2015–16 - Report on Plans and Priorities

Canadian Grain Commission

The Honourable Gerry Ritz
Minister of Agriculture and Agri-Food

Table of contents

Minister’s message

Chief Commissioner’s message

Appendix: Definitions

Minister's Message

The Honourable Gerry Ritz

I  am pleased to submit to Parliament and Canadians the Canadian Grain Commission (CGC)’s Report on Plans and Priorities 2015-16. The planning period covered in this document will be an exciting time for the CGC as well as the entire grain sector it collaborates with.

With the introduction of Bill C-48 – Modernization of Canada’s Grain Industry Act on December 9th, 2014, the Government of Canada has put forward concrete proposals to enhance producer protections and improve grain safety and quality assurance programming.

These amendments would build on earlier reforms to the Canada Grain Act. The Jobs and Growth Act, 2012 eliminated unnecessary mandatory CGC services, and reduced costs in the grain handling system. In 2014, The Fair Rail for Grain Farmers Act amended the Canada Grain Act to allow the CGC to regulate contractual provisions between producers and grain companies.

The plans and priorities in this document are a key component to the Government of Canada’s commitment to modernizing the organizations and the legislation that support the Canadian grain sector. I invite you to read this report to learn more about the CGC’s plans and priorities for the 2015-16 fiscal year.

The Honourable Gerry Ritz, P.C., M.P,
Minister of Agriculture and Agri-Food

Chief Commissioner's Message

Elwin Hermanson

Welcome to the Canadian Grain Commission (CGC)’s Report on Plans and Priorities 2015-16. Through its activities, the CGC supports a competitive, efficient grain sector and upholds Canada’s international and domestic reputation for consistent and reliable grain quantity, quality and safety. In addition, the CGC protects the rights of Canadian grain producers when they deliver grain to licensed grain handling companies.

The CGC is operating in a time of rapid change in global and domestic grain industries. On August 1, 2013, several amendments to the Canada Grain Act came into force. Concurrently, amendments to the CGC’s user fees also took effect August 1, 2013. To respond to and align with the legislative changes and restructured user fees, the CGC’s workforce, organizational design, and operations were significantly adjusted. Effective August 1, 2014, as a result of Bill C-30 - The Fair Rail for Farmers Act, amendments to the Canada Grain Act and consequential amendments to the Canada Grain Regulations came into force that enhance producer protection and contribute to more balanced contractual relationships between grain companies and farmers.

The CGC remains committed to modernizing its activities, infrastructure, legislative framework, and funding model to ensure the long-term success of Canada’s grain quality assurance system and to optimize the value for Canadian grain producers and the grain sector. On December 9, 2014, Bill C-48 - The Modernization of Canada’s Grain Industry Act, was introduced in Parliament. Bill C-48 includes proposed amendments to the Canada Grain Act focused on enhancing producer protection, enhancing grain quality and safety assurance, and further modernization of the Canada Grain Act.

As Chief Commissioner, I look forward to the CGC’s ongoing exemplary work to effectively meet the needs of producers, the industry and Canadians in general and encourage you to read this report.

Elwin Hermanson
Chief Commissioner
Canadian Grain Commission


Section I: Organizational Expenditure Overview

Organizational Profile

Minister: The Honourable Gerry Ritz, P.C.

Chief Commissioner: Elwin Hermanson

Ministerial portfolio: Agriculture and Agri-Food

Enabling Instrument: Canada Grain Act

Year of Incorporation / Commencement: 1912

Other: The CGC’s head office is located in Winnipeg, Manitoba. The CGC currently operates two regional offices and ten service centres across Canada. Funding for CGC programs and activities is through a combination of revolving fund and appropriation sources. The CGC plans to recover approximately 91 percent of its costs through user fees.

Organizational Context

Raison d’être

The Canadian Grain Commission (CGC) is a federal government agency and administers the provisions of the Canada Grain Act. The CGC’s mandate as set out in the Canada Grain Act is to, “in the interests of the grain producers, establish and maintain standards of quality for Canadian grain and regulate grain handling in Canada, to ensure a dependable commodity for domestic and export markets.” The CGC’s vision is: “To be a world class, science-based quality assurance provider”. The Minister of Agriculture and Agri-Food is responsible for the CGC.

Responsibilities

Under the Canada Grain Act, the CGC regulates the handling of 20 grains grown in Canada to ensure Canada’s grain is safe, reliable and marketable, and Canadian grain producers are properly compensated for grain deliveries to licensed grain companies.1 The CGC is a third party agency in Canada’s grain sector and is the official certifier of Canadian grain shipments. Through its activities, the CGC supports a competitive, efficient grain sector and upholds Canada’s international reputation for consistent and reliable grain quality and grain safety. To achieve its mandate, the CGC:

  • regulates grain handling in Canada through the grain quality and quantity assurance programs,
  • carries out scientific research to understand all aspects of grain quality and grain safety and to support the grain grading system, and
  • has implemented a number of producer protection programs and safeguards to ensure producers are properly compensated for the quality and quantity of grain delivered to licensed grain elevators and grain dealers. This includes the licensing and security program, the producer car allocation program, and the producer support program.

Additional information on the CGC’s mandate and responsibilities is available on theCGC website.

Footnotes
Footnote 1

Grain refers to any seed designated by regulation as a grain for the purposes of the Canada Grain Act. This includes barley, beans, buckwheat, canola, chick peas, corn, fababeans, flaxseed, lentils, mixed grain, mustard seed, oats, peas, rapeseed, rye, safflower seed, soybeans, sunflower seed, triticale and wheat. Solin was removed from the list effective August 1, 2013.

