Who gets the $$ for food in the North:big business or hungry
Posted: Fri Nov 28, 2014 11:22 amWho gets the $$ for food in the North -- big business or hungry people?
[ http://rabble.ca/blogs/bloggers/karl-ne ... gry-people ]
By Karl Nerenberg | November 25, 2014
EXCERPT:
The cost of supplying food, especially fresh food, to remote and isolated Northern communities, by air, is huge. When added to the retail price, that cost makes staples such as milk and eggs -- not to mention northern "luxuries" such as tomatoes -- prohibitively expensive.
For years, northerners would complain that alcoholic beverages provided by provincial or territorial agencies were, in effect, subsidized, so that a bottle of whiskey was the same price in the remote north as in Toronto, while milk was not.
A partial answer to that complaint was Food Mail, a longstanding program whereby Canada Post received a special subsidy to ship nutritious foods directly to people in remote and isolated northern communities.
In 2011, however, the Harper government decided to take the subsidy away from Canada Post and give it, instead, to a few large and highly profitable retail organizations that supply the North.
Subsidies to mammoth businesses with robust bottom lines
The new program is called Nutrition North, and in the year it was set up, 2010, one of those large retail businesses, the North West Company, had worldwide sales of $1.4 billion and a profit of well over $80 million.
Canada's Auditor General (AG) examined Nutrition North to see, in part, if the federal subsidies are actually getting passed on to the people of the North.
In his fall 2014 report, the AG had to say that he simply could not accurately verify that fact.
People of northern remote communities can definitely attest, however, that food prices remain punishingly high. Some say they would prefer a return to the Food Mail program.
The AG reports that while the Department of Aboriginal and Northern Affairs receives monthly reports on northern food prices, it does not have information on the retailers' profit margins, and so cannot ascertain who is really benefitting from the subsidies, and to what extent.
The government’s excuse for failing to know what the retailers' profit margins are is that such information might be "commercially confidential."
The AG's response to that argument is, in essence: nonsense.
The fall 2014 AG report puts it this way:
"Determining whether the entire amount of the subsidy is being deducted from the selling price of a food item requires an examination of profit margins (both current and over time): the impact of the subsidy may be negated if the profit margin is increased after the full subsidy is applied to the landed cost."
The Northwest Territories (NWT) NDP MP Dennis Bevington points out a couple of other major flaws in the Northern Nutrition program that the AG uncovered.
"The program may be unfair," Bevington says, "because it provides a full subsidy to food going to some communities and only a partial subsidy to other very similar communities. The Auditor General found no basis for this differential treatment."
As well, Bevington points out that the Nutrition North program now gets $60 million per year, the same amount as the government spent on the cancelled Food Mail program four years ago. And, the MP adds, there are heavy administrative costs to the current program: 10 per cent per year.
"Food prices have gone up," Bevington says, "but the program has not kept pace."
Aboriginal and Northern Affairs Minister Bernard Valcourt fights back by pointing to some of the apparent successes of the Nutrition North program.
"The volume of perishable nutritious food shipped to northern communities has increased by approximately 25 percent, and the cost of a food basket for a family of four dropped by approximately $110 a month in the first two years of the program," Valcourt says. "As opposed to the previous Food Mail program, the Nutrition North Canada program is dynamic and is intended to continue improving."
Having said all that, the government still pledges to implement all of the AG's recommendations for fixing the Northern Nutrition program.
Fix everything wrong with Nutrition North, or replace it -- NDP
What the Northwest Territories MP would like to see is that the government improve administration of the program, eliminate its arbitrary and unfair differentiations between similar communities, and make sure none of the subsidy money fattens the coffers of mammoth retailers, who definitely don't need that money in order to afford a balanced diet.
The first two improvements, Bevington believes, should be relatively easy to achieve. He is not so sure about the last one, however, since companies can be slippery when asked to divulge business-related data
The NWT MP says that if it should prove impossible for government officials to get their hands on the retailers’ profit-margin information, then the Nutrition North subsidy program should be replaced.
A while ago, Bevington floated another northern food subsidy idea, which he believed would work better, past then-Aboriginal and Northern Affairs Minister Leona Aglukkaq. The Northwest Territories MP suggested providing subsidies directly to northern families, in the form of "Food Cards" that could only be redeemed for nutritious foods.
Put the money in the people's pockets, Bevington proposed, rather than those of the companies.
