Thank you, Mr. Chair, and members of the committee.
FHCP members manufacture 80% of the goods you find in the centre aisles of grocery stores and pharmacies across Canada. Our sector employs more than 350,000 Canadians in nearly 10,000 facilities nationwide, making us the largest manufacturing sector employer in the country. We also transform close to 40% of Canada's agricultural output into value-added products that feed Canadians and supply global markets.
Today, more than half of the products on Canadian grocery shelves come from outside the country, mostly from the United States. Rising costs, fragmented and outdated regulation, and a highly consolidated retail environment have pushed production elsewhere, resulting in higher costs for Canadians.
What we need is a clearer, more competitive path for investment so that we can strengthen self-sufficiency at home and open new markets abroad. In the United States, manufacturing investment per worker is more than three times higher than in Canada, and our regulatory burden is a key reason for this gap.
When I speak to FHCP members, I hear the same story: regulations are outdated, inflexible and out of step with our trading partners. Canada's regulatory environment is more prescriptive and restrictive than most of our competitors. That means the cost of investing and bringing products to market here often outweighs the benefits. Almost all food products must be reformulated to meet Canadian requirements, which adds cost and complexity. The bottom line is that unless Canada aligns its rules with trusted trading partners, we will continue to discourage investment, reduce the opportunity for trade diversification and limit consumer choice.
One practical step is to adjust regulations to accommodate trade. This means allowing products manufactured for export to meet the standards of the destination market, even if those differ from Canadian domestic requirements.
By relaxing rules for export production, Canada can help its manufacturers compete internationally without compromising Canadian consumer protections at home.
Plastics regulations are also a pressing issue. FHCP was a founding member of the Canada Plastics Pact and the first association in Canada to support the Ellen MacArthur Foundation principles for a circular economy. Our members are committed to reducing packaging, but the federal plastics registry duplicates provincial systems and creates costly reporting without better outcomes. The single-use plastics ban, introduced without coordination with trading partners, risks disadvantaging Canadian exporters. The United States has already flagged Canada's plastics policy as a trade barrier.
There is also growing concern about environmental claims. FHCP supports truthful, transparent communication with consumers, but recent changes to the Competition Act have created confusion and risk for manufacturers. Without clear guidance, companies face rising compliance costs and legal uncertainty. The result is “greenhushing”, where many businesses stop communicating their sustainability efforts altogether. That penalizes responsible companies, discourages innovation and undermines investment. We urge government to clarify the rules and adopt a practical, business principle-based approach that protects consumers without stifling industry progress.
Finally, labelling rules need modernization as there are too many requests for on-pack labelling, which are an ineffective consumer communication technique. Digital labelling offers a practical alternative to on-pack requirements. It reduces costs by avoiding multiple label changes while meeting the objectives of reducing packaging and provides consumers with information they want in a technological format that they are very comfortable using. Moving quickly here would support affordability, availability and accessibility of current product information.
In conclusion, groceries, household essentials and consumer health products are not symbolic luxuries; they are the everyday goods Canadians rely on. This is an industry that is ready to invest, innovate and grow, but we cannot do it with outdated regulations that raise costs and hold us back.
If we modernize regulation, align with our trading partners, fix plastics and labelling policy, and clarify rules around environmental claims, we can start to rebuild capacity, reduce costs and give Canadians more secure access to the products they depend on every day.
I will welcome your questions at the conclusion of the presentations.