Canadian Northern Economic Development Agency (CanNor) - 2015-16 Departmental Performance Report

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ISSN 2368-3406
Cat. No. R1-38E-PDF

Table of contents

Ministers' Message

We are pleased to report the key results of the Canadian Northern Economic Development Agency (CanNor) for 2015-16.

The programs of the Innovation, Science and Economic Development Portfolio work together to deliver what Canada needs to improve productivity performance, to grow the economy and to enhance prosperity and well-being. That means supporting the government's commitment to develop an Innovation Agenda, which will in turn create good-paying jobs for the middle class, drive growth across all industries, and improve the lives of Canadians. The work of the Portfolio includes helping small businesses grow through trade and innovation, promoting increased tourism to Canada, and supporting scientific research and the integration of scientific considerations in our investment and policy choices.

As we approach Canada's 150th anniversary, we pledge to continue working with stakeholders from across the country to strengthen our place in the global economy.

It is our honour to present the 2015-16 Departmental Performance Report for CanNor.

Navdeep Singh Bains

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

Kirsty Duncan

The Honourable Kirsty Duncan
Minister of Science

Bardish Chagger

The Honorable, Bardish Chagger
Minister of Small Business and Tourism and Leader of the Government in the House of Commons

The original version was signed by
________________________________

The Honourable Navdeep Bains, P.C., M.P.
Minister of Innovation, Science and Economic Development

Results Highlights

What funds were used? (2015-16 Actual Spending) Who was involved? (2015-16 actual FTEs)
46,948,420 80

Results Highlights

  • To support economic development and foster diversification in the three northern territories, in 2015-16 CanNor invested $33.2 million in 135 projects:
    • Funding to strengthen key sectors of the economy, including $5.02 million to advance tourism and $2.98 million to build capacity, was delivered through the Strategic Investments in Northern Economic Development (SINED) program. SINED was renewed in Budget 2016. These investments supported economic growth and diversification, and helped strengthen Northerner's capacity to take advantage of economic opportunities; particularly related to northern innovation and clean growth.
    • To continue to build capacity and prepare Indigenous communities and organizations to plan for, pursue, and participate in economic opportunities, CanNor invested $5.05 million in 55 projects through its Northern Aboriginal Economic Opportunities Program (NAEOP). These investments helped grow Indigenous businesses and supported Indigenous community economic development.
    • CanNor implemented the Community Infrastructure Program (CIP) 150 across the territories. With this program, CanNor will deliver $12.8 million in funding to projects that rehabilitate, renovate, or enhance cultural and community infrastructure in 2016-17 and 2017-18.
    • In partnership with the three territorial colleges, the Agency delivered the Northern Adult Basic Education Program (NABEP), which to date has helped over 3,400 Northerners gain important literacy and numeracy skills needed to participate more fully in the labour market.
  • Through its Northern Projects Management Office (NPMO), CanNor supported efficient and transparent environmental assessment (EA) processes – from coordination of federal regulatory departments, to EA advisory support and Crown consultation coordination – for 14 major projects in the North in 2015-16. These projects offer the potential for over $12.5 billion in capital investment, and significant long-term economic benefits for local jobs and business opportunities for northern residents.

Section I: Organizational Overview

Organizational Profile

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

President: Janet King

Ministerial Portfolio: Innovation, Science and Economic Development

Enabling Instrument(s): Public Service Rearrangement and Transfer of Duties Act, R.S.C. 1985, c. P-34Endnote 1

Year of Incorporation / Commencement: 2009

Head Office:
Allavvik Building
1106 Inuksugait Plaza IV
Iqaluit, Nunavut
X0A 0H0
Canada

Website: CanNorEndnote 2

Organizational Context

Raison d'être

Contributing to jobs and growth in Canada, the Canadian Northern Economic Development Agency (CanNor) works to develop a diversified, sustainable and dynamic economy across Canada's three territories. It does this by delivering funding programs to Northerners, including Indigenous people, as well as coordinating and facilitating federal departments involved in reviewing major projects across the North through the Northern Projects Management Office (NPMO). It also undertakes research to support the development of evidence-based policies, advocating for Northern economic prosperity and diversification, and collaborating with other federal departments, territorial governments, Indigenous organizations, and industry.

Responsibilities

As the federal government's regional economic development agency for the three northern territories, CanNor is responsible for administering a suite of contribution programs which support investments in economic development opportunities in the North. Investments from these programs, which include the Strategic Investments in Northern Economic Development (SINED) program, the Northern Aboriginal Economic Opportunities Program (NAEOP) and the Northern Adult Basic Education Program (NABEP), can be the impetus to get a business started or expanded. They can also help a community to benefit from upcoming economic opportunities. Investments can support a wide range of studies and projects, from new technologies and capacity building to preparing individuals to enter the workforce. Often, they are a catalyst for other funding efforts, including the territorial governments investing additional funds in support of CanNor funding – a reflection of the importance of partnerships and aligning efforts that is characteristic of working in the North.

CanNor's NPMO provides single-window path-finding and issues management for industry at all stages of resource development. Support is also provided to Indigenous organizations that play a key role in the consideration of these projects. This work often begins during the exploration phase and takes on even greater importance during environmental assessment and regulatory permitting. NPMO coordinates federal regulators to ensure the timeliness, transparency and predictability of regulatory efforts, while overseeing the Crown's Indigenous consultations. CanNor, through NPMO, also partners with communities to foster their readiness to maximize the positive impact of projects, while working collaboratively to minimize and mitigate risks.

