2017-18 Departmental Results Report

The Honourable Navdeep Bains
Minister of Innovation, Science and
Economic Development

I am pleased to present the 2017–18 Departmental Results Report for Canada Economic Development for Quebec regions.

Over the past year, through integrated work across the various organizations of the Innovation, Science and Economic Development Portfolio, the Government of Canada worked very hard to improve Canada’s global competitiveness while creating jobs, nurturing growth and strengthening our country’s middle class.

In 2017-18, the Portfolio continued to implement the Innovation and Skills Plan to promote innovation and science, including support for scientific research and the commercialization of research and ideas. The Plan also encourages Canadian small businesses to grow, scale-up, and become more productive, more innovative and more export-oriented. An important area of this work included promoting increased tourism in Canada and the creation of new opportunities in our tourism sector. The Plan’s overarching aim to position Canada as an innovation leader has been the driving focus of the Portfolio’s programs.

In continuing to implement its renewed vision of regional economic development in Quebec, Canada Economic Development for Quebec Regions made a significant contribution to the achievement of portfolio objectives by helping businesses and communities grow, innovate and export their products so that they can create quality jobs and ensure the prosperity of Canadians.

Through deep collaborations and inclusive partnerships, the Innovation, Science and Economic Development Portfolio organizations have embarked on a shared journey to stronger, cleaner and more inclusive economic competitiveness that benefits all Canadians. This report documents the contributions that Canada Economic Development for Quebec regions is making towards this important work.

Manon Brassard
Deputy Minister / President of Canada Economic Development for Quebec Regions

Today, I am very pleased to present the 2017–2018 Departmental Results Report for Canada Economic Development for Quebec Regions (CED).

This annual report documents the ground covered since last year and assesses the progress made on the objectives outlined in the Departmental Plan. This is an opportunity to take pride in the work that has been accomplished, as well as the dedication of the employees who made it possible to achieve these results.

In 2017–2018, CED focused its efforts on five key priorities: innovation, clean growth, economic diversification of communities, economic development of Indigenous communities and support for high-impact businesses. We developed intervention strategies rooted in regional realities in order to contribute to a Quebec economy that is cleaner and more innovative and inclusive.

These results directly support the Government of Canada’s Innovation and Skills Plan. In fact, the Agency and its partners have worked together to create a more prosperous and innovative Canada, where Canadians have access to better jobs. Therefore, CED’s results clearly fall within the government’s vision.

Our efforts enabled us to deliver 176 clean technology projects, for a total of $35.7 million in contributions, which is $10 million more than the target set in the Departmental Plan. The results were equally positive in terms of innovation, with support for 268 new projects strengthening regional innovation ecosystems, while supporting the creation or preservation of 4,000 jobs.

We also launched an OECD research project in Wendake on best practices in Indigenous economic development. CED is jointly responsible, along with Indigenous and Northern Affairs Canada, for the Canadian portion of the project: a concrete demonstration of our long-standing commitment to these communities.

I encourage you to read this 2017–2018 Departmental Results Report to learn more about CED’s significant contribution to Quebec’s regional economic development.

Key results in 2017–2018

During the 2017–2018 fiscal year, CED invested $266.8 million in grants and contributions (G&C) and continued to support 1,394 projects in all regions of Quebec. For every dollar provided by CED, an average investment of $3.47 from other sources was generated in the form of leverage funds. CED also continued to work with federal, provincial and regional partners to provide Quebec regions with programs that meet their needs and help them make the most of their economic assets, as well as diversify, consolidate and develop their growth potential.

CED successfully implemented Canada 150 Infrastructure Program (CIP-150, components I and II), which came to an end in 2017–2018. Under this program, 514 projects were approved in 380 communities, with total investments of $60.34 million (2016–2017 and 2017–2018) from CED.

To contribute to the Government of Canada’s Innovation and Skills Plan,^{Footnote i} CED focused on five priorities.

1. Innovation: CED supported 268 new projects for a total of $124.3 million to promote the adoption of new technologies, develop new products and strengthen regional innovation ecosystems. All in all, these new projects plan to create or preserve more than 4,000 jobs.
2. High-impact firms: CED provided 125 businesses with financial support for an authorized amount of $83.6 million to help them expand and increase their productivity. In addition, 49 businesses in Quebec were enrolled in the Accelerated Growth Service,^{Footnote ii} 20 of which were recruited by CED. This service promotes the rapid growth and international competitiveness of the selected firms.
3. Clean technologies: CED’s spending in clean technologies reached $35.7 million (176 different projects) versus an annual target of $25 million. More than half of the SME projects made it possible to purchase equipment that improves environmental performance.
4. Economic diversification: CED provided financial support for 87 new projects, which will ultimately generate investments of $283 million, particularly in the tourism sector.
5. Indigenous communities: To support the economic development of Indigenous communities, CED supported 12 new projects for a total of over $3 million. CED also established mechanisms to support dialogue with representatives and business people from different communities. CED is also co-leading the Canadian portion of a two-year OECD international research project on the links between Indigenous communities and regional development, in partnership with other federal agencies.
   
   Finally, under CIP-150, a component specifically targeting Indigenous clients with criteria better geared to the needs of the communities was set up. That initiative resulted in a total of 36 projects being carried out, with $11.3 million in investments, which represents one third of the available funds under the second call for proposals (2017–2018).

The level of results achieved reflects the amount of effort and resources devoted by CED to ensure it achieved its priorities for 2017–2018.

For more information on CED’s plans, priorities and results achieved, see the “Results: what we achieved” section of this report.

Raison d’être

The mission of Canada Economic Development for Quebec Regions (CED) 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.”^{Footnote iii}.

