SECTION II - ANALYSIS OF PROGRAM ACTIVITIES BY STRATEGIC OUTCOME

1. Strategic Outcome: A competitive and expanded business sector in Western Canada and a strengthened western Canadian innovation system (Entrepreneurship & Innovation)

The following performance indicators form part of WD's Performance Management Framework and the baseline levels below will serve as a reference point against which the Department will measure future contributions towards Entrepreneurship and Innovation. At the strategic outcome level, WD will not attempt to directly attribute outcomes to departmental efforts; attribution is more direct at the program activity and sub-activity levels. The baseline for Western Canada is compared to Canada as a whole. In future years, WD will report actual outcomes against targets.

1.1 Program Activity: Business Development and Entrepreneurship

Expected Result: the growth of small businesses in Western Canada and their improved capacity to remain competitive in the face of rising global competition.

Business Development and Entrepreneurship involves: enhancing business productivity and competitiveness; supporting trade and investment attraction and penetration of western Canadian technologies, services and value-added products into international markets; encouraging greater industry collaboration; and improving SMEs’ access to capital.

The following performance indicators form part of WD's Performance Management Framework and the baseline levels below will serve as a reference point against which the Department will measure future performance in the area of Business Development and Entrepreneurship. The baseline for Western Canada is compared to Canada as a whole.

Aggregate Results Achieved

In 2007-2008, WD approved funding of $18.6M for 46 projects in support of Business Development and Entrepreneurship. The approved funding was distributed across five sub-activities, as illustrated below.

The impact of all Business Development and Entrepreneurship projects approved since April 1, 2005, which is captured through Project Gateway, include: an average client satisfaction rate of 89 per cent with services provided; 273 businesses created, maintained or expanded; 545 companies participating in export and market development initiatives; and 37 partnerships or strategic alliances created.⁹ (Refer to Table 14 in Section III for more detailed impacts.)

Results of evaluations, audits and impact studies

The evaluation of the Community Future Program (CFPwas initiated in 2007-2008 and is still in progress. The final report will be posted to WD's public web site under Audit and Evaluation in 2008-2009 and will include Business Development and Entrepreneurship and Community Economic Planning, Development and Adjustment results.

The final report of the Western Diversification Program (WDP) evaluation, which will also be posted to WD’s public web site shortly, includes results across WD’s program activities for the period from 2003 to 2007. According to the evaluation report, Business Development and Entrepreneurship activities represent 24.5 per cent of the expenditures for all activities undertaken through the WDP, and account for 26 per cent of all projects completed.

Sixty-six and one-half per cent of funding recipients agreed that their project had resulted in an increase successful partnerships and strategic alliances.

With respect to increased participation of western Canadian economies in international markets and the development of successful strategic alliances, key informants reported seeing positive changes. However, it was pointed out that the WDP is too small to have made significant changes on its own, and acknowledged that at least some of this increase could be attributed to other economic diversification programs. To key informants, partnership development was also noted to be a core aspect of economic diversification.

Both job and business creation is occurring in WDP funded projects, although potentially at a higher rate than the existing administrative data supports.

The final report of the Women’s Enterprise Initiative (WEI) impact assessment reflected the following results over a five-year period ending March 31, 2008.

• Improve Business Productivity - Economic return on investment made by WD has been significant: WEI organization generated one person-year of employment form every $4,246 in operating funding provided. Clients attribute 55 per cent of their current business revenues to the services provided by the WEI. When asked to rate their satisfaction with the WEI business services on a scale of one to five, with five being very satisfied, clients provided an average rating of 4.1, with 75 per cent indicating they are fairly or very satisfied and five per cent indicating they are not at all satisfied. Clients reported that the WEIs wide range of business services have helped them to further develop their business, management and/or personal skills, increased their access to other programs and services, enabled them to network with other entrepreneurs, increased their access to information for decision-making, and encouraged them to start and/or further develop their own business.
• Access to Capital - Revenues of the average business receiving loans increased from about $57K in the year prior to receiving the loan, to $163K in the first year, and to over $550K in the fifth year after receiving the loan - approximately $1.9M in additional revenues over a five-year period. The impact assessment estimates that the 572 loans totalling $22.9M provided to WEI clients over the five-year period has generated about $660M in incremental revenues and 8,000 person-years of employment. Of these amounts, clients attributed $363M in revenues and 4,430 person-years of employment to the services provided by the WEI.

The preliminary report of Francophone Economic Development Organizations (FEDOs) impact assessment reflected the following results over a five-year period ending March 31, 2008.

• Improved business productivity - Among 103 client survey respondents, the estimated number of new employees attributable to the FEDOs’ services was 145. The level of client satisfaction with all the services provided by the FEDOs was 4.45 on a scale of one to five, where five represents "very satisfied." The impact assessment concludes that, the FEDOs work efficiently, they have gained the confidence of their clients over the years, a large component of their client base is first-time entrepreneurs, and the FEDOs’ support accelerates business start-up or expansion.
• Access to capital - The impact assessment examined the Economic Development Council for Manitoba Bilingual Municipalities (CDEM) as a case study of access to capital. CDEM provides three sources of capital to its clients. Between February 2001 and May 2008, CDEM assisted 341 businesses access $41,526,496 in loans through business services, which created or maintained 788 jobs. Between January 1999 and October 2007, CDEM provided $1,454,489 in direct loans, which created 98 jobs. WD’s initial investment of $500,000 in this loan fund leveraged $11,198,879 in additional financing, representing $22.40 in leveraged financing for each dollar invested by WD. With respect to the Franco-Manitoban Fund, of which CDEM is a partner together with WD and the Business Development Bank of Canada (BDC), WD loan loss reserve contributions of $369,560 leveraged $2,477,800 in loans. CDEM’s role is to refer clients to the BDC.

Specific Results Achieved in Support of Departmental Priorities

The Business Development and Entrepreneurship Program Activity contributed to the following departmental priorities:

The WCBSN improved access to risk capital and business services to SMEs by responding to over 466,000 information requests, providing over 47,000 advisory services, training over 28,000 clients, receiving more than 3.3M self-service interactions (automated telephone services and web site visits) and approving 1,407 loans totalling $65.4M. This support created or maintained 8,742 jobs, and created, maintained or expanded 3,447 businesses. In addition, 154 loans totalling $15.76M were approved through the LI Program, leveraged by $1.9M in WD contributions, which will create an estimated 444 jobs and generate nearly $57M in increased sales. In order to seek additional qualified partners to provide greater access to risk capital for small businesses, in 2007-2008, WD broadly solicited expressions of interest and received several proposals, which it will be considering for funding in 2008-2009.

To enhance business productivity and competitiveness, WD approved funding for several systemic initiatives including:

• FPInnovations - $126,000 to work with the Wood Products Quality Council to promote and implement the Woodmark Quality System among companies involved in the production of value-added forestry products in British Columbia and Western Canada. This project will result in 20 companies being certified in the Woodmark Quality System of Western Canada.
• Manitoba Hydro - $341,500 to expand the capability of its chemical testing laboratory in Selkirk Manitoba and provide state-of-the-art fuel testing services to Manitoba’s bio-diesel industry. The new testing capabilities will benefit five local bio-diesel producers, reducing operating costs and helping to avoid outsourcing fuel testing to other regions.
• Canadian Light Source - $2M to assist with marketing to attract first-time industrial users. Through the funded business development activities, Canadian Light Source plans to draw 50 new industrial users to the facility, thereby assisting it in reaching its initial target of 10 per cent for industrial utilization in the program’s first year.

Western Canadian stakeholders (companies, industry associations and research institutions) who have participated in the US ERI and other WD-supported international competitiveness initiatives are increasingly seeing positive results, through sales, research agreements and signed contracts. Examples of WD-supported international competitiveness initiatives undertaken in 2007-2008 are provided below:

Asia-Pacific Gateway and Corridor Initiative (APGCI) - In partnership with Foreign Affairs and International Trade Canada (DFAIT) and western provincial governments, WD hosted a study tour of Western Canada, inviting 11 of Canada’s federal trade promotion and investment experts working out of Canadian posts in China, Taiwan, Korea and Japan to connect with Canadian science and technology companies. The objective of the study tour was to increase the trade commissioners’ awareness of Western Canada’s science and technology capabilities to better promote business and investment opportunities between Asia and Western Canada.

In 2007-2008, WD supported a record 35 international business development projects totaling $468,938 through the US ERI. Through its participation in the ERI, WD plays a vital role in promoting the West’s science and technology (S&T) capacities in the US market, and in 2007-2008, 25 of WD’s ERI projects addressed the S&T sector. WD also supported eight trade missions to the US in 2007-2008, including two Manitoba trade missions to Denver and Chicago that resulted in over $1.5M in new business deals. In addition, several companies have made commercial commitments in the Chicago and Denver markets and continue to undertake follow-up development work.

Saskatchewan Trade & Export Partnership Inc. (STEP) - Through the Western Canada Incoming Buyers Program, 209 companies participated in export and market development initiatives, 14 industry association partnerships were created, and 186 incoming buyers were attracted over the past three fiscal years.

A priority in 2007-2008 was to develop an International Competitiveness Strategy for the Department. Significant steps were taken and a final strategy will be released in 2008-2009.

To support Western Canada Business Service Network (WCBSN) accountability, transparency, performance reporting and coordination, the following steps were taken:

• Minimum community accountability standards were formalized, including: on-line posting of financial statements, board member names, and selection/ appointment process;
• Minimum performance standards were established for each of the Network Partner groups;
• Performance measurement training was provided to Community Futures organizations;
• Funding was provided to upgrade information technology infrastructure in support of continued on-line quarterly performance reporting; and
• Video-conferencing capabilities were expanded across the West to allow WCBSN members to more effectively share resources to serve their clients (e.g. video training session).

