Canada's NDP


July 7th, 2024

Agriculture Committee Report Proposes Ways to Drive Down Food Costs

A few weeks ago, the House of Commons Standing Committee on Agriculture and Agri-Food (AGRI) published a report titled A Call to Action: How Government and Industry Can Fight Back Against Food Price Volatility. The report is obviously a reaction to the astounding increase in food prices over the course of the past few years and propose ten significant recommendations following lots of witness testimony on how we can bring prices down. The report comes as many Canadians are justifiably reaching a peak of frustration with grocery giants, with many Canadians having participated (or potentially still participating) in boycotts of large chains like Loblaws. What are the recommendations, and would they really provide Canadians with relief at the register if implemented?

A few of the report recommendations would have an impact at the start of the food production cycle. The AGRI committee is recommending reducing the administrative burden of the Temporary Foreign Workers Program (TFW) and making the Recognized Employer Pilot program permanent. As TFWs are a large part of the food chain, the Committee believes that making it easier for Recognized Employers (those who have shown to be compliant with the rules of the TFW Program) will reduce costs for producers, in turn making food cheaper. Additionally, they want the increase staffing and inspections at the border for food imports to ensure they comply with and meet the same standards as Canadian products.

In addition, AGRI recommended passing Bill C-234 unamended. The bill, which provides farmers with a carbon pricing exemption for fuels for grain drying, has already been passed in the House of Commons with support of all parties, except that of the Liberals, but remains stuck in the House currently because of amendments made by the unelected Senate.

There are a number of smaller items that the Committee believes would be able to help lower grocery prices, including a review of front-of-package labelling regulations to “better balance its public health objectives with industry concerns over the cost of complying,” and also have the Government work with the food industry on better alternatives to plastic food packaging to both meet its pollution prevention policies while ensuring the food industry can ship food affordably. It also recommends reviewing the Nutrition North Program, designed to make food affordable in the far north, as well as some vague language surrounding engaging with the provinces and territories to discuss their Grocery Code of Conduct.

While its not entirely surprising that most of the Committee recommendations aren’t particularly controversial, there is one item, brought forward repeatedly by New Democrats over the last few years that was supported by the Committee broadly, including by Liberal MPs on the Committee. It states “the Committee recommends that the Government of Canada consider implementing policies to effectively tackle excessive net profits in monopolistic and oligopolistic sectors in the food supply chain, which are driving up food prices for consumers and input costs for farmers.” New Democrats have been arguing for a windfall tax on grocery giants since the inflation crisis began, but despite the recommendation from the Committee, including from Liberal members of the Committee, the government has not supported this idea.

The remaining recommendations are vitally important and matters that deserve more debate and scrutiny. They both relate to competition, or lack thereof, in the grocery industry. They involve a) making it more difficult for large chains to merge, creating less competition, and empowering the Competition Tribunal to “make an order dissolving a completed merger or prohibiting the merger from proceeding if the merger would result in excessive combined market share;” and b) identify and remove barriers to encourage further competition. They are recommendations that amount to modern trust busting, which would promote actual competition and lower prices.

Many of these are reasonable solutions to a food cost crisis that we likely wouldn’t be facing if not for the corporate greed of the small number of major players in Canada. If we are to tackle this issue in the long term, it’s frankly incumbent upon us to examine these recommendations more closely.