The
Spring Credit Advance Program
March 6, 2001
Responding to a request by producer groups due to
rising fuel and fertilizer costs, our government announced today that we have
more than doubled the amount available in interest-free loans under the Spring
Credit Advance Program, raising the maximum loan from $20,000 to $50,000 for the
2001 growing season.
This represents an increase of $350 million in
the budget of this program, so that up to $700 million in interest-free loans
could be issued to farmers this spring – providing timely and flexible
low-cost financing that is very easy for them to access.
This builds on the $500 million in emergency
assistance announced last week to help farmers address the financial challenges
they are facing. Should the provinces contribute their traditional 40 per-cent
share, this investment would amount to an additional $830 million for Canadian
farmers, bringing the total federal-provincial support for Canadian farmers
comes to more than $2.6 billion this year.
The Spring Credit Advance Program – a program
that Canadian farmers have asked for and made use of in the past – has been
very successful in getting money into farmers’ hands in time for spring
seeding.
In 2000, the first year of the program, 31,000
producers received $356 million in advances through their producer organizations
to assist with financing their spring input costs.
The federal government guarantees the repayment
of these advances and pays the interest while they are outstanding.
Participating farmers have to take part in the crop insurance program or in
another form or security that provides similar protection.
Program applications will be available during the
first week of April and advances would likely flow to farmers by mid-April.
The Spring Credit Advance Program is similar to
the Advance Payments Program and is available to all commodity groups covered
under the latter. It is administered through local producer groups and the
Canadian Wheat Board.
This program complements other income support
programs put in place by our government. We will continue to work with the
agricultural sector and the provinces to provide farmers with short-term
assistance, while pursuing our efforts to bring long-term stability to the
sector.
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