The Agency's pan-northern perspective and knowledge of Canada's North are at the core of its efforts to champion the economic interests of the region within and outside the federal government. Complementing its contribution programs and the work of NPMO, the Agency uses its policy and research capacity to examine and assess economic issues and opportunities. Furthermore, with its headquarters in the North (Iqaluit), CanNor offers a unique operational understanding, insight and intelligence to contribute to advancing the Government of Canada's priorities in the territories. The Agency is well-positioned to inform the federal perspective on northern economic development including the challenges and opportunities in the North. For CanNor, success is a function of its knowledge, partnerships, collaboration and networks, all in the interest of positive outcomes for Northerners.

Strategic Outcomes and Program Alignment Architecture

1. Strategic Outcome: Developed and diversified territorial economies that support prosperity for all Northerners.

  • 1.1 Program: Economic Development
    • 1.1.1 Sub-Program: Business Development
    • 1.1.2 Sub-Program: Community Development
  • 1.2 Program: Policy and Alignment
    • 1.2.1 Sub-Program: Policy and Advocacy
    • 1.2.2 Sub-Program: Coordination and Alignment
  • Internal Services

Operating Environment and Risk Analysis

Canada's three territories are home to approximately 119,000 people living across over 40% of Canada's landmass. While the North presents potential and opportunities for economic development, growth and innovation, the northern economy is challenged by a number of factors including its vast and remote geography, harsh climates, lack of infrastructure, connectivity challenges, the cost and access to energy, limited economic diversification, and shortage of skilled labour. This has the potential to constrain economic development opportunities. For example, in the North, the lack of infrastructure can increase capital costs by 15% for diamond mines and up to 2.5 times higher for base metal mines when compared to the rest of Canada.

The territorial economies remain significantly less diversified than other parts of Canada as three sectors alone – mining, quarrying, and oil and gas extraction, construction, and public administration (including health care and educational services) – account for more than 60% of the North's gross domestic product (GDP). The North's natural resource endowment will continue to be the foundation for economic growth. However, declining commodity prices in recent years as well as reduced investments have slowed down the northern mining industry in 2015, leading to a 0.8% decrease of the combined GDP. Over the medium- and long-term, it is expected that resource development will increase again, however building sustainable northern economies will require an increased focus on investments that contribute to economic diversification and ultimately, clean growth. Increased investments in clean technologies will present new economic development opportunities for the North to grow and diversify.

Access to skilled labour poses a significant challenge to supporting key economic sectors. Northern educational achievement rates remain low where on average, nearly a third of the northern population aged 25 to 64 does not possess a certificate, diploma or degree; twice the national average of 13% for Canada. This situation not only reflects an added challenge for businesses, it also prevents Northerners from fully benefiting from economic development opportunities.

These challenges shape CanNor activities and operations, and impact how it delivers on its mandate. Headquartered in Iqaluit, Nunavut, CanNor is a small and decentralized agency with offices in the three territorial capitals and a liaison office in Ottawa. As such, the Agency faces similar labour market and connectivity challenges in its operations.

In November 2015, CanNor was included in the new Innovation, Science and Economic Development (ISED) portfolio. Working collaboratively with the five other RDAs within the portfolio, CanNor aligned its activities with Government of Canada priorities and Ministers' mandate letters, including the development of the Inclusive Innovation Agenda with emphasis on investment in clean technology.

CanNor's key risks and response strategies are presented below.

Key Risks
Risk Risk Response Strategy Link to the
Organization's Program(s)
Operational Environment
CanNor's ability to advance economic development in the North is subject to contextual elements that are beyond the Agency's direct control and influence. This creates a risk of the Agency being unable to fully advance on its core objective. For instance, there is little ability to influence the cyclical changes in global economic dynamics which will have an important impact on the North given the region's heavy reliance on resource development.
The Agency funds projects supporting economic diversification and growth. Investments in diverse sectors, and support to small and medium-sized enterprises, contributed to the capacity of the northern economy to mitigate the effects of the natural resources boom-bust cycle.

CanNor conducts research and engagement with its stakeholders and informs its understanding of the changing northern context and the impacts of the global economy on the North. These activities informed the management, review and renewal of CanNor programs and delivery of its services.
Economic Development, Policy and Alignment
Performance Measurement
Performance measurement is required to determine the effectiveness of CanNor's programs and to inform the Agency's other functions including management processes, policy, advocacy, coordination, alignment and internal services. It is a foundation for continuous improvement efforts within the Agency.
CanNor reviewed its performance measurement strategies and related indicators. The review identified areas where some program performance measurement strategies could be strengthened. The Agency is considering these recommendations in the context of the new Treasury Board Policy on Results (2016).Endnote 3 Economic Development, Policy and Alignment, and Internal Services
Alignment of Priorities and Needs
The Agency's limited resources may not be fully aligned with its priorities. CanNor must prioritize its programs and activities appropriately to ensure that resources are allocated to priority activities that are aligned with the complex and fast-changing northern economy.
CanNor planned, prioritized and aligned its resources within its first integrated business plan. Economic Development, Policy and Alignment
Human and Knowledge Capital
Competition within the limited labour pool in the North carries risks for recruitment and retention. CanNor must manage the challenges associated with building and maintaining a sufficient and representative workforce with the skills, competencies, and corporate knowledge base required to implement the Agency's mandate.

There is also a risk that CanNor may be unable to meet its federal obligations established under Article 23 of the Nunavut Land Claims Agreement (NLCA), which establishes a level of Inuit representation in government employment in the Nunavut Settlement Area.
CanNor implemented its Human Resources Plan, including the Inuit Employment Plan and Strategic Staffing Plan. Through additional HR capacity, efforts focused on improving recruitment, retention and employee development. The Agency also promoted new learning and training opportunities for its staff.

CanNor worked with partners to launch the 2nd cohort of the Inuit Learning and Development Program – a pre-employment training initiative for NLCA beneficiaries.
Internal Services
Information Management and Information Technology (IM/IT)
IT systems and infrastructure may not sufficiently support CanNor's client and user needs, which may limit the availability of accurate and relevant information for some program and business processes. The IM/IT transformation agenda may lead to some disruptions to CanNor's systems and procedures
Effective partnerships with its service providers, including Indigenous and Northern Affairs Canada (the Agency's IT service provider), Health Canada and Shared Services Canada are maintained to manage this risk through active monitoring and continuous follow-up with service providers and adjusting processes accordingly.

