SASKATCHEWAN CALLS FOR CONTINUED STRONG PRODUCER VOICE ON GRAIN HANDLING AND TRANSPORTATION

Highways and Transportation Minister Judy Bradley, Agriculture and

Food Minister Eric Upshall and Intergovernmental and Aboriginal

Affairs Minister Berny Wiens today called on the federal government to

ensure that grain handling and transportation policy changes put money

into farmers pockets, including $200 million annually that farmers are

losing because of the failure of the system to share railway

productivity gains. The federal government is meeting with farm

groups and grain industry representatives in Winnipeg today to discuss

the Estey report on the grain transportation system.



The ministers called on Ottawa to review freight rates, maintain a cap

on rates, open the system to competition and short line railways, and

stop branch line abandonment while policy decisions are being made.



"Under The Western Grain Transportation Act (WGTA), farmers shared in

the gains in railway productivity through an adjustment to the cost

based maximum rate. However, with the demise of the WGTA the railways

no longer have to share productivity gains with producers." Wiens

said. "Saskatchewan is calling on the federal government to initiate

a review of the cost base to ensure that farmers share in the gains

in railway productivity."



Saskatchewan has always recognized that it is farmers who have the

most at stake and insist that they have a major role in designing a

future system.



"The major priority is that the process of change must work for the

benefit of farmers. It is farmers, who have borne most of the

costs associated with problems in the grain handling and

transportation system," Bradley said. "Whether we have a system

that serves farmers will depend to a large degree upon who is

leading the process. From our perspective, it is critical that

the process have the support and confidence of farmers."



"An important area for farmers is the future of the maximum rate

cap and how to obtain more competition in the grain handling and

transportation system, particularly in the rail sector," Upshall

said. "Saskatchewan's position is that the regulated rate

structure must remain in place until there is effective

competition."



With respect to increasing competition in the rail sector,

Justice Estey proposed that open access to the rail

infrastructure be looked at as a means of creating more

competition in the rail network. Saskatchewan maintains the

position that open access must receive serious consideration.



"Branch line abandonment and the establishment of viable short

lines are also major concerns for Saskatchewan farmers. Many

farmers and local communities have expressed an interest in

establishing short lines, however any successes to date have been

in spite of federal legislation rather than because of it,"

Bradley said. "Justice Estey in his report recognized these

problems and recommended that legislation governing branch line

abandonment and the establishment of short lines needs to be

revised as the current provisions of The Canada Transportation

Act (CTA) are not working."



"While Saskatchewan fully supports amendments to the CTA around

the issue of branchlines/shortlines, we are concerned that by the

time decisions are made, many branchlines will have disappeared,"

said Bradley. It is for this reason that we have previously

called for a standstill' on branch line abandonment until policy

decisions are made. Again today, we are reiterating our call to

the federal government to effect a standstill until the new

policy changes are implemented.



"Maintaining the role of the Canadian Wheat Board (CWB) in

transportation is also a critical issue for Saskatchewan

farmers," Upshall said. "It is important that the CWB has the

flexibility to use whatever tools are necessary to meet its

mandate of maximising returns to farmers."



- 30 -



For more information, contact:



Bernie Churko Hal Cushon Rob Cunningham

Highways and Agriculture and Intergovernmental and

Transportation Food Aboriginal Affairs

Regina Regina Regina

Phone:787-4866 Phone:787-5961 Phone: 787-8008