Mandate and role

CED is one of the regional development agencies (RDAs) that make up the Innovation, Science and Economic Development Portfolio. Quebec’s communities and businesses—especially small and medium-sized enterprises (SMEs)—are at the very heart of its action. Through the projects it funds and its networking and integration role, CED is a key federal actor in Quebec.

For more general information about the department, see the “Supplementary information” section of this report. For more information on the department’s organizational mandate letter commitments, see the Minister’s mandate letter.^{Footnote iv}

Operating context

Economic context^{Footnote v}

In 2017, the Quebec economy experienced its best performance since 2000: employment increased tremendously, the unemployment rate fell below the Canadian average, wage growth accelerated, Quebec exports remained steady as a result of the good performance of the U.S. and global economies, investments rose and the housing market was strong. As a result, the Quebec economy is running at full speed.

Despite the good performance of Quebec’s economy, it is still struggling with other issues, including global uncertainties and internal challenges: recruiting difficulties in some sectors and regions, weak growth in goods and services exporting, low productivity growth, an entrepreneurial deficit, a delay in adopting innovative processes and digital technologies, and limited sources of growth for remote communities.

Indeed, a number of communities that are far from large urban centres have insufficiently diversified economies and rely on opportunities arising from a single sector, such as natural resource development or tourism. Therefore, those communities continue to be more sensitive to economic fluctuations.

Government context

From the federal public perspective, CED continues to implement Canada’s Innovation and Skills Plan announced in Budget 2017, including its actions in partnership with the other regional development agencies (RDAs) listed in the Investing in Regional Innovation and Development^{Footnote vi} document. CED also invested in putting the other government priorities into action, particularly in terms of clean growth and growth for all. In this regard, a real dialogue was established between CED and several Indigenous communities in Quebec. Lastly, CED contributed to the work of federal partners by providing its expertise and regional perspective.

CED also contributed to the horizontal review of all federal innovation and clean technology programs. The objective was to simplify and streamline all programs, especially with expected results such as simple and effective innovation programs, and increased capital for clean technology companies. Further to that exercise, Budget 2018 included measures to support innovation within the RDAs. They mainly involve simplifying innovation programs and allocating additional resources. For CED, additional resources amount to nearly $20 million per year over five years, $4 million of which is earmarked for female entrepreneurs.

Also, the CED President chairs the Quebec Federal Council (QFC), an interdepartmental network bringing together senior federal officials from 49 federal organizations with responsibilities in the Quebec Region (excluding the National Capital Region). In 2017–2018, the QFC Secretariat, which comes under CED, supported QFC members in achieving three regional priorities, namely: 1) launching the QFC interdepartmental innovation lab; 2) promoting well-being in the workplace; and 3) recruiting, retaining and managing talent in the region. In addition, the Secretariat held four quarterly meetings on priority topics for the government, including digital, Indigenous people and mental health. Lastly, Montréal’s first Blueprint 2020 Innovation Fair was organized, along with two events during National Public Service Week: the QFC Awards for interdepartmental recognition, and Let’s Chat!, an interdepartmental express mentoring initiative.

From an organizational perspective, CED continues to transform through modernization, process optimization and improved customer experience with its Horizon 21 initiative. The three internal transformation areas of this initiative are:

CED also moved two of its regional business offices in 2017–2018. The Quebec–Chaudière-Appalaches and Bas-Saint-Laurent business offices now have new addresses, while the planning and completion of the relocation of its head office and the Greater Montréal business office were completed in April 2018. Those moves enabled CED to modernize its work environment and adhere to the Government of Canada’s Standard on establishing the Activity-Based Workplace (ABW) strategy.

Key risks

The following table shows the risk that CED faced and the mitigation strategies implemented in 2017–2018. Effective mitigation measures enabled CED to adapt its actions to the evolving economic context and the government’s priorities in order to support these priorities and achieve the targeted outcomes.

Key risks

The Treasury Board of Canada Secretariat introduced a new Policy on Results, which took full effect on April 1, 2018. That policy enabled CED and other regional development agencies to jointly develop the next 2018–2019 Departmental Results Framework (DRF). CED also created the tools that accompany the DRF, namely the Program Inventory and the Performance Information Profile. The next Departmental Results Report will therefore be prepared with a different set of indicators than those in this document.

Project funding

With its business development knowledge and experience, CED supports businesses and helps them carry out their projects. CED makes strategic investments in all regions of Quebec, thereby strengthening both the predominant economic sectors of the regions and the emerging economic sectors; CED focuses on innovation to drive economic growth for all and supports the economic diversification of communities that depend on a single sector.

Networking

Well rooted in the regions thanks to the on-site presence of its 12 business offices, CED builds on collaboration and the creation of synergies with businesses, communities, supporting organizations, universities, incubators, the provincial government and the municipalities in order to increase the quality and impact of its programs. For example, it forms partnerships to foster a concerted action by regional economic development players and ensures better information sharing among federal organizations.

CED thus promotes Quebec’s interests at the national level and works with other government departments to ensure coordination of government policies and programs. Its action has a significant impact on Quebec communities and businesses, not only through its direct investments, but also because it contributes to understanding the region’s economic development needs. For example, CED continued to support the Industrial and Technological Benefit (ITB) Policy so that Quebec SMEs could enjoy the industrial benefits generated by the Government of Canada’s major defence procurement projects in the aerospace, navy, land and security sectors, by promoting their abilities among prime contractors.

Grants and contributions programs and initiatives in effect in 2017–2018

Programs

Program 1.1 – Business Development

Description

This program is designed to support the development of Quebec businesses throughout their life cycle. Businesses—particularly SMEs—drive economic development and are known for generating significant economic activity and for creating jobs in communities.