CanNor worked closely with its IT service provider (INAC) to prepare for government-wide IM/IT transformation initiatives and to ensure data and systems were ready.

It also collaborated with other regional development agencies to develop business requirements for a common grants and contributions management system.
Economic Development, Internal Services

Organizational Priorities

Strengthening the northern economy by focussing on key economic sectors

Description:

CanNor strategically targets program investments to continue developing and expanding those economic sectors that can help build a strong, diversified and sustainable northern economy. Investment decisions are informed by regional intelligence and research, with a focus on aligning efforts and leveraging capacities with other federal departments, territorial governments, Indigenous organizations, and the private sector to best seize the economic opportunities.

Priority TypeEndnote 4: Ongoing
Key Supporting Initiatives
Planned Initiatives Start Date End Date Status Link to the Organization's Program(s)
Leverage large scale economic drivers like resource development while fostering economic diversification through investments in the creation and expansion of small and medium enterprises in growth (e.g. tourism) and emerging (e.g. biomass) sectors. These efforts will be based on measurable performance data and efficient and effective service delivery. Ongoing Ongoing On track 1.1 Economic Development

1.2 Policy and Alignment

Internal Services
Apply knowledge from research and analysis to inform programs and policies, while sharing this knowledge with partners and stakeholders to advance the northern economy. Ongoing Ongoing On track
Strengthen external communications to raise awareness of the Agency's programs and services to better serve clients and attract investment to the North Ongoing Ongoing On track
Position the Agency in support of delivering on an inclusive Innovation Agenda November 2015 Ongoing On track
Progress Toward the Priority

CanNor's contribution programs continued to help strengthen and diversify the northern economy, with $33.2 million in contribution funding delivered through 135 projects during the 2015-16 fiscal year.

Through SINED, a program focused on promoting economic diversification and growth, CanNor supported 60 projects with $17.4 million in contribution funding. Approximately 70% of this funding was focused on opportunities in geoscience, tourism, forestry and fisheries sectors, with the remaining funds invested in capacity development projects and small and medium enterprises (SMEs) across the North. The Agency was successful in receiving renewed funding for SINED through Budget 2016. Examples of projects supported under SINED include:

  • the Yukon Small and Medium Enterprise Training Project, delivered by the Whitehorse Chamber of Commerce, which enabled the Chamber to deliver a series of business development modules to small business owners in the Yukon, supporting the growth of local SME capacity;
  • the NWT Forest Industry and Biomass Initiative delivered by the Government of the Northwest Territories to continue the development of a viable forestry sector. Funding supported the creation and implementation of general development and harvesting plans and inventories for the regions participating in this sector; and,
  • the Iqaluit Solar Panel pilot project to test solar panel energy production in Arctic conditions. Testing results proved positive for this technology in cold, dry climates and the project results are contributing to the development of a net-metering policy. This, in turn, will afford consumers in Nunavut with the opportunity to offset energy costs through alternative energy production.

Through NAEOP, a program focused on increasing the participation of northern Indigenous communities and businesses in economic opportunities, CanNor supported 63 projects with over $8.8 million in contribution funding in 2015-16. Examples of projects this funding helped support include:

  • completing a business plan and training required by the Kluane First Nation to acquire and install three wind turbines in Yukon;
  • completing a feasibility study and business plan that will inform future decisions around developing facilities to support skills training for Tlicho youth in the Northwest Territories;
  • supporting tourism development in Arctic Bay, Nunavut through centralizing eco-tourism activities in the community, providing resources for product development, marketing, training, management and related equipment; and,
  • 3 projects creating separate equity funds valued at $2.9 million that will be used to support Indigenous businesses across the North.

Under NABEP, CanNor provided $3.5 million in funding to the three territorial colleges for the delivery of training programs to help northern adults acquire basic workplace skills. Since 2011, over 3,400 northern studentsEndnote 5 have benefitted from this initiative by developing core literacy and numeracy competencies. Budget 2016 also announced the continuation of funding for one additional year (2016-17) to review the program with a view to determining how to best support the participation of Northerners in the labour market.

In 2015-16, the Agency also implemented the Canada 150 Infrastructure Program (CIP 150) in the three territories. The continuous intake process for the new CIP 150 program was launched, and 13 CIP 150 projects totaling $3,405,800 were approved. Funds will flow to projects in the 2016-2017 and 2017-2018 fiscal years. These projects will rehabilitate and improve existing community infrastructure in the North.

CanNor continued to strengthen its external communications, to ensure that Canadians have access to current, relevant and quality information on the Agency's programs. Although communication activities were limited during the August-November election period, the Agency continued to provide internal services, support ministerial events, media enquiries and news release publications announcing contribution program funding.

In support of the new government and ministerial priorities to build an inclusive and innovative Canada, CanNor worked closely with the other RDAs to lay a national foundation to support the adoption, development and deployment of clean technologies. Building on outreach and partnerships, CanNor entered into a Memorandum of Understanding (MOU) with the National Research Council related to the Industrial Research Assistance Program to support collaboration on innovation in the North.

Advancing major project development in the North

Description:

Working with federal regulatory partners, CanNor, through NPMO, coordinates federal participation in the regulatory review and permitting processes in the North to ensure that decisions are based on scientific evidence, include consideration of traditional knowledge and provide for meaningful consultation of Indigenous people. NPMO's activities contribute to improving the investment and business climate in a way that encourages sustainable resource development, while ensuring new projects consider the long-term effects on jobs and economic opportunities for northern and Indigenous residents.

