Skip to main content

Red tape: two words familiar to many frustrated small-business owners. This week, the Canadian Federation of Independent Business launches its second annual Red Tape Awareness Week to bring attention to the problems created by excessive government regulations and bureaucratic processes, and to push for change. Laura Jones, CFIB's vice-president for Western Canada, who is spearheading this year's lobbying effort, spoke with Diane Jermyn.

What is red tape exactly?

It's a combination of things. Sometimes it's dumb rules that don't accomplish what they intend to accomplish. Sometimes it's complicated forms or language, permit delays or getting different interpretations about the rules from government.

Story continues below advertisement

All those things can feel like death by a thousand paper cuts. If you hold up any one of those things, it doesn't seem like such a big deal, but it becomes a big deal when the stack of paper is so high that it's hard to get anything else on your desk done. That's how a lot of Canadian business owners feel right now.

How big is the problem?

If you ask any business owner, they'll tell you a red tape story. Some problems are small, some threaten or have closed businesses. Around 60 per cent of business owners says that it affects our productivity, our ability to innovate and to be competitive in global markets. There's a huge opportunity here for Canada to get serious about this issue, and have a competitive advantage.

Why should the public care?

We've estimated that regulation costs Canadian businesses over $30-billion a year. Reducing red tape translates into more job opportunities, higher wages, lower prices, higher tax revenues and less stress for business owners and their families.

Why do we need a Red Tape Awareness Week?

The first step toward meaningful change is to make sure the public knows about it and understands that this is a huge hidden tax that frustrates entrepreneurship. The general public might encounter red tape occasionally with renovating a home or getting a passport, but business owners encounter red tape day in and day out being in compliance with business regulations with three levels of government.

Story continues below advertisement

We also wanted to give business owners a sense of hope that things can change. Business owners often feel no one is listening to them or that there's nowhere to tell their stories and get action.

Who's the biggest red tape offender?

It depends on the business, but lots of business owners have concerns about the Canada Revenue Agency (CRA) so, from a volume point of view, you could argue that it's the federal government. But provincial and municipal governments can make life miserable and threaten business, too.

Wouldn't the public be at risk with fewer regulations?

We differentiate red tape from necessary rules and regulations. Business owners say that red tape could easily be reduced by 25 per cent without harming any of the legitimate health and safety objectives of regulations. That's the equivalent of a $7.5-billion annual stimulus package. It's huge.

What are the biggest problems?

Story continues below advertisement

Duplication is a huge problem for businesses. Often the level of government isn't aware of the duplication, and sometimes the duplication has conflicting rules. That type of issue can be extremely frustrating.

How can government create better conditions?

It's pretty simple. We want government to set targets for reducing red tape. We want them to measure and be publicly accountable for those targets. Once those targets have been met, we want them to keep measuring and being publicly accountable and to set a 'zero increase' target to control red tape going into the future.

We'd like CRA to introduce a taxpayer fairness code, to use more tax-friendly language and to give taxpayers the right to get information in writing. I don't just mean for big companies, but small companies or individuals should be able to call and ask for advice, be able to get that in writing, and then have that written advice respected even if it's wrong.

What other issues do you have with the CRA?

Accessibility. Many members get busy signals, are put on hold or get disconnected. Once when we called on a member's behalf, we were disconnected after 17 minutes on hold, called back, got a different answer the second time, asked again where we could see it in writing on the Web site, got put on hold again, this time for 26 minutes, and were disconnected. The third time we called back, we asked to speak to a manager. The person on the other end of the phone said we couldn't speak to a manager and wouldn't give us any identifying information, but said if we left our information, someone would call us back tomorrow. That's not acceptable. It isn't representative but it happens too frequently.

Why doesn't government take more action?

The big problem with government and this issue is that they treat [it]like a flavour of the month. They talk about how they're going to make reform but don't bother to measure or set targets. They might do a little bit of good in some areas but overall, businesses still feel overwhelmed by red tape. There are some interesting government initiatives going on - it's not bleak or hopeless. Part of Red Tape Awareness Week is to champion and cheerlead some of those initiatives.

Are there any success stories?

One example where three levels of government have gotten together successfully is this program called BizPaL. It's a service for those who want to start a business or want to make sure that they're in compliance for their existing business. You can search all the permits and licences you need in your municipality for all three levels of government. For a restaurant opening in West Vancouver, all that homework used to take about seven and a half hours. BizPaL takes it down to 15 minutes. We now have 525 municipalities across Canada signed on to this program, and most of the provinces are on board.

Another where we've made some progress this year is the automobile expense deduction. The CRA deserve some credit on that one for working with us to simplify it.

What's your advice to a business having a red tape problem with government?

Start with the person you're dealing with and try to get it resolved there. Keep escalating it if necessary. If you can't get a resolution within government, talk to an organization, like CFIB, and see if they can do something to help. Document along the way by keeping very good notes and get things in writing whenever possible. With CRA, you can ask for their ID numbers now.

If things get into a 'he said, she said' situation, the government usually decides that they were in the right and you were in the wrong. There's a huge asymmetry in terms of the expectations that are put on those who are complying versus the expectations and accountability on those who are doing the regulating. That's a big problem.

If you're very frustrated or agitated, sometimes it's better to have a third party deal with the government on your behalf. If all else fails and it's a really terrible story, I've seen many things resolved after talking to a reporter.

What are you planning for the week?

On Monday, we're releasing the Red Tape Diaries - a compilation of stories and letters from business owners right across Canada expressing their frustrations, concerns and hopes about red tape to raise awareness on the issue. On Tuesday, we're doing a report card on provincial governments across Canada on what they're doing to be more accountable - which we see is to measure and set reduction targets, publish their findings to the public regularly and make red tape reduction permanent. On Wednesday, we've got a CRA report card on their service to businesses, looking at how they do when you phone in for advice.

How can people get involved with Red Tape Awareness Week?

Go to, check out our Facebook page or go to media outlets covering this issue and be willing to share your stories. Sometimes business owners are intimidated and afraid they'll be in trouble the next time the auditor comes calling, but the public needs to know what a big problem we have on our hands and to get excited about the solutions. We're hoping we'll get some really good announcements from governments this week.

Special to The Globe and Mail

Ms. Jones takes reader questions in a live online discussion Wednesday at noon (ET). Go to the Your Business home page to participate.

Report an error Editorial code of conduct
As of December 20, 2017, we have temporarily removed commenting from our articles. We hope to have this resolved by the end of January 2018. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to If you want to write a letter to the editor, please forward to