1.2 Program Activity Name: Innovation

Expected Result: an increase in knowledge-driven and value-added economic activities, built on both traditional and emerging industries that create a more diversified and resilient economy in Western Canada.

Innovation is the translation of knowledge into economic benefits and involves the development, commercialization, and adoption of technology as the primary means to a more diversified economy.

The following performance indicators form part of WD's Performance Management Framework and the baseline levels below will serve as a reference point against which the Department will measure future performance in the area of Innovation. The baseline for Western Canada is compared to Canada as a whole:

Aggregate Results Achieved

In 2007-2008, WD approved funding of $127.5M for 86 projects in support of Innovation. The approved funding was distributed across six sub-activities, as illustrated below¹⁰.

The impact of all Innovation projects approved since April 1, 2005 include: 90 technology demonstrations, 66 partnerships or networks created, and ten physical assets (buildings or equipment) for R&D or training.¹¹ (Refer to Table 14 in Section III for more detailed impacts.)

Results of evaluations, audits and impact studies

According to the final WDP evaluation report, Innovation-related activities represented 34.1 per cent of the expenditures for all activities undertaken by the WDP. Innovation-related activities accounted for 30.0 per cent of all projects completed.

Forty-seven point one per cent of the survey recipients expressed that the project they had participated in had resulted in increased productivity and 55.6 per cent felt that the project had enhanced education, training or skill development.

Key informants expressed the opinion that the WDP has a strong focus and a long-term interest in innovation, and that results in the area of innovation have already been demonstrated. These results include partnerships with universities, and work in the fields of life sciences, fuel cells, nanotechnology, health, environment, ICT, and wireless technologies. This success is attributed to strengths of the WDP model, which allow for the flexibility to support infrastructure and support services aimed at innovation, strong work with not-for-profits and other organizations, and core funding for technology linkages.

Specific Results Achieved in Support of Departmental Priorities/ the Program Activity

The Innovation Program Activity contributed to the following departmental priority:

WD continues to play a key role in the development of BC’s life sciences sector. WD has enabled key stakeholders, including Genome BC, the BC Cancer Foundation and the BC Cancer Agency, to acquire state of the art technology related to genomic (DNA) sequencing to conduct applied research, leading to the development of new and improved treatments for cancer. As the life sciences cluster has matured, WD’s efforts are evolving to support the commercialization of new technology. For example, WD support to key health research organizations such as the Centre for Drug Research and Development has facilitated the development of a commercialization pipeline for pharmaceutical compounds and attracted other resources such as funding under the federal Centre for Excellence in Commercialization and Research program. (The Impact study of WD's investments in Western Canada's life sciences cluster referenced in DPR 2006-2007 is now posted to WD’s web site.

The following demonstrates WD’s investments in Innovation priorities areas of technology commercialization and adoption, rural innovation, and technology skills development:

Technology Adoption and Commercialization

iRSM Dental Implant Manager Pilot - In 2003-2004, WD approved $975,000 to support the commercialization of Caritas Health Group’s Implant Manager, a dental implant management system, which was created through the collaborative efforts of a surgical research team (the Institute for Reconstructive Sciences in Medicine or iRSM, previously known as COMPRU) and an Alberta-based software development company. Implant Manager enables clinicians to view three-dimensional images of implants prior to surgery, and acts as an effective tool in educating patients and their families about the procedures. The development, demonstration and testing phases included piloting the technology at 10 sites in six countries. Implant Manager has attracted international attention and the project proponents are now exploring commercialization opportunities.

St. Boniface General Hospital - In 2004-2005, WD approved $390,000 of $440,000 in total project costs to create a 4600 sq. ft. business incubator space on the first floor of the Asper Clinical Research Institute. The facility has enabled two companies to mature, access venture capital and graduate to other locations in Winnipeg due to growth of the businesses. Both companies, Monteris (a unique MRI-guided, focused Laser Interstitial Thermal Therapy, which is used in the treatment of previously inoperable tumours) and Intelligent Hospital Systems Inc. (a robotic system that automates the preparation of IV solutions in bags and syringes) are founded on technologies developed at the St. Boniface General Hospital Research Centre. Both have seen growth in employment and sales, and are connected to the US market.

Rural Innovation (in support of rural diversification)

BC Regional Science and Technology Councils - In 2007-2008, WD approved $859,709 of total project costs of $1.040M for nine S&T councils located outside of the Vancouver metropolitan area to provide specialized "Linx" support services over two years to technology entrepreneurs and emerging companies to facilitate their growth. The Linx services include: business mentoring, networking, human resources, and training in financial strategies. The Regional S&T Councils are non-profit organizations that support the growth of the technology industry in rural BC and are connected through the BC Regional Science and Technology Network (BCRSTN). The combined efforts of these councils will lead to skills enhancement for over 1100 technology-based entrepreneurs in communities outside of the Vancouver metropolitan area.