CED contributes to the renewal of the Quebec business pool by supporting business succession and the emergence of new businesses. It also helps to enhance the competitiveness of existing businesses and to support their sustainability by improving their performance through the development of their production, innovation, marketing and export capabilities.

In this program, CED mainly targets businesses directly or through NPOs that support them. It promotes business development through its grants and contributions program: the Quebec Economic Development Program (QEDP).

Results

In that fiscal year, CED supported 419 new projects under the Business Development program with an assistance amount totalling $178.1 million.

In the vast majority of cases (98% or more), CED-supported businesses in recent years, whether in their start-up phase or later in their existence, are still operating. Over a longer period of time, the results are also convincing:

• 88% of recipients of financial assistance from CED are still active after 5 years (compared with 84% for a cohort of similar businesses that received no financial support from CED);
• 69% of recipients of financial assistance from CED are still active after 10 years (compared with 61% for a cohort of similar businesses that received no financial support from CED).^{Footnote vii}

Also, 52% of the businesses that received entrepreneurship support in recent years have survived past the start-up phase, an increase of nearly 6% over the previous fiscal year. Therefore, CED directly contributed to the launch and maintenance of 51 start-up businesses in 2017–2018. This means that those businesses have been in operation for at least one year, in addition to having generated revenues of at least 80% of their expenses.

Since innovation is a key factor in ensuring the survival and competitiveness of businesses, innovative projects are a priority for CED. However, statistics show that it is mainly medium-sized and large companies (250 or more employees) that introduce new products or processes.^{Footnote viii} CED is working to close the gap between SMEs and large businesses by supporting SMEs in their projects with an innovation component. As such, 268 new projects with an innovation component were supported by CED in 2017–2018.

Overall, 73% of the businesses supported by CED to improve their performance levels have increased their sales.

The difference between actual and planned spending is due to an increase in repayable contributions that were originally supposed to be allocated in 2018–2019 rather than 2017–2018. Given Quebec’s excellent economic performance, the authorization to advance those funds enabled CED to further support the development of businesses in Quebec during that fiscal year.

On the other hand, the actual expenditures of the Business Development Program are higher than planned due to the temporary reallocation of funds from some of its temporary initiatives to its regular programming. CED can benefit from some flexibility, in a controlled manner, enabling it to temporarily redirect those unused funds to other programs and thus enabling it to adapt to the reality of Quebec’s businesses, communities and regions and thereby make full use of the funds available to it.

Information on CED’s lower-level programs is available in the GC InfoBase.^{Footnote ix}.

Program 1.2 – Regional Economic Development

Description

This program is intended to strengthen the regions’ economic base so as to sustain Quebec’s economic growth. Quebec’s regions differ in, among other things, their industrial structure, and some are more sensitive to economic fluctuations than others. Quebec’s prosperity depends on the different regions participating in the economy to their full potential. CED contributes to building strong, competitive regions, and does so by supporting local communities as they take charge of their economic development and by stimulating investment in all Quebec regions. Under this program, CED intervenes primarily through NPOs active in economic development and through the QEDP.

Results

In this fiscal year, CED supported 28 new projects under the Regional Economic Development program for an assistance amount totalling $18.5 million.

Without CED’s help, most of the regions’ economic development projects could not have been completed, according to 83% of the funded NPOs surveyed. The benefits of the projects supported in terms of promoting assets are many, particularly with respect to:

• the increased tourist traffic; and
• the visibility and media impact.^{Footnote x}

The sum of foreign direct investment maintained or attracted by organizations receiving the Agency’s assistance is one of the results used to demonstrate our progress in the economic development of the regions. This result increased by $ 740 million according to the information obtained by the beneficiary organizations, for a total of $ 2.5 billion for the 2017-2018 fiscal year.

* In the 2016–2017 fiscal year, no collective economic equipment project achieved a completed project status, which is why the result is very low ($2.5 million) compared with the 2015–2016 and 2017–2018 fiscal years, when a few collective economic equipment projects were completed.

CED reallocated resources among its various programs—in compliance with departmental authorities—in order to adjust to the realities of Quebec’s businesses and regions.

Information on CED’s lower-level programs is available in the GC InfoBase^{Footnote xi}.

Program 1.3 Strengthening Community Economies

Description

In addition to its regular programs, CED develops, administers and implements Canada-wide programs or temporary and/or targeted initiatives. The common objective throughout is to strengthen community economies in order to increase Quebec’s economic growth. CED thus supports communities’ economic development. CED also supports economic activity in Quebec communities that are undergoing economic shocks, experiencing significant development challenges or gasping long-term business opportunities.

This program targets businesses and non-profit organizations. CED uses dedicated temporary or permanent additional funding from the Government of Canada, or specific funds which it allocates via the QEDP. It also intervenes by means of a permanent fund dedicated to the Community Futures Program (CFP).

Results

In the current fiscal year, CED supported 57 new projects under the Strengthening Community Economies program for the amount of assistance totalling $24.1 million.

In addition, CED continued to provide financial support to the 67 Community Futures Development Corporations (57) and Business Development Centres (10). The results of the last study conducted by Statistics Canada on the performance of the CFP in Quebec indicated that businesses supported by a CFDC/BDC have a better survival rate, create more jobs, and increase their payroll and sales faster, as compared with other similar businesses that did not receive assistance from a CFDC/BDC. So, results for the survival rate of businesses supported by the CFP are very satisfactory. Set targets were exceeded, with an 87% survival rate of supported businesses, compared with 53% for the comparison group.

The five temporary or targeted initiatives delivered through the QDEP supported 495 projects in 99 individual communities out of 104 communities in Quebec. Completed projects generated total community investments of $248 million, exceeding the established target.