Priority Type: Ongoing
Key Supporting Initiatives
Planned Initiatives Start Date End Date Status Link to the Organization's Program(s)
Coordinate federal regulatory partners to meet timelines and respond to the number and complexity of projects by enhancing coordination and seek to align these efforts with territorial governments and Indigenous communities. Ongoing Ongoing On track 1.1 Economic Development

1.2 Policy and Alignment
Foster community readiness so that Northerners benefit from major resource projects, and risks and opportunities are addressed early in the development of projects, ultimately improving socio-economic outcomes for Northerners. Ongoing Ongoing On track
Continue to ensure that the Government of Canada's consultation obligations to northern Indigenous people are met by coordinating a whole-of-government approach to consultation, holding the record of consultation and ensuring it is complete. Ongoing Ongoing On track
Continue to assess and advise on challenges to advancing major projects in the North. Ongoing Ongoing On track
Advance efforts to position Canada's North as a world-class location for resource development. Ongoing Ongoing On track
Progress Toward the Priority

In 2015-16, CanNor's NPMO continued to play a leadership role in helping advance major projects through environmental assessment (EA) processes in the territories. In 2015-16, over 30 major projects were either preparing for or progressing through the regulatory process, representing a potential of more than $22 billion in capital investment and over 10,000 jobs for the North. NPMO contributed to enhancing a stable and transparent northern regulatory environment by:

  • coordinating 14 projects that were in or about to enter the regulatory review and permitting processes;
  • organizing six Resource Development Advisory Group (RDAG) meetings that allowed project proponents to inform their major project proposals with RDAG feedback prior to formally entering the environmental assessment processes;
  • developing and refining Crown consultation and accommodation models for the territories, while continuing to ensure the Government of Canada met its consultation obligations to protect the rights of northern Indigenous people. Models for Yukon and the Northwest Territories were implemented, with work underway on a Nunavut model; and,
  • hosting the first Pan-Territorial Assessment and Regulatory Board Forum in January 2016, which brought together twenty participants representing the northern EA and regulatory (licensing/permitting) boards to discuss common challenges and opportunities. The forum was considered a success and the Boards have requested NPMO to continue this important engagement on a regular basis.

A formal evaluation determined that over its first five years, NPMO played an important role in coordinating multiple stakeholders participating in project reviews, contributed to increased transparency and consistency through its role as Crown consultation coordinator, and delivered high quality tools and services to clients and stakeholders.

NPMO also worked with federal, territorial and community partners to identify and respond to the challenges and opportunities in nurturing sustainable resource development in the North:

  • engaging with all three territorial governments to identify their infrastructure gaps and potential approaches to securing infrastructure investments;
  • fostering community readiness planning through a pilot project that aimed to help seven participating communities prepare for and maximize benefits associated with major resource development; and,
  • collaborating with Global Affairs Canada and the three territorial governments to host the third annual Invest in Canada's North session at the March 2016 Prospectors and Developers Association Convention. The seminar was well received with over 120 participants from private sector, Indigenous organizations, foreign governments and the general public; the session also led to a number of follow-up meetings with potential international investors.

NPMO funding was renewed for $10.1 million over four years (2016-17 to 2019-2020) through Budget 2016.

Excellence in people management

Description:

CanNor strives for excellence in people management by advancing an organizational culture of mutual support, teamwork, integrity, respect and trust. A focus is placed on supporting the health and well-being of employees so that they are engaged, productive and deliver high-quality services to clients.

Priority Type: Ongoing
Key Supporting Initiatives
Planned Initiatives Start Date End Date Status Link to the Organization's Program(s)
Use information from the 2014 Public Service Employee Survey to promote a culture of excellence, aligning these efforts with broader Public Service initiatives such as Blueprint 2020. Ongoing Ongoing On track Internal Services
Implement the Human Resources and Inuit Employment Plans to support recruitment, retention and representativeness and ensure a full staff complement in all offices, with a particular emphasis on increasing the number of Inuit employees in the Iqaluit office. Ongoing Ongoing On track
Implement ongoing training and continuous learning and development to ensure employees have the required competencies, skills and knowledge to deliver programs and serve clients. Ongoing Ongoing On track
Progress Toward the Priority

CanNor implemented a number of initiatives in response to the 2014 Public Service Employee Survey. A working group of employees from across the Agency identified priority areas for action and took on champion roles, and partnered with Internal Services to address issues raised in the PSES. Achievements include:

  • completing Agency Guidelines on the Management and Reporting of Overtime;
  • increasing attention to Awards and Recognition, including Instant Awards;
  • improving connectivity culture and support across the geographically dispersed Agency; and,
  • supporting regional team building activities such as regular all-team meetings in Yellowknife and more emphasis on informal team building in Whitehorse.

CanNor continued to implement its Human Resources (HR) and Inuit Employment Plans in 2015-16. In February 2016, CanNor implemented a second round of the successful Inuit Learning and Development Program (ILDP) with 10 participants.

In support of building and retaining a skilled and knowledgeable workforce, the Agency continued to support training and continuous learning and development opportunities for its employees, including advancing on a learning and development strategy for Operations staff, as well as core values and ethics training.

Continue to improve business processes, and program and service delivery

Description:

CanNor optimizes its resources to support results-based management, continuously working to improve business processes, program and service delivery. The Agency remains focused on consistently delivering programs and services that are inclusive, grounded in sound financial management, and meet the real-time needs of its clientele.

Priority Type: Ongoing
Key Supporting Initiatives
Planned Initiatives Start Date End Date Status Link to the Organization's Program(s)
Continue to improve program delivery processes and meet service standards. Ongoing Ongoing On track 1.1 Economic Development

1.2 Policy and Alignment

Internal Services
Gather program performance data and integrate this information in its program decision-making and policy development. Ongoing Ongoing On track
Consult with other RDAs and Shared Services Canada to seek long-term solutions in support of organizational and program decision-making and results-based management. Ongoing Ongoing On track
Progress Toward the Priority

CanNor continued to improve program delivery processes and meet service standards. Below are the Agency's service standards results for 2015-16.