Alberta Terrestrial Imaging Centre(ATIC) - In 2005-2006, WD approved $1.8M of $8.3M in total project costs to help establish the ATIC, a non-profit joint venture between University of Lethbridge and Iunctus Geomatics Corp., located in Lethbridge, Alberta. In a subsequent project in 2006-2007, WD approved $933K of $2.12M in total project costs to assist ATIC in acquiring specialized equipment to conduct research into the use of satellite images in a wide variety of areas such as resource management, energy, homeland security, emergency response, and global climate change. ATIC will also provide historic and new satellite images for research purposes to research institutions throughout North America, and is now recognized nationally for leadership in the area of satellite imagery. ATIC created ten jobs in two years through these projects.

Petroleum Technology Research Centre (PTRC) - In 2003-2004, WD approved $1M of a $10M project to support the PTRC in Regina, Saskatchewan, to undertake the following research: enhance competitiveness of oil and natural gas resources; encourage incremental industry investment; reduce the industry’s greenhouse gas intensity and other environmental consequences; develop the next generation of oil production technologies for recovery of heavy oil; enhance collaboration among industry, universities and government; support training; and encourage industry’s adoption of new technologies. The project attracted incremental industry funding of $963K and resulted in six new technologies commercialized. The direct impact of this work occurs in rural areas where petroleum is extracted.

Technology Skills

Alliance of Manufacturers and Exporters Canada - In partnership with the Province of Manitoba, in 2007-2008, WD approved $1.1M of the $4.0M total project costs in the Advanced Manufacturing Initiative (AMI) project, delivered by the Manitoba division of the Canadian Manufacturers and Exporters of Canada. This initiative has a multi-pronged approach to provide the manufacturing community with lean expertise and knowledge to improve productivity and develop skills that will assist companies to become internationally competitive. AMI will focus on programs for human resources and lean manufacturing awareness. This initiative will result in an increase in training, education and skills building of highly qualified people.

2. Strategic Outcome: Economically viable communities in Western Canada with a high quality of life (Community Economic Development)

The following performance indicators form part of WD's Performance Management Framework and the baseline levels below will serve as a reference point against which the Department will measure future contributions towards Community Economic Development. The baseline for Western Canada is compared to Canada as a whole:

2.1 Program Activity: Community Economic Planning, Development and Adjustment

Expected Result: to ensure strong and viable communities in urban and rural areas of Western Canada capable of responding to challenges that hinder competitiveness, opportunities, and quality of life.

Community Economic Planning, Development and Adjustment involves economic development and diversification initiatives and coordination activities that allow communities to sustain their economies, and adjust to changing and often very challenging economic circumstances. It includes facilitating economic recovery from depressed economic circumstances, working with community organizations to carry out Aboriginal economic development, and other community economic development initiatives.

The following performance indicators form part of WD's Performance Management Framework and the baseline levels will serve as a reference point against which the Department will measure future performance in the area of Community Economic Planning, Development and Adjustment. The baseline for Western Canada is compared to Canada as a whole.

Aggregate Results Achieved

In 2007-2008, WD approved funding of $48.6M for 58 projects in support of Community Economic Planning, Development and Adjustment. The approved funding was distributed across three sub-activities, as illustrated below:

The impact of all Community Economic Planning, Development and Adjustment projects approved since April 1, 2005 include: 101 activities providing planning leadership and expertise; 96 partnerships created or maintained; 934 instances of increased capacity in community organizations; 132 enhanced community services or facilities; 2,887 people trained; and 138 businesses created, maintained or expanded.¹⁴ (Refer to Table 14 in Section III for more detailed impacts.)

Results of evaluations, audits and impact studies

According to the final WDP evaluation report, Community Economic Planning, Development and Adjustment activities represented 41 per cent of the WDP expenditures and accounted for 43.5 per cent of all WDP projects. This represents the majority of both projects and expenditures undertaken through the WDP at the time of the evaluation.

Survey recipients generally agreed that the work in which they had participated had increased viability and diversification of the local economies (69.9 per cent) and contributed to enhanced community planning (68.3 per cent). Examples of activities undertaken by projects that have community economic related outcomes include strengthened networks and partnerships with schools, building new and/or refurbished facilities, installing new service hook-ups, and enhancing tourism activities.

Key informants generally agreed that community economic development has been well addressed in the WDP model. Ways in which the model was said to have addressed community economic development was through the Saskatchewan Northern Development Agreement, the Urban Development Agreements, and through work in rural areas and with Aboriginal communities.

Despite work in rural and Aboriginal communities, key informants noted that these communities present challenges to the community economic development aspect of the WDP model, as it can be difficult to locate an organization with the capacity to handle WDP funding. Key informants expressed the need for a clear definition of what community economic development means, given that some communities are not going to be sustainabl.

The preliminary report of the FEDOs impact assessment reflected the following results.

• Community Planning - FEDOs play an important direct support role in community economic planning and project implementation at various levels: supporting the creation of a local project with local economic impacts, linking activities which create community impetus for change, or complex planning in towns and villages, which brings together diverse stakeholders.
• Community Development - The presence of a francophone community is perceived to be an economic advantage by the broader community. Community "branding" exercises have had multiple impacts, which have endured for many years. With the support of the FEDOs, the communities have recognized the importance of regional development versus a local approach only. Strategic planning activities have created a sense of optimism in the communities, provided there has been follow-up.

