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I am pleased to sign this Departmental Performance Report at the end of a fiscal year marked by economic challenges.
More than ever, owing to the current economic times, this report points to the timeliness of the initiatives and programs implemented and administered by the Agency to ensure the vitality of communities and growth of enterprises in Quebec.
The report demonstrates that the Agency’s regular programming, focussing on the development and diversification of communities and the growth of enterprises and regions, is geared to Quebec’s economic realities.
This report also highlights the Agency’s ability to react diligently so as to enable enterprises and communities to be better equipped during an economic downturn. Despite the hard times, our economy today stands on a solid foundation, the best among industrialized nations. Thus, in a perspective of consolidating and enhancing our position, the Government of Canada is continuing to implement Canada’s Economic Action Plan. Announced on January 27, 2009, this plan aims to ensure a rapid economic recovery and sustainable growth.
Thus, in order to address the crisis and stimulate the country’s economy, the Government of Canada has introduced immediate measures of some $30 billion to help Canadians and support enterprises.
I am delighted at the contribution made by the Agency, which, through its action, reinforces our economic base by working toward the outreach of our enterprises and the well-being of our communities.
Original signed by
Christian Paradis
Minister of Public Works and Government
Services and Minister responsible for the
Economic Development Agency of Canada
for the Regions of Quebec
I am proud to present the Departmental Performance Report prepared by the Economic Development Agency of Canada for the Regions of Quebec for the period ending March 31, 2009.
In its desire to offset the impact of the economic crisis, the Agency rapidly proposed measures to support the development of SMEs, particularly those in devitalized regions. In the wake of my tour of the regions, we announced the implementation and enhancement of several measures.
Such measures include the Community Adjustment Fund; the Business Startup and Succession Fund; the new policy on NPOs; revised financial assistance with respect to tourist accommodation establishments; and greater flexibility in several components of the Major Economic and Tourism Facilities measure.
Thus, I am also pleased to point out that, as at March 31, 2009, the Agency had $665.2 million in planned investments to support the startup or continuation of all the 1,165 development projects in progress. The Agency’s contributions have had a significant leverage effect in the regions of Quebec, since these projects have led to $2.4 billion in total investment. This investment has contributed to the pre-startup, startup, development and maintenance of more than 2,964 enterprises and the creation of more than six jobs on average per SME receiving direct assistance.
The economic situation called for rapid, tangible measures and decisions from us, and we have played our role in full. Quebec’s SMEs and regions have many challenges to meet, and the Agency is working to provide them with all its support.
Original signed by
Denis Lebel
Minister of State for the
Economic Development Agency of Canada
for the Regions of Quebec
The object of the Agency is to promote the long-term economic development of the regions of Quebec by giving special attention to those where slow economic growth is prevalent or opportunities for productive employment are inadequate. In carrying out this mission, the Agency shall take such measures as will promote cooperation and complementarity with Quebec and the communities of Quebec.
In the long term, Quebec’s regions and communities will have increased their develop-ment capabilities, dynamism and prosperity in a lasting and significant manner for the benefit of their citizens.
Regular programs:
Programs mandated by the Government of Canada:
The Agency’s aim is to increase the vitality of communities and strengthen the competitiveness of small- and medium-sized enterprises (SMEs) and regions while giving due consideration to the realities of Quebec’s regions. Through its programs and presence in the regions, the Agency provides financial assistance, guidance and consulting services, analyses, forward-looking studies, referrals and information. It covers the entire province with its 14 business offices and delivers support to communities, SMEs and non-profit organizations (NPOs).
Program activity architecture
The table below shows the full framework of the Agency’s program activities and subactivities and how they further its three strategic outcomes. This report presents an overview of the performance achieved in 2008-2009 in relation to these components.
