The Montreal Economic Institute, long a strident critic of supply management, says the government should end the system by buying out quota.
It proposes paying about $13 billion over 10 years and funding it with a temporary tax.
The institute says ridding Canada of supply management “would be positive both for farmers and for Canadian consumers.”
Alexandre Moreau, public policy analyst at MEI, and one of the authors of the report, wrote that “if the government decided to compensate farmers for the value of their quotas over a period of 10 years, it would have to offer them annual payments of $1.6 billion.
“Yet the net benefit for consumers would be from $3.9 billion to $5.1 billion each year, and up to $6.7 billion once the reimbursement period is over.
“This exit plan would be positive and fair both for farmers and for consumers. Now, it's up to public decision-makers to take action and dismantle this regime that is unfair and costly for consumers, all while adequately compensating farmers,” he wrote.
The buyouts should vary among producers to ensure no one receives “excessive compensation” for quota acquired at a low cost, the report says.
“Such a policy was used successfully in Australia when that country eliminated its own supply management system,” Vincent Geloso, associate researcher and the other author of the report.