Government red tape strangling Canada’s economy

The cost of regulation from all three levels of government to Canadian businesses totalled $38.8 billion in 2020, for a total of 731 million hours—the equivalent of nearly 375,000 fulltime jobs.

One does not have to look too deeply into recent headlines to see that Canada’s economic conditions are declining and consequently eroding the prosperity and living standards of Canadians. Between 2000 and 2023, Canada’s per-person GDP (a key indicator of living standards) has lagged far behind its peer countries. Business investment is also lagging, as are unemployment rates across the country particularly compared to the United States.

There are many reasons for Canada’s dismal economic conditions—including layer upon layer of regulation. Indeed, Canada’s regulatory load is substantial and growing. Between 2009 and 2018, the number of regulations in Canada grew from about 66,000 to 72,000. These regulations restrict business activity, impose costs on firms and reduce economic productivity.

According to a recent “red tape” study published by the Canadian Federation of Independent Business (CFIB), the cost of regulation from all three levels of government to Canadian businesses totalled $38.8 billion in 2020, for a total of 731 million hours—the equivalent of nearly 375,000 fulltime jobs. If we apply a $16.65 per-hour cost (the federal minimum wage in Canada for 2023), $12.2 billion annually is lost to regulatory compliance.

Of course, Canada’s smallest businesses bear a disproportionately high burden of the cost, paying up to five times more for regulatory compliance per-employee than larger businesses. The smallest businesses pay $7,023 per employee annually to comply with government regulation while larger businesses pay a much lower $1,237 per employee for regulatory compliance.

And the Trudeau government has embarked on a massive regulatory spree over the last decade, enacting dozens of major regulatory initiatives including Bill C-69 (which tightens Canada’s environmental assessment process for major infrastructure projects), Bill C-48 (which restricts oil tankers off Canada’s west coast) and electric vehicle mandates (which require all new cars be electric by 2035). Other examples of government red tape include appliance standards to reduce energy consumption from household appliances, home efficiency standards to reduce household energy consumption, banning single-use plastic products, “net zero” nitrous oxide emissions regulation, “net zero” building emissions regulations, and clean electricity standards to drive net emissions of greenhouse gases in electricity production to “net zero” by 2035.

Clearly, Canada’s festooning pile of regulatory red tape is badly in need of weeding. And it can be done. For example, during a deregulatory effort in British Columbia, which appointed a minister of deregulation in 2001, there was a 37 per cent reduction in regulatory requirements in the province by 2004.

Rather with plowing ahead with an ever-growing pallet of regulations to be heaped upon Canadian businesses and citizens, government should reach for the garden shears and start reducing the most recent regulatory expansions (before they have time to do too much harm), and then scour the massive strangling forest of older regulations.

Whacking through the red tape would go a long way to help Canada’s economy out of its dismal state and back into competitive ranges with its fellow developed countries and our neighbours in the U.S.

Author:

Kenneth P. Green

Senior Fellow, Fraser Institute

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Trudeau government wants to give CBC more money

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Why living in Canada has become impossible

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Trudeau government wants to give CBC more money

Published on December 30, 2024

Todayville

From the Canadian Taxpayers Association

By Kris Sims

The CBC used to air The Simpsons after school.

One of the best episodes was the Cape Fear homage where an FBI agent is trying to change Homer’s last name to Thompson.

After hours of explanation, the kids have fallen asleep, Marge has given up and the agent says, “When I step on your foot and say: ‘Hello Mr. Thompson,’ you nod your head! Got it?!”

Homer did not get it.

The Liberal members of Parliament on the heritage committee still don’t get it either.

The committee has sent a report to the House of Commons urging the government to give the CBC even more money.

“That the Government of Canada provide a substantial and lasting increase in the parliamentary appropriations for CBC/Radio-Canada, allowing it to eliminate its paid subscription services and gradually end its reliance on commercial advertising revenues,” reads the report.

Really? More money? The CBC already takes $1.4 billion year from taxpayers. And that’s not enough?

That amount of money could already cover the salaries of about 7,000 police officers and 7,000 paramedics.

If Trudeau’s MPs want to give the CBC more money so that it can get rid of its advertising and subscription funding, that means a huge cost for taxpayers.

According it’s latest annual report, the CBC collected about $493 million in revenue other than government funding in 2023-24, the bulk being subscription fees and advertising.

This means these Trudeau government MPs want taxpayers to fund the CBC to the tune of about $2 billion per year.

This is the opposite of what needs to happen.

The CBC should be defunded for three key reasons.

The CBC is a huge waste of money, nearly nobody is watching it and journalists should not be paid by the government.

The committee knows this.

And we know they know because the Canadian Taxpayers Federation told them to their faces in testimony before the committee.

CBC CEO Catherine Tait repeatedly testified at the committee and each time she inadvertently made a stronger case to defund the CBC, due to her entitlement and lack of accountability.

Tait refused to say if she will take a severance when she leaves the CBC next year, claiming it’s a personal matter.

It’s not personal if it’s taxpayers’ money.

Documents obtained by the Canadian Taxpayers Federation show Tait is paid between $460,000 and $551,000 this year, with a bonus of up to 28 per cent.

That’s a bonus of up to $154,448. That’s more than the average Canadian family earns in a year.

Just before Christmas last year, Tait cried broke to the committee and afterwards the CBC announced lay offs in its newsrooms.

Documents obtained by the CTF show the CBC handed out big bonuses that year anyway, costing taxpayers $18 million.

As the CBC fan group Friends of Canadian Media put it: “This decision is deeply out of touch and unbefitting of our national public broadcaster.”

It gets worse because the state broadcaster isn’t even doing a good job.

According to the CBC’s latest quarterly report, CBC News Network’s national audience share is 1.7 per cent.

Documents obtained by the CTF show the CBC’s supper hour newscast drawing microscopic audiences, with 0.7 per cent of Toronto watching the six o’clock news on CBC.

Journalists should not be paid by the government because it’s an obvious conflict of interest.

You can’t hold the powerful government to account if you’re counting on that government for your paycheque.

Such government funding of media has contributed to the rapid erosion of trust in the news media, with 61 per cent of Canadians saying they think journalists are “purposely trying to mislead people by saying things they know are false or gross exaggerations.”

CBC’s entertainment programming barely fares better. The Murdoch Mysteries, which is not produced by the CBC, pulls in its biggest audience with about 1.9 per cent of the population watching.

The politicians on the committee know all of this, and yet, like Homer Simpson, they are not getting the message.

If the CBC needs money, it should earn that money itself.

Taxpayers can’t afford the state broadcast’s bill now, let alone hundreds of millions more.

It’s time to defund the CBC.

Kris Sims is the Alberta Director for the Canadian Taxpayers Federation and a former member of the Parliamentary Press Gallery.