New federal competitiveness directive introduces tougher regulatory burden offsets and ongoing rule reviews.
Federal government adopts new "two-for-one" regulatory rule as business groups call for fewer compliance costs and less paperwork
The federal government's latest effort to reduce regulatory burden is being welcomed by Canada's small business community, including many entrepreneurs in the agriculture sector who have long expressed concerns about growing compliance requirements.
On October 21, the Treasury Board of Canada Secretariat announced a new Cabinet Directive on Regulatory Competitiveness and Red Tape Reduction designed to make federal regulations more efficient and business-friendly. The directive requires federal regulators to remove $2 worth of regulatory burden costs for every $1 in new burden introduced, while also emphasizing competitiveness reviews, modernization efforts and ongoing regulatory evaluations.
The Canadian Federation of Independent Business (CFIB), which represents more than 100,000 small and medium-sized businesses across Canada, quickly endorsed the move.
"The new requirement for regulators to reduce regulatory burden costs by $2 for every $1 added is a significant step forward," said CFIB President Dan Kelly.
Kelly noted that CFIB has advocated for a two-for-one approach for years because similar regulatory budgeting measures have proven effective in reducing unnecessary administrative burden in other jurisdictions.
"Small business owners have watched paperwork, reporting requirements and compliance obligations grow year after year. Requiring regulators to offset new burdens with meaningful reductions is an important reform for reversing that trend," Kelly said.
For Canadian agriculture, the announcement could be significant.
Farm operations face regulations from multiple federal departments and agencies, covering areas such as transportation, food safety, environmental compliance, traceability, labour, trade and taxation. While many regulations serve important public policy objectives, producer groups have often argued that duplicated reporting requirements and outdated administrative processes can create unnecessary costs without improving outcomes.
The new directive goes beyond the government's previous "one-for-one" approach. According to the Treasury Board, regulators will now need to consider competitiveness impacts when developing new regulations, regularly review existing rules, remove outdated requirements more quickly and make greater use of recognized national and international standards.
Treasury Board President Shafqat Ali said the directive is intended to help Canada remain an attractive place for business investment while maintaining necessary protections.
The federal government stated that the changes are designed to improve predictability and efficiency in the regulatory system, making it easier for businesses to invest, innovate and grow.
CFIB also expressed support for the directive's emphasis on competitiveness and periodic reviews.
"We are also encouraged by the directive's focus on competitiveness and regular regulatory reviews. Together, these measures will help create a more efficient and business-friendly regulatory system while ensuring rules remain relevant and effective," Kelly said.
One area that could affect agriculture is the government's commitment to rely more heavily on recognized standards. Industry standards are often used in areas such as food processing, transportation, workplace safety and environmental management.
However, Kelly warned that implementation will determine whether the benefits are ultimately realized. "Small businesses should not face new costs or barriers as a result of having to purchase access to standards or obtain unnecessary certifications," he said.
The directive builds on the federal government's broader red tape reduction agenda. Earlier this month, Ottawa introduced the Cutting Red Tape for All Canadians Act, legislation aimed at streamlining regulatory requirements across dozens of federal statutes and reducing administrative obstacles for businesses. The government said those measures are expected to improve efficiency while maintaining health, safety and environmental protections.
For farm businesses already facing rising input costs, labour shortages and market uncertainty, any reduction in paperwork or compliance expenses could provide welcome relief.
"While today's announcement is very positive, success will ultimately be measured by results. Small business owners want to see fewer forms, lower compliance costs and more time to focus on running their businesses," Kelly said.