Field

Regulatory Burden Discussion Paper

Regulatory burden is imposed when regulation and policies are implemented and increase the amount of paperwork, cost and time for businesses to operate.  In agriculture, regulatory burden can be imposed by varying levels of government: municipal, provincial and federal.  Some issues can be multi-jurisdictional which further complexes the burden.

The reasons that regulations are burdensome to agriculture are varying.  Outdated regulations can limit growth and often don’t reflect the current direction of the industry.  For example, the maximum loan that the Farm Loan Board can approve without an Order in Council is $2 million.  Considering the nature of farms in the 21st century, an operating, sustainable farm business could easily be valued above the $2 million limit.  The turn-around time for an Order in Council varies; some files take three months before an approval is reached depending on when and the duration that Cabinet is recessed for a break.  This three month time frame is unfavourable for farms and is often a reason the Nova Scotia Farm Loan Board loses a-list clients to lending institutions.

Order in Council also creates a barrier in aspects of the Nova Scotia Crop and Livestock Insurance Commission (NSCLIC).  NSCLIC provides insurance programs to farms which will support the farm during a period of yield losses.  Since the program is a yield loss insurance program, it is seasonal by commodity.  There are key dates for the program to operate effectively and fairly for producers in the same commodity: registration, planting and harvesting.  Presently, these dates can only be changed through Order in Council.  As discussed previously, Order in Council can create a hold-up in process.  Weather has been known to cause delay in planting or harvesting; with planting and harvesting dates written firmly in regulation, the flexibility that agriculture requires is not available.

Federal regulations and strategies have influence over aspects of agriculture and agri-food.  For example, the Healthy Eating Strategy in progress by Health Canada is proposing front of package labelling for all food products.  The proposed strategy has identified select exemptions from labeling for agriculture products which further lumps agriculture products in the same categories as highly processed products, like honey and maple syrup with refined white sugar.  To indicate which nutrient of concern (saturated fat, sugar or sodium) is high, Health Canada has proposed using warning labels, similar to those you would find on pesticide labels or other WHMIS controlled products.

Regulation matters can also be cross-jurisdictional.  Food Safety is an excellent example of the federal set of regulations differing from a provincial set of regulations.  With the implementation of the Safe Food for Canadians Act and its applicable fees, regulatory changes and new control measures, farms selling produce direct to market across provincial boarders will be required to adhere to federal regulations.  Considering the commodity diversification that is present on farms in Nova Scotia, establishing a preventive control plan for each commodity would be an elaborate cost for farms.  By nature, farms selling direct to market are smaller in scale and income; adding the additional costs of an extensive preventive control plan would increase financial burden on the farm.  Keeping in line with the federal one-for-one rule, in the cases where fees will be required through the purchase of licenses and registrations are being implemented, there will be a time saving component by being able to apply for certificates online.  The Nova Scotia Food Safety Regulations are in line with the current (June 2017) Federal Food Safety Regulations.

Another example of cross-jurisdiction of regulations is carbon pricing.  Program design is left to individual provinces while the value per CO­2e and threshold is a national target.  This method creates perceived or real competitive disadvantages across provincial and national borders. Competitive disadvantages are of particular concern in Atlantic Canada, especially when larger provinces have access to more efficient infrastructure such as energy options and greater market access.

Regulation isn’t the only government decision tool that causes barriers or red tape.  Public Policy and inconsistent service delivery creates burdens as well.  For example, on occasion when a new program is implemented, not all program administrators are informed of this program creating unnecessary lag time for the farmer accessing the program.

 

Recommendations

  • Nova Scotia Treasury Board increase the Farm Loan Board limit to $7 million before an Order in Council is required.
  • Change regulations to allow for the NSCLIC Board determine key deadlines and reporting dates for crop insurance program.
  • CFIA exempt farms that sell produce direct to consumer from Safe Food for Canadians Act regulations.
  • All levels of government must ensure that service delivery is consistent across regions.