Specific Results Achieved in Support of the Program Activity - Mountain Pine Beetle Initiative

In January 2007, the federal government allocated $33M to a Community Economic Diversification Initiative (CEDI) and $19.4M to an Airport Improvement Initiative within a $200M Mountain Pine Beetle Program (MPBP). In 2007-2008, WD approved funding of $1.04M towards five CEDI projects and $12.35M towards runway extensions at the Prince George and Kelowna airports. This represents the initial wave of MPBP project approvals, which will have a significant impact over the next several fiscal years. Three CEDI projects are highlighted below.

In British Columbia, WD funding of $100,000 to the CFDC of Cariboo-Chilcotin, helped develop a strategic plan for the Cariboo-Chilcotin Beetle Action Coalition (C-CBAC). While drawing attention to the significant economic and social impact of the mountain pine beetle, the coalition established a model for community collaboration and action to address these impacts. The C-CBAC continues to lead efforts to address impacts and has recently completed a series of economic sector strategies aimed at addressing impacts. Due to the plan that was developed, the C-CBAC recently accessed $1.3M from the BC government to further develop their opportunity analysis.

The Mountain Pine Beetle-Community Economic Development Initiative (MPB-CEDI) provided $150,000 in funding to the Quesnel Community and Economic Development Corporation for a bio-refinery feasibility study. A bio-energy project could utilize damaged wood fibre and other bio-resources available as a result of the mountain pine beetle infestation. This early stage MPB-CEDI project is the first in a number of projects advancing knowledge of diversification options for communities impacted by the infestation. Further projects are currently under consideration.

Through the MPB-CEDI, WD funding of $50,000 supported the Northern Development Initiative Trust (NDIT) to undertake a Northwest Trade and Manufacturing Corridor Opportunity Study to identify the competitive advantages of this corridor as it relates to global manufacturing, and to attract investment in manufacturing and related opportunities to the region. The provinces of British Columbia and Alberta, CN Rail, Port of Prince Rupert, Prince George Airport Authority, Alcan, Maher Terminals, West Fraser Timber, Canfor, Initiatives Prince George, and the Edmonton Economic Development Commission also supported the project.

2.2 Program Activity: Infrastructure

Expected Result: to improve and expand sustainable public infrastructure that enhances the quality of the environment and allows for long-term economic growth.

This program activity provides public infrastructure funding in Western Canada to meet the Government of Canada's commitment to growth and the quality of life of all Canadians. This program activity will renew and build infrastructure in rural and urban municipalities across Canada allowing them to compete in the regional, national and global economy. WD delivers infrastructure programming in partnership with Infrastructure Canada (INFC) and the four western provincial governments.

WD's Performance Management Framework reflects the impact of the Infrastructure at the program activity level in terms federal funding approved for infrastructure projects and additional funding leveraged. Both of these values were $0 in 2007-2008 because the Infrastructure Canada Program (ICP) is winding down. In future years, WD will continue to report the on-going benefits realized by municipalities as a result of these infrastructure investments at the sub-activity level.

Aggregate Results Achieved

During 2007-2008, WD continued to deliver the ICP in Western Canada. As of March 31, 2008, approximately 98 per cent of the total federal funding of $546M had been committed towards 1,622 infrastructure projects across the West. While all project approvals were decided by June 2005, the program was extended until March 31, 2011 to allow the construction of all projects to be completed and benefits reported. The approved funding was distributed across six project types, as illustrated below:

The impact of all ICP projects approved since program inception include: 587,275 households with improved potable water quality; 198,806 households with improved wastewater treatment; 277 road and local transportation infrastructure improvements; and 290 communities benefiting from cultural, recreation and tourism facilities.¹⁶ (Refer to Table 14 in Section III for more detailed impacts.)

WD also administers the Municipal Rural Infrastructure Fund (MRIF) in each western province on behalf of INFC, as well as a number of Canada Strategic Infrastructure Fund (CSIF) projects in the West. G&C funding for MRIF and CSIF ($216.6M in actual spending in 2007-2008) is provided through INFC’s appropriation and details on these program results are found in INFC's Departmental Performance Report.

Specific Results Achieved in Support of Departmental Priorities

The Infrastructure Program Activity contributed to the following departmental priority:

The delivery of infrastructure programming is an important role that WD plays in supporting the western Canadian economy. There are often direct and indirect linkages between strategic infrastructure investments and economic development initiatives. Some examples of ICP projects completed in 2007-2008 include.

In BC, WD contributed $1.078M towards improving the wastewater management capabilities within the District of Port Hardy through the following project: upgrades to the Tsulquate Wastewater Treatment Plant (WWTP), and extension of the Tsulquate WWTP outfall. The project increased the capacity of the wastewater treatment plant and improved the water quality, which will support the future growth plans for the community, particularly the restoration of historical shellfish harvesting areas.

