Scott Jeary remembers being so vocal that people were staring at him in the concourse of the Vancouver airport.
The CEO of English Bay College in Vancouver had just received a text message informing him he was about to save $100,000. Years of lobbying and perseverance had paid off: The B.C. government confirmed in November it would not be forcing new compliance regulations on the province's ESL schools.
Government regulations are a double-edged sword for businesses in Canada. If an environmental law comes into effect, for example, it can result in a lottery win for companies that manufacture solar panels or wind turbines that have new demands to meet. On the other hand, a business can come close to being strangled in a noose of legislated red tape. Smart companies find ways to monitor developments, often banding together to fight for, or against, regulatory changes.
The Canadian Federation of Independent Business says complying with government red tape costs firms $30.5 billion a year. Laura Jones, CFIB's vice president for Western Canada, notes that her organization, along with its 105,000 members, works to ensure that regulations don't become so overwhelming that they effectively kill business. "One small change in regulation can mean thousands of obligations for businesses," she says.
"Governments are not noted for putting things in clear language, and getting precise information is often difficult. Organizations like ours have many years of experience and know the doors to knock on and how to approach things. There are some good government programs for businesses but one thing consumers need to do is when getting information from government sources, get it in writing and also get the person's employee number."
A seven-year fight to save money
English Bay College employs 29 people and generates revenue of about $4 million a year. Incorporated in 2000, it has had the sword of regulation threatening it for about seven years, as the B.C. government considered adding another layer of mandatory compliance to what is required by Languages Canada, which calls itself "the voice of the Canadian language training sector." Mr. Jeary believes the province eventually recognized how well LC is organized and that it has rigorous quality standards.
"Each student file at time of application would have been about 30-plus pages of documentation," Mr. Jeary says. "The application package of documents and information required about 150 pages, all of which is already covered by LC accreditation. We would have to hire an additional person just to ensure we were meeting the requirements of registration."
This would have resulted in added annual paperwork costs of $100,000, he adds, and the school might have been forced to close.
"Our students come from places like South America and Eastern Europe and have injected millions into the local economy. We worked with Languages Canada and CFIB since 2005 to bring about this result. Not only did this decision make it easier to sleep at night, it made me proud that finally, all the work we had done as part of Languages Canada was accepted and recognized. We are members of the Vancouver Board of Trade and the International Student Safety Project as well as CFIB and Languages Canada.
"We belong for a variety of reasons, including advocacy, marketing and networking."
Good tax planning and accountants
Patrick Desormeau, the president of Nexim, a 15-person insurance business based in Laval, Que., points out that tax laws can actually be effective tools for companies. A provision such as the 2007 federal law that allows the first $750,000 of lifetime capital gains for small businesses to be tax free can be an asset boost for an entrepreneur who may have put all of his or her funds into a company rather than building up an RRSP. "In a business like mine, you may sell your book of clients when you are ready to retire. If the business is valued at $1 million and the first $750,000 is not taxed, you will have a much better nest egg."
This is precisely the type of program that business organizations work to identify for small firms, and that they lobby governments to put into place, Mr. Desormeau points out. "Top notch accounting and tax professionals are essential and invaluable in using these types of legislation effectively," he says. "We have worked with many other associations besides the CFIB, such as the Quebec Order of Chartered Accountants."
Thinking of the future
As his two-year-old green-roof company starts to flourish, Colin Viebrock of Toronto-based Green Garage is hoping for a government-backed boost for his one-person-plus-crew enterprise. A recently passed municipal bylaw says new commercial and institutional structures that are more than 2,000 square metres and are approved after Jan. 31, must devote a portion of their roofs to green plantings with the size of that space depending on the size of the roof. "I am a member of Green Enterprise Toronto, Green Roofs for Healthy Cities, and the Canadian Green Building Council. Mostly I'm a member for marketing and networking opportunities, and to stay on top of any developments that might affect the business," he explains.
"Green Roofs for Healthy Cities has been working on getting the city to pass this legislation for a couple of years. This should help my business in two ways: Any increased awareness of the benefits of green roofs is going to be good. Plus, I have always specialized in smaller projects, but there is no reason why I can't take on bigger ones too."
CFIB's Ms. Jones says she would "advise any business to join with others. As the economy improves it will be very important that the government make life easy for businesses. When entrepreneurship thrives, revenues increase and everyone benefits."
Liberal small business critic Navdeep Bains, Member of Parliament for Mississauga Brampton South, says his role includes forming policy designed to create jobs. "There are good government programs for business such as SHRED, which gives tax credits to help companies invest in research and development," he points out. "What we want is to make Canada the place companies will choose when they want to locate and do business. We need to make sure that jobs are created and that they are good, sustainable jobs."
Special to the Globe and MailReport Typo/Error
Follow us on Twitter: