Nutrition North Canada Advisory Board Second Report

The Advisory Board's report, findings and recommendations for April 2012 to December 2016.

Table of contents

Introduction

Dear Minister Bennett,

It is my honour, on behalf of the Nutrition North Canada (NNC) Advisory Board, to present our second report to you. This report represents the Advisory Board's activities following the First Report of the Advisory Board for February 2011 to March 2012. In terms of program milestones, it spans the final months of the 18-month transition from the former Food Mail Program up until the close of the NNC public engagement process on December 9, 2016.

We are particularly pleased that, over the period of this report, we had the opportunity to visit several communities across the North, including Goose Bay and Nain in Labrador; Norman Wells in the Northwest Territories; Rankin Inlet, Iqaluit and Kugluktuk in Nunavut; and Old Crow in Yukon, and most recently in Fort Hope and Kitchenuhmaykoosib Inninuwug in Ontario.

While some issues remain to be addressed, we have noticed a shift in our conversations with Northerners away from issues regarding the roll-out of NNC and program mechanics that we heard in the early stages of the transition. Recently, the discussion focus has moved to broader conversations on transparency, accountability, and food security, including the importance of nutrition education, strengthening local food systems, and accessing country and traditional foods.

As you know, many factors affect food security, such as the availability and accessibility of store-bought food, country/traditional food and locally-produced food; local community supports; and health and nutrition knowledge. It is clear that NNC has an important role to play in strengthening food security by making nutritious and perishable foods purchased in-store more affordable than they would be without the support of this program. This is particularly relevant given the recent Statistics Canada report Food Security among Inuit Living in Inuit Nunangat. It will be important, going forward, to properly situate this program within the larger context of food security. We recognize that this program is not the answer to food insecurity; rather it is only one of the many responses that will be required to address it. Supporting food security will require extensive collaboration and work of other levels of government, communities and organizations to develop sustainable solutions.

Over the period of this report, we have supported the advances on program transparency, particularly through the new requirement to display savings on grocery store receipts. Nonetheless, we continue to hear that more work has to be done to give community members more confidence that they are receiving the full benefits of the program. Towards this end, we are very much looking forward to exploring the ideas gathered through the public engagement process with Northerners. This process has provided us with more perspectives to consider in thinking innovatively about the program.

We also welcomed the expansion of the program to all northern isolated communities that was effective as of October 1, 2016. As you are aware, the cost of living and doing business in northern isolated communities is higher than in non-isolated communities. This expansion meant that the full benefits of NNC were expanded to an additional 37 isolated communities, which will help lower prices in these communities as well as provide community members with Nutrition Education Initiatives.

In fulfilling our role, in addition to having strong connections to the North, we have taken the opportunity to visit many northern isolated communities and meet many community members. In listening to their perspectives, we are well positioned to effectively communicate their thoughts and perspectives within this program – a responsibility we do not take lightly. We look forward to continuing to work within our communities and across the North to provide you with advice on how NNC can better support those it is intended to serve.

We would like to recognize and thank all of the past Advisory Board members who volunteered their valuable time to this endeavour. With their effort, we were able to mark many notable achievements during the past four years, and we look forward to continuing this important work.

Key achievements that occurred during the time period covered by this report include:

Sincerely,

Nellie Cournoyea
Acting Chair
Nutrition North Canada Advisory Board

Advisory Board role and members: April 2012 – December 2016

The Advisory Board provides advice to the Minister of Indigenous and Northern Affairs Canada to help guide the direction and activities of Nutrition North Canada (NNC). The Advisory Board was introduced in 2010 as a key governance mechanism of the program. The Advisory Board, whose members serve as volunteers, ensures that the voices of Northerners are heard in the context of program management and design, including the development of policy and operational aspects of the program. Advisory Board members are not decision-makers or program managers; rather, members collectively represent diverse backgrounds, northern views and interests, and work together to draw from the experience and expertise of Northern organizations and individuals involved in transportation, distribution, nutrition, public health, government agencies, community development, retailers, and wholesalers to provide insight and advice on how the program can better support those it is intended to serve.

Current membership

Nellie Cournoyea
Acting Chair
Member since November 2010

Kristin Erickson
Member since October 2014

Tracy M. Rispin
Member since March 2015

Gordon Harkness
Member since April 2015

Michele Wood
Member since November 2010

Past membership

Elizabeth Copland, Chair
May 21, 2010 – February 10, 2012

Wilfred Wilcox, Member and Chair
May 2012 – November 2014 (Chair)
November 2010 – May 2014 (Member)

Elisabeth Cayen, Member
November 2012 – November 2015

Katherine Nukon, Member
November 2010 – November 2013

Marie-Josée Gauthier, Member
November 2010 – November 2013

Steve McDougall, Member
November 2010 – November 2013

Danielle Medina, Technical Advisor
November 2010 – December 2015

About the program

Many northern communities in Canada are only accessible by air for part, or all, of the year – resulting in much higher prices for necessities, such as perishable food, which must be flown into these communities. These higher prices make it more difficult for Northerners to afford a nutritious diet of store bought foods. In order to alleviate the costs of nutritious, perishable foods in these communities, the Government of Canada introduced Nutrition North Canada (NNC) on April 1, 2011. NNC provides a retail-based food subsidy that helps to make perishable, nutritious food more accessible and more affordable than it otherwise would be for Northerners living in isolated communities.

