The Northwest Territories has received a failing grade from the Canadian Federation for Independent Business (CFIB) for its small business- entangling red tape, the only jurisdiction to get an F on the organization’s yearly report card.
According to the CFIB, the NWT dropped to an F from last year’s D- because of no visible movement by the territorial government to address the “egregious” amount of red tape facing small business.
Amber Ruddy, CFIB’s policy analyst for the NWT, said the territory is “lagging behind” other jurisdictions to reduce paperwork and bureaucratic limitations.
This is the fourth year the organization has published a red tape report card, which measures political leadership, constraints on regulators, legislation and momentum.
Michael Miltenberger, NWT’s minister of Finance, currently sits on a cabinet committee to address red tape, but Ruddy said the CFIB has not seen any evidence of movement from the committee.
“Unfortunately we don’t give out marks based on promises or commitments; we give out the marks based on action and outcomes,” she said.
Minister defends GNWT-made measures
According to Miltenberger, the CFIB is totally ignoring progress made by the GNWT to reduce red tape across all business sectors, including the greatest “red tape reducing” measure of all: devolution.
“We’re going to sheer off 5,000 km of red tape between us and Ottawa,” Miltenberger told The Journal, adding that small businesses will be just one of the groups benefiting from streamlined regulations.
Other recent red tape-reducing measures from the GNWT include moving regulation services online, adding francophone services and introducing community navigators for small business, he added.
Miltenberger said the issue is simply “apples to oranges” since CFIB analysts have repeatedly rebuked the territorial government for not taking their suggestions on legislation while dismissing territory-made solutions.
“They have their own agenda,” he said.
Federal government legislates against red tape
Last week, during the CFIB’s proclaimed Red Tape Awareness Week, the federal government introduced legislation proposing a one-for-one rule that would see departments scrap an old requirement for each new one given to businesses.
A study recently done by CFIB calculated Canadian small businesses spend $9 billion a year on red tape regulation.
“We’re only talking about that excessive paperwork, silly rules and poor customer service,” Ruddy said.
Red tape is often a hidden tax on businesses and those caught without the proper paperwork, more often than not, were not aware they had to fill it out, she said.
“When we survey our membership, right next to labour shortages and taxes, red tape is a top issue,” Ruddy said.
The Yukon was also among the report card’s bottom dwellers with a D-, while BC received an A for the second year in a row. According to the report, BC’s government has legislated publicly measuring and reporting on regulatory requirements for small businesses.
CFIB to meet with GNWT
CFIB meets with the GNWT once a year to discuss its clients in the territory. This year, despite the failing grade, Ruddy said she isn’t looking to discourage the government, but rather to draw attention to the importance of addressing red tape and suggest some easy fixes.
“There are some things they can do immediately to get business owners on their side,” she said, like adding expirations on regulations or creating their own one-for-one legislation.
“We’d be more than willing to share examples from across the country of what jurisdictions are doing to address this,” Ruddy said.
CFIB represents around 250 independently-owned businesses in the NWT from all economic sectors, a relatively small number compared to other provinces.