In Alberta, WD contributed $7M towards the construction of 26,900 sq. ft. of exhibition hall space and the redevelopment of 28,400 sq. ft. of existing space in the Shaw Conference Centre in Edmonton. The project, approved in March 2003 and completed in 2007, directly created 300 permanent jobs. There was also an estimated $10.73M increase in private sector capital investment or economic activity in the community as a result of this project.¹⁷

In Saskatchewan, WD contributed $604,526 towards the location of a new water source, pipeline and upgrades to the Town of Maidstone’s water supply system. This project allowed the town to develop new residential subdivisions to ensure the workers in the oil industry were able to live and work in the same area.

Virtually all ICP projects in Manitoba were completed prior to the 2007-2008 fiscal year.

3. Strategic Outcome: Policies and programs that support the development of Western Canada (Policy, Advocacy and Coordination)

The following performance indicators form part of WD's Performance Management Framework and the outcomes below reflect the Department’s contributions towards Policy, Advocacy and Coordination.

In 2007-2008, WD approved funding of $1.17M for seven projects in support of Policy, Advocacy and Coordination. The approved funding was distributed across three program activities, as illustrated below:

The impact of all projects reporting results under the Policy, Advocacy & Coordination strategic outcome from April 1, 2005 are included in Table 14 in Section III.

Results of evaluations, audits and impact studies

According to the results of the WDP evaluation file review, economic research projects undertaken through WDP resulted in increased awareness and understanding of western issues. Some of the results were used in policy decisions such as being referenced in the Department’s visioning exercise. Case study respondents also spoke positively about WDP activities leading to awareness and dialogue about western issues.

Findings from the file review and the case studies supported the views of key informants that improved coordination of federal economic activities has occurred as a result of the WDP. In the opinion of key informants, improved awareness and understanding of western issues can be attributed to the work of the WDP, including relationship, advocacy, and capacity building. In this respect, most key informants believe the WDP has played a substantial role in increased dialogue among federal departments, between the federal and provincial levels of government, and the federal government and local communities.

3.1 Program Activity: Collaboration and Coordination

Expected Result: better coordinated economic development activities and programs in the West.

This program activity involves bringing people, ideas, communities and resources together in order to plan or precipitate actions that result in the development and/or diversification of the western economy. This may involve the process of policy and program development to leverage resources and address economic challenges or exploit economic opportunities.

The following performance indicators form part of WD's Performance Management Framework and the outcomes below reflect the Department’s performance in the area of Collaboration and Coordination in 2007-2008.

Specific Results Achieved in Support of Departmental Priorities

This program activity contributed to all departmental priorities.

Outputs

WD regional offices in both Manitoba and BC provided a coordinating role regarding federal responses to potential floods. Each spring in Manitoba, WD and Public Safety Canada chair an interdepartmental working group comprised of departments who have information or services to provide in a situation of potential flooding. The group looks at potential risks, conducts pre-emptive analysis, prepares strategies and briefs ministers to ensure there is a coordinated federal response to flood issues. In BC, the flood response actions and tracking were in relation to an episodic set of factors that indicated flood potential.

WD coordinated a Ministers’ Forum comprised of ministers from WD and seven provincial departments responsible for science and technology, and economic development in Western Canada, which took place in April 2008. Although WD has organized regular meetings among deputy and assistant deputy ministers from these departments over the past nine years, this was an occasion for ministers from the two orders of government to discuss challenges and opportunities for increased collaboration with a focus on science and technology, productivity and competitiveness, and trade gateways and corridors.

In January 2008, WD successfully planned, coordinated and implemented a Pacific Northwest Economic Region (PNWER) tour in Ottawa. The PNWER delegation met with the Prime Minister, seven federal ministers in key departments, the Ambassador of the United States to Canada, the Prime Minister’s Chief of Staff, and senior departmental officials, to advocate for federal support for key PNWER and western Canadian economic priorities, particularly in the areas of border issues related to promoting greater regional economic collaboration, energy, the 2010 Olympics, and economic links with Asia-Pacific.

The Department played a key role in organizing a water workshop, Navigating the Rapids, through the Alberta Federal Council (AFC); this workshop also reinvigorated the Prairie Water Group. Furthermore, WD lead the organization of oXYgen - Breathing New Life into the Federal Public Service, which brought together new/ young public servants in Alberta to encourage the formation of a professional network and provide feedback/ recommendations to AFC and its member departments on renewal and retention initiatives.

Outcomes

In Saskatchewan, WD provided a conditional grant of $15M, which leveraged $4.5M from the Province of Saskatchewan, to the Primrose Lake Economic Development Corporation to create a trust fund in support of a stronger, more diversified and sustainable economy in the Primrose Lake area of northwest Saskatchewan. WD played an important coordinating role working with community representatives, the provincial government and other federal departments to identify a workable delivery model. One lesson learned through this process was that communities do not always have the capacity to develop and deliver initiatives such as a trust fund and that considerable time and effort may be required to enable the community to participate effectively.

