A whole-of-government approach to promoting competition

Remarks from Matthew Boswell, Commissioner of Competition

Canada’s Competition Summit

Ottawa, ON

October 5, 2023

(As prepared for delivery)
 

Thank you very much, Minister, for joining us this morning and for your words on competition in Canada.

Good morning everyone, and thank you for attending Canada’s Competition Summit 2023!

Before we begin, I’d like to take a moment to thank the Bureau’s Summit 2023 team for organizing the event. I appreciate the amount of work that has gone into this and we are all grateful for your efforts. I’d also like to thank each of the speakers for their time and energy to help us advance competition policy in Canada, as well as all of the attendees for taking an interest in this important topic. To everybody, I welcome you.

Now, I’d like to turn our minds to the reason that we are all here today.

I’ve said this before and I’ll say it again now – Canada needs more competition. But how can we help achieve this?

The focus of today’s conversations will be on how we can promote greater competition in Canada through a “whole-of-government approach”. But what do I mean by “we”? And what is a “whole-of-government approach”?

• “We” are people from a large variety of business, legal, academic, and government organizations who understand the need for a collaborative approach to encourage robust competition in Canadian marketplaces. I believe that it’s this exact assortment of people who are best placed to lead this discussion. And,
• A “whole-of-government approach” is one where governments, at all levels, know the far-reaching impacts of competition and tailor their policies and regulations to maximize the benefits of strong competition.

This Summit occurs during an exciting time – with a lot of change in Canadian competition law and policy underway, and more changes possible in the future. Last year, the Government of Canada introduced several initial improvements to Canada’s Competition Act. It quickly followed-up by launching a comprehensive consultation on Canada’s competition framework, which garnered significant input from a wide range of stakeholders.  On the heels of that consultation, the Government last month announced plans for another set of legislative amendments to the Competition Act, including proposals to enhance the Competition Bureau’s capacity to conduct effective market studies and our ability to prevent anti-competitive mergers.

We are particularly encouraged by these steps, as they speak to the growing recognition that now, more than ever, competition matters.

• Competitive prices and product choices matter to consumers, especially those struggling to make ends meet with the rising cost of living;
• Open and contestable markets matter to entrepreneurs and businesses of all sizes, but especially to small- and medium-sized enterprises, who are the lifeblood of the economy; and
• Competition also drives our economic growth. It encourages companies to innovate, and it spurs greater productivity, increasing the total wealth available to society.

Beyond modernizing the Competition Act, now is the time to look at how all of us in the public sector, at all levels of government – municipal, provincial, territorial and federal – can stimulate our economy by addressing restrictions that harm the competitive process.

Government policy almost always affects how businesses in Canada can compete. Government policies can impact:

• how easily new firms enter and expand;
• how freely firms set the price, quality, and quantity of their products and services;
• the incentives firms have to compete; and
• how easily consumers can switch between competitive alternatives.

The reality is that Canada does not place enough importance on competition in the conduct of its affairs.

And our performance on public restraints on competition is poor. The OECD’s Product Market Regulation Survey is unique and globally-recognized indicator that measures regulatory barriers and competition in a broad range of key economic sectors and policy areas. Canada comes near the very bottom among all of our OECD peers.

The Bureau is also finalizing a report, following an extensive study of competitive intensity in Canada over the last two decades. This report will review various measures of competition and economic dynamism in the Canadian economy as a whole from 2000 to 2020. We examine a number of indicators, including concentration, rank stability, entry and exit rates, as well as mark-ups and profits across all Canadian industries using Statistics Canada data. This report is truly a first of its kind for the Bureau, and in Canada.

We’ll publish the report in the coming weeks. As the report isn’t public yet, you’ll have to wait for more details, but overall, we found that Canada’s competitive intensity has decreased from 2000 to 2020. Our findings are quite striking and provide further support for a significant course correction in Canada.

This is why our discussion today is so important. We must consider the role that governments can play to nurture and stimulate competition in the economy.

And there is lots be learned about the experience abroad.

Some of you may be familiar with President Biden’s Executive Order on Promoting Competition in the American Economy, supported by the White House Competition Council. It is making competition a priority across their entire regulatory system. It’s an economic strategy and it’s delivering results. On that note, we are honored to have a keynote address by Professor Tim Wu today. Professor Wu is one of the world’s leading thinkers on antitrust and technology, and is viewed as one of the principal architects of President’s Biden competition and antitrust agenda in the United States.

The Australian experience is also noteworthy as it demonstrates the transformative power of competition to drive productivity growth. In the 1990s, Australia embarked on a whole-of-government competition policy reform to its economy. These are regarded as the most significant and successful economic reforms in Australia’s history and involved efforts and coordination at all levels of government. Australia’s Productivity Commissioner estimated that these reforms led to a permanent increase of at least 2.5 per cent in Australia’s GDP, or around $5000 per household. Among other things, the reforms included a review of over 1,800 laws and regulations, finding opportunities to boost competition across numerous sectors of the economy.

There is a huge opportunity to increase GDP in our economy by addressing the “competition gap” in our policy and regulatory processes.

That is why I’m so excited to be here with you all today to discuss this opportunity.

Throughout the event, I’d like to ask each of you to think critically about the kind of marketplace we want for ourselves and for generations to come. What tools can we use to ensure that it’s fair… accessible… equitable… and prosperous for all? These are some of the questions we asked ourselves when the Government launched its consultation on the future of competition policy in Canada.

Thank you to our special guests, including Minister Champagne and Tim Wu for joining us today.

We certainly have a full agenda today – so, without further delay, let’s get started!
 

Matthew Boswell
Commissioner of Competition