Return to footnote 1 referrer

Strategic Outcome and Program Alignment Architecture

  1. Strategic Outcome: Canada’s grain is safe, reliable and marketable and Canadian grain producers are properly compensated for grain deliveries to licensed grain companies
    • 1.1 Program: Quality Assurance Program
    • 1.2 Program: Quantity Assurance Program
    • 1.3 Program: Grain Quality Research Program
    • 1.4 Program: Producer Protection Program
      • 1.4.1 Sub-Program: Licensing and Security Program
      • 1.4.2 Sub-Program: Producer Car Allocation Program
      • 1.4.3 Sub-Program: Producer Support Programs
    • Internal Services

Organizational Priorities

Priority Type2 Strategic Outcome and Programs
Relevant, efficient and innovative programs and services Previously committed to This priority contributes to the CGC’s strategic outcome and all CGC programs.
Description
Why is this a priority?
Ensuring the CGC remains relevant supports the continued competitiveness of Canadian grain in both domestic and international markets. A targeted set of amendments were made to the Canada Grain Act as part of the Jobs and Growth Act, 2012. The majority of these amendments came into force on August 1, 2013. The amendments streamlined operations of the CGC and reduced costs to the grain sector by approximately $20 million per year. While these amendments were an important first step, additional amendments are needed to further align the Canada Grain Act with the needs of today’s grain sector.
What are the plans for meeting this priority?
Bill C-48 - Modernization of Canada’s Grain Industry Act, introduced in Parliament on December 9, 2014, includes further amendments to the Canada Grain Act to build on and complement amendments made as part of the Jobs and Growth Act, 2012. Proposed amendments would enhance producer protection and enhance grain quality and grain safety assurance (additional details are provided in Section II). Amendments would also modernize the Canada Grain Act by clarifying that the CGC acts in the interest of all Canadians, including grain producers; establish a non-binding process for reviewing certain CGC decisions; provide authority for the Minister of Agriculture and Agri-Food to appoint and re-appoint members to the grain standards committees, upon recommendation of the Commission; allow the CGC to enact regulations that require producers and shippers to make declarations on grain deliveries; make certain offences under the Canada Grain Act subject to administrative monetary penalties under the Agriculture and Agri-Food Administrative Monetary Penalties Act; and permit licensees to refuse varieties of grain that are not registered under the Seeds Act for sale or import into Canada. The proposed legislative amendments would have limited impact on CGC workforce and costs. Existing resources would be re-allocated where the CGC takes on additional responsibilities. Depending on the progress of Bill C-48, the CGC will initiate the process to amend the Canada Grain Regulations to align with the proposed legislative amendments during 2015-16.
While Bill C-48 is being considered by Parliament, the CGC will continue to operate under the existing provisions of the Canada Grain Act and the Canada Grain Regulations. The CGC will work in close collaboration with producers, industry stakeholders, Agriculture and Agri-Food Canada (AAFC), and other domestic and foreign government entities to ensure the CGC remains relevant and provides valuable programs and services going forward. Additional information on aligning the Canada Grain Act with the needs of today’s grain sector is available on the CGC website.
Footnotes
Footnote 2

Type is defined as follows: previously committed to—committed to in the first or second fiscal year prior to the subject year of the report; ongoing—committed to at least three fiscal years prior to the subject year of the report; and new—newly committed to in the reporting year of the RPP or DPR. If another type that is specific to the department is introduced, an explanation of its meaning must be provided.

Return to footnote 2 referrer

Priority Type3 Strategic Outcome and Programs
Investing in CGC Infrastructure New This priority contributes to the CGC’s strategic outcome and all CGC programs
Description
Why is this priority?
Investing in CGC infrastructure will ensure the ongoing viability of the CGC and allow the CGC to provide programs and services as efficiently and effectively as possible.
What are the plans for meeting this priority?
The CGC plans to invest in infrastructure over the next few years. Investment plans and priorities include renovations at CGC offices at terminal elevators, space consolidation in the Winnipeg office, information technology infrastructure and applications development, and a new financial system. The CGC will continue to work in close collaboration with central agencies to make progress towards this priority.
Footnotes
Footnote 3

Type is defined as follows: previously committed to—committed to in the first or second fiscal year prior to the subject year of the report; ongoing—committed to at least three fiscal years prior to the subject year of the report; and new—newly committed to in the reporting year of the RPP or DPR.

Return to footnote 3 referrer

Priority Type4 Strategic Outcome and Programs
Skilled, adaptable, and engaged workforce Previously committed to This priority contributes to the CGC’s strategic outcome and all CGC programs.
Description
Why is this a priority?
In light of significant changes experienced at all levels of the organization as well as the principles of Blueprint 2020, this priority is aimed at fostering a work environment where employees are involved, equipped and supported as they adapt and adjust to ongoing change.
What are the plans for meeting this priority?
Plans include engaging employees in discussions regarding career development and training, as well as establishing talent management strategies and succession development paths to ensure CGC employees are productive in their current roles, positioned to take advantage of future opportunities, and in a position to provide services and value to all stakeholders in an ever changing environment. The results of the most recent Public Service Employee Survey will be used to develop and incorporate people planning strategies to improve the CGC work environment and culture.
Footnotes
Footnote 4

Type is defined as follows: previously committed to—committed to in the first or second fiscal year prior to the subject year of the report; ongoing—committed to at least three fiscal years prior to the subject year of the report; and new—newly committed to in the reporting year of the RPP or DPR.

Return to footnote 4 referrer

Priority Type5 Strategic Outcome and Programs
Investing in Stakeholder Relations New This priority contributes to the CGC’s strategic outcome and all CGC programs
Description
Why is this priority?
Canada is known around the world for the quality, consistency, reliability and safety of its grain and grain products. While the CGC plays a key role in supporting Canadian exporters to market successfully in competitive international grain markets, general knowledge of what the CGC does and our role in domestic and international grain markets is limited. The CGC provides value along the entire value chain from producers to global consumers of Canadian grain. In order to succeed in a rapidly changing and complex environment, constructive relationships with stakeholders will be critical.
What are the plans for meeting this priority?
During the upcoming year, the CGC will promote awareness of CGC activities and services with the intention of increasing stakeholder understanding of the organization’s role in the grain sector. Given that producers now contribute a significant portion of CGC funding, a priority will be to communicate to them the value of CGC activities, such as the grading system, the harvest sample program, research activities, statistical reports, and maintaining and increasing access to international markets. The CGC must demonstrate high standards of performance to all stakeholders and must provide services that are recognized as being relevant and valuable. The CGC will engage with grain handlers, domestic and international end–use customers, elected officials, central agencies, unions, and domestic and foreign government entities, including embassies, to expand understanding and appreciation for CGC programs and activities. Investing in stakeholder relations will form a strong foundation for ongoing efforts to ensure the CGC’s funding model and fees are reflective of the value provided.
Footnotes
Footnote 5

Type is defined as follows: previously committed to—committed to in the first or second fiscal year prior to the subject year of the report; ongoing—committed to at least three fiscal years prior to the subject year of the report; and new—newly committed to in the reporting year of the RPP or DPR.

