Question Period Note: BUSINESS RISK MANAGEMENT (BRM) AND NON-BRM PROGRAMS

Q1 - How is the government responding to requests for fundamental BRM program improvements? Q2 – How is AAFC helping farmers with increased costs and the impact of U.S. and Chinese tariffs under business risk management? Q3 – How do Sustainable CAP and BRM programs address the environment and climate change? Q4 – How is Sustainable CAP Cost-Shared Programming supporting the Canadian agriculture sector? Q5 - How is AAFC supporting the agricultural sector’s competitiveness and trade diversification efforts? Q6 - Has the Government examined the feasibility of introducing a universal basic income pilot in the agricultural sector?

R.1 - AAFC and its provincial and territorial counterparts recognize that BRM programs are the first line of defence for producers and that it is critical that they are working for the entire sector. They have agreed to continue to prioritize work to ensure BRM programs are timely, responsive, and predictable to help producers manage business risks. R.2 - To support producers navigating significant pressure and uncertainty, the interest-free limit for the Advance Payments Program was once again increased from $100,000 to $250,000 for the 2025 program year. This change is expected to provide an additional $5,000 in interest savings to 13,000 producers for a total savings of up to $65 million this program year.

Additionally, it was announced on September 5, 2025, that the Government of Canada is temporarily increasing the interest-free portion for canola advances. For the remainder of the 2025 program year and the 2026 program year, the interest-free limit for canola will be $500,000. It is expected that this program change will provide approximately 1,745 canola producers (in program year 2025) and 6,000 canola producers (in program year 2026) with a combined $36.3 million ($5.1 million in 2025 and $31.2 million in 2026) in additional interest savings.

Also, under Sustainable CAP, starting in 2023, the AgriStability rate was increased from 70 to 80% to provide more support to farmers in times of need. Moreover, in July 2025, federal, provincial and territorial (FPT) governments agreed to additional support through AgriStability including increasing the compensation rate from 80% to 90% and doubling the current payment cap to $6 million for the 2025 program year. R.3 - The Sustainable CAP plays an important role in supporting the agriculture and agri-food sector by contributing to reductions in greenhouse gas (GHG) emissions, adapting to climate change and continuing to ensure a sustainable path for economic growth.

Central to having a more significant focus on climate change is the establishment of the Resilient Agricultural Landscape Program, a $250 million investment by FPT governments which will support on-farm adoption of environmental beneficial management practices that reduce GHG emissions and increase carbon sequestration. Additionally, under Sustainable CAP, all provinces have agreed to spend at least 12.5% of their total spending on activities that specifically support GHG emissions-reducing and carbon sequestration activities.

With regard to BRM programs, AAFC officials are conducting a BRM Climate Review that is looking at how climate change could impact future BRM payments, AgriInsurance premiums, and how BRM programs could encourage climate action.
Program officials are also working to pilot AgriInsurance premium rebates for producers who adopt practices that have environmental benefits and also reduce production risks. And as of 2025, the largest producers need to have a valid agri-environmental risk assessment to receive the government contribution in AgriInvest. R.4 - The Sustainable CAP is a five-year, $3.5 billion federal-provincial-territorial investment, including $1 billion in federal programs and $2.5 billion in cost-shared initiatives (60:40 federal to PT). It is designed to strengthen Canada’s agriculture, agri-food, and agri-based products sector through innovation, growth, and sustainability. Provinces and territories have flexibility to design cost-shared programs aligned to regional needs within five priority areas: Climate Change and Environment; Science, Research and Innovation; Market Development and Trade; Building Sector Capacity, Growth and Competitiveness; and Resiliency and Public Trust.

Sustainable CAP sets ambitious economic targets of $250 billion in sector revenues and $95 billion in export revenues by 2028. To help achieve these goals, cost-shared PT programs are advancing market diversification and export readiness, while also growing the domestic market and strengthening the competitiveness of the industry through strategic investments. This includes supporting clean technologies and on-farm practices that meet evolving market requirements; investing in food processing and the value-added sector to spur growth and innovation; advancing science and innovation to boost productivity; and enhancing assurance systems to build resiliency and public trust. Together, these initiatives position the sector for success at home and abroad.

As part of the increase of $500 million in funding compared to the previous FPT framework, governments introduced the Resilient Agricultural Landscape Program (RALP), a new $250 million cost-shared program, $150 million federal and $100 million provincial/territorial funds, that uses an ecological goods and services payment approach to support on-farm adoption of beneficial management practices that reduce GHG emissions and increase carbon sequestration. R.5 - Under Sustainable CAP, the AgriMarketing Program’s budget is $129.97 million over 5 years (from 2023-2028). The program aims to increase and diversify exports to global markets and seize market opportunities via industry-led promotional activities to differentiate Canadian products and producers, by leveraging Canada's reputation for high-quality and safe food. A wide range of agricultural sectors are supported, and a higher cost-share ratio is offered as an incentive to encourage diversification in emerging markets in the Indo-Pacific Region.