At the time of transition from the former Food Mail Program to NNC, community eligibility was based on factors of isolation (lack of year-round road, rail or marine access) and whether or not communities had used the Food Mail Program. These criteria meant an initial total of 103 communities were eligible for NNC, 19 of which were receiving a nominal subsidy. As of October 1, 2016, revisions to the community eligibility criteria have been made to remove the need for past usage of the Food Mail Program, in order to expand the full benefits of the program to all 121 isolated northern communities.

The Nutrition North Canada: Subsidized Foods List outlines the goods that are eligible for subsidies. This list focuses on perishable, nutritious foods as well as important northern staples. There are two different subsidy levels based on perishability and nutritional value, with the most nutritious and perishable foods receiving the highest level of subsidy. Country or traditional foods are also eligible for the subsidy when supplied from government regulated processing plants registered with the program, either to local stores, or directly to community members.

The subsidy is where the government pays a portion of the price of food to help lower the cost by the same amount in fly-in communities. The retailer or supplier makes a claim to the program and is reimbursed the appropriate amount based on the weight of eligible food shipped by air. To make sure the right amount of money is being claimed, retailers and suppliers must give their shipping documentation (e.g. purchase order, air waybill, etc.) to a third party company who checks to make sure no mistakes have been made in claiming the correct amounts. Retailers and suppliers are required to pass along the full value of the subsidy to community members by reducing the prices on store shelves. They must sign a document every month swearing that they have done so. These retailers and suppliers have signed agreements with NNC, and compliance reviews are also completed to ensure that retailers and suppliers are meeting the terms of their agreement with the government. The government also monitors prices. Some commercial and social institutions in eligible communities can benefit from the subsidy – such as daycares. Finally, individuals in eligible communities are also able to benefit from the subsidy when they make personal or direct orders with southern suppliers registered with NNC. The registered suppliers take the subsidy amount off the bill to lower the cost to the individuals ordering.

As of April 1, 2016, larger northern retailers registered with the program are required to show a few important pieces of information on store receipts, including the community's subsidy rate (dollars per kilogram), how the NNC subsidy has been applied to each eligible item purchased, and the total amount of savings received as a result of the NNC subsidies. As of this date, a new clause was also adopted as part of the 2015-2016 funding agreement that requires NNC registered retailers to make profit margin information available to independent auditors retained by the department to undertake compliance reviews. Subsidy rates differ for each community, and reflect the different costs required to access food in each community (communities with the highest costs to access food have the highest subsidy rates).

When the Government of Canada introduced the NNC program in 2011, it had a fixed budget of $60 million – this included $53.9 million for food subsidies and $2.9 million for Nutrition Education Initiatives. In 2014-2015, the subsidy budget was increased by $8.2 million in order to address population growth and growing demand for subsidized items, along with a new 5 percent annual compound escalator. This means the subsidy budget will grow by 5% each year. Furthermore, Budget 2016 proposed invested an additional $64.5 million over five years, starting in 2016-2017, and $13.8 million ongoing in order to expand NNC to support all isolated communities.

An important part of NNC is the additional collaboration with Health Canada, which provides funding to support culturally appropriate retail and community based nutrition education initiatives in eligible northern communities. In transition to include 37 new communities in 2016/17, the Public Health Agency of Canada (PHAC) joined the program to support provision of funding to 10 eligible communities falling outside of Health Canada's mandate. Nutrition education activities aim to increase knowledge of healthy eating and develop skills in selecting and preparing healthy store-bought and traditional or country food.

Program Results

Since our first report, the program has made changes and sought continuous feedback from all partners and communities. Perishable, nutritious food is now more accessible in isolated communities than when the program was first introduced in 2011, and demand is continuing to grow. The annual weight of eligible food being shipped to communities has increased by approximately 28.4 percent between March 2011 and March 2016.

We can also see that NNC is reducing the cost of foods that Northerners purchase in support of leading a healthy life. The Revised Northern Food Basket (RNFB) is the tool that Indigenous and Northern Affairs Canada uses to monitor the cost of healthy eating in isolated northern communities eligible for NNC. It measures the cost of a nutritious diet for a family of four for one week using 67 standard food items. In March 2015, the cost of the RNFB was an average of 5 percent lower than what it was in March 2011 (before the program came into effect) in fully eligible communities. While the purpose of the program is to help lower costs in isolated northern communities, it does not mean that prices will remain the same. Food prices purchased in stores have increased across the country by 9.9% over the same period, according to the Consumer Price Index. Last year, the CPI for food purchased in stores increased by 3.99% while the RNFB increased by half that amount (2.04%). This suggests that the NNC subsidy has had a positive impact on the price of food in the North.