Return to footnote 5 referrer

Risk Analysis

Key Risks
Risk Risk Response Strategy Link to Program Alignment Architecture
Adapting the organization to remain relevant to CGC stakeholders The CGC operates in an environment where the needs of Canadian producers and the grain industry continue to evolve rapidly. As such, the CGC will continue to investigate and integrate new technologies, processes and protocols into programs and services. The organizational priorities “relevant, efficient and innovative programs and services” and “investing in CGC infrastructure” are aimed at mitigating this risk. Trends will be monitored closely and mitigation strategies revised as required. Linked to the CGC’s sole strategic outcome and all CGC programs
Risk Risk Response Strategy Link to Program Alignment Architecture
Stakeholder pressure related to the CGC funding model While updated user fees took effect on August 1, 2013, there continues to be external pressure related to the CGC’s funding structure. The CGC will continue to work with external stakeholders, central agencies, and AAFC to investigate funding model options. The organizational priority “investing in stakeholder relations” is aimed at mitigating this risk by increasing stakeholder awareness of the value of CGC activities and services. Trends will continue to be monitored closely and mitigation strategies revised as required. Linked to the CGC’s sole strategic outcome and all CGC programs
Risk Risk Response Strategy Link to Program Alignment Architecture
Capacity within the CGC to deliver programs and adapt to change The CGC will continue efforts to ensure sufficient human resource capacity to carry out day-to-day operational work, while at the same time adapting to changes in the internal and external environments. While this is linked to all organizational priorities and programs, the priority “skilled, adaptable, engaged workforce” is aimed at mitigating this risk. Capacity trends will be monitored closely and mitigation strategies revised as required. Linked to the CGC’s sole strategic outcome and all CGC programs

Risk management is an essential part of strategic planning and decision making at the CGC. The Canadian grain industry, the CGC, and the Grain Quality Assurance System (GQAS) operate in a climate of constant change (e.g. grain volume and crop quality fluctuations, increased market demand for grain safety assurances). As such, the CGC is continually adapting programs and services to assure consistent and reliable grain quality and grain safety that meets the needs of international and domestic markets and to ensure Canadian grain producers are properly compensated for grain deliveries to licensed grain companies. Feedback from producers and grain handlers, domestic and international grain buyers and processors, and other domestic and foreign government entities has proven to be a reliable early indicator of risk arising from developments in our external environment.

The CGC has established a process to identify, monitor, mitigate and manage corporate level risks. Strategic planning includes preparation of an extensive environmental scan, broad and inclusive identification of emerging threats and/or opportunities for improvement, an internal and external workforce analysis, and the development of a corporate risk profile summary to identify areas of greatest risk exposure to the CGC in delivering its strategic outcome and programs. Corporate level risks and mitigation strategies are reviewed during the strategic planning process and key risks for the upcoming fiscal year are identified based on current internal and external factors. During 2014-15, the CGC re-established its Integrated Risk Management Working Group (IRMWG). This group includes representatives from all CGC programs and divisions. The group meets regularly to identify and assess CGC risks and risk response strategies. Information and recommendations from the IRMWG are forwarded to CGC senior management. Subsequently, senior management meets to review key corporate risks and to identify additional mitigation strategies and/or contingency plans if necessary.

Planned Expenditures

Budgetary Financial Resources (dollars)
2015–16
Main Estimates 6
2015–16
Planned Spending
2016–17
Planned Spending
2017–18
Planned Spending
60,537,521 60,537,521 61,538,819 62,557,000
Human Resources (Full-time equivalents—FTEs)
2015–16 2016–17 2017–18
404 404 404
Budgetary Planning Summary for Strategic Outcome and Programs (dollars)
Strategic Outcome, Programs and Internal Services 2012–13 Expenditures 2013–14 Expenditures 2014–15 Forecast Spending 2015–16 Main Estimates 6 2015–16 Planned Spending 2016–17 Planned Spending 2017–18 Planned Spending
1. Strategic Outcome:  Canada’s grain is safe, reliable and marketable and Canadian grain producers are properly compensated for grain deliveries to licensed grain companies
1.1 Quality Assurance Program 40,035,541 36,108,210 30,960,181 30,665,359 30,665,359 31,172,568 31,688,329
1.2 Quantity Assurance Program 12,520,212 10,988,215 1,769,754 1,752,902 1,752,902 1,781,895 1,811,377
1.3 Grain Quality Research Program 11,055,383 12,091,194 7,509,260 7,437,753 7,437,753 7,560,774 7,685,870
1.4 Producer Protection Program 3,711,368 3,614,362 3,597,984 3,563,722 3,563,722 3,622,667 3,682,604
Subtotal 67,322,504 62,801,981 43,837,179 43,419,736 43,419,736 44,137,904 44,868,180
Internal Services Subtotal 15,049,754 15,729,596 17,282,358 17,117,785 17,117,785 17,400,915 17,688,820
Total 82,372,258 78,531,577 61,119,537 60,537,521 60,537,521 61,538,819 62,557,000
Footnotes
Footnote 5

2015-16 Main Estimates published in this document represents total CGC budgetary expenditures. This is funded by annual appropriation of $5.48 million and user fees revenue of approximately $55.06 million. Estimated CGC budgetary expenditures published in the 2015-16 Main Estimates Publication is $5.48 million. This amount represents total estimated CGC budgetary expenditures of $60.54 million less forecasted revenues of $55.06 million.

