Thank you very much, and thanks for the opportunity to be here today.
I must stress at the outset that I'm not a safety expert, nor do I know the details of all the standards, practices, and regulations of the many thousands of businesses my organization represents. But what I can tell you is how a small-business owner may think and react to Bill C-6.
Let me also state at this time that CFIB and our members support the underlying intent of this bill and that consumer safety is of the utmost importance. We believe that governments, industry, consumers all have a role to play to ensure that products purchased by Canadians are safe for them and their families. I also want to point out that CFIB is a member of the Consumer Product Safety Coalition, which of course is going to be here today, and my colleagues next to me will provide you with some recommendations from that group.
You should have in front of you a document from us. You should have a slide deck, which I'm going to walk you through; a copy of a letter we sent to the minister a few months back on this issue; as well as a member profile of CFIB.
Some of you may know that CFIB is a not-for-profit organization that represents the interests of small and medium-sized companies across Canada. We have over 105,000 privately owned and operated Canadian companies as members who collectively employ approximately one and a quarter million Canadians. Our members represent all sectors of the economy, and they are located in all regions of the country.
You should also have a copy in front of you of CFIB's member profile. It's really there to show you how our members are distributed across the country and how many of them are going to be directly affected by this legislation. For example, we have over 30,000 retailers, 8,000 wholesalers, and more than 13,000 manufacturing firms, among others, who may be impacted by this bill.
Most people know this fundamentally, but it's so important to understand the importance of small and medium-sized businesses in Canada. Ninety-eight percent of businesses in Canada have fewer than 50 employees. They employ 60% of working Canadians, and they are Canada's primary job creators, especially during these more difficult economic times. These same businesses produce almost half of Canada's economic output today. So it's imperative that the government always be mindful of the impacts of new policies, regulations, or legislation on this group.
CFIB is constantly tracking the issues of highest priority for Canada's small and medium-sized businesses, and the next chart shows the results from the most recent data collected in March of 2009 based on more than 10,000 responses. In this you can see that almost two-thirds cited government regulation and paper burden as an issue of high priority. This is not surprising when you realize that complying with government regulations from all levels of government is costing Canadian businesses approximately $33 billion a year.
But even more important than the total amount spent complying is the fact that the smaller the business, the higher the cost for the business to comply, and this is illustrated on slide 5. This is from a report CFIB did back in 2005, and this data has actually been validated by the OECD as well. It is higher for smaller companies partly because relatively speaking they often have to invest more time and energy to figure out all the rules, as they usually have no staff to do this for them, and partly because many regulations are put together with big business in mind and they do not always factor in whether the same rules are workable for smaller companies.
So part of my intent here today really is to highlight the higher cost borne by smaller companies and to ask that you ensure that this legislation be workable for smaller companies because they make up such a significant part of Canada's economy.
When it comes to Bill C-6, we do worry about the additional burden and complexity this will bring to small and medium-sized companies. This is especially concerning to us after the government's success in reducing paper burden by 22% across 13 departments earlier this year. This exercise actually included Health Canada, which had recorded the highest number of obligations and requirements for businesses among those 13 departments. So we don't want to lose this momentum that's been created by this exercise, and we hope this new legislation and its associated regulations and policies will follow the paper burden reduction principles, which were that any policy has to be designed to balance business needs with the need to protect the health and safety of Canadians.
One way to do this more effectively, though, is to require some measurement that will help policy-makers and legislators understand whether the legislation is working as intended or if it's causing unintended consequences. Requiring ongoing measurement and public reporting of those measurements keeps a check and balance of the system, and allows for adjustments as needed along the way.
How else can governments help small businesses to comply? The next slide shows some ideas from SMEs themselves. Clearly communicating new regulations, providing examples of compliance, and improving government customer service are just some of the practical ways SMEs have identified will help them to better comply. SMEs are small and medium-sized enterprises. CFIB has already met with Health Canada several times to provide this kind of feedback, and we have agreed to work with them on implementation as this is when SMEs will experience the greatest impact.
So CFIB has some very general concerns with the legislation. We also have some very specific concerns we'd like to see addressed, and my colleagues in the coalition will touch on these in more detail.
First, we believe that incident reporting and documentation preparation timelines are too short, and it is not very clear when the two-day requirement to report kicks in. This needs to be clarified, as smaller companies may end up sending far too much or not enough information to Health Canada, if this is not better defined.
It's also important to remember that many if not most small companies will not likely have the capacity to carry out an investigation of a consumer complaint or conduct a risk assessment. What would be expected of these types of businesses in such circumstances must be made clear.
Secondly, there needs to be some time limit as to how long a business is required to keep records. Most other departments, including the Canada Revenue Agency, put a limit on how long a business needs to keep records. We would suggest five years.
There also needs to be clarity on what is meant by “prescribed documents”. We suggest that examples be provided to smaller companies so that they better understand what it means. We would also suggest that any such documents be limited to documents already in the possession of a business and not require new forms to be filled out every time a product is produced, imported, or sold.
We also have concerns that the legislation provides inspectors with very broad powers to conduct inspections and impose seizures, stop orders, and recalls. These broad powers must be balanced with some procedural safeguards, so that inspectors are accountable for their actions as well--for example, requiring them to provide advance notification of a seizure or a stop order; providing an opportunity for a business to respond; time limits for a stop order; or a process for recovery of seized items.
In addition, given the magnitude of the mandatory recall order and its possible implications for a company, only the minister should have the authority to issue mandatory recall orders, as is already the case with the Canadian Food Inspection Agency, and this should only be after the business has been given an opportunity to voluntarily recall the product.
Finally, I want to raise the issue of protecting the confidentiality of business information when sharing this information with other countries. We recognize that there may be a need for Health Canada to quickly share information when there is an imminent threat; however, businesses should be given advance notice that their business information is to be shared, and an opportunity to validate and correct that information. This information should also be restricted only to information necessary to protect the health and safety of Canadians.
In conclusion, CFIB supports the underlying objective of this bill to protect Canadian consumers and products that may pose a danger to their safety; however, we all know that the devil is in the details, so it will be imperative for Health Canada to effectively implement and clearly communicate what is required.
I ask that when you're going through the details of this bill you put on the hat of a small-business owner simply trying to run a business in this more difficult economy, attempting to comply with all the various rules and requirements that are out there from all levels of government. Think about how the bill will be workable for them, so that they can be more effective in helping to protect consumers.
Thank you for the opportunity to present.