The Conservative Minister did not evince the slightest interest.
[ http://rabble.ca/blogs/bloggers/karl-ne ... gry-people ]
By Karl Nerenberg | November 25, 2014
EXCERPT:
The cost of supplying food, especially fresh food, to remote and isolated Northern communities, by air, is huge. When added to the retail price, that cost makes staples such as milk and eggs -- not to mention northern "luxuries" such as tomatoes -- prohibitively expensive.
For years, northerners would complain that alcoholic beverages provided by provincial or territorial agencies were, in effect, subsidized, so that a bottle of whiskey was the same price in the remote north as in Toronto, while milk was not.
A partial answer to that complaint was Food Mail, a longstanding program whereby Canada Post received a special subsidy to ship nutritious foods directly to people in remote and isolated northern communities.
In 2011, however, the Harper government decided to take the subsidy away from Canada Post and give it, instead, to a few large and highly profitable retail organizations that supply the North.
Subsidies to mammoth businesses with robust bottom lines
The new program is called Nutrition North, and in the year it was set up, 2010, one of those large retail businesses, the North West Company, had worldwide sales of $1.4 billion and a profit of well over $80 million.
Canada's Auditor General (AG) examined Nutrition North to see, in part, if the federal subsidies are actually getting passed on to the people of the North.
In his fall 2014 report, the AG had to say that he simply could not accurately verify that fact.
People of northern remote communities can definitely attest, however, that food prices remain punishingly high. Some say they would prefer a return to the Food Mail program.
The AG reports that while the Department of Aboriginal and Northern Affairs receives monthly reports on northern food prices, it does not have information on the retailers' profit margins, and so cannot ascertain who is really benefitting from the subsidies, and to what extent.
The government’s excuse for failing to know what the retailers' profit margins are is that such information might be "commercially confidential."
The AG's response to that argument is, in essence: nonsense.
The fall 2014 AG report puts it this way:
"Determining whether the entire amount of the subsidy is being deducted from the selling price of a food item requires an examination of profit margins (both current and over time): the impact of the subsidy may be negated if the profit margin is increased after the full subsidy is applied to the landed cost."
The Northwest Territories (NWT) NDP MP Dennis Bevington points out a couple of other major flaws in the Northern Nutrition program that the AG uncovered.
"The program may be unfair," Bevington says, "because it provides a full subsidy to food going to some communities and only a partial subsidy to other very similar communities. The Auditor General found no basis for this differential treatment."
As well, Bevington points out that the Nutrition North program now gets $60 million per year, the same amount as the government spent on the cancelled Food Mail program four years ago. And, the MP adds, there are heavy administrative costs to the current program: 10 per cent per year.
"Food prices have gone up," Bevington says, "but the program has not kept pace."
Aboriginal and Northern Affairs Minister Bernard Valcourt fights back by pointing to some of the apparent successes of the Nutrition North program.
"The volume of perishable nutritious food shipped to northern communities has increased by approximately 25 percent, and the cost of a food basket for a family of four dropped by approximately $110 a month in the first two years of the program," Valcourt says. "As opposed to the previous Food Mail program, the Nutrition North Canada program is dynamic and is intended to continue improving."
Having said all that, the government still pledges to implement all of the AG's recommendations for fixing the Northern Nutrition program.
Fix everything wrong with Nutrition North, or replace it -- NDP
What the Northwest Territories MP would like to see is that the government improve administration of the program, eliminate its arbitrary and unfair differentiations between similar communities, and make sure none of the subsidy money fattens the coffers of mammoth retailers, who definitely don't need that money in order to afford a balanced diet.
The first two improvements, Bevington believes, should be relatively easy to achieve. He is not so sure about the last one, however, since companies can be slippery when asked to divulge business-related data
The NWT MP says that if it should prove impossible for government officials to get their hands on the retailers’ profit-margin information, then the Nutrition North subsidy program should be replaced.
A while ago, Bevington floated another northern food subsidy idea, which he believed would work better, past then-Aboriginal and Northern Affairs Minister Leona Aglukkaq. The Northwest Territories MP suggested providing subsidies directly to northern families, in the form of "Food Cards" that could only be redeemed for nutritious foods.
Put the money in the people's pockets, Bevington proposed, rather than those of the companies.
The Conservative Minister did not evince the slightest interest.