More $$ for agricultural climate programs, school food policy, and renewed funding for superclusters: the federal budget through an agricultural lens

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The federal government is planning to boost funding for environmental programs through Agriculture and Agri-Food Canada in the 2022 budget introduced on April 7.

While the budget contains projections of a $52.8 billion deficit and national debt totalling $1.2 trillion at the end of 2022-23, the $452.3 billion spending plan and Finance Minister Chrystia Freeland’s speech to the House of Commons Thursday afternoon focused on themes around housing, affordability, and climate.

Here’s a preliminary list of some of the agriculture-related proposals in the budget:

Climate programs

  • A further $329.4 million over six years, starting in 2022-23, to triple the size of the Agricultural Clean Technology Program. (This program has previously included funds to help farmers switch to lower emissions grain dryers.) This funding was originally announced, although without details, as part of the government’s emissions reduction plan unveiled in late March.
  • $469.5 million over six years, starting in 2022-23, for the On-Farm Climate Action Fund. This money was also referred to in the emissions reduction plan tabled March 29.
  • $150 million for “a resilient agricultural landscape program to support carbon sequestration, adaptation, and address other environmental co-benefits,” to be discussed with provinces and territories.
  • $100 million over six years, starting in 2022-23, to the federal granting councils to support post-secondary research “in developing technologies and crop varieties that will allow for net-zero emission agriculture.”
  • $780 million over five years, starting in 2022-23, to Environment and Climate Change Canada to expand the Nature Smart Climate Solutions Fund, which supports projects that conserve, restore and enhance wetlands, peatlands, and grasslands to capture and store carbon.
  • Multiple other programs and tax credits regarding carbon capture and net-zero technologies.

Tax changes

  • The government is launching consultations around the implementation of Bill C-208, Conservative MP Larry Maguire’s private member’s bill that received Royal Assent in June 2021. The bill was designed to remove tax barriers for intergenerational transfers of small businesses, including farms, among family members. The government says it is concerned the changes “may unintentionally permit surplus stripping without requiring that a genuine intergenerational business transfer takes place.” A bill could potentially be tabled in the fall of 2022 after the consultation process concludes.
  • The budget proposes to phase out access to the small business tax rate (from 9% to the general 15% rate) when a corporation’s taxable capital reaches $50 million, rather than at $15 million.
  • While no details were given, the government said it is committed to examining a new minimum tax regime, which will “go further towards ensuring that all wealthy Canadians pay their fair share of tax.” An update to rules around the Alternative Minimum Tax is to be proposed in the 2022 fall economic and fiscal update.

Temporary Foreign Workers and labour

  • $29.3 million to create a Trusted Employer model and cut red tape for accessing the Temporary Foreign Worker Program.
  • $48.2 million to create a new streamlined foreign worker program for agricultural and fish processing employers.
  • The budget proposes the creation of a Labour Mobility Deduction, which would provide tax recognition on up to $4,000 per year in eligible travel and temporary relocation expenses to eligible tradespersons and apprentices.

School Food Policy

  • Minister of Agriculture and Agri-Food and the Minister of Families, Children and Social Development are to work with provinces, territories, municipalities, Indigenous partners, and stakeholders over the next year to develop a National School Food Policy.

Transportation and supply chains

  • $450 million over five years, starting in 2022-23, to support supply chain projects through the National Trade Corridors Fund (in addition to the $4.2 billion that has been allocated to the fund since 2017.) The transport minister will also be renaming the fund to reflect the government’s focus on supply chains.
  • $136.3 million over five years, starting in 2022-23, to develop “industry-driven solutions to use data to make our supply chains more efficient, building on the success of initiatives like the West Coast Supply Chain Visibility Program.”
  • $16.9 million over five years, starting in 2022-23, “to continue making Canada’s supply chains more competitive by cutting needless red tape, including working to ensure that regulations across various modes of cargo transportation (e.g., ship, rail) work effectively together.”
  • Related, seemingly very little, if any, reference to trade promotion.

“Supercluster” funding

  • The budget proposes $750 million over six years, starting in 2022-23, to fund the “Global Innovation Clusters,” which includes Protein Industries Canada. The funds will be allocated between the five clusters on a competitive basis. The superclusters were originally announced in the 2017 budget, with a total $950 million funding commitment at the time. The five agencies asked for $1.5 billion heading into the ’22 budget, according to reporting by The Logic and The Globe and Mail.

PEI potato sector

  • The budget includes $16 million over two years, on a cash basis, starting in 2022-23 for the Atlantic Canada Opportunities Agency “to support long-term investments and assist in stabilizing the Prince Edward Island potato sector and supply chain.”
  • $12 million over two years, starting in 2022-23, for the Canadian Food Inspection Agency to expedite soil testing “to accelerate the investigation into the latest detection of potato wart to help prevent its spread and to allow for full trade to resume with the United States as soon as possible.”

NAFTA compensation for supply-managed sectors

  • The government says it will announce compensation for the supply-managed sectors affected by concessions made in the new North American trade deal in the 2022 fall economic and fiscal update. (Previous announcements were for Canada-EU and Pacific trade deals.)

Renewing the Canadian Agricultural Partnership

  • The budget includes several paragraphs summarizing the Canadian Agricultural Partnership and the federal government’s commitment to working with provincial and territorial governments “over the coming year to renew the programs under the next agricultural policy framework that begins in 2023.”

More to come. And make sure to join us for a live RealAg Politics federal budget discussion on Friday at 2pm E, right here.

 

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