AAFC to shed federal responsibility for co-operatives

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Canada’s federal agriculture department is poised to hand off its responsibility for policy and support relating to the co-operative sector.

Agriculture and Agri-Food Canada’s oversight of Canada’s Rural and Co-operatives Secretariat (RCS), which the department has held for over 30 years, is to be transferred to Industry Canada.

Further details weren’t yet available on the move, which was announced Monday in the government’s response to last September’s report from the special Commons committee on co-operatives.

"A review was conducted and it was decided to transfer (AAFC’s) co-operative policy and sector support functions to (Industry Canada)," the government said in its response Monday.

"This will ensure a single, consolidated, focal point in government to encourage and support development, innovation and growth in the co-operative sector."

The federal finance department, meanwhile, "will remain responsible for legislation and regulation of all federally incorporated credit union associations and insurance mutual companies," the government added.

The special Commons committee had recommended in its September report that the government "study the possibility of consolidating the responsibility for co-operatives under a suitable department, such as Industry Canada."

Canada’s two national co-operative associations, the Canadian Co-operative Association (CCA) and the Conseil canadien de la cooperation et de la mutualite (CCCM), noted Monday they have "strongly urged the government to make this move."

In a release Monday, CCCM president Marthe Hamelin hailed the government’s response, adding the CCCM and CCA "are looking to build a new relationship with the Canadian government."

The co-operative movement, Hamelin said, can work together with Industry Canada "to create an accurate portrait of the capitalization needs and opportunities of co-operatives, and possibly open the door to further actions in the not-too-distant future."

During its hearings, the committee said in its September report, "several" witnesses, including representatives from Quebec’s Coop federee — owner of meat packer Olymel, hardware and farm supply chain Unimat and fuel company Sonic — "emphasized that it was now inappropriate for (the RCS) to be under AAFC’s aegis since co-operatives no longer have a solely rural or agricultural purpose."

A century ago, "the country’s development actually went through the agri-food industry," Coop federee president Denis Richard told the committee in July. "The Fathers of Confederation felt that co-operatives were part of the agricultural industry. That was logical then.

"However, in 2012, issues related to energy co-operatives have little to do with the department of agriculture. The reality has changed along with the era."

"The big picture"

CCCM executive director Brigitte Gagne had further recommended in July that statistical data the RCS compiles should be transferred to Industry Canada.

Gagne added that recent budget cuts to the RCS would have "repercussions" in the co-operative sector. "In particular, the statistics we used to rely on in order to understand the big picture and the state of Canada’s co-operative movement will virtually disappear."

The committee acknowledged the RCS has been hit by budget cuts, but noted that AAFC associate deputy minister Claude Carriere assured the committee in July that the RCS would continue to play an important role in the co-operative sector and its database would be maintained.

"We reduced the role of the (RCS) to bring its role back to what it was previously, which was research and policy co-ordination with the provinces and other departments," Carriere said in July.

"The main function of the (RCS) when it comes to co-operatives will be to maintain the database on co-operatives, which has existed now for several decades. That is one need of the co-operatives sector. It assures us that this sector will continue to be healthy."

Among other related budget cuts, the government announced last spring it would discontinue the Co-operative Development Initiative (CDI), a program that’s backed new and emerging co-operatives since 2003.

Related story:
Federal ag research, food inspection budgeting jeered, April 13, 2012