Estevan – Komarnicki stated “I just can’t understand what the federal government is up to. On the one hand they say they are concerned about Western alienation and on the other hand their sticking it to Western Canada and Saskatchewan in particular.”

The Farm Improvement Loan Program has just been cancelled and it’s a program that has significant ramifications for farmers and financial institutions alike in Souris-Moose Mountain.

Qualifying Farmers under the Farm Improvement Loan Program could borrow 90% instead of 75% of market value of land, equipment and breeding stock and at a favorable interest rate of prime plus one.

When times are tough it seems remarkable that a program would be dropped that otherwise would help farmers with a lower rate of interest and greater borrowing power at a time of need.

It affects financial institutions and Credit Unions in particular who provide a significant amount of farm financing. In addition they must now set aside reserves for lending that will no longer be government guaranteed.

“To give an example” Komarnicki stated “In 2004 Saskatchewan financial institutions gave out nearly 67 million in loans or 70% of total loans given out in all of Canada.”

“While it’s true” said Komarnicki “that the overall borrowing has been declining since a high lending rate of 188 million in 2001 the Saskatchewan rural economy has taken a significant beating in the intervening years and a decline in borrowing should not at this time be a bases for cancellation of the program.”.

“On average” said Komarnicki “the banks and Credit Unions each provide about half the FIL financing.”

Given the state of our farm economy it again displays a sense of liberal arrogance in cancelling a program without checking the impact it may have in rural Saskatchewan.

“I find it amazing that our finance minister that hails from Saskatchewan has not put a stop to it especially at a time when farmers are suffering the effects of BSE, frost, low commodity prices and an uncertain economic future.”

“Surely” said Komarnicki “during one of the most difficult years in agriculture where we expect financial institutions to work with farmers for another year the government shouldn’t pull the plug on the farm improvement loan guarantee program.”

“This issue” said Komarnicki “must be raised and pursued with the Minister of Finance and Agriculture as well as in the House and any other avenue that is available. You can expect it will be raised when I speak to the budget on Monday” concluded Komarnicki.