Federal government looking to cut ‘unnecessary red tape’ and modernize regulations

A federal office tower in Ottawa. Aug. 2, 2021. (Jackie Perez / CTV News Ottawa)

The federal government is launching a “red tape review” of regulations across all federal departments and agencies with regulatory responsibilities in a bid to cut “unnecessary red tape.”

Treasury Board President Shafqat Ali announced Wednesday morning that ministers will have 60 days to review regulatory responsibilities and report back on their organizations progress and next steps.

“Regulations play a key role in protecting the health and safety of Canadians—but to stay effective, they must be regularly reviewed,” Ali said in a statement. “Cutting unnecessary red tape is essential to unlocking Canada’s full economic potential.”

The recently created Red Tape Reduction Office will oversee the review, which is intended to modernize outdated regulations and reduce red tape.

“As part of this review, Ministers will review regulations in their portfolios and propose actions and measures to eliminate red tape –– including removing outdated regulation, reducing duplication with provincial rules, and making it easier to access and deliver services,” Treasury Board said in a statement.

The Canadian Federation of Independent Business released a report that the combined cost of regulation to businesses from all three levels of government was estimated at $51.5 billion in 2024, with approximately $17.9 billion attributed to red tape.

“Canada’s new government has a mandate to spend less and invest more. To that end, we will remove red tape by eliminating outdated regulation,” Prime Minister Mark Carney said in a statement.

“It’s time to make government more efficient, make its processes more effective, and to catalyze more private capital so we can build the strongest economy in the G7.”

The Liberal Party’s election platform pledged to reduce red tape, saying it would require all federal departments – including Transport Canada, Natural Resources Canada, and Innovation, Science and Economic Development Canada – to review and report on progress to “eliminate outdated and unnecessary rules, reduce duplication or overlap with provincial rules, and streamline the administration of rules and the delivery of regulatory decisions.”

The Liberal platform also promised to build AI infrastructure by investing in nation-building energy infrastructure and cutting red tape to make Canada the best place in the world to build data centres.

According to the Red Tape Reduction Office’s website, the office was established to address regulatory red tape by “making the regulatory system more efficient,” “reducing barriers to innovation, productivity and economic growth,” and “reducing regulatory costs for Canadians and businesses.”

The federal government’s move to “modernize outdated regulations and reduce red tape” within the government comes two days after cabinet ministers were directed to find operational savings over the next three years.

CTV News learned Monday that federal ministers have been asked to find 7.5 per cent savings for the 2026-27 fiscal year that begins on April 1, 2026 followed by 10 per cent in 2027-28 and 15 per cent in 2028-29 in an effort to find “long-term savings.”