By CKOM News

APAS and provincial ministers face-off over mid-year financials

Dec 2, 2021 | 9:32 AM

The Agricultural Producers Association of Saskatchewan (APAS) and the province’s finance and agriculture ministers are at odds over Saskatchewan’s mid-year financial report, released earlier this week.

On Monday, Finance Minister Donna Harpauer released the report, saying the province had a big jump in revenue this year and, were it not for the record crop insurance claims from drought, would have been close to balance for the year.

“If you backed out the expense of crop insurance — the $2.4 billion — as well as the livestock producer support, we would almost be balanced. That is how significant that support was for agriculture producers,” Harpauer said Monday.

On Wednesday, the association put out a news release, saying that the government was blaming producers for the province’s continued deficit position and that the association was concerned about the claim.

“In 2020, Saskatchewan Crop Insurance Corporation reported a $2.4-billion surplus accumulated over previous years, plus a sizable surplus in the reinsurance fund,” APAS vice-president Ian Boxall said in a news release. “It’s not fair to blame producers for a provincial deficit in a drought year when that surplus gets used up.”

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Boxall said in the statement that if the surplus from crop insurance had been invested in a dedicated fund, the money would have been made available for crop insurance claims.

A few hours after the APAS news release, Harpauer and Minister of Agriculture David Marit put out a joint letter to APAS president Todd Lewis.

“We disagree with the premise of the entire document, and to suggest that the provincial government is somehow blaming our agricultural producers for the financial deficit … is not only false, it is offensive,” began the letter.

The ministers wrote APAS was willingly misinforming its members with “callous disregard,” and suggested the association doesn’t understand public financial reporting or the difference between debt and deficit.

The ministers also seemed to take offence to what they felt was a suggestion in Boxall’s statement that crop insurance claims couldn’t be paid out.

“The fact we had a surplus in place to cash-flow such a devastating year for producers, and still maintain a surplus in that fund, goes to show how well managed SCIC is,” read the letter.

Harpauer later explained the crop insurance claims were fully paid out from the fund, and there are still funds left over.

She said because of public sector accounting rules, even though there were funds to pay for the crop insurance indemnity, it still had to be put on the year’s balance sheet as an expense. She compared it to a household budget — if your expenses are higher than your income for one month, that doesn’t mean there isn’t money in the bank.

Harpauer said she wasn’t throwing farmers under the bus.

“It’s because of the drought, period. Farmers did not create a drought. The crop insurance program was the largest payout in the history of the province, we can’t deny that. I cannot go to the public and say, ‘No, that didn’t really happen,’ ” said Harpauer.

The finance minister said she was disappointed with APAS, noting its statement was released before the organization tried to reach out to her to clear things up. She felt it was an attack on the government.

Harpauer and Marit in the letter are urging Boxall to retract what was said in the APAS statement.

“In the future, we hope APAS will remember that our government has been steadfast in its commitment to our agricultural producers and that APAS doesn’t take that support for granted the next time it considers making such a reckless statement,” the ministers wrote.

They finished by saying they hoped the government and APAS can continue working together to support the agricultural sector and producers in Saskatchewan.

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