers money attempting to prove it was above and superior to the Government of Canada regarding federal legislation and who was making decisions for the best interest of the country. The Supreme Court has also been clear.

CWB Marquis (source: CWB)

The first of CWB’s two laker ships — CWB Marquis — is on its way to Thunder Bay from China (source: CWB)

The government has also been clear with respect to the transformation of the CWB into a private entity. It has stated it wants three elements; enhanced competition in the western grain industry, greater capacity in Canada, and farmer ownership in the new entity.

To meet these ends the new CWB has laid out a clear plan. The investment in new state of the art facilities and the stated intentions of looking at new opportunities is clearly satisfying the role of enhancing competition.

Negotiations looking for a “well-capitalized strategic partner” are underway and will fulfill the second element of greater Canadian capacity. Comments suggest they are well down this path.

CWB has detailed a plan where farmers will get equity in the organization. The plan provides patronage, where the more business farmers do the greater their equity share will be. Obviously each farmer has the freedom to make the choice related to this offer on their farm. The proportion of farmer ownership of this new entity will depend upon the patronage of farmers and the size of the final entity. This farmer ownership satisfies the final pillars moving forward.

I am particularly impressed to see the recent NDP statements regarding three conditions for privatization very much in line with what is occurring. As a farmer, I have to admit their party has come a long way in recognizing farmer’s freedom.

We need to all move on. This change was about creating more wealth for Canada, the Canadian grain industry and especially farmers. It was about creating a bigger pie for us to all share. There is no question it’s doing that. Other than rail transportation, the last two years has seen more investment by farmers and companies in the Canadian Grain industry than any previous time in history.

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