Strategic outcomes | Program activities | Program subactivities |
---|---|---|
Dynamic and revitalized communities that have a better socio-economic outlook and are developing their economic activity base | Development of communities |
|
Infrastructure |
|
|
Special intervention measures |
|
|
Presence of conditions conducive to sustainable growth and the competitive positioning of SMEs and regions | Competitiveness of enterprises (SMEs) |
|
Competitive positioning of sectors and regions |
|
|
Policies, programs and cooperative actions that strengthen the economy of Quebec regions | Policies, programs and initiatives |
|
Financial resources1 for 2008-2009 (in thousands of dollars) |
||
---|---|---|
Planned spending | Total authorities | Actual expenditures |
292,655 | 302,443 | 299,247 |
The Agency made full use of its budget. In fact, it had at its disposal $302.4 million, of which it used $299.2 million, or 98.9%. Furthermore, the variance between planned spending and total authorities is primarily attributable to the appropriations received during the year for the establishment of a broadband network in the James Bay territory ($2 million), development of international cruises on the St. Lawrence and Saguenay rivers ($1 million) and the Social Economy Initiative in Quebec ($2.9 million).
Human resources for 2008-2009 (Full-time equivalents) |
||
---|---|---|
Planned resources | Actual resources | Variance |
411 | 401 | -10 |
Performance indicator | Five-year target (from 2007-2008 to 2011-2012) | Performance 2008-2009 |
---|---|---|
Measurement of communities’ diversification | Communities’ vitality is maintained or increased. |
The Agency contributed to maintaining communities’ vitality through implementation of 134 development and diversification projects, strengthening of the regional tourism offering generating $61.3 million in investment and support for the creation, development and maintenance of 2,811 SMEs, primarily in the seven devitalized regions and 21 most devitalized regional county municipalities (RCMs). Leverage effect2: |
Program activities (in thousands of dollars) |
Actual expenditures 2007-2008 | Main Estimates 2008-2009 | Planned spending 2008-2009 | Total authorities | Actual expenditures 2008-2009 | Link to Government of Canada performance |
---|---|---|---|---|---|---|
Development of communities | 169,479 | 130,974 | 130,974 | 146,616 | 145,906 | Strong economic growth3 |
Infrastructures | 48,866 | 27,313 | 27,313 | 53,864 | 53,607 | |
Special intervention measures | — | — | — | — | — | |
Total | 218,345 | 158,287 | 158,287 | 200,480 | 199,513 |
The variance between planned spending and actual expenditures is primarily attributable to a reallocation pursuant to strategic outcome #2 and additional funding during the year. As a result of the economic downturn, some projects could not be carried out with respect to the competitiveness of SMEs and regions, thus freeing up funds. Consequently, additional investment was made under this strategic outcome, so it was possible to continue meeting the needs of communities and regions in these hard economic times.
Performance indicator | Five-year target (from 2007-2008 to 2011-2012) | Performance 2008-2009 |
---|---|---|
Measurement of SMEs’ and regions’ competitiveness | The competitiveness of SMEs assisted and the regions is maintained or increased. |
The Agency contributed to SMEs’ and regions’ competitiveness by the sales growth observed in 120 SMEs assisted, support for 248 new exporting SMEs, improved productivity of 216 SMEs, and creation and expansion of 153 innovative enterprises. Leverage effect: |
Program activities (in thousands of dollars) |
Actual expenditures 2007-2008 | Main Estimates 2008-2009 | Planned spending 2008-2009 | Total authorities | Actual expenditures 2008-2009 | Link to Government of Canada performance |
---|---|---|---|---|---|---|
Competitiveness of enterprises (SMEs) | 70,387 | 81,327 | 81,327 | 58,036 | 56,466 | Strong economic growth4 |
Competitive positioning of sectors and regions | 46,367 | 45,528 | 45,528 | 37,194 | 37,038 | |
Total | 116,754 | 126,855 | 126,855 | 95,230 | 93,504 |
The variance between planned spending and actual expenditures is attributable to the fact that, in the economic downturn, enterprises put their investment projects on hold, thus using fewer program resources than expected. It was decided to reallocate the funding from this strategic outcome. Thus, additional investment was made in infrastructure projects and economic diversification of communities.
