Thank you very much.
Thank you for inviting us to appear today.
We're really pleased to be here before the committee to discuss the impacts of Canada’s regulatory structure on small business.
My colleagues and I are here to answer your questions primarily, so what I have to say will be quite short.
I'd like to begin by speaking about the importance of small businesses in Canada. As you may know, small businesses are the backbone of our economy and vital contributors to growth. Let me clarify that, according to Statistics Canada, small businesses are firms that have fewer than 100 employees, while medium-sized businesses have between 100 and 499 employees. There are over one million small and medium-sized businesses in Canada, and they make up 98% of all Canadian businesses. Moreover, 11.4% of small businesses export goods and services. As a whole, the sector employs over eight million Canadians and generates 42% of the private sector gross domestic product.
I will turn to the responsibilities of our department and our role in supporting small businesses, which range from very small, main street shops that provide us with service and high-quality products locally, to high-growth firms that create many jobs across Canada. They innovate and pioneer new technologies, products and services. This is a wide range of companies.
Our department, ISED, or Innovation, Science and Economic Development, plays a vital role in strengthening Canada's economic competitiveness. We work with Canadians in all areas of the economy to improve conditions for investment, enhance Canada's innovation performance, increase Canada's share of global trade and build a fair, efficient and competitive marketplace.
Our department has frequent interactions with members of the business community who have reinforced with us that a strong regulatory environment is a critical platform for helping businesses to compete and expand. In fact, our department recently published a report from Canada's economic strategy tables, which Darcy could tell you more about. It's a new model for industry-government collaboration that underscored the urgency for Canada to improve conditions for competitiveness, innovation, trade and investment in today's global economy.
One of the economic strategy tables' most significant priorities was the call for Canada to develop an agile regulatory system that ranks within the top quartile globally, and that's conducive to innovation, creates public trust and attracts investment. We know that our regulatory system has to be able to keep pace with advances in technology and innovation and reduce regulatory burden while continuing to protect the health, security and safety of Canadians and the environment.
A number of recommendations came from the economic strategy tables. One is to establish a charter on regulatory agility with built-in reviews and accounting for the cumulative impact of regulations and competitiveness. Other recommendations include establishing an innovative and competitive regulations council for high-growth sectors, and establishing pilot projects to keep innovation going, supported by a hub to develop and share best practices.
In the 2018 fall economic statement, these recommendations were cited as a rationale for the creation of a dedicated external advisory committee on regulatory competitiveness and a centre for regulatory innovation. In fact, economic strategy table members that we collaborated with were quoted to make the case for why this was needed.
It is important for me to touch on our own department's specific role on the broader regulatory system.
ISED and its portfolio entities have important regulatory functions. We cover over 50 acts and over 100 sets of regulations related to areas such as bankruptcy, consumer affairs, copyright, investment, patents, telecommunications, and weights and measures. As a department, we're committed to taking steps to ensure efficient and effective federal regulations. We actively seek to ensure that our regulatory approaches remain flexible to allow innovation to thrive.
You have heard from the Treasury Board Secretariat. Our department has been working very closely with the Treasury Board Secretariat as they develop their plans to deliver on the initiatives announced in the the 2018 fall economic statement that I mentioned.
Another key initiative being undertaken by the Treasury Board Secretariat is the development of an e-regulation system. The system is an online platform to encourage Canadians to participate in regulatory development in order to improve the transparency and efficiency of the process. This is in addition to the new cabinet directive on regulation, which was announced in fall 2018. All regulations will now undergo a small business lens analysis. This approach is different from the approaches that we've seen in the past. It will help reduce the regulatory burden on small businesses, increase transparency and create a more predictable regulatory system.
We firmly believe that the initiatives led by the Treasury Board Secretariat and that we're working on with them are well placed to strengthen Canada's regulatory framework while addressing rules, requirements and processes that are outdated and unduly burdensome for businesses.
I should also add that other federal government departments and agencies are also working to transform their service delivery into a more modern, timely and integrated experience for business. This is important when we talk about reducing burden for small businesses, especially those small businesses that are not the kinds of businesses that would have a legal department or an accountant full time and would have to do this work themselves.
With Canada Revenue Agency improving client services related to telephone services, digital services and information technology infrastructure, Employment and Social Development Canada is modernizing its service delivery beginning with employment insurance. Public Services and Procurement Canada's efforts to transform the way it serves small business through a new electronic procurement platform will help small businesses and entrepreneurs better access opportunities to work for government.
There are a number of things that our department is also leading to reduce the burden for small businesses. I'll touch on those briefly and then we can turn to some questions.
We know that digital services for businesses making them client-centric really help introduce operational efficiencies not just for businesses but also for us as a government. We are working on communicating better, explaining and streamlining our processes and services in a different way.
One of the things that I wanted to point out to you is the new platform that we have for small businesses called Innovation Canada. That platform actually enables entrepreneurs to be matched with the right programs and services not just from the federal government but also from other governments in provinces and territories.
We're also making it easier to register a company through registration in our multi-jurisdictional registry access system. Right now, if you operate a company in British Columbia and you want to expand into Alberta, you have to register separately in Alberta through the registrar of corporations in Alberta. What we're working on with the provinces and territories is a system that will allow the information in any of the registries to be leveraged by the other registries.
That work is under way. That will also allow for robust business searches across the registries. It will streamline extra-provincial corporate registration and reporting. You may be aware that this is one of the top 10 irritants that the Canadian Federation of Independent Business talks about: multiple corporate registries.
We're also working on making it easier to protect intellectual property which is very important for small businesses as they look into exporting. You may be aware that Minister Bains announced an intellectual property strategy last year to do that.
In closing, we're committed to making the Canadian regulatory system more agile, transparent and responsive so that small businesses across the country have the resources and support they need to grow. That said, we understand that we must make additional progress.
We welcome your insights and advice as the committee does its work.
Thank you.