Service Standard Target Result
*CanNor did not recommend projects during the election period and swearing-in of a new Minister from August 2, 2015 to November 4, 2015.
**This service standard was impacted by reports received but not being accepted due to the quality of the report or missing information.
Acknowledging an Expression of Interest within 10 Business days 90% 96%
Acknowledging an Application within 10 business days 90% 97.5%
Rendering a Funding Decision within 90 days of Receiving a completed application 90% 83.1%*
Rendering a Payment Decision within 10 days of when payment could have been released 90% 65.1%**

CanNor continued to collect program performance data and integrate this information in program decision-making and policy development. These activities contributed to sector analyses that supported SINED renewal efforts. The results of these analyses reinforced the need to continue investment activities in such sectors as northern tourism, forestry and energy, as well as economic infrastructure, and businesses. This information was used to determine priority areas for investment under a renewed SINED program and will be used for planned evaluations of the SINED and NAEOP programs.

CanNor is working closely with other RDAs and Shared Services Canada (SSC), as well as the Office of the Comptroller General (OCG) to develop a common management solution to support organizational, program decision-making and results-based management – an "Enterprise Grants and Contribution Solution".

For more information on organizational priorities, see the Ministers' mandate letters.Endnote 6

Section II: Expenditure Overview

Actual Expenditures

Budgetary Financial Resources (dollars)
2015-16
Main Estimates
2015-16
Planned Spending
2015-16
Total Authorities
Available for Use
2015-16
Actual Spending
(authorities used)
Difference
(actual minus planned)
50,668,666 50,668,666 51,293,715 46,948,420 (3,720,246)
Human Resources (Full-Time Equivalents [FTEs])
2015-16
Planned
2015-16
Actual
2015-16
Difference (actual minus planned)
93 80 (13)

Budgetary Performance Summary

Budgetary Performance Summary for Program(s) and Internal Services (dollars)
Program(s) and Internal Services 2015-16
Main Estimates
2015-16
Planned Spending
2016-17
Planned Spending
2017-18
Planned Spending
2015-16
Total Authorities Available for Use
2015-16
Actual Spending (authorities used)
2014-15
Actual Spending (authorities used)
2013-14
Actual Spending (authorities used)
1.1 Economic Development 40,496,412 40,496,412 18,108,174 16,984,687 40,559,414 36,670,762 38,684,842 40,878,078
1.2 Policy & Alignment 4,857,866 4,857,866 2,013,466 2,013,466 4,857,866 3,949,912 3,955,430 3,226,458
Internal Services 5,314,388 5,314,388 6,111,811 6,111,811 5,876,435 6,327,746 6,480,289 6,674,942
Total 50,668,666 50,668,666 26,233,451 25,109,964 51,293,715 46,948,420 49,120,561 50,779,478

In 2015-16, Actual Spending was lower than Total Authorities Available for Use for both contribution and operating budgets. With regards to contributions, CanNor's programs are proposal-driven. As such, there are fluctuations in demand from year-to-year based on the number and dollar value of proposals received. The SINED program was under-subscribed by approximately $781 thousand and NAEOP was under-subscribed by $2 million. Lapses in NAEOP are in part from the implementation of the 2013 commitment to phase-out the Community Economic Development Program (CEDP). CanNor has moved in the direction of supporting proposal-driven projects under NAEOP, as opposed to core operation funding from CEDP, consequently, additional work was required with clients to develop eligible projects that met new program objectives. This change, combined with changes to proponent spending plans towards the end of 2015-16, contributed to NAEOP being under-subscribed.

In addition, $1.7 million in available operating funds were not required largely due to lower than expected overall salary requirements. The actual number of employees was lower than planned due to a combination of workforce turnover and challenges associated with staffing positions in northern locations, and positions which are linked to program funding renewals.

The decrease in reported Planned Spending for 2016-17 is attributed to the sunsetting of SINED ($20.0 million), NABEP ($4.0 million) and NPMO ($2.6 million) in 2015-16. These programs were subsequently renewed in the 2016-17 Supplementary Estimates A for similar amounts. Funding for the Centre for Northern Innovation in Mining (CNIM) also decreases in 2016-17 by $1.3 million (to $1.1 million) as it entered its sunsetting year. These decreases were offset slightly by new funding for the Canada 150 Infrastructure Program (CIP 150) ($3.2 million).

Planned Spending in 2017-18 is lower due to the sunsetting of CNIM (representing a decrease of $1.1 million from the year prior).

Other minor financial differences are a result of the annual carry-forward, the employee benefit plan and other administrative adjustments.

Departmental Spending Trend

Departmental Spending Trend Graph
Text description of the Departmental Spending Trend Graph

This spending graph demonstrates actual spending, planned spending and sunset programs and total over six fiscal years. In 2013-14, actual spending was 51 million dollars. In 2014-15, actual spending was 49 million dollars. In 2015-16, actual spending was 47 million dollars. In 2016-17, planned spending is expected to be 26 million dollars with 4 million dollars expected to sunset. In 2017-18 planned spending is expected to be 25 million dollars with 3 million dollars expected to sunset. In 2018-19, planned spending is expected to be 22 million dollars with 156,000 dollars scheduled to sunset.