Return to footnote 6 referrer

Fiscal years 2013-14 and 2014-15 were transition years for the CGC as a result of updates to user fees and amendments to the Canada Grain Act that came into effect concurrently on August 1, 2013. These changes resulted in a significant reduction in CGC operating costs and FTE requirements. Program spending for 2015-16 and future years reflects planned program spending under the amended Canada Grain Act. Spending on internal services was consistent during 2012-13 and 2013-14. Spending on internal services in 2014-15 and future years is forecast to be higher primarily because additional internal services support is required for work related to legislative amendments, transitioning to a sustainable funding model, evolving service delivery models, and some infrastructure renewal costs. In addition, human resource costs previously funded by AAFC are now being funded by the CGC. It is anticipated the CGC’s planned spending will stabilize at approximately $60.54 million. This will be funded by annual appropriation of $5.48 million and annual user fees revenue of approximately $55.06 million.

Alignment of Spending With the Whole-of-Government Framework

Alignment of 2015–16 Actual Spending With the Whole-of-Government-Framework (dollars)
Strategic Outcome Program Spending Area Government of Canada Outcome 2015–16 Planned Spending
1.Canada’s grain is safe, reliable and marketable and Canadian grain producers are properly compensated for grain deliveries to licensed grain companies 1.1 Quality Assurance Program Economic Affairs An innovative and knowledge-based economy 30,665,359
  1.2 Quantity Assurance Program Economic Affairs An innovative and knowledge-based economy 1,752,902
  1.3 Grain Quality Research Program Economic Affairs An innovative and knowledge-based economy 7,437,753
  1.4 Producer Protection Program Economic Affairs A fair and secure marketplace 3,563,722
Total Spending by Spending Area (dollars)
Spending Area Total Planned Spending
Economic Affairs 43,419,736
Social Affairs Nil
International Affairs Nil
Government Affairs Nil

Departmental Spending Trend

Departmental Spending Trend Graph

Departmental Spending Trend Graph. Text version below.
[text version]
Departmental Spending Trend Graph
  2012-13 2013-14 2014-15 2015-16 2016-17 2017-18
Sunset Programs - Anticipated 0 0 0 0 0 0
Statutory 50 743 46 719 54 704 55 654 56 655 57 673
Voted 31 629 31 813 6 416 4 884 4 884 4 884

The Spending Trend Graph shows CGC actual spending (2012-13 and 2013-14), forecast spending (2014-15), and planned spending (2015-16 through 2017-18). Actual spending was consistent in 2012-13 and 2013-14. During 2013-14, the CGC completed consultations on updated user fees based on streamlined CGC operations and amendments to the Canada Grain Act. Fiscal years 2013-14 and 2014-15 were transition years for the CGC as a result of updates to user fees and amendments to the Canada Grain Act that came into effect concurrently on August 1, 2013. Funding for fiscal years 2012-13, 2013-14, and 2014-15 includes a combination of an ongoing appropriation, ad hoc appropriation and authority to re-spend revenues collected from fees. Fiscal year 2015-16 will be the first full year for the CGC under its updated user fees structure.

Updated CGC user fees are expected to eliminate the requirement for annual ad hoc funding going forward. It is anticipated the CGC’s planned spending will stabilize at approximately $60.54 million. This will be funded by annual appropriation of $5.48 million and user fees revenue of approximately $55.06 million. Proposed amendments to the Canada Grain Act contained in Bill C-48 will not impact planned spending.

It is important to note that CGC revenues and expenditures are dependent on annual grain volumes and crop quality that can fluctuate considerably from year to year, and are not fully known prior to commencement of the fiscal year. These factors can result in significant variances between CGC revenue and expenditure projections and actual results. The CGC’s user fees structure and revenue projections are based on average annual grain volumes of 23.3 million metric tonnes. Because actual grain volumes vary from year to year, in years with higher-than-average grain volumes, revenues may exceed costs and the CGC could accumulate surpluses. In years with lower-than-average grain volumes, revenues could be less than costs and the CGC must draw on its surpluses. The Government’s revolving fund policy requires that CGC revenues and expenses balance over a 5-year time horizon. Furthermore, in this current period the CGC is not permitted to use a line of credit and can only offset a deficit from its surplus. During 2015-16, the CGC will commence a review of its fee structure to ensure that user fees accurately reflect the costs of providing services and reflect updated grain volume projections. Any adjustments to the fee structure and user fees will be made upon completion of the user fees review.

Estimates by Vote

For information on the CGC’s organizational Votes and statutory expenditures, consult the 2015–16 Main Estimates on the Treasury Board of Canada Secretariat website.


Section II: Analysis of Programs by Strategic Outcome

Strategic Outcome: Canada’s grain is safe, reliable and marketable and Canadian grain producers are properly compensated for grain deliveries to licensed grain companies

Program 1.1: Quality Assurance Program

Description

The CGC's quality assurance program is delivered pursuant to the Canada Grain Act and the Canada Grain Regulations. This program assures consistent and reliable grain quality that meets the needs of international and domestic markets. Grain quality refers to end use processing quality, grain safety and cleanliness, and, in some cases, the composition of varieties in shipments of grain. Provision of grain inspection, grain safety, grain sanitation, grading and analytical services, as well as strong scientific and technical support programs and services are integral components to the overall delivery of an effective quality assurance program. The program includes a complaints resolution process for resolving customer complaints and disputes with respect to grain quality assurance. An effective grain quality assurance program is a key factor in permitting Canadian exporters to market successfully in competitive international grain markets and is essential for producers to realize maximum value from their grain. The quality assurance program is funded by revolving fund revenue.

Budgetary Financial Resources (dollars)
2015–16 Main Estimates 2015–16 Planned Spending 2016–17 Planned Spending 2017–18 Planned Spending
30,665,359 30,665,359 31,172,568 31,688,329
Human Resources (Full-Time Equivalents—FTEs)
2015–16 2016–17 2017–18
226 226 226
Performance Measurement
Expected Results Performance Indicators Targets Date to Be Achieved
Consistent and reliable grain quality and grain safety assurance to meet the needs of domestic and international markets Number of justified cargo complaints due to a breakdown in CGC quality and/or safety assurance Zero March, 2016
Number of instances where buyers are dissatisfied with CGC standards, methods or procedures used to ensure a safe and dependable commodity for domestic and export markets Zero March, 2016

Planning Highlights

The Quality Assurance Program directly supports the delivery of the CGC’s mandate and is necessary for the CGC to deliver upon its strategic outcome of assuring Canada’s grain is safe, reliable and marketable. To achieve the program expected results, the CGC will continue to maintain and deliver an effective Quality Management System as per the ISO 9001:2008 and ISO 17025:2008 standards. Adherence to ISO Quality Management System procedures includes regular review of quality assurance processes allowing the CGC to adjust service procedures and identify or adjust training as necessary.