Performance indicator | Five-year target (from 2007-2008 to 2011-2012) | Performance 2008-2009 |
---|---|---|
Measurement of the Agency’s ability to cater to the needs of Quebec regions, communities and SMEs | Alignment of Agency policies, programs and initiatives with Quebec regions’ needs and Government of Canada priorities | The Agency developed its ability to cater to the needs of regions, communities and SMEs through the completion of five studies; development and implementation of four initiatives; taking into account of the needs of regions, communities and SMEs as garnered from a Ministerial tour of the 14 regions; and participation in two trade missions to support SMEs in entering into contracts with major contractors. |
Program activity (in thousands of dollars) |
Actual expenditures 2007-2008 | Main Estimates 2008-2009 | Planned spending 2008-2009 | Total authorities | Actual expenditures 2008-2009 | Link to Government of Canada performance |
---|---|---|---|---|---|---|
Policies, programs and initiatives | 7,369 | 7,513 | 7,513 | 6,733 | 6,230 | Strong economic growth5 |
Total | 7,369 | 7,513 | 7,513 | 6,733 | 6,230 |
Program priorities | Type | Progress | Links to strategic outcomes |
---|---|---|---|
Continue the economic diversification of regions and communities posting slow economic growth |
Previously committed to | Surpasses expectations Performance: 65% of commitments approved |
SO #1 Making the terms and conditions of the Community Diversification program more flexible reinforced this intention during the year. Two initiatives were in progress, primarily targeting the seven devitalized regions and 21 devitalized RCMs6 (Community Economic Diversification Initiative – CEDI-Vitality and Major Economic and Tourism Facilities). |
Strengthen the performance of innovative, competitive SMEs in key sectors Investment target: 30-35% of total commitments approved in 2008-2009. |
Previously committed to | Meets all expectations Performance: 32% of commitments approved. |
SO #2 Three new initiatives were implemented (productivity support, innovation support, including natural resources testing and experimentation, and export support). |
Management priorities | Type | Progress | Links to strategic outcomes |
---|---|---|---|
Implement the Departmental Action Plan with regard to the report of the Independent Blue Ribbon Panel on effective program delivery | New | Meets all expectations
|
SO #1 and SO #2 The formative evaluation indicates that the Agency now meets its announced standards8 with respect to processing times in the vast majority of cases. |
Continue improving management of expenditures, results and risk | Previously committed to | Surpasses expectations
|
SO #1 and SO #2 The formative evaluation mentioned that the Agency should continue with implementation of the five-year strategy by emphasizing ownership of results-based management. |
When the Report on Plans and Priorities 2008-2009 (RPP) was drafted, in Fall 2007, there were no signs of any major downturn in the economy. While the first half of the year was profitable for many sectors of the Quebec economy (e.g. construction, transportation equipment and tourism), the province entered a recession in the final quarter of 2008. The U.S. economic slowdown and the deteriorating global economy curbed Quebec’s exports. Furthermore, the economy uncertainty led to a decline in domestic demand, also contributing to the deterioration of the provincial economy. Quebec’s gross domestic product (GDP) shrank by 0.7% in 2008-2009, compared with a 2.4% increase in 2007. International commodity exports fell 12.4% from the second quarter of 2008 to the first quarter of 2009. Over the same period, the jobless rate rose from 7.4% to 8.0%.
After facing rapidly rising energy and raw material costs, Quebec’s manufacturing sector had to deal with falling demand on global and local markets. This sector lost 30,000 jobs from the first quarter of 2007 to the first quarter of 2009 (-5.4%), including 15,000 jobs in 2008-2009 alone.
The Agency identified the eight key risks it had to manage in 2008-2009. These risks concerned in particular its ability to cater to the needs of Quebec enterprises and regions in hard economic times; reliability of performance data and its impact on decision-making; implementation of an information management policy; and the consistency of its external communication products. Mitigation strategies were put in place for each of the risks identified. The initiatives contained in these strategies form the core of the Agency’s two management priorities.