The Departmental Spending Trend above follows from information presented in the Agency's 2015-16 Report on Plans and Priorities, and excludes program renewals announced in Budget 2016 which were subsequently included in 2016-17 Supplementary Estimates. The following changes impacted CanNor's spending trend between 2013-14 and 2018-19:

  • In 2014-15, spending was lower than the previous year because of the sunsetting of the Community Infrastructure Improvement Fund ($3.2 million) in 2013-14. However, this decrease was offset slightly by new funding for the CNIM program ($975 thousand) and increased funding for NPMO ($400 thousand).
  • In 2015-16, spending for the NABEP dropped by $3.0 million ($7 million to $4 million) as the program started its sunsetting year. An increase in NPMO funding ($389 thousand) was also accounted for in the same period to accommodate planned expenses for the final year of NPMO funding.
  • In 2016-17, planned spending decreased because of the sunsetting of SINED ($20.0 million), NABEP ($4.0 million) and NPMO ($2.6 million) in 2015-16. CNIM funding also decreased in 2016-17 by $1.3 million (to $1.1 million) as it entered its sunsetting year. These decreases were offset slightly by new funding for the Canada Infrastructure Program 150 ($3.2 million).
  • In 2017-18, planned spending decreased because of the sunsetting of CNIM (representing a decrease of $1.1 million from the year prior).

Sunsetting programs are subject to government decisions to extend, reduce, or enhance funding and may be affected by results achieved, evolving priorities and available resources. New funding decisions are reflected in the Agency's future budget exercises and Estimates documents. CanNor is focused on ensuring its programs continue to meet the needs of Northerners, and provide stability for multi-year economic development projects.

Expenditures by Vote

For information on the Canadian Northern Economic Development Agency's organizational voted and statutory expenditures, consult the Public Accounts of Canada 2016Endnote 7.

Alignment of Spending With the Whole-of-Government Framework

Alignment of 2015-16 Actual Spending With the Whole-of-Government FrameworkEndnote 8 (dollars)
Program Spending Area Government of Canada Outcome 2015-16 Actual Spending
1.1 Economic Development Economic Affairs Strong Economic Growth 36,670,762
1.2 Policy & Alignment Economic Affairs Strong Economic Growth 3,949,912
Total Spending by Spending Area (dollars)
Spending Area Total Planned Spending Total Actual Spending
Economic affairs 45,354,278 40,620,674
Social affairs not applicable not applicable
International affairs not applicable not applicable
Government affairs not applicable not applicable

Financial Statements and Financial Statements Highlights

Financial Statements

The financial highlights presented within this DPR are intended to serve as a general overview of CanNor's financial position and operations and should be read in conjunction with the 2015-16 CanNor Financial Statements, which can be found on the Agency's websiteEndnote 9.

Financial Statements Highlights

The financial results are shaped by the Agency's programs and internal services that aim to build a strong, diversified, sustainable and dynamic economy for Northerners and Indigenous people, communities and businesses across Canada's three territories, thus contributing to Canada's prosperity.

Condensed Statement of Operations (unaudited)
For the Year Ended March 31, 2016 (dollars)
Financial Information 2015-16
Planned Results
2015-16
Actual
2014-15
Actual
Difference
(2015-16 actual minus 2015-16 planned)
Difference
(2015-16 actual minus 2014-15 actual)
Total expenses 51,318,000 46,068,211 51,694,082 (5,249,789) (5,625,871)
Total revenues - - - - -
Net cost of operations before government funding and transfers 51,318,000 46,068,211 51,694,082 (5,249,789) (5,625,871)
Condensed Statement of Financial Position (unaudited)
As at March 31, 2016 (dollars)
Financial Information 2015-16 2014-15 Difference
(2015-16 minus 2014-15)
Total net liabilities 20,340,376 27,367,882 (7,027,506)
Total net financial assets 19,361,388 26,460,162 (7,098,774)
Departmental net debt 978,988 907,719 71,269
Total non-financial assets 748,724 801,277 (52,553)
Departmental net financial position (230,264) (106,442) (123,822)

Total expenses for 2015-16 decreased by $5.6 million compared to 2014-15. Approximately $1 million of this was due to a decrease in operating costs, the majority of which relate to the one-time cost of $620 thousand for leasehold improvements which was incurred in 2014-15. The majority of this decrease is attributed to reduced contribution spending in 2015-16.

Total net liabilities were reduced by $7 million compared to 2014-15, due to an increased disbursement rate for contribution payments, and improved clearing of outstanding old-year liabilities. In 2015-16, approximately $4 million fewer contribution liabilities were established compared to 2014-15 – largely due to the Agency's success in working with recipients to accelerate the issuance of contribution payments. A further $3 million in previous year liabilities was reviewed and identified as no longer required.

Other changes are relatively minor and include changes to non-financial assets such as amortization of leasehold improvements and vehicles.

Section III: Analysis of Program(s) and Internal Services

Program: 1.1 Economic Development

Description

This program supports economic development in Canada's three territories: Nunavut, Northwest Territories and Yukon. Ensuring that the North is able to participate actively in the economy is essential to Canada's economic growth. Each territory has unique opportunities and challenges that require individual strategies to foster sustainable, competitive and diverse economic development. Through funding support, CanNor strengthens and stimulates the northern economy by taking steps to advance private sector efforts, ranging from small and medium enterprises to large-scale industry. There is also a strong focus on creating the conditions to position individuals, including Indigenous and non-Indigenous Northerners, communities and business-related organizations for economic success.

Program Performance Analysis and Lessons Learned

While each territory and region is unique, economic development across the North is challenging due to a sparse and widely distributed population, harsh climates, cyclical economic patterns due to a dependence on natural resource development, an infrastructure deficit, and labour-market challenges.

In 2015, the territorial combined GDP decreased by 0.8% to $8.03 billion; largely a result of a decrease in the GDP contribution of mining, quarrying and oil and gas activities. Slight growth in the construction sector offset these losses as the percentage contribution of GDP from this sector grew by 0.99%. Public administration, resource development and construction continue to be key components of northern GDP.