On September 5, 2025, the Government announced that it is providing the AgriMarketing Program with an additional $75 million over 5 years, starting in 2026-27. This investment is separate from Sustainable CAP funding and is intended to help sectors that have been affected by trade barriers, such as canola producers, to better manage future risks by diversifying their markets and exports. These new funds would be targeted to help exporters pivot to enhance more effective regional promotional strategies to target new consumer segments in non-traditional and emerging markets, such as Africa and the Middle East, and help the sector reinforce Canada’s reputation as a safe and reliable supplier of high-quality, sustainable agricultural products. R.6 - While the Government of Canada does not offer a universal basic income program, producers facing significant losses can access financial support through existing Business Risk Management (BRM) programs.

These programs work together to protect farm income against severe market volatility, natural disasters, and production losses, encourage proactive financial planning, and provide targeted assistance for extraordinary recovery costs. These programs are cost-shared with provinces, and combined government contributions exceed $2 billion annually.

Federal, provincial, and territorial governments recognize that BRM programs are the first line of defence for producers, and we continue to work together to ensure the BRM suite remains timely, responsive, and predictable for the entire sector.

SUSTAINABLE CAP PROGRAMMING

• The Sustainable CAP is a $3.5-billion, 5-year agreement (April 1, 2023, to March 31, 2028), between the federal, provincial and territorial governments to strengthen the competitiveness, innovation, and resiliency of the agriculture, agri‐food and agri‐based products sector.
• The agreement includes $1 billion in federal programs and activities and $2.5 billion in cost-shared programs and activities funded by federal, provincial and territorial governments.
• This 5-year agreement will inject $500 million, representing a 25% increase in the cost-shared portion of the partnership.
• Under the cost-shared envelope, FPT governments agreed to a $250 million Resilient Agricultural Landscape Program to support ecological goods and services provided by the agriculture sector.

Federal Programs and Activities under Sustainable CAP
• Federal programs and activities are national in scope and represent a $1 billion investment over 5 years.
• Federally delivered programs include: AgriScience, AgriInnovate, AgriDiversity, AgriCompetitiveness, AgriAssurance, AgriMarketing.
• Sustainable CAP federal programs and activities include a greater focus on priority areas such as:
• Science, research and development of innovative technologies and practices that address sector and government research priorities;
• Supporting science, research and development of transformative solutions that can contribute to the Government of Canada’s 2030 and 2050 emissions targets; and,
• Market diversification, including activities in the Indo-Pacific region; marketing green products; and supporting inclusive trade.
• Key changes to the programs since the last framework include:
• Greater focus on environmental priorities;
• Better cost-share and/or stacking ratio for underrepresented groups;
• Design changes to help incentivize small enterprises, start-ups and emerging innovators;
• Greater emphasis on impacts and performance measurement; and,
• The launch of the Grants and Contributions Digital Platform solution for end-to-end online program administration.

Cost-Shared Strategic Initiatives under Sustainable CAP
• Cost-shared Strategic Initiatives are a joint undertaking whereby both federal and provincial/territorial (PT) governments provide funding for programming that is designed and delivered by PTs.
• These initiatives represent a $2.5 billion investment over 5 years: 60% federally funded ($1.5 billion) and 40% PT funded ($1 billion).
• The main objective is to provide the PT governments with flexibility to meet regional priorities and resolve issues while contributing to broader national outcomes that are developed collaboratively among federal, provincial and territorial governments.
• Funding will be allocated among the five Priority Areas identified in the Guelph Statement:
• Climate Change and Environment;
• Science, Research, and Innovation;
• Market Development and Trade;
• Building Sector Capacity, Growth, and Competitiveness; and,
• Resiliency and Public Trust.

• Key changes to the programs since the last framework include:
• Introduction of the $250 million Resilient Agricultural Landscape Program;
• PT governments agreed to a level of proportionate spending of at least 12.5% of cost-shared funds to support GHG emissions-reducing and carbon sequestration activities; and,
• Increased emphasis on understanding programming impact through improved data sharing, results reporting, and a commitment to contribute to measurable outcomes.

ADDITIONAL FUNDING

• On September 5, 2025, the Government announced $75 million over five years to enhance the AgriMarketing Program, starting in 2026-27. This funding is separate from Sustainable CAP and will support sectors most affected by market access barriers and trade tariffs for greater alignment with Canada’s Indo-Pacific Strategy, shifting focus beyond traditional export destinations like the U.S. and China.

