OTTAWA — The Canadian Agricultural Income Stabilization program, popularly known as CAIS, is foundering in incompetence and possibly fraud, according to the Auditor General’s report released in early May.

Agriculture and Agri-Food Canada made errors totalling $70 million or 10 per cent in 2003 and 2004 but was able to reduce that the following year to $43 million. The probability for error was much higher than the figures indicate, says the auditor, because Agriculture Canada did not check those farms that applied and didn’t receive money from the $1.5 billion program. About 25,000 farms out of the 57,000 farms that applied received no payments while the payout to others was too low to check, altogether accounting for 70 per cent of applicants.

The Auditor General said that Agriculture Canada focused on over payment and neglected to check whether or not it was under paying farms on the lower end.

Twelve producers received more than $1 million apiece while 50 received $500,000 or more. The rest received $10,000 or fewer.

The auditor accused Agriculture Canada of lack of transparency, noting that it failed to inform farmers of changes in processing procedure. One farm that evidently was informed increased its payout by $90,000 because of following the changes.

Employees at Agriculture Canada were filling in application forms for their own farms, while others were moonlighting, filling in forms for others. They were processing forms by day, not necessarily the ones they filled out.

At one point 18 CAIS employees were sent additional reminders to cease filing forms for personal clients. Five employees were ordered to stop making out forms for clients.

The auditor-general said the program was far too complex, with more than 1,500 codes. More than 70 per cent of the farms used a financial advisor to complete the forms.

The auditor-general recommends more training for staff and noted that incompetence seems endemic to Agriculture Canada.

The auditor said: "Our past audits of previous farm income support programs have found similar problems."

CAIS is a federal-provincial program supported 60 per cent by the federal government and 40 per cent by the provincial government. Ontario, Quebec, British Columbia, Alberta and Prince Edward Island administer their programs. But that’s no guarantee of anything. The auditor-general said that provincial systems have the same problems with delivery.

The average waiting time for a cheque has been 120 days for federal delivery programs. It is expected to be lowered by half.

Says the president of the Ontario Corn Producers Dale Mountjoy: "Our membership has been telling us there have been lots of problems."

An audit of Agricorp would take about two years, says OFA vice-president Bette-Jean Crews. The proivnce has yet to decide if it will allow an audit of Agricorp.