In order for Quebec communities to celebrate Canada’s 150th anniversary, the Agency implemented the Canada 150 Community Infrastructure Program, which supported the rehabilitation or improvement of community infrastructure. The program was a great success. As a result of the program, 377 organizations in Quebec were supported in carrying out projects in the 2017–2018 fiscal year, totalling an investment of nearly $50 million by the Agency.

CED’s work in the communities is noticed and appreciated by the public. Mid-term evaluations of the Economic Recovery Initiative for Lac-Mégantic and the Canadian Initiative for the Economic Diversification of Communities Reliant on Chrysotile confirm the need for intervention and the relevance of these initiatives as well as their alignment with priorities and their complementarity. In addition, the presence of a dedicated on-site team helped establish a partnership that the partners described as excellent.^{Footnote xiii}

*With respect to the infrastructure modernization target, the results for this program are published in Infrastructure Canada’s Departmental Results Report.

The result of the target total investment generated in communities for temporary and/or targeted support increased significantly over the last two years. This increase is mainly due to implementation of the temporary CIP-150 initiative, which enabled the Agency to support a substantially higher number of projects in the 2016–2017 and 2017–2018 fiscal years, resulting in a significant increase in investments in the communities. In addition, for the 2017–2018 fiscal year, the Strategic Initiative to Combat the Spruce Budworm in Quebec, another temporary initiative that ended on March 31, 2018, also increased the total investment generated.

The Canada 150 Community Infrastructure Program came to an end in 2017–2018. The projects carried out enabled more than 350 communities and towns to benefit from improved community infrastructure, thereby promoting their vitality. Almost the entire budget was invested.

The difference between actual and planned spending is mainly due to a slowdown in spending for some of the temporary initiatives during the year. For example, the Economic Recovery Initiative for Lac-Mégantic experienced delays in the development, planning and completion of certain public infrastructure improvement and construction projects, which, in turn, delayed spending in the following few years.

This slowdown in spending enabled CED to temporarily reallocate resources to its other programs so that businesses, communities and regions in Quebec could benefit from CED’s support for their projects in 2017–2018.

Information on CED’s lower-level programs is available in the GC InfoBase^{Footnote xiv}.

Internal Services

Description

Internal Services are those groups of related activities and resources that the federal government considers to be services in support of programs and/or required to meet corporate obligations of an organization. Internal Services refers to the activities and resources of the 10 distinct service categories that support Program delivery in the organization, regardless of the Internal Services delivery model in a department. The 10 service categories are: Management and Oversight Services; Communications Services; Legal Services; Human Resources Management Services; Financial Management Services; Information Management Services; Information Technology Services; Real Property Services; Materiel Services; and Acquisition Services.

Results

In 2017, CED continued to implement the Departmental Workplace Wellness Strategy through an action plan. Factoring in employee concerns revolves around the plan’s four priorities: 1) the promotion of a healthy and respectful environment, 2) highlighting CED’s innovation culture in order to increase its performance, 3) recognition and engagement, and 4) effective communication with management. The Health and Safety Policy Committee (HSPC) designated for its implementation conducted activities such as health awareness and training workshops and Employee Assistance Program (EAP) services.

Another aspect of the Agency’s human resource management results involves the management of employee talent. The priority is to develop personalized learning plans for all employees and hold discussions between managers and employees on talent. This exercise identified a pool of “high-potential” employees who were eligible for a pilot development program through a specific learning pathway and support throughout the year.

Since achieving results was supported by optimal resource planning, CED began to improve its integrated planning process in 2017–2018. The efforts made, including clarification of the role of stakeholders and in-house development of a new computer platform will help establish a simpler, centralized and transparent process and better corporate risk mitigation for 2018–2019.

In addition, CED continues to ensure that internal measures are in place to address gender and diversity (GBA+) factors in its practices and services, including identifying the impacts of its programs and initiatives on diverse groups of men and women in Quebec.

In partnership with the five RDAs and FedNor, CED is continuing to develop a common system to manage grants and contributions that puts clients’ concerns at the forefront of its actions. The new government-wide system, which is scheduled to be rolled out in 2020, will provide RDA clients with modern tools, including a transactional portal.

Given the timeline and the review of the scope of the project for the transition to the Government of Canada Finance and Materiel System (GCFM), CED is devoting more resources to stabilize the infrastructure of its current financial management system. That said, CED is continuing the work to migrate to the new system because it is one of the government-wide priority initiatives and should improve the quality of integrated financial information and strengthen the financial management function across the Government of Canada.

In 2017–2018, in addition to relocating the Quebec–Chaudière-Appalaches and Bas-Saint-Laurent business offices, CED invested resources into planning and implementing the relocation of its head office and the Greater Montréal business office in preparation for a move in April 2018. Establishing these modern workplaces included the modernization of physical workplaces; a review of the processes and systems that help employees perform their duties; and the introduction of new technologies that will enable employees to connect, collaborate and communicate across the government and with Canadians.

Actual expenditures

Departmental spending trend graph

The graph below shows the trends in CED’s actual and planned spending. The dark grey bars are G&C and operating expenditures, while the light grey bars show statutory expenditures associated with employee benefits plan.

Between 2015–2016 and 2017–2018, expenditures increased by 20%, from $259.2 million to $311.4 million (including $266.8 million in grants and contributions and $44.6 million in operations and benefits). This increase is mainly due to the dedicated temporary funding allocated to the Strengthening Community Economies program, particularly through the Economic Recovery Initiative for Lac-Mégantic, the Initiative for the Economic Diversification of Communities Reliant on Chrysotile and the Canada 150 Community Infrastructure Program (Components I and II).

In 2018–2019, the decrease in planned spending is mainly due to the end of the Canada 150 Community Infrastructure Program on March 31, 2018 (Components I and II). For the years following 2018–2019, the decrease is explained by the fact that planned expenditures do not take into account the reinvestment of clients’ repayable contributions.

