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INDUSTRY CONSULTATIONS ON A PROPOSED NATIONAL INSPECTION REGIME FOR ORGANIC AGRICULTURE
Problem Description / Risk Analysis / Benefits, Costs, and Regulatory Burden
Regulatory Proposals Assessment
Benefits, Costs, and Regulatory Burden
One of the primary reasons why an alternative solution may be dismissed is because of the cost of implementing the solution. Regulators are required to conduct analyses of the options and solutions that have been gathered. Note that the analytical effort should be proportional to the related risks being assessed.
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Benefit-Cost Analysis
- For each alternative solution that has been proposed, including the status quo, summarize all monetary benefits and costs. Include an estimate of the total gross cost of the proposal. Considerations: examine the following in the analysis: direct and indirect benefits and costs, the financial impact on the environment, government, business, workers, consumers, other sectors of society, sustainable development.
| Direct & Indirect Benefits & Costs | Option 2 Mandatory Regime |
|---|---|
| Financial impact on the environment | Reducing pesticide use will reduce the environmental cost.
OECD study urges governments to address the externalities, i.e environmental cost, of conventional farming systems, in order to establish a level playing field for organic producers (OECD, 2003, p.12) |
| Financial impact on the government | |
| Financial impact on businesses | Help to compete with other systems |
| Financial impact on producers | Canadian production will increase.
Cost will increase if it is seen as an expense and decrease if it is seen as an investment (Open Market). Cost will increase for small producers (local and interprovincial) but the regulation can help in reestablishing small communities because the input cost of organic is lower. |
| Financial impact on consumers | - reliability and confidence
- safety - choice - possibility for consumers to make better choices and be more responsible |
| Financial impact on other sectors of society | The cost of the accrediting process will be reduce for the certifiers. In the present situation, certifiers are accredited by several accreditors which, in turn, leads to a higher price for consumers. Present cost of accreditation is definitely too high. |
| Financial impact on sustainable development | OECD recognize the organic agriculture as contributor of the sustainable development (OECD, 2001, p. 471) |
| Note: All the external impacts will be difficult to calculate | |
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Regulatory Burden
Two elements must be examined under this item:- Describe how the proposed regulation ties in to the existing regulatory framework and, in particular, any additional burden it places on small business. Considerations: examine the cumulative regulatory burden of this and similar regulations; are there additional costs related to information, administrative and compliance requirements that this regulation would impose; use the Business Impact Test or Workplace Impact Test to quantify anticipated impacts on business.
- How will the industry be affected by the proposed regulation?
| Last updated: 2004-01-01 | Top of Page | Important Notices |