We have heard from retailers about how NNC promotes innovation and enables retailers to introduce greater efficiencies into how they supply nutritious, perishable foods to isolated communities. For example, the North West Company is no longer constrained by the system of fixed entry points that was central to the former Food Mail Program. In order to distribute food to Iqaluit, under the Food Mail Program, shipments would have had to go through Ottawa to Val d'Or, wait for a 48-hour inspection period, then proceed to Iqaluit. Now, the company is able to use heavy aircraft to transport all cargo directly from Winnipeg to Iqaluit, pooling eligible and ineligible products, for savings that result in reduced food prices on shelves for eligible communities. We have also heard that program reporting requirements can be a benefit for retailers by producing data they can use to improve operations.

Northerners have continued to provide us with their valuable insight. In addition to the strong connections we have within the North, we are grateful to have had the opportunity to visit many isolated northern communities as an Advisory Board during the period covered by this report and host meetings and public sessions. While residents expressed appreciation that NNC is a program of universal access, making benefits available to all community members, the high cost of living remains the main overarching concern. We have heard that community members are largely supportive of the subsidy and the savings, but that prices for important goods are still too high. We've also heard that it is difficult to understand how the program works, and how the subsidy is passed on to northern consumers. With these perspectives in mind, we have been able to advise the Minister on changes to the program to better serve Northerners.

Programs need to evolve to stay relevant for the intended program beneficiaries. On May 30, 2016, the Honourable Carolyn Bennett, Minister of Indigenous and Northern Affairs, and the Honourable Jane Philpott, Minister of Health, announced that the Government of Canada would be launching a public engagement process to listen and learn from Northern residents on how to further improve the NNC program. The public engagement sessions took place from May 30 to December 9, 2016, and included 19 community meetings in eligible communities, 4 meetings with community leadership, 63 interviews with key partners, 262 surveys (available in paper form in eligible communities and online), 21 written submissions, and 9 tweets using #NNCMySay. Over 500 people participated; and we heard many diverse and important views. This input will be helpful in updating the program in a manner that the program remains sustainable in the long term while it serves Northerners in a more efficient, transparent and culturally appropriate manner.

Key milestones and Advisory Board activities

2012

June 11-12: Advisory Board held an in-person meeting and public session in Norman Wells, Northwest Territories.

Fall 2012: Advisory Board Chair Wilf Wilcox's report "Nutrition North: Putting the Focus on Nutrition" is published in Northern Public Affairs.

November 19-21: Advisory Board held an in-person meeting in Labrador; including a public session in Nain, and meetings in Goose Bay with provincial officials and registered suppliers Advisory Board members had the opportunity to visit local initiatives, including a community freezer and youth involvement programs.

2013

February 6-7: Advisory Board held an in-person meeting in Winnipeg, Manitoba, which included discussions with major retailers and suppliers, and stakeholder presentations on Nutrition Education Initiatives and community eligibility.

June 3-4: Advisory Board held a meeting in Ottawa, Ontario, including stakeholder presentations and discussions with major retailers.

June: AANDC internal audit report is approved. Recommendations include reviewing the purpose and role of the Advisory Board for the next phase of program implementation.

September: AANDC internal evaluation report is approved. Recommendations include clarifying the purpose, role and responsibilities of the Advisory Board, taking into consideration the level of resources required on the part of program management to support those activities.

2014

February 3-4: Advisory Board met with the Honourable Bernard Valcourt, Minister of Aboriginal Affairs and Northern Development Canada in Ottawa, Ontario. The Advisory Board then met to develop their annual work plan and provided input for revisions to the Advisory Board's Terms of Reference.

June10-11: Advisory Board held an in-person meeting and community session in Rankin Inlet, Nunavut.

November 12-14: Advisory Board held a meeting in Ottawa, Ontario and tasked its Technical Advisor to meet with retailers and explore ways to demonstrate to consumers on their grocery store receipts that they were receiving the full subsidy.

November 21: Advisory Board members Kristin Erickson and Elisabeth Cayen attended the Parliamentary Secretary's announcement in Iqaluit concerning an increase in the Nutrition North subsidy budget announced in Budget 2014 and news that the Government would be engaging Northerners on ways to improve the program while keeping it on a sustainable path.

November 24: The Office of the Auditor General released its report on the Nutrition North Canada Program (AANDC component) including five recommendations.

2015

March 25-27: Advisory Board held an in-person meeting and public session in Iqaluit, Nunavut. Additional meetings were also held with territorial nutritionist Allison MacRury, including presentations by Nunavut Tunngavik Incorporated and representatives from the Government of Nunavut.