*Given that CED implemented its new Departmental Results Framework in 2018–2019, future data are presented differently. This is why the planned spending for 2018–2019 and 2019–2020 is not shown.

The difference between the actual expenditures and those projected by CED in 2017–2018 is $7.6 million (3%). This can be explained by an increase in repayable contributions and the deferral of funds from 2016–2017.

Actual human resources

CED internally reallocated these funds to implement certain departmental and government-wide initiatives, transform and modernize its services, and address financial gaps resulting from collective agreement renewals in 2017–2018 by aligning its resources differently.

Expenditures by vote

For information on the CED’s organizational voted and statutory expenditures, consult the Public Accounts of Canada 2017–2018.^{Footnote xv}

Government of Canada spending and activities

Information on the alignment of the CED’s spending with the Government of Canada’s spending and activities is available in the GC InfoBase.^{Footnote xvi}

Financial statements and financial statements highlights

Financial statements

CED’s financial statements (unaudited) for the year ended March 31, 2018, are available on the departmental website.

Financial statements highlights

The financial highlights presented below provide an overview of CED’s financial position and operations. The unaudited financial statements are drawn up in accordance with government accounting policies, which are based on Canadian Generally Accepted Accounting Principles for the public sector.

Note that the spending presented in the tables in other sections of the Report were prepared on a cash basis, while the financial highlights that follow were prepared on an accrual basis. Tables reconciling these two accounting methods are presented in the Notes to CED’s Financial Statements.

A more detailed statement of operations and associated notes, including a reconciliation of the net costs of operations with the requested authorities, are available on the CED website.

*CED’s Future-Oriented Statement of Operations (unaudited) as at March 31, 2017, and 2018

Expenses

• In 2017–2018, CED’s total expenses stood at $216.2 million, up $19.5 million from the previous year. That 9.9% increase is primarily attributable to the increase in non-repayable contributions.
• Transfer payment expenses—totalling $165.9 million—rose by 10.8% between 2016–2017 and 2017–2018. Operating expenses stood at $50.3 million, an increase of 6.9% over the previous year.
• The $0.9 million variance (0.4%) with projected net expenses is attributable to non-repayable contributions that were lower than projected.

Revenue

• CED’s revenue, returned to the Consolidated Revenue Fund, is declared in its financial statements as having been earned on behalf of the government. As a result, the organization’s total net revenue is zero. In 2017–2018, CED’s total gross revenue stood at $885,090, an increase of 91.5% over the previous year. Revenue consists mainly of interest charges on payments in default.

Liabilities

• As at March 31, 2018, CED’s net liabilities stood at $20 million, down 11.5% from 2016–2017. This decrease is largely attributable to the decline in net accounts payable and accrued liabilities.
• Accounts payable and accrued liabilities represented the largest component of liabilities, at 84.3% ($16.8 million) of total net liabilities. Vacation pay and compensatory leave, along with future fringe benefits account for 8.9% ($1.8 million) and 6.8% ($1.4 million) of the organization’s net liabilities, respectively.

Assets

• As at March 31, 2018, net financial assets stood at $16.8 million, down 12.7% from the previous year’s total. This decrease is attributable to the decline in amounts due from the Consolidated Revenue Fund to discharge liabilities (fringe benefits and accrued liabilities), which were also down.
• CED’s non-financial assets stood at $1.1 million as at March 31, 2018, up 11.4% over the previous year. This increase is explained mainly by the purchase of videoconferencing equipment as part of the relocation of the head office.
• CED’s loans, held entirely on behalf of the government, totalled $387.2 million as at March 31, 2018, up 4.2% from 2016–2017, due to the increase in repayable contributions from the organization.

Corporate information

Organizational profile

Appropriate Minister: The Honourable Navdeep Bains, P.C., M.P.

Minister of Innovation, Science and Economic Development and Minister responsible for the Economic Development Agency of Canada for the Regions of Quebec

Institutional Head: Manon Brassard

Ministerial portfolio: Innovation, Science and Economic Development

Enabling Instrument: Economic Development Agency of Canada for the Regions of Quebec Act (S.C. 2005, c. 26)^{Footnote xviii}

Year of Incorporation / Commencement: 2005

Reporting framework

The CED Strategic Outcome and Program Alignment Architecture (PAA) of record for 2016–2017 are shown below:

• 1. Strategic Outcome: Quebec’s Regions Have a Growing Economy
• Program 1.1 – Business Development
  • Sub-program 1.1.1 – Support for Entrepreneurship
  • Sub-program 1.1.2 - Business Performance
• Program 1.2 - Regional Economic Development
  • Sub-Program 1.2.1 – Regional Engagement
  • Sub-Program 1.2.2 – Regional Investment
• Program 1.3 – Strengthening Community Economies
  • Sub-program 1.3.1 – Community Futures Program
  • Sub-Program 1.3.2 – Infrastructure Modernization
  • Sub-Program 1.3.3 – Temporary and/or Targeted Support
• Internal Services

Supporting information on lower-level programs

Supporting information on lower level programs is available on the GC InfoBase.^{Footnote ix}

Supplementary information tables

Please see the section below

Federal tax expenditures

The tax system can be used to achieve public policy objectives through the application of special measures such as low tax rates, exemptions, deductions, deferrals and credits. The Department of Finance Canada publishes cost estimates and projections for these measures each year in the Report on Federal Tax Expenditures.^{Footnote xix} This report also provides detailed background information on tax expenditures, including descriptions, objectives, historical information and references to related federal spending programs. The tax measures presented in this report are the responsibility of the Minister of Finance.