To ensure consistent and reliable grain quality and grain safety assurance and facilitate international trade, the Quality Assurance Program must continue to align with and be able to respond to the changing requirements of domestic and international grain markets. Proposed amendments to the Canada Grain Act, contained in Bill C-48, would enhance grain quality and grain safety assurance by:

  • giving the CGC the authority to monitor and test with respect to grain safety issues at grain elevators in Eastern Canada; and
  • creating a new class of licence for container loading facilities, in response to increasing volumes of grain shipped in containers, to maintain Canada’s reputation for consistent grain quality and safety.

Until such time that the Canada Grain Act is changed, the CGC will continue to operate under its current responsibilities and authorities.

During 2015-16, the CGC will continue to liaise with other Canadian government departments (e.g. AAFC, the Canadian Food Inspection Agency (CFIA), Health Canada, and Department of Foreign Affairs, Trade and Development), the Canadian grain industry, producers, as well as other domestic and foreign government entities concerning grain quality and safety matters and trade implications. Communication efforts will focus on clarifying the CGC’s role. This will facilitate the evolution of grain quality and grain safety assurance activities and services in accordance with that role.

Additional information on the activities and services that contribute to the Quality Assurance Program is available on the CGC website.

Program 1.2: Quantity Assurance Program

Description

The CGC’s quantity assurance program is delivered pursuant to the Canada Grain Act and the Canada Grain Regulations. The services delivered under this program facilitate the official weighing of export shipments of grain discharged from terminal elevators and the issuance of accompanying quantity assurance documentation. This program ensures international grain buyers and end users that Canadian export grain shipments are accurately weighed and that the weighed product is delivered to conveyances as reported on CGC documentation. The program includes validation of weighing process documentation and weighing device records, establishing and maintaining a weighing systems certification program, and providing input into weighing equipment requirements to ensure accurate weighing of grain shipments from terminal elevators. The quantity assurance program is funded by revolving fund revenue.

Budgetary Financial Resources (dollars)
2015–16 Main Estimates 2015–16 Planned Spending 2016–17 Planned Spending 2017–18 Planned Spending
1,752,902 1,752,902 1,781,895 1,811,377
Human Resources (Full-Time Equivalents—FTEs)
2015–16 2015–16 2016–17
14 14 14
Performance Measurement
Expected Results Performance Indicators Targets Date to Be Achieved
Consistent and reliable quantity assurance of Canadian grain shipments Number of justified cargo complaints due to a breakdown in CGC quantity assurance processes Zero March, 2016

Planning Highlights

The Quantity Assurance Program must align with and be able to respond to the changing requirements of the grain industry while still effectively ensuring consistent and reliable quantity assurance of Canadian grain exports. The 2013 amendments to the Canada Grain Act streamlined CGC service delivery to more efficiently deliver this program and removed services that were no longer necessary to meet the program expected result. This included fully transforming to a Weighing Oversight and Certification Program (WOCP) and implementing Automated Weight Recording and Playback System (AWRAPS) technology at export positions. Going forward, the CGC will continue to provide services under the established WOCP, provide oversight validation of weighing process documentation and weighing device records, conduct periodic onsite auditing of terminal weighing procedures, and provide input into weighing equipment requirements to ensure accurate quantity assurance of grain shipments from terminal elevators.

During 2015-16, the CGC will continue to provide all weighing activities as per ISO 9001:2008 Standards to ensure consistent and reliable quantity assurance of Canadian grain shipments and to meet the legislative requirements of the Canada Grain Act. This includes regular review of quantity assurance processes allowing the CGC to adjust service procedures and identify or adjust training as necessary. The CGC will continue to work closely with producers, industry stakeholders, Measurement Canada, AAFC, and other government departments and agencies to establish and maintain grain quantity assurance standards that evolve with industry grain weighing procedures, equipment standards, and quantity assurance needs.

Additional information on the activities and services that contribute to the Quantity Assurance Program is available on the CGC website.

Program 1.3: Grain Quality Research Program

Description

The Canada Grain Act requires the CGC to undertake, sponsor and promote research related to grains. The CGC conducts research in support of Canada’s grain quality assurance system to address emerging issues and facilitate the effective marketing of Canadian grain in domestic and international markets. The CGC’s Grain Research Laboratory (GRL) researches factors affecting the quality and safety of grain and grain-based products as well as procedures and technologies to quantify those factors. Research in the GRL forms the basis of grade specifications. This program benefits not only the agricultural sector, but also Canadians as consumers of grain products. Close collaboration with Canadian and international scientific, academic, analytical, grain industry organizations, as well as other Canadian government departments (e.g., Agriculture and Agri-Food Canada, Canadian Food Inspection Agency, Health Canada) ensures that the CGC remains abreast of new research developments and is able to adapt research priorities to emerging challenges. The grain quality research program is funded by a combination of revolving fund revenue and appropriations.

Budgetary Financial Resources (dollars)
2015–16 Main Estimates 2015–16 Planned Spending 2016–17 Planned Spending 2017–18 Planned Spending
7,437,753 7,437,753 7,560,774 7,685,870
Human Resources (Full-Time Equivalents—FTEs)
2015–16 2016–17 2017–18
44 44 44
Performance Measurement
Expected Results Performance Indicators Targets Date to Be Achieved
Scientific information is available to support and inform GQAS decision making Number of instances where timely and appropriate scientific information is not available to support and inform GQAS decision making Zero March, 2016
Domestic and international marketers, buyers, and processors have accurate and appropriate scientific information on the quality and safety of Canadian grain Number of instances where domestic and international marketers, buyers, and processors do not have access to accurate and appropriate scientific information on the quality and safety of Canadian grain Zero March, 2016
Threats to Canada's GQAS from registration of new varieties are minimized Number of complaints from end-users of Canadian grain on the quality of newly registered varieties Zero March, 2016

Planning Highlights

The Grain Quality Research Program contributes directly to the CGC’s strategic outcome of ensuring Canada’s grain is consistent, safe and marketable. Research undertaken and sponsored by the CGC leads to the development of recognized methods for quality and safety evaluation of all grains as well as objective testing protocols and specifications to support the Canadian grading system. In addition, research conducted under this program facilitates end-use diversification of Canadian grains and ensures that Canadian grains meet the end-use needs and processing expectations of domestic and international buyers.

