Federal minister says ‘clearer data’ needed to assess Nutrition North program

NDP is calling for ‘urgent action’ to reform the food subsidy program.

Nutrition North

Innovation, Science and Industry Minister Francois-Philippe Champagne waits to appear at the House Agriculture and Agri-Food committee, Tuesday, February 27, 2024 in Ottawa. Photo: Adrian Wyld/The Canadian Press.

The federal minister of Innovation, Science and Industry says more information is needed to understand the issues with the Nutrition North Canada program.

“There are a number of issues around Nutri-North [Nutrition North Canada],“ said Francois Phillipe Champagne who was answering questions about the program at a Parliamentary committee on Tuesday.

Nutrition North Canada, or NNC, is a federally subsidized food program that seeks to make nutritious food accessible to residents in isolated northern communities.

But a joint APTN and CBC investigation found that the subsidies to Northern/North Mart, or NNC, are not fully being passed on to the consumer with only 67 per cent of every dollar reaching the intended recipients.

The federal government spends $134 million a year on the program. However, according to University of Toronto professor Tracey Galloway, food insecurity has only risen since the creation of the NNC program.

Food insecurity is determined by the accessibility of nutritious food within a community. Statistics Canada reported in 2023 that Indigenous families are at the highest risk of being food insecure.

Galloway recently co-published a study in the Journal of Public Economics.

Nutrition North
University of Toronto professor Tracey Galloway. Photo: CBC

The study analyzed dozens of eligible communities between 2016 and 2019 and found that the subsidy was not being fully passed on to consumers to make groceries cheaper.

“The amount of subsidy that was being translated into lower [grocery] prices were 67 cents on the dollar,’ said Galloway.

The NNC, requires northern retailers to pass along 100 per cent of the subsidy to reduce the cost of food. For communities with only one grocery store, the researchers found that the subsidy pass-through was even lower.

“If there was no competition, not another store in the community, the pass-through was 58 cents,” she said.

The North West Company was formed in 1779, beginning as a direct competitor to the HBC during the fur trade. Eventually, the two companies merged and over time trading became retailing. In 1989, investors bought out the northern retailing division of the HBC and named themselves the North West Company (NWC).

For many folks living north of the 50th parallel, the NWC has become a household name. The billion-dollar company has operations that stretch from Alaska to the Caribbean.

And the Northern store is just one of several operations owned by the grocery giant. But, the NWC doesn’t just sell groceries, its operations have taken hold of the financial and shipping sectors in the North.

The Northwest Company disputes those findings. “The North West Company unequivocally passes along 100 per cent of all NNC subsidies in our pricing,” said a spokesperson for the northern retailer.

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APTN Investigates: Food for Profit

Lori Idlout, MP for Nunavut, asked about the program at the committee Tuesday morning. Idlout pressed the minister on where the other 33 cents were going.

“I was in one community which has a Northern store as well as a local [Arctic] Co-op, which also receives the subsidy,” said Idlout. “The price of a dozen eggs at Northern was $6.49 while the same eggs on the same day were $3.99 at the Co-op.

“Having heard this, do you think Nutrition North is working?” asked Idlout.

Champagne replied that Idlout was “highlighting an issue,” and that it’s why the federal government needs to “look into this. We need clearer data.”

According to Dan Vandal, minister of northern affairs, the government is committed to ensuring the subsidy reaches people in remote, northern communities.

“We know that food prices in the north are too high, affordability is a real issue in the north. Our government is absolutely committed to ensuring 100 per cent of the Nutrition North retail subsidy is passed on directly to northerners,” said Vandal. “We have worked and will continue to work with territorial governments, with Indigenous partners and with people who live in the north and the Arctic to bring prices down.

“There’s a lot of work to do. We are committed to getting it done.”

After the story was published, Vandal’s office contacted APTN and asked for clarification on the line that said the “entire subsidy is reaching people in remote, northern communities.” The minister’s office said this wasn’t an accurate reflection of what the minister said. APTN asked for more information on the clarification, including whether the entire subsidy was going to northerners, but none were provided.

APTN requested an interview with the minister several times to clarify the issue with the NNC program but was told he was unavailable.

The NDP is “calling for urgent action” to reform the program so “funds will help people buy food and necessities.”

“Minister Champagne could only express concern, and Minister Vandal said he would work with the government and with communities,” said Idlout. “Neither said the companies are to blame for high prices – but both letdown Northerners who can’t afford to put food on the table.”

Editor’s Note: This story was updated on Feb. 29, 2024 after the minister’s office asked for clarification on the line in the article saying the entire subsidy from the Nutrition North Canada program was going to northerners. 

With files from Mark Blackburn, Brittany Guyot and Tom Fennario

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