BUSINESS RISK MANAGEMENT PROGRAMS

Business risk management (BRM) programs are joint federal-provincial-territorial (FPT) programs that are in place to help producers manage risks that threaten the viability of their farms and provide protection against different types of income and production losses. Producers take responsibility for managing normal risks, while government support is in place to help manage events that exceed producers’ capacity to manage.

The programs are cost-shared 60:40 (Federal:Provincial-Territorial) as outlined in the Sustainable Canadian Agricultural Partnership (Sustainable CAP).

The AgriStability program is a whole-farm program designed to support producers who have experienced a margin decline of more than 30% for reasons such as production loss, increased costs and market conditions. On average, FPT governments pay producers $422 million through AgriStability each year.

In July of 2025, FPT Ministers of agriculture announced several enhancements to AgriStability for the 2025 program year, including increasing the payment limit and compensation rate.

As part of the Sustainable CAP, ministers also agreed to implement a new model for AgriStability that is simpler, timely, and more predictable. Working with provinces and territories, a more streamlined approach was developed that allows reference margins to be calculated based on how producers file their taxes (cash or accrual accounting), offer a new coverage notice, and more timely payments to producers. This new model is being offered as an option for producers and has been implemented in the jurisdictions where AAFC administers the program (i.e. Manitoba, New Brunswick, Nova Scotia, Newfoundland and Labrador, Yukon Territory, and the Northwest Territories) in the 2024 program year. AAFC officials are working with the remaining provinces to support their efforts to offer some or all of these elements on an optional basis during the Sustainable CAP.

Finally, beginning in the 2026 program year, jurisdictions will have the option of adopting a new valuation methodology for significant commodities grown and used on farm (e.g. feed). This is expected to better align program payments with disaster years.

The AgriInvest program allows producers to save a portion of the proceeds from their annual net sales, with a matching government contribution up to a maximum of $10,000 annually, to help manage smaller income declines. FPT governments contribute approximately $278 million annually to AgriInvest accounts.

 
Since Sustainable CAP came into effect in April 2023, several changes in the BRM Suite are being implemented. The AgriStability compensation rate increased from 70 to 80% beginning in the 2023 program year, increasing support to farmers up to $72 million per year. In addition, as of 2025, producers with allowable net sales (ANS) of at least $1 million are required to have a valid agri-environmental risk assessment in order to receive an AgriInvest government contribution.

The AgriInsurance program helps to stabilize producer income by minimizing the economic effects of production losses caused by severe but uncontrollable natural hazards. It provides premium subsidy support, both federal and provincial, largely to crop producers, averaging over $1.3 billion per year since 2018, which represents approximately two-thirds of all BRM contributions.

AgriRecovery is a federal-provincial-territorial initiative designed to assist agricultural producers with the extraordinary costs required to recover from a natural disaster. It operates as a collaborative framework, bringing together governments to assess impacts and deliver targeted assistance when producers experience extraordinary costs beyond their capacity to manage. While AgriRecovery plays an important role in addressing recovery needs, it is not meant to replace available coverage under other programs such as AgriInsurance, AgriStability, and AgriInvest.

The Advance Payments Program (APP) is a federal loan guarantee program which provides agricultural producers with easy access to low-interest cash advances. Under the program, producers can obtain cash advances of up to $1 million based on the expected market value of their commodities, thus helping them meet their financial needs, including input costs, over their production and marketing cycle.

To ensure that Canadian farmers have access to the cash flow needed to continue producing food and supporting national food security, the Government increased the $100,000 interest-free limit on loans temporarily under the APP to $250,000 in 2022, to $350,000 in 2023 and to $250,000 in 2024, representing a total savings of $175.1 million for producers over the three-year period (2022 to 2024).

On March 7, 2025, it was announced that the interest-free limit was also temporarily increased to $250,000 for the 2025 program year. Participating producers could save up to $5,000 in interest costs. This change will represent estimated savings of up to $65 million for over 13,000 producers.

Additionally, it was announced on September 5, 2025, that the interest-free limit will be temporarily increased to $500,000 for canola advances in the 2025 and 2026 program years. It is expected that this program change would provide approximately 1,745 canola producers in program year 2025 and 6,000 canola producers in program year 2026 with a combined $36.3 million ($5.1 million in 2025 and $31.2 million in 2026) in additional interest savings.
 

• The Sustainable Canadian Agricultural Partnership (Sustainable CAP) is a 5-year, $3.5 billion investment by federal, provincial and territorial governments to support and grow Canada’s agriculture and agri-food sector.

• This includes a commitment to expand market opportunities for producers, strengthen the resiliency of the food system, and encourage diversity and inclusion in the sector.

• Under the Sustainable CAP, Agriculture and Agri-Food Canada continues to work with provinces and territories to make business risk management programs more effective for producers and to support greater resiliency within the sector.

• Producers have access to the full suite of federal-provincial-territorial business risk management programs to help them manage production losses, severe market