3.2 Program Activity: Advocacy

Expected Result: an improved understanding and awareness of western issues by federal policy makers and increased access to and participation in federal programs by the region.

This program activity is concerned with advancing the interests of Western Canada in national economic policy, program and project development and implementation. Examples of advocacy activity include: providing input into Cabinet submissions, establishing and participating in western-based consultation forums, advocating in support of specific regional projects or issues, and engaging western Canadian stakeholders in the development and implementation of national priorities. This program activity may also involve the Department advocating federal government priorities in its dealings with provincial governments, industry and institutions in Western Canada.

Beginning in 2008-2009, WD will survey key informants to evaluate the extent to which the Department is achieving its expected results through Advocacy. The results of these surveys will be reported in DPR 2008-2009.

Specific Results Achieved in Support of Departmental Priorities

This program activity contributed to all departmental priorities.

In 2007-2008, WD’s priorities under this Program Activity were to advocate on behalf of western Canadians regarding:

• trade and investment activities related to the federal government’s Global Commerce Strategy;
• R&D and technology commercialization; and
• Asia-Pacific trade and economic opportunities.

WD updated its Advocacy Strategy in 2007-2008, clearly setting out departmental advocacy roles and responsibilities, advocacy messages, target audiences and priority issues. The update produced WD’s current approach to advocacy, whereby assistant deputy ministers champion a limited number of key advocacy priorities over a fiscal year. (In 2008-2009, the priorities are Asia-Pacific Gateway and Corridor Initiative, Science and Technology, Inland Ports and Corridors, Procurement/ Industrial and Regional Benefits, and Foreign Trade Zones.)

Trade and Investment

Defense Procurement Market Opportunities - WD advocacy efforts in support of the federal government’s Industrial Regional Benefits (IRB) Policy and the "Canada First Defence Strategy", have helped to ensure that western Canadian companies and capabilities are better known by global prime contractors and their suppliers. In order to develop these important relationships, WD led a delegation of 17 western Canadian aerospace and defence companies on supplier development missions to Boeing in St. Louis, Missouri and to Lockheed Martin in Marietta, Georgia. WD also led several other major prime contractors on pan-western tours of western Canadian shipbuilding, defence and security companies.

WD played a key role in introducing western Canadian companies to the US Department of Defence’s Comparative Testing Office, as they searched for new and enhanced technical capabilities. In collaboration with the Department of National Defence, WD led officials from the US Department of Defence in visits with western Canadian companies in Calgary, Alberta and Vancouver, B.C.

WD was successful in encouraging Western Canada’s four provincial aerospace industry associations to sign a Memorandum of Understanding, thereby identifying themselves as the Western Aerospace Alliance (WAA). With this new structure, the WAA will work cooperatively to enhance industry growth and diversification by making western Canadian firms more competitive through technology and knowledge transfer among private sector stakeholders.

Canada-US Commerce - As a result of WD’s advocacy efforts related to encouraging international commerce between Manitoba and the neighbouring US states of Minnesota, Wisconsin and the Dakotas, an initiative is currently under development to explore and strengthen linkages across this cross-border economic region. A US/Canada Bi-National Economic Summit is planned for October 2008, that will focus on three principle areas of bi-national co-operation: business and industry linkages, university-based research, and technology transfer and commercialization.

Research and Development, and Technology Commercialization

Canadian Light Source Inc. (CLS) - The CLS is one of the largest scientific facilities in Canada and one of the world’s most advanced synchrotrons. It is positioning itself to become one of Canada’s leading partners in generators of economic and social benefits through scientific discovery in a wide variety of fields including nanotechnology, advanced materials, environmental research, and medical science. Sourcing necessary operating funding for a major science centre such as CLS is a challenge. Advocacy work by CLS, WD, and others resulted in CLS receiving additional operating funding of $10M for the next two years in Budget 2008.

Asia-Pacific Trade and Economic Opportunities

Mid-Continent Corridor - WD and the Manitoba government are supporting an economic impact assessment of Manitoba’s transportation, logistics, and infrastructure that connect the Asia-Pacific Gateway and western trade corridors through Winnipeg to the mid-continent corridor. Following this assessment, a strategic plan will be produced to guide the development of Manitoba's international gateway.

Port Alberta - WD is working in partnership with Edmonton Airports, the Edmonton Economic Development Corporation, the Edmonton Chamber of Commerce, the Province of Alberta, and the City of Edmonton to explore potential opportunities associated with the Asia-Pacific Gateway and Corridor Initiative, including the development of Port Alberta as a major North American warehousing, distribution, manufacturing, and multi-modal transportation hub. WD is contributing $1.5M towards the development of a Port Alberta strategic plan, as well as $760K towards the research and design of two key components: the logistics support centre and the SmartPort information technology platform.

