Red tape

Red tape is a concept employed to denounce excessive or redundant regulation and adherence to formal rules for creating unnecessary constraints on action and decision-making.^{[1][2][3]: 274, 278–9} The occurrence of red tape is usually associated with governments but also extended to corporations.^{[1][3]: 273–4} While the term is intended to describe an institutional pathology, some organizational theorists have argued that the existence of practices seen as red tape may be beneficial, and others have pointed to difficulties with distinguishing red tape from legitimate procedural safeguards.^{[3]: 276, 279}

Red tape is in excess of the necessary administrative burden, or cost to the public, of implementing government policies and procedures.^[4][5][6][7] This definition is also consistent with popular usage, which generally views red tape as negative.^{[3]: 276, 278–9}

Red tape can hamper the ability of firms to compete, grow, and create jobs.^[8][9] Research finds red tape has a cost to public sector workers, and can reduce employee well-being and job satisfaction.^[10][11][12]

In 2005, the UK's Better Regulation Task Force suggested that red tape reforms could lead to an increase in income of 16 billion pounds per year, an amount greater than 1% of GDP.^[13] 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.^[9] This represented about 28% of the total burden of regulation for businesses in Canada.^[9]

Some governments have introduced initiatives to limit or cut red tape, such as a one-for-one rule that removes one regulation each time a new administrative burden is imposed on business.^[14][15] Experience from British Columbia, Canada suggests a successful red tape reduction initiative requires strong political commitment.^[15][16]