During 2015-16, research priorities will be identified to build upon and strengthen Canada’s GQAS based on feedback received by CGC personnel from international and/or domestic buyers, processors, producers, grain handlers, and the Western Standards Committee and Eastern Standards Committee. To remain abreast of new developments, GRL personnel will continue to liaise with Canadian and international scientific, academic, analytical, and grain industry organizations.

Close cross-divisional collaboration among the GRL’s Crops Section, the GRL’s Technologies Section, and the CGC’s Industry Services Division is critical to meeting the expected results associated with the Grain Quality Research Program. Continued efforts to maintain collaboration and coordination of research efforts both internally and with external research partners (e.g. universities, international organizations) and other domestic and foreign government entities will ensure that the GRL is able to adapt research priorities to emerging challenges, address stakeholder needs, and use resources effectively.

Additional information on the Grain Quality Research Program is available on the CGC website.

Program 1.4: Producer Protection Program

Description

Pursuant to the Canada Grain Act and Canada Grain Regulations, the CGC has implemented a number of programs and safeguards to ensure that grain producers are properly compensated for grain delivered to licensed grain companies. These include the licensing and security program, allocation of available producer cars for producers and producer groups that wish to ship their own grain, and producer liaison measures including education and a grain grade reinspection system. In addition, the CGC collects and updates grain quality data and grain handling information to facilitate producer sales and marketing decisions. The producer protection program is funded by revolving fund revenue.

Budgetary Financial Resources (dollars)
2015–16 Main Estimates 2015–16 Planned Spending 2016–17 Planned Spending 2017–18 Planned Spending
3,563,722 3,563,722 3,622,667 3,682,604
Human Resources (Full-Time Equivalents—FTEs)
2015–16 2016–17 2017–18
30 30 30
Performance Measurement
Expected Results Performance Indicators Targets Date to Be Achieved
Risk to producers of not receiving fair compensation for their grain is mitigated Percentage of producers who agree that CGC producer protection activities help to reduce the risk of not being fairly compensated for grain delivered into the licensed grain handling system 75 percent March, 2016
Producers are aware of CGC producer protection programs and services Percentage of producers who are aware of CGC producer protection activities 75 percent March, 2016

Performance Analysis and Lessons Learned

Bill C-30, the Fair Rail for Grain Farmers Act, contained amendments to the Canada Grain Act to allow the CGC to regulate provisions in grain contracts between producers and grain buyers. Amendments to the Canada Grain Regulations came into effect on August 1, 2014 that enhanced producer protection and will contribute to more balanced contractual relationships between grain companies and producers. Producers now have a mechanism where they could be paid a penalty amount if their grain deliveries are not accepted within the timeframes defined in their contracts with grain companies licensed by the CGC. The CGC will continue communication efforts to ensure producers and grain companies are aware of these new provisions.

During the planning period, the CGC will continue to consult with and evaluate feedback from producers on the services provided under this program. Further amendments to CGC processes, protocols and the CGC’s legislative framework,identified as an organizational priority in Section I, are being considered to address gaps in the Producer Protection Program and complement the legislative amendments that came into force on August 1, 2013. Bill C-48 includes proposed legislative changes that would expand “subject to inspector’s grade and dockage” provisions to licensed process elevators, grain dealers, and container loading operations, and provide authority to establish a producer compensation fund for use in the event that a licensee fails to pay for a grain delivery. In addition, feed mills that purchase grain from producers may be brought under the licensing and producer payment protection program, through the regulatory process. Until such time that the Canada Grain Act and/or Canada Grain Regulations are actually changed, the CGC will continue to operate under its current responsibilities and authorities. Where possible, program amendments will be made to benefit producers and promote a lower cost, competitive and innovative grain handling sector. The CGC will continue communication efforts to ensure producers are aware of their rights under the Canada Grain Act and to increase awareness of CGC producer protection activities and services.

Additional information on the producer protection programs and the benefits to Canadian producers is available on the CGC website.

Sub-Program 1.4.1: Licensing and Security Program

Description

Pursuant to the Canada Grain Act and Canada Grain Regulations, the CGC licenses or exempts grain companies from licensing if their businesses meet certain legislated requirements. The licensing and security program mitigates risks to producers of not being properly compensated for grain delivered to licensed grain companies and provides the framework for establishing and maintaining the Canadian grain quality assurance system. CGC licensees are required to obtain and maintain prescribed security for the purpose of covering their potential obligations to producers in the event of a company default.

Budgetary Financial Resources (dollars)
2015–16 Planned Spending 2016–17 Planned Spending 2017–18 Planned Spending
1,291,199 1,312,556 1,334,272
Human Resources (FTEs)
2015–16 2016–17 2017–18
12 12 12
Performance Measurement
Expected Results Performance Indicators Targets Date to Be Achieved
Risks to producers of not being properly compensated for grain delivered to a CGC licensee is mitigated Percentage of producers who agree that the CGC's licensing and security program reduces the risk of not being properly compensated for grain delivered into the licensed grain handling system 75 percent March, 2016

Planning Highlights

Currently, all licensees are required to provide security to the CGC as a condition of licensing. Proposed legislation to amend the Canada Grain Act (Bill C-48), would establish the authority for the CGC to administer a Producer Compensation Fund. This authority would provide additional flexibility with respect to an alternative producer payment protection model. A Producer Compensation Fund could be used as a stand-alone program, or in conjunction with an insurance-based model, or the current program. In addition, to further enhance producer payment protection, the CGC is investigating licensing of feedmills that purchase grain from producers. Until such time that the Canada Grain Act and/or the Canada Grain Regulations are amended, the CGC will continue to operate under its current responsibilities and authorities. During 2015-16, the CGC will continue to monitor CGC licensees using a risk assessment framework and a risk-based audit plan to determine audit priorities. This includes continuous refinements to the risk assessment framework and ongoing scrutiny to mitigate the risks associated with operating the current security program as well as non-payment risks to producers.

