Cost Recovery Initiative: Consultation Document
8. CFIA approach to fee setting
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As CFIA works to develop a cost recovery proposal for the second phase of consultations, it will follow Treasury Board Secretariat's Guide to Establishing the Level of a Cost-Based User Fee or Regulatory Charge when developing fees.
This Guide outlines the three main steps in the fee setting process:
Step one - estimating the full cost of an activity
Step two - assessing the upper limit of the fee
Step three - consideration of pricing factors.
Pricing factors that the CFIA will be considering include:
- Mix of public - private benefits: the Canadian agriculture and agri-food industry benefits from many CFIA activities as the primary end users of CFIA services. These are considered private benefits. Where a particular CFIA activity confers a benefit to a regulated party, the regulated party is expected to contribute to the costs of this activity. The general public also benefits from CFIA activities from a health and safety perspective (consumer protection). These are considered public benefits. As a result of this mix of private and public benefits, CFIA services are funded by both private and public funds.
- International benchmarking: as part of its analysis, the Agency will compare its cost recovery approach, including services, service standards, and fees with those of major trading partners.
- Other considerations: fees may also be adjusted to take other factors into account, such as:
- fairness and equity of the fee across industry sectors
- economic impact on regulated parties; ability of regulated parties to pay
- competition with the private sector
- public policy objectives
- need for interdepartmental and/or multi-jurisdictional co-ordination
- regulatory efficiency
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