Agriculture and Agri-Food Canada

Agriculture and Agri-Food Canada

March 31, 2006 14:35 ET

Governments Take Action to Change CAIS

OTTAWA, ONTARIO--(CCNMatthews - March 31, 2006) - Federal, provincial and territorial governments are taking action to change the Canadian Agricultural Income Stabilization (CAIS) program by following through on previous commitments to program changes.



The following changes are now officially in place (see attached
backgrounder for more detail):

- The deposit has been eliminated and is now replaced by a fee
beginning with the 2006 program. The fee is more affordable and
does not require producers to tie up working capital. With the
fee, producers will pay $4.50 for every $1,000 of reference
margin protected.

- Producers who participated in 2003, 2004, or 2005 CAIS do not
have to make a deposit or pay a fee for these program years.
Producers who have funds in their CAIS accounts do not need to
contact their financial institution or the CAIS Administration to
access funds. All CAIS accounts will be closed and funds
remaining in producer accounts will automatically be paid to
producers.


The $55 Administrative Cost Share for the CAIS program will continue to be collected annually.

At their March 20 meeting, ministers agreed unanimously to move forward on transforming CAIS to ensure that the program is simpler and more responsive to the needs of producers. Ministers tasked officials to engage with industry and review options, including the possibility of replacing the current integrated program with one that separates disaster relief from income stabilization, and to bring recommendations back to them at their next meeting in June.

The current CAIS program will remain in place for the 2006 crop year to ensure stability for producers.

Officials will also continue to work toward putting the necessary authorities in place to improve negative margin coverage under the program and to establish a targeted advance which will proactively direct assistance to commodities or regions affected by a disaster.

The CAIS program is delivered by the Government of Canada's CAIS Administration in British Columbia, Saskatchewan, Manitoba, New Brunswick, Yukon, Nova Scotia, and Newfoundland and Labrador. Producers in these provinces can contact the CAIS administration toll free at 1-866-367-8506 or visit the CAIS program Web site at www.agr.gc.ca/caisprogram.

In Alberta, producers can call Agriculture Financial Services Corporation (AFSC) at 1-877-744-7900. In Ontario, producers can call AGRICORP at 1-877-838-5144. In Quebec, producers can call La Financiere agricole du Quebec at 1-800-749-3646. On Prince Edward Island, producers can call (902) 368-4842.

BACKGROUNDER

CAIS DEPOSIT REPLACED BY A FEE

The Canadian Agricultural Income Stabilization (CAIS) program is a joint federal/provincial/territorial Business Risk Management program to help producers protect their farm income from both small and large income declines. Governments are moving ahead with changes to CAIS to make the program simpler and more responsive to the needs of producers. These changes include replacing the deposit with a fee in 2006 and waiving the deposit requirement for 2003, 2004 and 2005.

Replacement of the Deposit with a Fee

The deposit has been eliminated and will be replaced by a fee for the 2006 CAIS program. The fee is more affordable and does not require producers to tie up large amounts of working capital.

Previously, producers needed to set aside 22 percent of the value of their reference margins in a CAIS account to have full protection under the program. With the fee, producers will pay $4.50 for every $1,000 of reference margin protected.



Example: A producer with a reference margin of $60,000 will now
pay a fee of $270 plus the $55 administrative cost share for
maximum protection under the program, as opposed to making a
deposit of $13,200.


Producers who have previously participated in CAIS will automatically be enrolled in the program for 2006 and will receive a letter with more detailed information on the fee.

No Deposit Required for 2003, 2004, or 2005

Producers who participated in 2003, 2004, or 2005 CAIS do not have to make a deposit or pay a fee for these program years. Producers who have funds in their CAIS accounts do not need to contact their financial institution or the CAIS Administration to access funds. All CAIS accounts will be closed and funds remaining in producer accounts will automatically be paid to producers.

For more information

The CAIS program is delivered by the Government of Canada's CAIS Administration in British Columbia, Saskatchewan, Manitoba, New Brunswick, Yukon, Nova Scotia, and Newfoundland and Labrador. Producers in these provinces can contact the CAIS administration toll free at 1-866-367-8506 or visit the CAIS program Web site at www.agr.gc.ca/caisprogram.

In Alberta, producers can call Agriculture Financial Services Corporation (AFSC) at 1-877-744-7900. In Ontario, producers can call AGRICORP at 1-877-838-5144. In Quebec, producers can call La Financiere agricole du Quebec at 1-800-749-3646. On Prince Edward Island, producers can call (902) 368-4842.

Contact Information

  • Agriculture and Agri-Food Canada, Ottawa
    Media Relations
    (613) 759-7972
    1-866-345-7972
    or
    Minister Strahl's Office
    Jeff Howard
    Press Secretary
    (613) 759-1059