March 26: Minister Valcourt directed the Advisory Board to examine the pilot project of Fédérations des cooperatives du Nouveau Québec (FCNQ) that displays subsidy savings on the till receipts and to provide advice on a wider application of a point-of-sale system by June 1, 2015.

June 1: Recommendations on the wider application of the point-of-sale system submitted to the Minister Valcourt.

June 4: Minister Valcourt thanked the Advisory Board for its advice regarding at-the-till receipts, and noted that the government would be considering the best approach forward on this issue in the coming weeks.

July 26-30: Advisory Board held an in-person meeting and public session in Kugluktuk, Nunavut. Additional meetings were also held with territorial officials in Yellowknife, Northwest Territories to learn more about how the territory is addressing poverty and food security.

July 27: Minister Valcourt announced that a point-of-sale receipt system, outlining itemized NNC subsidy savings, would become a mandatory program requirement for major retailers, effective April 1, 2016.

2016

January 9: Nellie Cournoyea, Acting Chair of the Advisory Board, attended a meeting held by the Honourable Carolyn Bennett, Minister of Indigenous and Northern Affairs Canada, with Indigenous groups and stakeholders in Norman Wells, Northwest Territories to canvas their views on how to update the program and address food insecurity.

April 1: All major NNC northern retailers are required to implement at-the-till receipt systems, which show the subsidy savings by item on the sales receipt.

May 30: Minister Bennett, alongside the Honourable Jane Philpott, Minister of Health, announced the launch of engagement sessions across the North to gather perspectives from northern residents on how to update the NNC Program. The Advisory Board held an in-person meeting in Old Crow, Yukon, attended the first engagement session, and provided advice on how the engagement products and community sessions could be improved.

July 18: Nellie Cournoyea, Acting Chair of the Advisory Board, joined Minister Bennett in Inuvik, NWT to host a roundtable on food security and announce the expansion of the NNC Program to an additional 37 isolated northern communities, effective October 1, 2016.

October 1: NNC is expanded to include all 121 isolated northern communities, on advice of the Advisory Board, with the removal of the criterion requiring communities to be users of the former Food Mail program. The partial subsidy provision is also removed, giving all eligible communities access to the full benefits of the program.

November 27: Advisory Board held an in-person meeting in Thunder Bay, Ontario as well as an additional meeting with Deputy Grand Chief Derek Fox and Wendy Trylinski, Director of Public Health Education, of the Nishnawbe Aski Nation.

November 29: Advisory Board held in-person meetings with the Chiefs and Councils in Fort Hope and Kitchenuhmaykoosib Inninuwug, Ontario as well as a public community session with community members of Kitchenuhmaykoosib Inninuwug.

December 9: The Program concluded its public engagement sessions with Northerners, Indigenous organizations, and other key partners, to gather feedback on the program.

Correspondence

During the period covered by this report, the Advisory Board corresponded with many different people and organizations, covering many topics.

Topic General inquiries Advisory Board activities Food security 2016 public engagement process High cost of food Media requests Program improvement Food production Total
Number of e-mails 27 15 9 9 8 7 6 2 83

Meetings with key partners

In addition to ongoing support from Indigenous and Northern Affairs Canada, Health Canada, and the Public Health Agency of Canada, the Advisory Board met with a wide range of stakeholders such as provincial and territorial governments, retailers and suppliers, Indigenous organizations, and community groups and representatives.

Provincial and territorial governments:

Retailers and suppliers:

Indigenous organizations

Community groups and representatives:

Advisory Board advice

Transparency

Passing on the subsidy

Background

The NNC subsidy is provided to Northerners in eligible communities through retailers and suppliers that apply, and are selected, to register with the program. These retailers and suppliers enter into a contractual agreement with INAC, and as a term of this arrangement, are required to pass along the full subsidy to consumers through reduced in-store prices of eligible food. NNC closely monitors compliance and publishes regular compliance reports online.

Northerners benefit from the subsidy at registered retailers in their community when they buy eligible food on store shelves or make direct or personal orders, as well as when they order eligible food through a registered supplier. The subsidies are applied against the total cost of an eligible product (including product purchasing cost, transportation, insurance and overhead) shipped by air to an eligible community.

The original program requirement required that community food subsidy rates be displayed on retail receipts and through in-store posters.

What we heard

For the past few years, we have heard community members question if the full value of the NNC subsidy was really getting passed on to consumers in the form of lower prices, such as in Norman Wells (June 2012), Nain (November 2012), Rankin Inlet (June 2014), Iqaluit (March 2015), Kuglutuk (July 2015), and Old Crow (May 2016).

Furthermore, we are hearing that Northerners do not understand how the subsidy is applied and how the program works to lower the prices of perishable, nutritious foods on grocery store shelves.

