OTTAWA - Under political pressure, the federal government has buckled and agreed to extend the subsidies to Nutrition North Canada, a move that's expected to add $20 million to its price tag.
The new program, which supplies affordable and healthy foods to isolated Arctic communities, will now only come into full effect late next year instead of this April.
About 2,700 products slated to be dropped from the subsidized food list will now be kept on until October 2012 to the tune of roughly $1 million a month, said Indian and Northern Affairs Minister John Duncan, who made the announcement in Iqaluit on Wednesday.
Ottawa has been getting an earful from northerners in sticker-shock over the skyrocketing costs of certain goods, and pictures of $30 Cheez Whiz and $38 bottles of cranberry juice have been widely circulated through the media.
Prime Minister Stephen Harper even waded into the fray last month, promising to implement changes if food costs spiralled out of control.
Duncan said this extension will ensure a smooth transition and allow retailers time to sea-lift more goods up to the Arctic.
"We had a very aggressive timeline," he said. "We think it was overly aggressive."
Despite the costs related to the switch, stakeholders say the government made the right decision.
Nunavut MLA Ron Elliott, who has been an outspoken critic of the new plan, said it shows the government is listening to northerners.
"As long as your putting healthy food on the table I don't care how you're getting it here," he said.
Michael McMullen, the executive vice-president of the Winnipeg-based North West Co., which runs stores up north, said it gives his company time to phase in the shift.
"This is a good news story," he said.
Ottawa is in the middle of phasing out the 50-year-old Food Mail Program for the new market-driven food-delivery program.
It replaces subsidized air transportation via Canada Post with federal subsidies given directly to retailers on specific foods.
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