Organizational contact information

Canada Economic Development for Quebec Regions

800 René-Lévesque Blvd, Suite 500
Montreal, Quebec
H3B 1X9

Telephone: 514-283-6412
Fax: 514-283-3302
www.dec-ced.gc.ca

appropriation (crédit)
Any authority of Parliament to pay money out of the Consolidated Revenue Fund.

budgetary expenditures (dépenses budgétaires)
Operating and capital expenditures; transfer payments to other levels of government, organizations or individuals; and payments to Crown corporations.

Departmental Plan (plan ministériel)
A report on the plans and expected performance of an appropriated department over a three year period. Departmental Plans are tabled in Parliament each spring.

Departmental Results Report (rapport sur les résultats ministériels)
A report on an appropriated department’s actual accomplishments against the plans, priorities and expected results set out in the corresponding Departmental Plan.

evaluation (évaluation)
In the Government of Canada, the systematic and neutral collection and analysis of evidence to judge merit, worth or value. Evaluation informs decision making, improvements, innovation and accountability. Evaluations typically focus on programs, policies and priorities and examine questions related to relevance, effectiveness and efficiency. Depending on user needs, however, evaluations can also examine other units, themes and issues, including alternatives to existing interventions. Evaluations generally employ social science research methods.

experimentation (expérimentation)
Activities that seek to explore, test and compare the effects and impacts of policies, interventions and approaches, to inform evidence-based decision-making, by learning what works and what does not.

full time equivalent (équivalent temps plein)
A measure of the extent to which an employee represents a full person year charge against a departmental budget. Full time equivalents are calculated as a ratio of assigned hours of work to scheduled hours of work. Scheduled hours of work are set out in collective agreements.

gender-based analysis plus (GBA+) (analyse comparative entre les sexes plus [ACS+])
An analytical approach used to assess how diverse groups of women, men and gender-diverse people may experience policies, programs and initiatives. The “plus” in GBA+ acknowledges that the gender-based analysis goes beyond biological (sex) and socio-cultural (gender) differences. We all have multiple identity factors that intersect to make us who we are; GBA+ considers many other identity factors, such as race, ethnicity, religion, age, and mental or physical disability. Examples of GBA+ processes include using data disaggregated by sex, gender and other intersecting identity factors in performance analysis, and identifying any impacts of the program on diverse groups of people, with a view to adjusting these initiatives to make them more inclusive.

government-wide priorities (priorités pangouvernementales)
For the purpose of the 2017–18 Departmental Results Report, those high-level themes outlining the government’s agenda in the 2015 Speech from the Throne, namely: Growth for the Middle Class; Open and Transparent Government; A Clean Environment and a Strong Economy; Diversity is Canada’s Strength; and Security and Opportunity.

horizontal initiative (initiative horizontale)
An initiative where two or more departments are given funding to pursue a shared outcome, often linked to a government priority.

Management, Resources and Results Structure (structure de gestion, des ressources et des résultats)
A comprehensive framework that consists of an organization’s inventory of programs, resources, results, performance indicators and governance information. Programs and results are depicted in their hierarchical relationship to each other and to the Strategic Outcome(s) to which they contribute. The Management, Resources and Results Structure is developed from the Program Alignment Architecture.

non budgetary expenditures (dépenses non budgétaires)
Net outlays and receipts related to loans, investments and advances, which change the composition of the financial assets of the Government of Canada.

performance (rendement)
What an organization did with its resources to achieve its results, how well those results compare to what the organization intended to achieve, and how well lessons learned have been identified.

performance indicator (indicateur de rendement)
A qualitative or quantitative means of measuring an output or outcome, with the intention of gauging the performance of an organization, program, policy or initiative respecting expected results.

performance reporting (production de rapports sur le rendement)
The process of communicating evidence based performance information. Performance reporting supports decision making, accountability and transparency.

plan (plan)
The articulation of strategic choices, which provides information on how an organization intends to achieve its priorities and associated results. Generally a plan will explain the logic behind the strategies chosen and tend to focus on actions that lead up to the expected result.

planned spending (dépenses prévues)
For Departmental Plans and Departmental Results Reports, planned spending refers to those amounts that receive Treasury Board approval by February 1. Therefore, planned spending may include amounts incremental to planned expenditures presented in the Main Estimates.

A department is expected to be aware of the authorities that it has sought and received. The determination of planned spending is a departmental responsibility, and departments must be able to defend the expenditure and accrual numbers presented in their Departmental Plans and Departmental Results Reports.

priority (priorité)
A plan or project that an organization has chosen to focus and report on during the planning period. Priorities represent the things that are most important or what must be done first to support the achievement of the desired Strategic Outcome(s) or Departmental Results.

program (programme)
A group of related resource inputs and activities that are managed to meet specific needs and to achieve intended results and that are treated as a budgetary unit.

Program Alignment Architecture (architecture d’alignement des programmes)
A structured inventory of an organization’s programs depicting the hierarchical relationship between programs and the Strategic Outcome(s) to which they contribute.

result (résultat)
An external consequence attributed, in part, to an organization, policy, program or initiative. Results are not within the control of a single organization, policy, program or initiative; instead they are within the area of the organization’s influence.

statutory expenditures (dépenses législatives)
Expenditures that Parliament has approved through legislation other than appropriation acts. The legislation sets out the purpose of the expenditures and the terms and conditions under which they may be made.

Strategic Outcome (résultat stratégique)
A long term and enduring benefit to Canadians that is linked to the organization’s mandate, vision and core functions.

sunset program (programme temporisé)
A time limited program that does not have an ongoing funding and policy authority. When the program is set to expire, a decision must be made whether to continue the program. In the case of a renewal, the decision specifies the scope, funding level and duration.

target (cible)
A measurable performance or success level that an organization, program or initiative plans to achieve within a specified time period. Targets can be either quantitative or qualitative.

voted expenditures (dépenses votées)
Expenditures that Parliament approves annually through an Appropriation Act. The Vote wording becomes the governing conditions under which these expenditures may be made.

