Canadian red tape costs remain high, American costs now higher

Feb 22, 2022

Toronto - While small businesses on both sides of the border report major red tape barriers, Canada’s entrepreneurs now spend considerably less on regulatory compliance than their U.S. counterparts. This is according to Regulatory Costs in Canada and the United States: A Small Business Perspective, the latest red tape report from the Canadian Federation of Independent Business (CFIB), done for the first time in partnership with the Small Business Roundtable in the U.S. and supported by Intuit Canada.

The smallest Canadian businesses spend $7,310 (CAD) per employee each year complying with government rules, which is roughly the same as previous years. In the U.S., similar sized businesses have seen costs increase to $11,904 (CAD) per employee, up considerably from the last estimate in 2013. The estimates mark a turnaround from CFIB’s 2013 comparison where costs were higher in Canada compared to the U.S.

It’s important to note that these estimates do not include the cost of COVID-19 compliance, which is significant according to three quarters of business owners in each country.

“Businesses have been hammered by the cost of COVID-19 over the past two years,” said Laura Jones, CFIB executive vice president. “While governments have shown more regulatory agility during the pandemic, this needs to be their default setting moving forward. It’s critical to our recovery.”

The report is the only apples-to-apples comparison of regulatory costs to businesses in Canada and the U.S. Other key findings of the report include:

Red tape costs Canadian businesses $11.3-billion (CAD) annually. It costs American businesses $167.5-billion (CAD).
The average Canadian business spends approximately 677 hours – the equivalent of 85 days – each year on regulatory compliance. The average American business spends 889 hours, the equivalent of 111 days.
In Canada, the smallest businesses spend almost ten times more on a per employee basis on regulatory compliance than the largest businesses. The smallest American businesses spend 14 times more time per employee than their largest counterparts.
87 per cent of Canadian business owners and 84 per cent of American business owners report excessive government regulations add significant stress to their lives.
Given the current burden of regulation, 63 per cent of Canadian business owners and 46 per cent of American business owners would not advise their children to start a business.

The Regulatory Costs in Canada and the United States: A Small Business Perspective report was conducted in partnership with the Small Business Roundtable and generously sponsored by Intuit Canada.

Source : CFIB

Video: The 15-Year Bet Behind Every New Variety!

Canada is trying to decide how much agricultural research capacity it can afford to lose. Brian Rossnagel believes the better question is whether the country can afford to rebuild it.

The longtime barley and oat breeder makes the case with a simple fact about his profession: the consequences of today’s decisions may not become visible for 10 or 15 years.

“Pick the right parents. That’s the biggest thing,” Rossnagel says. “If you pick the wrong parents, you’re not going to get anywhere—and you don’t know that until 10 years, 15 years later.”

That warning carries particular weight as Agriculture and Agri-Food Canada moves to reduce spending and streamline parts of its science operations. The department’s 2026–27 plan anticipates the loss of approximately 665 positions by 2028–29 and says some research will be reduced where capacity exists in academia or industry. AAFC says the changes will make its science operations more cost-effective over the long term.

For Canada’s seed industry, Rossnagel’s career illustrates what is at stake.

This fall, the retired University of Saskatchewan breeder will be inducted into the Canadian Agricultural Hall of Fame. During his 35-year career at the Crop Development Centre, he helped develop more than 100 barley and oat varieties, including CDC Austenson—one of Western Canada’s most widely grown feed barleys. His induction recognizes not only those varieties, but the collaboration and research system that made them possible.

Rossnagel is quick to emphasize that none of it was the work of one person.

“The first thing I thought about was all the other people who contributed to whatever success I and my program had over the years,” he says. “We know that it’s not an individual who does this. It’s a group—a team.”

That team extends well beyond the breeder whose name appears beside a variety. It includes technicians, pathologists, quality specialists, statisticians, regional testing sites, seed growers and industry partners. It also includes the breeders who came before and those who will carry the germplasm forward.

CDC Fraser barley, for example, moved through three breeding careers. Its parents came from Brian Harvey’s program. Rossnagel advanced the material after Harvey retired, and Aaron Beattie later guided it through registration and release.

That kind of handoff is normal in plant breeding. The person who makes the original cross may never see the resulting variety reach farmers.

It also explains why lost research capacity cannot simply be switched back on when budgets improve.

“If you shut it off, it’s very, very difficult—and particularly costly—to start it up again,” Rossnagel says. “If you have to start from scratch, it’s going to be at least 10 years before anybody notices whether you’re getting anything done or not.”

The concern is not simply how many experimental lines Canada can process. Modern equipment, statistical tools and genetic technologies allow today’s breeding programs to evaluate tens of thousands of lines—far more than Rossnagel could handle when he entered the field in the early 1970s.

But efficiency and automation do not generate every idea.

“If you pare back down, and instead of having six or seven individual scientists concentrating on wheat breeding, you go down and say three people could handle all this, well, that’s half the ideas gone,” he says. “Particularly if you happen to lose the three people who had the really neat and innovative ideas, boy, that’s a problem.”

It is a timely distinction for Canadian agriculture. Consolidating programs may preserve the volume of material moving through a system, at least initially. It may not preserve the diversity of thinking, regional knowledge or willingness to pursue unconventional crosses.

That regional knowledge matters because Canadian agriculture is not one uniform production environment. A variety suited to southern Alberta may face different disease, moisture and maturity pressures than one grown in Manitoba, Ontario or Atlantic Canada.

“Agriculture is applied biology,” Rossnagel says. “Biology, all around the Earth, moves from the poles to the equator. It does not move from Newfoundland to B.C. like politics do.”