Red tape

Red tape is excessive or redundant regulation or bureaucratic procedures that create financial or time compliance costs. It is usually associated with governments, but can apply to other organizations, such as private corporations. Red tape differs from beneficial rules and safeguards. It is the administrative burden, or cost to the public, over and above the necessary cost of implementing policies and procedures. A distinction is sometimes made between rules that are dysfunctional from inception ("rules born bad"), and rules that initially served a useful function but evolved into red tape ("good rules gone bad"). Red tape can hamper the ability of firms to compete, grow, and create jobs. Research finds red tape has a cost to public sector workers, and can reduce employee well-being and job satisfaction. In 2005, the UK's Better Regulation Task Force suggested that red tape reforms could lead to an increase in GDP of 16 billion pounds per year, a greater than 1% rise. The Canadian Federation of Independent Business estimated the cost to business of red tape arising from federal, provincial and municipal government regulations was $11 billion in 2020, or about 28% of the total burden of regulation for businesses in Canada. Many governments have introduced measures to limit or cut red tape, including the European Union, Argentina, the United States, and India. Experience from British Columbia, Canada, suggests a successful red tape reduction initiative requires strong political commitment.