CanNor also calculates a broader indicator of the state of northern economic development to guide its internal analyses and inform Agency priority setting exercises. This measure is referred to as the Northern Economic Index (NEI)Endnote 10 and is constructed on a 0 to 35-point scale. Movement along this scale reflects annual changes in seven indicators of the territorial economies that relate to: the labour market, financial well-being of Northerners, fiscal health/sufficiency of territorial governments, investments in the territories, as well as the status of business activity.

The NEI score of 4.5 reaffirms that in 2015 there was a contraction in economic activity in the North relative to the previous years in 2010 to 2015 period. The territories saw an increase in their unemployment rate, a decrease in own-source revenues generated by territorial governments, and a decrease in the rate of growth in average weekly earnings. Despite a slight increase in mineral exploration spending, the North observed a decline in resource development sector activity. Given the dependence on this sector, this decline contributed to reduced economic activity in other areas.

Based on these program performance results, CanNor continued its efforts to strengthen and diversify the northern economy through investments and collaboration with its partners. Some examples of these efforts include:

  • supporting the construction of the Centre for Northern Innovation in Mining (CNIM), a partnership with Government of Yukon and Yukon College which has provided Northerners with better access to the education and training needed to take full advantage of the local jobs and prosperity generated in the mining and resource development sectors;
  • working with Northwest Territories Tourism and the Government of the Northwest Territories to build Indigenous capacity to support enhanced northern tourism experiences;
  • supporting a film workshop which involved the participation of 92 Northern residents in all facets of film production including directing, acting, stunt skills development and camera work. This resulted in the production of at least two other feature films to the territory, as the local capacity to work in this industry has now been established; and,
  • working with 7 communities in support of community readiness planning – a foundational process piloted to identify sector economic diversification opportunities associated with resource development in order to maximize related community benefits.

CanNor learned through its SINED renewal analyses, review of performance measures and related results that the Agency needs to increase its direct work with businesses, provide for some investment in economic infrastructure, and enhance its service delivery. Increased efforts in these areas will respond to the needs of businesses and contribute to an enhanced foundation for economic diversification and growth across the North.

Budgetary Financial Resources (dollars)
2015-16
Main Estimates
2015-16
Planned Spending
2015-16
Total Authorities Available for Use
2015-16
Actual Spending
(authorities used)
2015-16
Difference
(actual minus planned)
40,496,412 40,496,412 40,559,414 36,670,762 (3,825,650)

The difference between Planned Spending and Actual Spending is primarily due to lapsing of contribution funding for SINED ($781 thousand) and NAEOP – CROP ($2.2 million). A significant lapse in operating costs was also realized. With changes to CEDP programming, CanNor moved in the direction of supporting proposal-driven projects (as opposed to core operation funding) under NAEOP. This change, combined with changes to proponent spending plans towards the end of 2015-16, contributed to NAEOP being under-subscribed. CanNor also increased its efforts in 2015-16 to support the roll-out of the Canada 150 Infrastructure Program (CIP 150). In 2015-2016, the continuous intake process for the new CIP 150 program was launched, and 13 CIP 150 projects totaling $3,405,800 were approved. Funds will flow to projects in the 2016-2017 and 2017-2018 fiscal years. These projects will rehabilitate and improve existing community infrastructure in the North.

Human Resources (Full-Time Equivalents [FTEs])
2015-16
Planned
2015-16
Actual
2015-16
Difference
(actual minus planned)
35 26 (9)

The lower than planned FTE number is due to the combined challenges of staff turnover in positions linked to sunsetting programs, as well as the difficulty of staffing in the North.

Performance Results
Expected Results Performance Indicators Targets Actual Results
Increased northern economic activity and well-being of northern communities Northern Economic Index (NEI)Endnote 10 Value of 24 to 26 4.5Endnote 11

Program 1.2 Policy and Alignment

Description

This program supports research and analysis to guide programming and policy choices, the promotion of northern interests both inside and outside of the federal government, and the development of horizontal strategies, initiatives and projects to address economic development challenges and opportunities in the North.

Program Performance Analysis and Lessons Learned

The Policy and Alignment program includes both the Agency's strategic policy and planning unit, as well as the NPMO. CanNor uses its policy, research, and coordination capacity to examine economic issues and opportunities to inform the delivery of the Agency's contribution programs and NPMO operations. CanNor assesses the effectiveness of this program by how successful the Agency is in meeting its overall strategic objective of strengthening the northern economy. To determine this, CanNor measures annual changes across seven indicators of economic developmentEndnote 12. CanNor aims to meet targets for at least five out of seven of these indicators to determine whether the composite measure's target was met.

In 2015-16, the Agency met five of the seven performance indicator thresholds it used to assess its economic development program and its related sub-programs through Policy and Alignment. Based on this performance analysis, this result indicates that CanNor's current policies and programs are aligned with strengthening the northern economy. 2015 results for the NEI and northern GDP, however, were not met during the reporting period.

CanNor Policy was active in 2015-16 both in terms of planning for and conducting evaluations. These efforts were instrumental in supporting program renewals announced in Budget 2016 and in ensuring programs are meeting the needs of Northerners. Some examples of these efforts include:

  • collaborating with other RDAs to inform and launch CIP 150, which included northern-specific parameters to address the unique operating context, such as enabling a higher Government of Canada contribution ratio (75% in the territories as compared to 50% in the provinces), to accommodate the high cost of construction and limited availability of funds in the North;
  • completing external engagements and a comprehensive analysis of the SINED program to identify challenges and opportunities, including what adjustments could be made to the program to increase CanNor's support to SMEs;
  • concluding a formal NPMO evaluation, which informed its renewal;
  • developing business cases for program renewals based on policy research, analyses and engagement; and,
  • providing a northern perspective to national decision-making processes; for instance, the NPMO's continued work to ensure a northern perspective on engagement is integrated into environmental assessment Crown consultation processes.