More specifically, in order to enhance the quality of performance data, the Agency opted in 2008-2009 for a new data collection methodology. Follow-up on project performance was increased, so the annual survey is no longer needed for obtaining those data.
The Agency’s actual expenditures for 2008-2009 were $299.2 million, including $242.5 million in grants and contributions. The Agency’s planned spending will increase in 2009-2010, to $461.2 million, including $400.2 million in grants and contributions as a result of the temporary funding allocated in budget 2009, Canada’s Economic Action Plan, for Canada’s economic recovery.
The figure below illustrates trends in grant and contribution expenditures over a six-year period.
Trends in grant and contribution expenditures
The table below replicates the summary table from the Main Estimates and shows appropriations voted (Main Estimates) by Parliament and funds used (actual expenditures).
(in thousands of dollars) | 2006-2007 | 2007-2008 | 2008-2009 | |||
---|---|---|---|---|---|---|
Vote or statutory item (S) | Truncated vote or statutory wording | Actual expenditures | Actual expenditures | Main Estimates | Actual expenditures | |
1 | Operating expenditures | 43,664 | 45,663 | 44,104 | 45,955 | |
5 | Grants and contributions | 316,125 | 285,784 | 237,959 | 242,518 | |
(S) | Contribution to employee benefit plans | 5,085 | 4,934 | 5,324 | 4,922 | |
(S) | Minister responsible for the Economic Development Agency of Canada for the Regions of Quebec - Salary and motor car allowance | — | — | — | 24 | |
(S) | Spending of proceeds from disposal of surplus Crown assets | 25 | 4 | — | 2 | |
Total | 364,899 | 336,385 | 287,387 | 293,421 |
Actual grant and contribution expenditures for 2008-2009 were down compared with 2007-2008, particularly because of the end of the grant to the Québec Port Authority and the Agency’s efforts to cut back in the context of the 2006 spending review. The variance between actual expenditures and the Main Estimates is attributable to new appropriations received during the year through supplementary estimates.
Notes:
1 All amounts presented under financial resources include the cost of services received without charge.
2 The method for calculating the leverage effect was modified in 2008-2009. The leverage effect presented in this report is calculated by dividing the total costs of approved projects (excluding the Agency’s part of the funding) by the total financial assistance approved by the Agency. The leverage effect excludes the Infrastructure program activity and the grant to the Québec Port Authority.
3 Section 2 makes the link with Government of Canada results - www.tbs-sct.gc.ca/report/govrev/06/cp-rc04-eng.asp. The Agency targets the economic diversification of Quebec’s devitalized regions and sectoral competitiveness (of SMEs and regions) in order to ensure enhanced quality of life and a higher standard of living for Canadians.
4 Section 2 makes the link with Government of Canada results - www.tbs-sct.gc.ca/report/govrev/06/cp-rc04-eng.asp. The Agency targets the economic diversification of Quebec’s devitalized regions and sectoral competitiveness (of SMEs and regions) in order to ensure enhanced quality of life and a higher standard of living for Canadians.
5 Section 2 makes the link with Government of Canada results - www.tbs-sct.gc.ca/report/govrev/06/cp-rc04-eng.asp. The Agency targets the economic diversification of Quebec’s devitalized regions and sectoral competitiveness (of SMEs and regions) in order to ensure enhanced quality of life and a higher standard of living for Canadians.
6 See Appendix 1 for a list of the seven devitalized regions and 21 devitalized RCMs: www.dec-ced.gc.ca/eng/publications/agency/rmr.html
7 These achievements were part of the strategy to mitigate key risks which the Agency had to manage in 2008-2009.
8 Service standards indicate processing times between 35 and 65 days, depending on project scale.
9 The amounts presented in this table exclude services received without charge.