'Made-in-the-North' changes coming to food subsidy program: AANDC

As public outcry over high food prices in Canada's North continues, the federal government says it is taking steps to improve its food subsidy program.

Last November, the Auditor General of Canada produced a report that pointed out a number of issues with Nutrition North Canada, going so far as to say that Aboriginal Affairs and Northern Development Canada does not gather enough information to know if retailers are passing on the full savings to customers.

Mark Strahl, the parliamentary secretary for the department, says that will soon change.

“The requirement for retailers to post their profit margins, their profit margins over time, the subsidy levels they're receiving. That information as of April will be part of those contracts and will be publicly available," said Strahl.

The change is in direct response to one of the points raised in the Auditor General's report: that Aboriginal Affairs collects information based on the wholesale cost of the food, the transportation cost and the selling price, but does not look at the profit margin on food or the rate of spoilage. 

“I would think that retailers should be eager to show customers who are purchasing their products that they are passing along those subsidies to them,” said Strahl.

The president of one of the North's biggest food retailers says that consumers could already easily access that information by looking at the company's financial statements, and if Nutrition North is going to be improved, people need to look beyond that.

“I think there's been some simplification and vilification of issues,” said Edward Kennedy, the president and CEO of the North West Company. “We have to be knowledgeable and realistic.”

Kennedy said their profit margin is usually 4 or 5 cents on the dollar.

“It's a skinny business. I was going through our [Iqaluit] store yesterday, and if First Air doesn't ship our freight and we get two loads at once, then we have to write off half of the freight or donate it... That's fine too, but all the costs of doing business in the North, they don't begin and end with freight.”

Not a 'made-in-Ottawa' solution

Since the Auditor General's findings were released, Aboriginal Affairs has said that it will review the program and consult with advisory groups, political officials, retailers and Northerners themselves.

Strahl says that process is moving forward and he hopes consultations will begin in earnest this spring.

“The consultations will focus in those communities [who need the subsidy], including in Nunavut,” he said.

“We want to hear from Northerners and not develop a made-in-Ottawa solution. We want a made-in-the-North solution for the challenges to this program.”

Strahl wouldn't say if the Nutrition North Canada Advisory Board will definitely conduct in-person consultations in Nunavut, but he thinks that it will.

“I anticipate there will be those types of [town hall] meetings and round tables held," said Strahl.

Kennedy, whose company was the recent subject of a pan-Northern boycott, said Northerners understand the cost of operating in remote communities because they deal with those same costs.

“Whether it's the rent they pay, their internet fees, their fuel costs, their repair and maintenance costs, unfortunately, it adds up," Kennedy said.

He said the North West Company and other retailers are fighting for other issues to be addressed.

“We're also advocating for changes that have recently hit the headlines, on eligibility of communities, subsidy equity between communities and inclusion and exclusion of certain items.”