CanNor also positioned itself through alignment and collaboration with the RDAs to deliver on emerging government commitments. The initial focus of these efforts in 2015-16 was on setting the stage for increased adoption of clean technologies.

CanNor learned through its performance analyses in 2015-16 that an integrated policy function, drawing upon all the Agency linkages, greatly informs decision-making processes. Through concentrating analytical capacity, communication across multiple business lines was greatly improved in the Agency, leading to more effective program delivery.

Budgetary Financial Resources (dollars)
2015-16
Main Estimates
2015-16
Planned Spending
2015-16
Total Authorities Available for Use
2015-16
Actual Spending
(authorities used)
2015-16
Difference
(actual minus planned)
4,857,866 4,857,866 4,857,866 3,949,912 (907,954)

The NPMO funding profile for 2015-16 included $400 thousand which was identified as the cost of winding down the initiative in its originally expected sunset year (e.g., for staff relocation and related costs). NPMO funding was renewed in Budget 2016 and no sunset costs were incurred in 2015-16. A lapse of approximately $500 thousand is related to lower personnel and other operating costs due to a shortfall of four FTEs.

Human Resources (Full-Time Equivalents [FTEs])
2015-16 Planned 2015-16 Actual 2015-16 Difference (actual minus planned)
30 26 (4)

The lower than planned FTE count is due to the combined challenges of staff turnover in positions linked to sunsetting programs, as well as the difficulty of hiring in the North.

Performance Results
Expected Results Performance Indicators Targets Actual Results
Policies, programs and initiatives that are effective in strengthening the northern Canadian economy, thereby enabling Northerners to access business and community development opportunities Composite of performance indicators for the Economic Development Program and the related Sub-Programs of Business Development and Community Development Meet or exceed at least 2/3 of targets identified in Program 1.1 and the related Sub-Programs 5/7 indicators met.

Internal Services

Description

Internal Services are groups of related activities and resources that are administered to support the needs of programs and other corporate obligations of an organization. These groups 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, Acquisition Services, and Other Administrative Services. Internal Services include only those activities and resources that apply across an organization and not to those provided specifically to a program.

Program Performance Analysis and Lessons Learned

CanNor continued to provide learning opportunities, coaching and mentorship to employees, raising awareness of employment opportunities and innovative programs that attract and retain Inuit employees to the Agency.

Over the course of 2015-16, CanNor Communications made significant strides in preparing for migration to Canada.ca in 2016-17. All of CanNor's web content was analyzed for accuracy and relevance. Further, major portions were updated and re-written to reflect current priorities and to follow the new style guide for posting in the next fiscal year.

The Agency worked to prepare its information systems and employees for the implementation of two new government-wide HR systems, Phoenix and MyGCHR. Employees were provided with training and assistance to prepare for the future implementation of other information management and email transformation. CanNor also worked closely with other RDAs to identify common requirements and plan the development of a new shared system for the management of grants and contributions.

CanNor more actively managed relationships with the Agency's service partners to ensure CanNor has the tools and services in place to deliver in its unique operating environment. CanNor also anticipated changes to its operating environment, and used the transformation to enhance data integrity and management.

Budgetary Financial Resources (dollars)
2015-16
Main Estimates
2015-16
Planned Spending
2015-16
Total Authorities Available for Use
2015-16
Actual Spending
(authorities used)
2015-16
Difference
(actual minus planned)
5,314,388 5,314,388 5,876,435 6,327,746 1,013,358

Actual spending was greater than planned by $1 million and total authorities available for use was increased by $560 thousand due to the allocation of funds available from the operating budget carry forward. The current difference is a result of several years of accumulated increases in Crown housing, salaries, and other northern operating costs, compared to related funding levels which have remained constant since 2009. The Agency is currently exploring options for rationalizing its Internal Services costs and ensuring a longer-term, more sustainable funding model.

Human Resources (FTEs)
2015-16 Planned 2015-16 Actual 2015-16 Difference (actual minus planned)
28 28 0

Staffing in internal services has been stable over the year.

Section IV: Supplementary Information

Supporting Information on Lower-Level Programs

Supporting information on lower-level programsEndnote 13 is available on CanNor's website.

Supplementary Information Tables

The following supplementary information tablesEndnote 14 are available on CanNor's website.

  • Departmental Sustainable Development Strategy
  • Details on Transfer Payment Programs of $5 Million or More
  • Internal Audits and Evaluations

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 annually in the Report of Federal Tax ExpendituresEndnote 15. 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

Canadian Northern Economic Development Agency

Inuksugait Plaza II, P.O. Box 40
Iqaluit, Nunavut X0A 0H0
Canada

Web: CanNor

Appendix: Definitions

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 Performance Report (rapport ministériel sur le rendement): Reports on an appropriated organization's actual accomplishments against the plans, priorities and expected results set out in the corresponding Reports on Plans and Priorities. These reports are tabled in Parliament in the fall.

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.

Government of Canada outcomes (résultats du gouvernement du Canada): A set of 16 high-level objectives defined for the government as a whole, grouped in four spending areas: economic affairs, social affairs, international affairs and government affairs.

Management, Resources and Results Structure (Structure de la 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.

planned spending (dépenses prévues): For Reports on Plans and Priorities (RPPs) and Departmental Performance Reports (DPRs), 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 RPPs and DPRs.

plans (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.

priorities (priorité): Plans or projects 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).

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.

Report on Plans and Priorities (rapport sur les plans et les priorités): Provides information on the plans and expected performance of appropriated organizations over a three-year period. These reports are tabled in Parliament each spring.

results (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.

Whole-of-government framework (cadre pangouvernemental): Maps the financial contributions of federal organizations receiving appropriations by aligning their Programs to a set of 16 government-wide, high-level outcome areas, grouped under four spending areas.

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