Sub-Program 1.4.2: Producer Car Allocation Program

Description

Pursuant to the Canada Grain Act and Canada Grain Regulations, the CGC provides an alternate grain delivery mechanism for producers and producer groups that wish to ship their own grain by railcar. The CGC works closely and cooperatively with the grain industry and the railways in an effort to ensure that producer car orders are filled in a timely manner. The CGC has sole responsibility for the allocation of available producer cars for all grains.

Budgetary Financial Resources (dollars)
2015–16 Planned Spending 2016–17 Planned Spending 2017–18 Planned Spending
297,832 302,758 307,767
Human Resources (FTEs)
2015–16 2016–17 2017–18
3 3 3
Performance Measurement
Expected Results Performance Indicators Targets Date to Be Achieved
Producers are able to bypass the primary elevator system and ship grain to port position or another destination of their choosing The number of formal justifiable complaints related to producer car access and availability Zero March, 2016
Percentage of producers who use the producer car allocation program who are satisfied with the program 75 percent March, 2016

Planning Highlights

The CGC will continue to work closely and cooperatively with producer car administrators and the railways in an effort to ensure that the producer car allocation program in modernized to respond to the evolving needs of the industry. In addition, the CGC will continue communication efforts to ensure producers and producer groups are aware of the producer car program and the steps involved in applying for a producer car if they choose to ship their own grain by railcar.

Sub-Program 1.4.3: Producer Support Programs

Description

The CGC has several programs and activities to ensure producers are properly compensated for the quality of grain delivered and shipped. These programs and activities are not material enough to be considered independently. They include the submitted samples program, the harvest sample program, reinspection of samples on producer request, and investigation of quality and dockage complaints. In addition, the CGC continually collects and updates grain quality data and grain handling information and makes it available to producers and other interested parties to facilitate producer sales and marketing decisions.

Budgetary Financial Resources (dollars)
2015–16 Planned Spending 2016–17 Planned Spending 2017–18 Planned Spending
1,974,691 2,007,353 2,040,565
Human Resources (FTEs)
2015–16 2016–17 2017–18
15 15 15
Performance Measurement
Expected Results Performance Indicators Targets Date to Be Achieved
Risk to producers of not receiving fair compensation for the quality of grain delivered into the licensed grain handling system is mitigated Percentage of producers who agree that access to CGC third party quality information reduces their risks of not receiving fair compensation for the quality of their grain upon delivery into the licensed grain handling system 70 percent March, 2016

Planning Highlights

The CGC will continue communication efforts to ensure producers are aware of the producer support programs available to them under this sub-program. This includes consulting with and evaluating feedback from producers on access to CGC third party quality information.

Currently, producers who deliver to licensed primary elevators have the right to CGC binding determination when they disagree with the grade and dockage assigned by the elevator company, whereas producers delivering to licensed process elevators and grain dealers cannot get a second opinion on grade and dockage from a CGC inspector. Proposed legislative amendments contained in Bill C-48 would expand “subject to inspector’s grade and dockage” provisions to licensed process elevators, grain dealers, and container loading elevators. The proposed legislative changes would give producers the same rights when delivering to all CGC licensees and would resolve inconsistencies in producer rights across the licensed grain handling system.

During 2015-16, the CGC will also continue to work with grain quality and grain handling data providers to ensure statistical information is accurate and available to producers and other users of the data. Further updates to operational processes will be made to improve efficiency, reduce costs, and increase accessibility to online CGC statistical information.

Internal Services

Description

Internal Services are groups of related activities and resources that are administered to support the needs of programs and other corporate obligations of an organization. Internal services include only those activities and resources that apply across an organization, and not those provided to a specific program. The groups of activities are Management and Oversight Services; Communications Services; Legal Services; Human Resources Management Services; Financial Management Services; Information Management Services; Information Technology Services; Real Property Services; Materiel Services; and Acquisition Services.

Budgetary Financial Resources (dollars)
2015–16 Main Estimates 2015–16 Planned Spending 2016–17 Planned Spending 2017–18 Planned Spending
17,117,785 17,117,785 17,400,915 17,688,820
Human Resources (FTEs)
2015–16 2016–17 2017–18
90 90 90

Planning Highlights

Internal Services include only those activities and resources that apply across the organization and not those provided specifically to a program. Because internal services are enabling activities, the CGC measures performance by tracking results against organizational and government-wide priorities.

During 2015-16, a key focus will continue to be providing support and services with respect to the CGC’s organizational priorities identified in Section I. In addition to providing organizational support for these priorities, plans include adjusting and adapting Internal Services activities, tools, and resources to be as efficient as possible. Feedback from the 2014 Public Service Employee Survey and the 2014 Management Accountably Frameworkassessment will be used to identify organizational strengths, areas that require improvement, and priorities going forward. Two Government of Canada initiatives that will continue to be a focus of CGC attention going forward include Blueprint 2020 and the Performance Management Directive.


Section III: Supplementary Information

Future-Oriented Statement of Operations

The future-oriented condensed statement of operations provides a general overview of the Canada Grain Commission’s operations. The forecast of financial information on expenses and revenues is prepared on an accrual accounting basis to strengthen accountability and to improve transparency and financial management.

Because the future-oriented condensed statement of operations is prepared on an accrual accounting basis, and the forecast and planned spending amounts presented in other sections of the Report on Plans and Priorities are prepared on an expenditure basis, amounts differ.

A more detailed future-oriented statement of operations and associated notes, including a reconciliation of the net cost of operations to the requested authorities, can be found on the Canadian Grain Commission’s website.