Advisory Board response

In the transition from the Food Mail Program to NNC, we believed that retailers could do more to show consumers specifically how they benefit from the program. We discussed how showing the subsidy savings for each eligible item purchased on the receipt, as well as the total savings on the entire purchase, would help Northerners see which foods received a subsidy, and how much subsidy savings they were receiving.

When we met with the Minister of INAC in 2014, we discussed the need for better transparency measures, such as these point-of-sale receipts. The Minister directed us to explore opportunities to implement a requirement to show NNC subsidy savings on point-of-sale receipts. In order to explore feasibility, we tasked the Technical Advisor in late 2014 to meet with retailers and explore options for point-of-sale receipt solutions. The Fédération des cooperatives du Nouveau Québec (FCNQ) implemented a pilot project across its 14 cooperatives in Nunavik, Québec which greatly assisted this work. In 2015, we provided our advice to the Minister based on our work with the FCNQ, and discussions with all registered retailers.

On July 27, 2015, the Minister announced the new mandatory program requirement which would start April 1, 2016, for major retailers to implement a new point-of-sale system that clearly shows consumers the subsidy savings on each eligible item bought and overall subsidy savings.

We further endorsed the requirement for retailers to make profit margin information available to independent auditors retained by INAC to undertake compliance reviews in order to address concerns raised by the Auditor General of Canada. This will further enhance compliance reviews to support transparency and ensure that the full value of the subsidy is being passed on to consumers.

The result

As of April 1, 2016, all large retailers are required to show itemized and total NNC subsidy savings on the at-the-till receipts, as well as to report their profit margin information to INAC auditors.

Program effectiveness

Meeting Northerners' needs

Background

The subsidy component of the NNC program is intended to offset some of the high costs associated with shipping and stocking perishable, nutritious foods for isolated northern communities without year-round road, rail or marine access, with the objective of lowering prices of eligible items by the amount of the subsidy.

In addition to NNC, there are subsidy programs at the provincial and regional level that complement this approach, including the Food and Other Essentials Program in Quebec, Affordable Food in Remote Manitoba, and the Air Foodlift Subsidy of Labrador (although discontinued in 2016).

What we heard

In recent meetings, particularly in Kugluktuk, Nunavut (2015) and Old Crow, Yukon (2016), we have heard an appreciation for the program and its impact on food prices; however healthy food – even with the subsidy applied – is still expensive. Household products are not eligible for subsidies, such as detergents, diapers and personal hygiene products, are expensive, especially when retailers fly them in instead of having enough on hand that has also been brought in by sealift or winter road. This impacts many families who are on fixed incomes.

At our meetings, Northerners have also raised that purchasing goods in order to go out on the land for harvesting is remarkably costly, and it would be helpful if something could be done to lower their costs. At the same time, there is no consensus as to whether the food list should be narrowed to allow other items to be added, or to allow for deeper subsidy on staple items.

Advisory Board response

The program cannot be all things to all people. As with all programs, there is a set budget. We have heard a wide range of views on how the program can work better for Northerners, and it is clear that there are no easy answers.

That said, we consider all views in forming our advice to the Minister on how to best meet the needs of Northerners in such a way that may enhance the impact of the subsidy for Northern families while working within the existing budget.

The result

The Government of Canada launched a national public engagement process, completed on December 9, 2016, to seek the views of Northerners on how the program could be more responsive to Northerners while remaining within budget.

How the NNC subsidy works

Background

There are two levels of subsidies for food eligible to be subsidized under NNC. The higher (Level 1) subsidy rate applies largely to the most nutritious, perishable food. The lower (Level 2) subsidy rate applies to the less perishable, nutritious items. Country or traditional food processed in government regulated and/or approved-for-export commercial plants is also eligible, with its own subsidy rate. Subsidy rates were set to vary according to the differing cost drivers for each community.

What we heard

We have heard that it is difficult for community members to understand how the NNC subsidy is applied to eligible food, and how the rates themselves are determined. We also heard that it is not clear why subsidy rates are set differently for various communities. Community members in Iqaluit and Kugluktuk, Nunavut (March and July 2015) and Old Crow, Yukon (May 2016) further emphasized that this lack of clarity contributed to concerns that the subsidy is not being passed on in full.

The result

The NNC website was updated using less technical language. Further, all materials for public engagement were reworked to be more straightforward and useful to community members.

Nutrition education initiatives

Background

Health Canada has provided funding to communities eligible for NNC in order to support retail and community-based nutrition education initiatives. Communities have the flexibility to direct and design activities that address local needs and priorities. They can also combine the funds they get through NNC with funding from other sources to enhance its impact. A variety of activities are supported and enhanced through NNC, such as: the promotion of healthy food knowledge and skills among children, youth and adults; lessons on budgeting and proper food storage; in-store taste tests and grocery store tours; and traditional or country food harvesting and preparation. In 2016/17, the Public Health Agency of Canada joined the program as a new partner to provide nutrition education funding to 10 eligible communities, alongside Health Canada.