Departmental Sustainable Development Strategy

1. Context for the Departmental Sustainable Development Strategy

The 2016–2019 Federal Sustainable Development Strategy (FSDS)

• sets out the Government of Canada’s sustainable development priorities
• establishes goals and targets
• identifies actions to achieve them, as required by the Federal Sustainable Development Act

In keeping with the objectives of the Act to make environmental decision-making more transparent and accountable to Parliament, Canada Economic Development for Quebec Regions supports reporting on the implementation of the FSDS and its Departmental Sustainable Development Strategy, or equivalent document, through the activities described in this supplementary information table.

2. Sustainable Development at Canada Economic Development for Quebec Regions (CED)

CED’s Departmental Sustainable Development Strategy for 2017 to 2020 describes the department’s actions in support of achieving the following goals:

• Goal 2: Low-carbon government
• Goal 3: Clean growth
• Goal 8: Sustainably managed lands and forests

This supplementary information table presents available results for the departmental actions pertinent to these goals. Last year’s supplementary information table is posted on the department’s website. This year, CE is also noting which UN Sustainable Development Goal target each departmental action contributes to achieving.

3. Departmental performance by FSDS goal

The following tables provide performance information on departmental actions in support of the FSDS goal listed in section 2.

Context for the FSDS goal related Objective 3: Clean Growth

Clean Growth

• Through its various programs, CED invests in technologies that aim, among other things, to reduce GHG emissions and air pollutants.

* This new element shows how departments are contributing to achieving the UN Sustainable Development Goals (SDGs) and targets.

† This column is new.

Context for the FSDS goal related to Objective 8: Sustainability managed lands and forests

• CED, through its main program, the Quebec Economic Development Program (QEDP), has implemented the Strategic Initiative to Combat the Spruce Budworm Outbreak in Quebec (SICSBOQ) to prevent its spread and thus reduce the negative impact on the environment and economy of the regions.
• The SB is wreaking havoc on Quebec’s forests. By fighting it, the Government of Canada is helping to contain an epidemic that could destroy thousands of hectares and harm the economy of the forestry industry, its workers and rural communities that depend on the forestry industry.

* This new element shows how departments are contributing to achieving the UN Sustainable Development Goals (SDGs) and targets.

† This column is new.

4. Report on integrating sustainable development

During the 2017–18 reporting cycle, CED had no proposals that required a Strategic Environmental Assessment and no public statements were produced.

Details on transfer payment programs of $5 million or more

General Information

General information

Evaluations

* An evaluation is considered complete when the deputy head approves the evaluation report (including a management response and an action plan).

Fees

Owing to legislative changes, the 2017 to 2018 fees results will be published in a separate report. The Fees Report is currently under development, and the link to the Fees Report, once tabled in Parliament, will appear on this web page by March 31, 2019.

Internal audits

Response to parliamentary committees and external audits

Response to parliamentary committees

• No recommendations were made to Canada Economic Development for Quebec Regions (CED).

Response to audits conducted by the Office of the Auditor General of Canada (including audits conducted by the Commissioner of the Environment and Sustainable Development)

• 2017 Fall Reports of the Commissioner of the Environment and Sustainable Development: Report 4—Departmental Progress in Implementing Sustainable Development Strategies
• The audit focused on whether departments and agencies studied, including CED, had adequately applied the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals; reported on the extent and results of their strategic environmental assessment practices; and met their commitments to strengthen these practices. The Office of the Commissioner of the Environment and Sustainable Development concluded that the Cabinet Directive had not been applied to most policies, plans and program proposals submitted to a Minister or Cabinet for approval, including Treasury Board approval. Overall, from January 2013 to December 2016, departments and agencies.
• CED has made the necessary corrections. A questionnaire covering the various components to be considered under the directive was developed and the internal policy development process was amended to include better documentation of the application of the Cabinet Directive.

Response to audits conducted by the Public Service Commission of Canada or the Office of the Commissioner of Official Languages

• No recommendations were made to Canada Economic Development for Quebec Regions.

1. Canada Economic Development for Quebec Regions (CED) Performance Measurement Methodology

1.1 Project tracking

The tracking of CED-supported projects is carried out through a performance data collection system that has been in place since April 1, 2007. On April 1, 2012, a new Performance Management Framework (PMF) was implemented, reflecting CED’s new Program Alignment Architecture (PAA) and its new regular program, the Quebec Economic Development Program (QEDP). Since that date, project tracking has exhibited major improvements, in particular the reduction in the number of indicators, as well as efforts to simplify and automate the management information system (Hermès).

In the field of economic development, expected results are rarely observed during the year of the expenditure. Generally speaking, it is only after one or two years that the impact of an enterprise’s development activities on its sales is seen. The same is true for many activities supported through CED programs, whether in market development, technology transfer or enterprise creation.

To report on the use of funding awarded by CED in 2017–18 as well as on intermediate and final results, two main baselines are used in this report:

• Projects for which an expenditure was made in 2017–18 (fiscal year^{Footnote 1}). This baseline tells us about the number of economic development projects that received financial support from CED, along with the amount of that assistance. This baseline contains data on output indicators.
• Projects that have reached the scheduled date for attaining longer-term results (e.g., sales increased). This baseline is used to measure the impact of CED programs on the economic development of Quebec, and of enterprises, regions and communities. It contains projects which were completed (i.e. actual project end date) between 2014-15 and 2017–18.

