Brad Duguid, Ontario Minister of Economic Development, Employment and Infrastructure, and Ontario Premier Kathleen Wynne (R) are pictured during a photo-op at the Honda of Canada plant in Alliston, Ontario, November 6, 2014. Honda Motor Co Ltd's Cana
IN PHOTO: Brad Duguid, Ontario Minister of Economic Development, Employment and Infrastructure, and Ontario Premier Kathleen Wynne (R) are pictured during a photo-op at the Honda of Canada plant in Alliston, Ontario, November 6, 2014. Honda Motor Co Ltd's Canadian division said on Thursday it will invest C$857 million ($749.98 million) over three years to upgrade manufacturing plants in Alliston, Ontario, which will be the global lead for production of the next-generation Honda Civic. Reuters/Aaron Harris

Excessive government regulation is slapping a heavy cost burden on many provincial businesses in Canada. This was disclosed in a new report that studied the adverse impact of Red Tape on regional businesses. The report specifically highlighted the case of government regulation on Alberta businesses, where the costs escalated to by more than $4.6 billion in 2014.

Canada’s Red Tape Report was released on Wednesday by the Canadian Federation of Independent Business. The trade body is also observing a Red Tape Awareness Week from Jan 19-23. The report also said the cost of doing businesses in the provinces has been on the rise in the past few years. From $3.8 billion in 2005, it reached $4.4 billion in 2008 and now $4.6 billion in 2014, reported Calgary Herald.

Hyper Regulation

Noted Amber Ruddy, senior policy analyst at CFIB in Calgary: “Many business owners are telling us that rules, regulations, and requirements are piling up. If Alberta wants to preserve its status as a great place to run business, the government must ramp up its efforts to measure regulatory requirements and be accountable to red tape. Finding ways to give entrepreneurs some of their own time back would be a big boost to the province’s economy.”

Nationally too, the cost of doing business has risen to $37.1 billion in 2014 from $33.8 billion in 2005. According to CFIB, in 2014, Canadian businesses spent an average of 842 hours complying with various government rules and paperwork. It was 12 percent up from 2012. The trade body said 42 percent of small business owners are now advising their children not to start a business, given the heavy burden of regulation.

“If today’s entrepreneurs are telling their kids don’t do it, where is that next generation of entrepreneurs going to come from?” asked CFIB executive vice-president Laura Jones. She said Red tape is a serious threat to future prosperity. Reducing it will free up business owners and will also allow them to spend more time in training staff, growing the business and getting home a little earlier to spend time with family. In terms of time wasted and money spent, there is overwhelming evidence that Red tape is going out of hand and governments ought to cut it, Jones noted.

Golden Scissors Award

The Red Tape Week also honours outstanding government officials who take a pro-business approach and encourage growth. Therefore the CFIB has instituted Golden Scissors Award to honour such officials, reported Financial Post. Nominations are invited from across the country and at every level of the government. For the 2015 award, the winner will be announced on Jan 23.

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