What we heard

In Nain (2012), we met with Health Canada Atlantic Region officials and health workers from Labrador's coastal communities who shared community success stories on a variety of initiatives: cooking classes for children and teens, radio shows promoting nutrition, healthy snacks in schools and daycares, and collaborating with other initiatives such as World Diabetes Day. We were impressed by a video presented at our February 2013 meeting in Winnipeg by a health worker from Four Arrows Regional Health Authority on the activities made possible with Health Canada's funding. Other activities, supported in part through NNC nutrition education initiative funding, have been discussed at our meetings and include supporting access to country/traditional food (Nain 2012), Fort Albany's Good Food Box initiative (Ottawa 2013) and promoting community-based nutrition education like Nunavut's Food Guide and the Core Recipes project (Norman Wells 2012 and Iqaluit 2015).

We have noted that, in many cases, Northerners are not aware of what initiatives and activities in their communities are supported by NNC nutrition education funding, as these are not necessarily "branded" as NNC.

Advisory Board response

We advised that all eligible isolated northern communities be made aware and continue to have access to the nutrition education initiatives funded as part of NNC, and that these initiatives are promoted as being supported by NNC.

The result

Nutrition education support was expanded to all 121 isolated communities. Health Canada will continue to support the delivery of nutrition education initiatives through regions and in collaboration with eligible communities, the territorial governments and other partners. In 2016/17, the Public Health Agency of Canada joined NNC as a new partner to provide nutrition education funding to 10 communities falling outside the mandate of Health Canada. PHAC and Health Canada will work in partnership to support all eligible communities.

Country/traditional food and food security

Background

Country or traditional food, such as Arctic char, muskox, caribou, etc. is subsidized under the NNC program if it is shipped by air from a registered country food processor/distributor and processed in government regulated and/or approved-for-export commercial plants. Northerners can access subsidized country/traditional food by ordering it directly from the registered distributor or purchasing it from a local retailer.

Since the Advisory Board's first report, food security in the North has become front-of-mind in public discussions. In May 2012, Canada was visited by Olivier de Schutter, the United Nations Special Rapporteur on the Right to Food, whose public comments and eventual report drew attention to "the deep and severe food insecurity" faced by Indigenous peoples across Canada. Many other reports, assessments, and social media movements have continued to put northern food security top of mind in Canada.

What we heard

We heard from Northerners, and Hunters and Trappers Associations in Rankin Inlet (2014) that they would like to include more locally-relevant food into their diets and that harvesting equipment such as gasoline, ammunition, and nets, is costly and can prevent Northerners from accessing locally-sourced country and traditional food. In our meetings we have learned about existing harvesting and country/traditional food supports provided by other organizations and levels of government. We have heard from Nunavut Tunngavik Incorporated in Rankin Inlet (2014) concerns about the wildlife population being on the decline, the need for conservation as well as the need to transfer knowledge on how to hunt, and prepare other types of wildlife at the same time.

We heard about important work being undertaken by the Government of Nunavut (Iqaluit 2015) and the Government of the Northwest Territories (Yellowknife 2015) and from the Nunavut Food Security Coalition (Rankin Inlet, 2014). We have learned more about initiatives operated by other levels of government and organizations that work to reduce the costs of food in isolated northern communities. When meeting in northern communities, we have visited and learned about community initiatives – like greenhouses, community freezers, community-led food security assessments, youth engagement, and the work of local harvesting organizations – that work to address the larger issue of food security.

Advisory Board response

We believe that country and traditional food harvesting is an important aspect of a northern diet and way of life. However, the mandate for Nutrition North Canada is for foods bought in-store and subsidizing country food supports is outside the scope of the program. That said, we have heard that there are many important supports in place to support access to country food by territorial and provincial governments and by Indigenous governments and organizations. For example, the Country Food Distribution Program in Nunavut, the Traditional Harvest Program in the Northwest Territories, and the Nain Community Freezer Program in Labrador.

Northern food security is an important and complex issue, particularly for those living in isolated communities. This is an issue that cannot be addressed through one program or one organization alone. There are many ways to address food security that are beyond the scope of NNC. Food security is far more complex than the high cost of food. It is important for all to understand that the program is not the answer to food security; rather, it works to address one aspect of this complex issue. We believe that effectively addressing northern food security will require collaborations between different levels of government, organizations, and sectors.

Program sustainability

Program budget

Background

From 2011 to 2014, the Government of Canada invested about $60 million in the program each year, including $2.9 million for community-based nutrition education through Health Canada.