Moreover, CED’s intervention takes place in two ways:

• Through projects involving direct assistance (DA): by offering financial support to a client, whether an enterprise or a non-profit organization (NPO). For instance, a contribution to an enterprise (client) wishing to acquire new equipment with a view to modernizing its facility;
• Through projects involving intermediary groups (IGs): by awarding financial assistance to a client that will offer its services to third parties. For instance, a contribution to an incubator (client) that will support new entrepreneurs (recipients) so they can start up their enterprises.

In addition, during fiscal year 2015–16, CED conducted an in-depth analysis of its performance measurement strategy (PMS). This analysis was necessary to respond to the findings of program evaluations and also to comply with the Policy on Transfer Payments, which specifies that departments must update their programs PMS on a regular basis. The result chains and their indicators have been revised, thus making it possible to improve each of the components of the Program Alignment Architecture (PAA). CED also conducted a literature review on performance measurement and accountability conducted by other similar government agencies, resulting in a comparative analysis.

The PMS analysis enabled CED to develop its next Departmental Results Framework 2018–19 and to create the accompanying tools: Program Directory and Performance Information Profiles, as per the new requirements of the new TBS Policy on Results.

1.2 Performance data collection

1.2.1 Reliability of performance data

For DA projects, project results are tracked by business office advisors as part of regular client agreement follow-up activities. Generally speaking, data comes from enterprises’ financial statements, thus yielding a high level of reliability. Instructions for using and inputting indicators along with appropriate quality controls ensure standardized input of data into the Hermès performance information system. In that regard, simplification and automation have reduced the time advisors devote to tracking the performance of each project.

CED introduced a new data collection strategy for IGs projects in order to measure the impact of IGs’ intervention with their recipients. This approach, which involves tracking IGs’ clientele directly, is based on obtaining a list of accompanied recipients so that CED can send them a survey. To date, results are conclusive and yield more reliable information on services provided to recipients. This procedure helps avoid a situation where an enterprise is counted twice, through different IGs. Note that this approach will be broadened to all IGs supported by CED in the years to come.

The Technical Notes section provides detailed information on the reliability of the data presented in this report. Findings of the most recent internal audit on the integrity of the information from the Hermès system confirm that the information contained in the Hermès Programmes application, CED’s tracking system, is reliable for decision-making and information purposes.

1.2.2 Attribution of results

CED works closely with a number of departments and agencies of the governments of Canada and Quebec, and with many local and regional stakeholders. This collaboration is reflected in the financial packages put together for projects. That is why CED cannot claim the merit or the responsibility for all the results obtained. For this reason, it is more accurate to say that the financial assistance granted by CED for the completion of projects contributes to the attainment of the results observed.

2. Technical Notes on Performance Data

List of acronyms:

BDC:

Business Development Centre

CFDC:

Community Futures Development Corporation

CFO:

Community Futures Organization

CFP:

Community Futures Program

CIP150:

Canada 150 Community Infrastructure Program

DA:

(interventions) Direct intervention with enterprises

DPR:

Departmental Performance Report

EDI:

Linguistic Duality Economic Development Initiative

ET:

Equivalent territory

G&C:

Grants and contributions

GDP:

Gross domestic product

IG:

Intervention through intermediary groups

LII:

Local Investment Initiative

NPO:

Non-profit organization

OLMCs:

Official Language Minority Communities

ORPEX:

Regional export promotion organization

PAA:

Program Alignment Architecture

QEDP:

Quebec Economic Development Program

RCM:

Regional county municipality

REMOM:

Mount Mégantic Observatory

RIWC:

Restoration Initiative for Watercourse Crossings

RPP:

Report on Plans and Priorities

SICSBOQ:

Strategic Initiative to Combat the Spruce Budworm Outbreak in Quebec

SME:

Small and medium-sized enterprise

Chrysotile:

Canadian Initiative for the Economic Diversification of Communities Reliant on Chrysotile

Infrastructure:

Infrastructure Canada Program

Mégantic:

Funding for the economic recovery of Lac-Mégantic

Pipeline:

Bellechasse Pipeline

2.1 Technical notes on Performance Measurement Framework (PMF) indicators

STRATEGIC OUTCOME – Quebec’s regions have a growing economy.

Program 1.1 – BUSINESS DEVELOPMENT

Final result – The pool of enterprises in Quebec is renewed.

Sub-program 1.1.1 – Entrepreneurship Support

Intermediate result – Enterprises are started up or transferred

Sub-program 1.1.2 – Business Performance

Intermediate result – Enterprises improve their performance.

Program 1.2 – REGIONAL ECONOMIC DEVELOPMENT

Final result – Quebec’s regions have a stronger economic base.

Sub-program 1.2.1 – Regional Engagement

Intermediate result – Communities take charge of their economic development.

Sub-program 1.2.2 – Regional Investment

Intermediate result – Quebec regions attract investment.

Program 1.3 – Strengthening Community Economies

Final result – Quebec communities have stronger economies.

Sub-program 1.3.1 – Community Futures Program (CFP)

Intermediate result – Communities are economically sustainable.

Sub-program 1.3.2 – Infrastructure Modernization

Intermediate result – Quebec communities have upgraded public infrastructure.

Sub-program 1.3.3 – Targeted or Temporary Support

Intermediate result - Communities have targeted and/or temporary support available for stabilizing or strengthening their economies.

2.2 Technical notes on other performance data

2.2.1 Additional data with respect to strategic outcome

2.2.2 Additional data with respect to Business Performance sub-program

2.2.3 Additional data with respect to the Regional Engagement sub-program

2.2.4 Additional data with respect to the Community economic facilities sub-sub-program

2.2.5 Additional data with respect to the Linguistic Duality Economic Development Initiative (EDI) sub-sub-program

2.2.6 Additional data with respect to the Canada 150 Community Infrastructure Program (CIP150 calls 1 and 2)