Other

Economic Development for Forestry Communities - WD’s advocacy work can help ensure an appropriate federal action to assist regional industries and communities experiencing hardship. For example, in January 2007, the federal government allocated $33M to a Community Economic Diversification Initiative (CEDI) within a $200M Mountain Pine Beetle Program (MPBP). CEDI was in part modeled on WD’s experience in advocating for and delivering the Softwood Industry and Community Economic Adjustment Initiative (SICEAI) in Western Canada, which ran from October 2002 to March 2005. WD administers CEDI and has received over 500 expressions of interest from community organizations with ideas to help diversify the economic foundation of their local community. The most promising of these proposals are being developed into detailed funding proposals. The federal government also allocated $19.4M to an Airport Improvement Initiative as an additional component under the MPBP, which supports airport improvements in communities impacted by the pine beetle infestation.

This past year, WD advocated for community economic development initiatives to help transform the local economies of Western Canada’s forestry communities. The federal government responded by establishing the Community Development Trust to provide up to $1B for provincial and territorial initiatives to assist workers and communities. The BC government is using its share funding ($129M) from the trust to help its forestry communities.

3.3 Program Activity: Research and Analysis

Expected Result: an enhanced dialogue around and understanding of western issues, challenges, opportunities and priorities.

This program activity may include externally-generated research or in-house research and analysis involving economic overviews, environmental scans, analysis of federal or other government documents and industrial sector or issue analysis that supports departmental policy, planning or program development. It includes external consultation on key economic issues or opportunities facing Western Canada with leaders from both the private and public sectors.

The following performance indicators form part of WD's Performance Management Framework and the outcomes below reflect the Department’s performance in the area of Research and Analysis in 2007-2008.

Specific Results Achieved in Support of Departmental Priorities

This program activity contributed to all departmental priorities.

Outputs

Examples of specific projects initiated in 2007-2008 include:

WD contributed $750,000 to a three-year project with the Canada West Foundation called, Going for Gold, which will examine the West’s economic standing through a series of research papers from key economic thinkers, provincial research roundtables, and public opinion and expert surveys, and make recommendations to ensure Western Canada maintains long-term success in the global economy. The project will conclude with a seminal conference in Vancouver in the Fall of 2009, that will bring together the top thinkers from around the world to explore best practices in economic development policy in industrialized countries.

Canada West Foundation (CWF) skills and labour research - The Pacific Federal Council's (PFC) Strategic Analysis and Policy Committee co-funded a joint study with the Alberta Federal Council (AFC) to look at the labour market situation in Alberta and BC, and how it might affect the federal government's efforts under Public Service Renewal. The CWF (Dr. Roslyn Kunin) was contracted to complete the study; she presented her findings and nine recommendations to the PFC in April 2008, and will make a similar presentation to the AFC at a future date.

Working with the Western Centre for Economic Research at the University of Alberta, WD hired two students through a Trade Policy Fellowship pilot project. The objectives were two-fold: to undertake research related to trade and investment, and to support public service renewal component by raising our profile among students at the university who may subsequently be interested in a career with the Department.

Outcomes

The following WD-supported research also yielded useful insights into Western Canada:

Building Saskatchewan’s Bio-economy: A Life Sciences Strategy - In 2006-2007, WD, along with Saskatoon Regional Economic Development Authority (SREDA), Saskatchewan Ministry of Industry and Resources, Saskatchewan Ministry of Agriculture and Food, and Industry Canada co-funded a project to develop a meaningful strategic plan to accelerate the growth of Saskatchewan’s life sciences industry, attract new companies to the province and build on the province’s comparative advantage in this area. There was considerable media coverage of the report’s release. The proponent has received additional financial support to implement some of the recommendations in the report and attributes a number of outcomes, such as the attraction of three new business investments to Saskatchewan, to the report. This study also clearly demonstrated that by working collaboratively with other federal departments, WD could avoid duplication and overlap and reduce reporting requirements for the client.

State of the West 2008 is the final product of the NEXT West project, a three-year project undertaken by the Canada West Foundation with funding support from WD, which engaged western Canadians from across the spectrum to generate and debate public policy strategies best able to promote economic prosperity and quality of life in the region, over the long-term. The report addresses two questions simultaneously: to what extent do the four western provinces differ, and to what extent do they reflect common regional features and trends? The report provides a rich set of data on historical trends in 14 key demographic and economic domains. The findings provide detailed information about the individual western provinces, the region as a whole, how the region has changed, and how it compares to the other parts of the country. The media covered the release of the document extensively with more than 23 stories the day after release and ongoing references to the findings in sources ranging from the Canadian Mining Journal to Canada Watch - a virtual network for Canadians and friends of Canada in the US.

Brandon Development Strategy - WD approved funding of $119,970 in 2001-2002 for Economic Development Brandon, which contracted Corporate Affairs International to develop a plan that "provides the Greater Brandon Area with a clear vision and strategy to guide its activities over the next 20 years, and a 5-year action plan that, if implemented effectively, will retain the region’s core community values and prepare it for a promising socio-economic future." As a result, the City of Brandon has experienced strong economic growth over the last six to seven years.