What we heard

When we visit communities, we hear that NNC is important in making perishable, nutritious goods less expensive. We also had concerns, largely from 2012 to 2014, regarding the program budget cap. We were concerned that there would be the need to reduce subsidy rates in order to prevent cost over-runs given increasing demand for perishable, nutritious food and population growth in the North. Further, there were concerns that should other communities be added to the program, the subsidies for existing communities would be cut.

Advisory Board response

We advised that the program seek a budget escalator in order to continue to administer the subsidy component of the program without needing to reduce subsidy rates – which would have an adverse effect on the price of perishable, nutritious food in eligible communities – in order to avoid substantial cost overruns. We also advised that it would be important to take care not to disrupt benefits to currently eligible communities or dilute the program to a point that it could no longer meet its objective.

The result

On November 21, 2014, following the Budget 2014 proposal to enhance funding for NNC, the Government of Canada announced an increase of $11.3 million to the NNC subsidy budget for 2014-2015, which included a new 5 percent annual compound escalator for the subsidy component of the program. This escalator will help the program keep pace with population growth and increasing demand for perishable nutritious food in the North.

On October 1, 2016, NNC was expanded to all isolated, northern communities with the support of a Budget 2016 commitment to invest an additional $64.5 million over five years, starting in 2016-2017, and $13.8 million ongoing. This also saw the Public Health Agency of Canada join the program as a new partner to provide funding for Nutrition Education Initiatives alongside Health Canada.

Community eligibility

Eligibility criteria

Background

When NNC was first implemented in 2011, in order to be eligible for the program, a community had to satisfy two criteria:

  1. be an isolated northern community (that lacks year-round road, rail or marine access)
  2. have participated in the Food Mail Program

Furthermore, some communities had access to full program benefits (higher subsidy rates) while others had only partial benefits (lower subsidy rates) and not all communities had access to the Nutrition Education Initiative component of the program. The positive impact of the NNC food subsidy in eligible communities sometimes created a significant gap in the prices of nutritious perishable foods between neighbouring communities.

What we heard

We continued to hear from communities that lacked access to year-round surface transportation networks that were ineligible for NNC since they did not participate in the Food Mail Program that the community eligibility for the program was unfair, and that isolation alone should determine if a community is eligible for the program.

Furthermore, we heard from communities only receiving partial program benefits, and those without access to the Nutrition Education Initiative component, that they wanted full access to the program.

Advisory Board response

We advised revising the community eligibility criteria to be based solely on isolation factors alone, without consideration for former Food Mail Program usage. We also cautioned that expanding the program to additional communities should not adversely affect the benefits for currently eligible communities. We also advised that all eligible communities should have access to the full program benefits, including the Nutrition Education Initiative component.

The result

As a result of revisions to the community eligibility criteria, and a Budget 2016 commitment to $64.5 million over five years and the $13.8 million ongoing, NNC was expanded to all isolated northern communities on October 1, 2016. This also provided the requisite funding to allow all eligible communities to have access to full program benefits and saw the Public Health Agency of Canada join the program as a partner to provide funding for Nutrition Education Initiatives alongside Health Canada in all eligible communities.

Subsidized Foods List

Updating the list of eligible foods

Background

The Subsidized Foods List outlines the items eligible for NNC subsidies, as well as the level of subsidy that are attributed to items. The implementation of the NNC Subsidized Foods List on October 1, 2012, marked the end of the 18-month transition phase from Food Mail to NNC. Health Canada provides technical advice on nutrition for the eligible food list and the Advisory Board provides advice from a northern perspective.

What we heard

We heard concerns from many communities as to why some foods, which are not in line with northern diets such as starfruit and dragon fruit, are being subsidized. Further requests consisted of moving some level 2 subsidies such as flour and rice, to a level 1 subsidy, due to their high demand and need. Recommendations by community members were raised on nutritional supplements. There is a continuous need to consult and collaborate with northern nutritionists and community members to understand how the program can best serve Northerners.

Advisory Board response

The Advisory Board provided advice on food items that retailers and suppliers requested become eligible for subsidy. In particular, we make recommendations in support of a healthy, northern lifestyle and to ensure the benefits of the subsidy are not being diluted. Our advice considers whether the requested additions are relevant to Northerners' diets, traditions, and health.

The result

Northern views and perspectives are included in the review of new products being put forward by retailers and suppliers for consideration under the program.

Retailers and suppliers

Cost of northern retailing

Background

The cost of living is higher in the North, with its large geographical area and limited means of transportation, than in other parts of the country. Specifically, the cost of food retailing in the North is much more expensive because of a number of factors including utilities, staffing needs (higher salaries), fuel (higher prices in the North for longer trips), and airport maintenance and infrastructure. Other reasons behind higher prices can be attributed to store construction and maintenance, human resource considerations, spoilage, higher inventory costs and retailer profit margins.