Future-Oriented Condensed Statement of Operations
For the Year Ended March 31(dollars)
Financial Information 2014–15
Estimated Results
2015–16
Planned Results
Difference
Total expenses 55,240,654 59,648,376 4,407,722
Total revenues 80,836,306 60,537,521 (20,298,785)
Net cost of operations (25,595,652) (889,145) (24,706,507)

The net costs of CGC operations for 2015-16 are projected to be $(0.889) million, a planned increase of $24.7 million due to:

Total expenses

Total expenses for the CGC are planned to be $59.6 million in 2015-16, an increase of $4.4 million over the 2014-15 forecasted expenditures of $55.2 million. This is mainly due to the transformation of the CGC to its new structure as a result of the amendments to the Canada Grain Act and revised user fees. Planned expenditures are based on the expectation that the CGC will secure the necessary resources required to continue to deliver on its mandate. Investing in CGC infrastructure has been identified as a priority for 2015-16 to ensure the ongoing viability of the CGC.

Total revenues

Total revenues for the CGC are planned to be $60.5 million in 2015-16, a decrease of $20.3 million over the 2014-15 forecasted revenue of $80.8 million. This is mainly due to increased revenues realized in 2014-15 resulting from higher grain volumes handled due to the 2013 record crop carryover. In 2015-16, the CGC plans to earn revenues based on a five year historical average grain volume of 23.3 million tonnes of grain, whereas in 2014-15, the CGC forecasts grain volumes of 35.3 million tonnes of grain.During 2015-16, the CGC will commence a review of its fee structure to ensure that user fees accurately reflect the costs of providing services and reflect updated grain volume projections. Any adjustments to the fee structure and user fees will be made upon completion of the user fees review.

Supplementary Information Tables

The supplementary information tables listed in the 2015–16 Report on Plans and Priorities can be found on the Canadian Grain Commission’s website.

Tax Expenditures and Evaluations

The tax system can be used to achieve public policy objectives through the application of special measures such as low tax rates, exemptions, deductions, deferrals and credits. The Department of Finance Canada publishes cost estimates and projections for these measures annually in the Tax Expenditures and Evaluations publication. The tax measures presented in the Tax Expenditures and Evaluations publication are the sole responsibility of the Minister of Finance.


Section IV: Organizational Contact Information

Rémi Gosselin

Manager, Corporate Information Services
Canadian Grain Commission

303 MAIN STREET, Canadian Grain Commission Bldg, Floor 8, Room 801
Winnipeg, Manitoba  R3C 3G8
Canada

Telephone: 204-983-2749

Fax: 204-983-6098

Email : contact@grainscanada.gc.ca

CGC website: www.grainscanada.gc.ca


Appropriation:
Any authority of Parliament to pay money out of the Consolidated Revenue Fund.
Budgetary expenditures:
Include operating and capital expenditures; transfer payments to other levels of government, organizations or individuals; and payments to Crown corporations.
Departmental Performance Report:
Reports on an appropriated organization’s actual accomplishments against the plans, priorities and expected results set out in the corresponding Reports on Plans and Priorities. These reports are tabled in Parliament in the fall.
Full-time equivalent:
Is a measure of the extent to which an employee represents a full person-year charge against a departmental budget. Full-time equivalents are calculated as a ratio of assigned hours of work to scheduled hours of work. Scheduled hours of work are set out in collective agreements.
Government of Canada outcomes:
A set of 16 high-level objectives defined for the government as a whole, grouped in four spending areas: economic affairs, social affairs, international affairs and government affairs.
Management, Resources and Results Structure:
A comprehensive framework that consists of an organization’s inventory of programs, resources, results, performance indicators and governance information. Programs and results are depicted in their hierarchical relationship to each other and to the Strategic Outcome(s) to which they contribute. The Management, Resources and Results Structure is developed from the Program Alignment Architecture.
Non-budgetary expenditures:
Include net outlays and receipts related to loans, investments and advances, which change the composition of the financial assets of the Government of Canada.
Performance:
What an organization did with its resources to achieve its results, how well those results compare to what the organization intended to achieve and how well lessons learned have been identified.
Performance indicator:
A qualitative or quantitative means of measuring an output or outcome, with the intention of gauging the performance of an organization, program, policy or initiative respecting expected results.
Performance reporting:
The process of communicating evidence-based performance information. Performance reporting supports decision making, accountability and transparency.
Planned spending:
For Reports on Plans and Priorities (RPPs) and Departmental Performance Reports (DPRs), planned spending refers to those amounts that receive Treasury Board approval by February 1. Therefore, planned spending may include amounts incremental to planned expenditures presented in the Main Estimates.
A department is expected to be aware of the authorities that it has sought and received. The determination of planned spending is a departmental responsibility, and departments must be able to defend the expenditure and accrual numbers presented in their RPPs and DPRs.
Plans:
The articulation of strategic choices, which provides information on how an organization intends to achieve its priorities and associated results. Generally a plan will explain the logic behind the strategies chosen and tend to focus on actions that lead up to the expected result.
Priorities:
Plans or projects that an organization has chosen to focus and report on during the planning period. Priorities represent the things that are most important or what must be done first to support the achievement of the desired Strategic Outcome(s).
Program:
A group of related resource inputs and activities that are managed to meet specific needs and to achieve intended results and that are treated as a budgetary unit.
Program Alignment Architecture:
A structured inventory of an organization’s programs depicting the hierarchical relationship between programs and the Strategic Outcome(s) to which they contribute.
Report on Plans and Priorities:
Provides information on the plans and expected performance of appropriated organizations over a three-year period. These reports are tabled in Parliament each spring.
Strategic Outcome:
A long-term and enduring benefit to Canadians that is linked to the organization’s mandate, vision and core functions.
Results:
An external consequence attributed, in part, to an organization, policy, program or initiative. Results are not within the control of a single organization, policy, program or initiative; instead they are within the area of the organization’s influence.
Sunset program:
A time-limited program that does not have an ongoing funding and policy authority. When the program is set to expire, a decision must be made whether to continue the program. In the case of a renewal, the decision specifies the scope, funding level and duration.
Target:
A measurable performance or success level that an organization, program or initiative plans to achieve within a specified time period. Targets can be either quantitative or qualitative.
Whole-of-government framework:
Maps the financial contributions of federal organizations receiving appropriations by aligning their Programs to a set of 16 government-wide, high-level outcome areas, grouped under four spending areas.