What we heard

Northern retailers have continued to express to us that food prices in the North are driven by many factors aside from freight costs and profit margins. For example, during the panel discussion in Rankin Inlet (June 2014), a retailer stated that wages and electricity were two of the highest operating costs, in addition to transport. The example given was the Government of Nunavut implemented a retroactive power rate increase shortly after NNC implementation of roughly 19%, followed by another increase of 5.1% in May 2014. We are hearing that this information is not being effectively communicated to community members, as this lack of information contributes to higher perception that profit margins are eroding the value of the NNC subsidy. Inflation is another factor that increases prices.

Advisory Board response

We advised that the factors affecting the cost of food in isolated communities be more fully explored in concert with retailers and suppliers.

Furthermore, we believe that providing the public with more accessible information about the costs of northern grocery retailing would be important for the program, in addition to consumer education on this issue.

The result

The Northern Food Retail Data Collection and Analysis involved in-person interviews and focus groups composed of community members, as well as surveying grocery store managers. The report is posted on the program website and includes a breakdown of the study's findings regarding the factors that influence the cost of food in isolated norther communities. Some of these factors include:

  • transportation
  • store maintenance
  • human resource considerations
  • spoilage
  • inventory costs
  • retailer profit margins

Communications

Direct or personal orders

Background

Subsidized food is available through NNC's direct or personal order provision, in addition to being available on store shelves in eligible communities. Some community members refer to this part of the program as "food mail". If a customer in an eligible community wants to purchase food directly from a supplier instead of a local retailer, they can place a direct or personal order. Like registered northern retailers, registered suppliers are contractually required to pass along the full value of the NNC subsidy to customers in eligible communities, with the subsidy savings noted on the invoice.

What we heard

At our public meeting in Norman Wells (June 2012), we heard that community members were dissatisfied with the available options for direct orders as the understanding was that some Yellowknife suppliers had chosen not to register with the new program. Through the discussion, it became evident that many residents were unaware that an additional supplier had since registered with the program to provide direct order service. Other communities have raised concerns with the limited number of registered suppliers and would like there to be more options.

Furthermore, we have also heard that community members are largely unaware of the direct or personal order aspect of the program.

Advisory Board response

We advised that the direct or personal orders section of the NNC website indicate potential suppliers for each region. In addition, as more suppliers are added to the program, we suggested using social media to communicate the list of suppliers, as well as the regions they serve, to Northerners.

Since we have come to learn that many Northerners are unaware of the ability to order subsidized food from registered suppliers, we advised that the program increase its communications regarding this option and how it can be accessed by Northerners.

The result

Registered southern suppliers and the regions they serve are posted on the NNC website, and updated as new suppliers register.

Best before dates

Background

Information that helps explain the difference between best before dates and expiry dates is available on the Health Canada and Canadian Food Inspection Agency websites. The best before date is meant to indicate the freshness and shelf life of unopened foods. It tells a consumer how long food will retain its original qualities (quality, flavour, nutritional content). Expiry dates indicate up to which point the microbiological and physical stability and nutrient content is still safe to consume.

What we heard

We have heard the issue of "best before dates" raised by both retailers and northern consumers and the lack of clarity of what they mean and the resulting waste of food. We have heard retailers express frustration that best before dates are being increasingly adopted by manufacturers of products for which they are not legally required, nor regulated. In these cases, we understand that best before dates are not about food safety, but they are a manufacturer guarantee of maximum flavour and freshness. However, northern consumers are understandably reluctant to consume or purchase a product beyond this date.

We also heard from community members, particularly in Rankin Inlet in our 2014 community meeting, who believe retailers are wasting food by keeping food on the shelf at full price until the best before date, then discarding it if it doesn't sell rather than putting it on sale before the best before date and selling it at a reduced price. We have also heard from Northerners who are upset that the retailers are selling items past their best before date.

Advisory Board response

We advised that efforts focus on consumer education, with a particular focus on best before dates, which are often mistakenly viewed as expiry dates, which then leads to unnecessary food wastage in food insecure areas.

The result

Nutrition education allows opportunities to provide information on understanding food labels, which includes best before dates.

Concluding remarks

During the four year period covered by this report, we have seen Nutrition North Canada evolve and the public dialogue around it evolve from the transition from the former Food Mail program to the current program, and the role it plays in addressing one component, market food, in the complex issue of food security. We have heard from many Northerners, retailers and suppliers, provincial and territorial governments, food security coalitions and concerned members of the public. We have looked at the results being achieved by the program, and note that prices are still 5% lower than they were under the former subsidy program, while prices have risen nationally by approximately 10% over the same period. We recognize and acknowledge that that the cost of living in northern isolated communities is a key driver of community wellbeing. However, this program has played a role in decreasing the cost of perishable, nutritious food and we encourage all levels of government and the private sector to work together to find ways to continue lowering the cost of living. What we need are approaches that are people-centred and holistic, with multiple sectors working together in a coordinated way.

Nellie Cournoyea
Acting Chair
Nutrition North Canada Advisory Board

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