Archived — 2016–17 Report on Plans and Priorities

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Section I: Organizational Expenditure Overview

Organizational Profile

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

Minister of Science:
The Honourable Kirsty Duncan, P.C., M.P.

Minister of Small Business and Tourism:
The Honourable Bardish Chagger, P.C., M.P

President:
Nancy Horsman

Ministerial Portfolio:
Innovation, Science and Economic Development

Enabling Instrument:
Order in Council P.C. 2009–1410 dated August 13, 2009, amending Schedule I.1 of the Financial Administration ActEndnote v to include the Federal Economic Development Agency for Southern Ontario as a department.

Order in Council P.C. 2009–1411 dated August 13, 2009, whereby the Department of Industry transferred to the Federal Economic Development Agency for Southern Ontario the control and supervision of the portion of the federal administration in the Department of Industry known as the Southern Ontario Regional Economic Branch.

Year of Incorporation / Commencement:
2009

Organizational Context

Raison d'être

The Federal Economic Development Agency for Southern Ontario (FedDev Ontario) was established in 2009 to support economic growth in southern Ontario through the delivery of federal programs and services.

In 2013, FedDev Ontario's mandate was renewed for a second five-year term, from 2014–15 to 2018–19. Budget 2013 provided the Agency with $920 million in core funding for this five-year period, with a renewed commitment to strengthen the region's capacity for innovation, entrepreneurship and collaboration and to promote the development of a strong and diversified southern Ontario economy.

Responsibilities

FedDev Ontario's mandate is to support economic growth and competitiveness in southern Ontario. As one of the federal departments and agencies that make up the ISED portfolio, FedDev Ontario supports a number of the Government of Canada's commitments, including helping Canadian businesses grow, innovate and export in order to create good-quality jobs and wealth for Canadians; and working with stakeholders to improve the impact of programs to support innovation and entrepreneurship.

To achieve its mandate, FedDev Ontario delivers three core transfer payment programs designed to address specific opportunities and challenges facing the region: the Southern Ontario Prosperity Initiatives; the Advanced Manufacturing Fund; and the Eastern Ontario Development Program. FedDev Ontario, like other regional development agencies across the country, also plays an important role as a federal delivery agent for national programs, specifically the Community Futures Program, the Economic Development Initiative, the Canada 150 Community Infrastructure Program, and certain national infrastructure programs across the province of Ontario. The Agency also delivers special projects such as the $8 million investment to fund the revitalization of Toronto's Massey Hall and a $12 million grant for the remediation of a former industrial site in the city of Brantford, Ontario.

FedDev Ontario also delivers services at the regional level to firms and other stakeholders on national initiatives. In this regard, the Agency works with southern Ontario firms to identify opportunities to participate in defence procurement projects in support of the Industrial and Technological Benefits Policy. The Agency also operates Canada Business Ontario (part of the Canada Business Network), which helps entrepreneurs gain access to government business information, such as available funding opportunities.

With its headquarters in Waterloo and offices in Toronto, Peterborough and Ottawa, FedDev Ontario provides a strong federal presence across southern Ontario and facilitates collaboration with a broad range of stakeholders, including post-secondary institutions, not-for-profit organizations, municipal and provincial governments, Indigenous communities and private sector firms. The Agency plays an important role in convening key regional stakeholders to enable more seamless support to businesses and other organizations within the region, with a particular emphasis on working closely with the Government of Ontario and key federal departments and agencies to ensure complementary approaches in supporting the southern Ontario economy. In addition, through ongoing partnerships with other federal departments and agencies, FedDev Ontario ensures that the perspectives of southern Ontario are reflected in decision-making at the federal level.

The Agency is focusing its activities in 2016–17 through four areas as defined in its Program Alignment Architecture (PAA):

Technological Innovation:

FedDev Ontario facilitates business-led partnerships with post-secondary institutions and research institutions to support the creation of new products, services, processes and markets. The Agency also promotes the continued growth and increased productivity of Ontario's manufacturing sector by supporting transformative advanced manufacturing activities; advancing adoption of cutting-edge technologies; establishing clusters or global supply chains; and fostering collaboration between the private sector and post-secondary and research institutions.

Business Development:

FedDev Ontario supports a broad spectrum of firms at various stages of growth. Agency investments help early-stage companies and entrepreneurs to access capital and develop the necessary skills to grow their businesses and commercialize their innovations; help more established businesses improve productivity; support scale-up of businesses to effectively compete in global markets; and support business integration into global value chains.

Community Economic Development:

FedDev Ontario leverages regional assets to support economic diversification and growth in communities across southern Ontario. The Agency supports community-based organizations that provide southern Ontario firms with the information, training and loans they need to sustain and grow their businesses. It also delivers national infrastructure programs that benefit communities across southern Ontario.

Internal Services:

FedDev Ontario's internal services include policy and research activities that enable the Agency to effectively communicate the region's interests in national and regional policy discussions, champion the region's assets, and convene stakeholders to respond to regional challenges and opportunities. Through this area, the Agency also undertakes activities required for its ongoing operation.

Scope of Operations

FedDev Ontario's mandate covers southern Ontario, as defined by the following 37 Statistics Canada census divisions:

  • Stormont, Dundas and Glengarry
  • Kawartha Lakes
  • Niagara
  • Middlesex
  • Prescott and Russell
  • Peterborough
  • Haldimand–Norfolk
  • Huron
  • Ottawa
  • Durham
  • Halton
  • Essex
  • Brant
  • Bruce
  • Leeds and Grenville
  • York
  • Waterloo
  • Grey
  • Lanark
  • Toronto
  • Perth
  • Simcoe
  • Frontenac
  • Northumberland
  • Hamilton
  • Peel
  • Oxford
  • Haliburton
  • Lennox and Addington
  • Dufferin
  • Elgin
  • Renfrew
  • Hastings
  • Wellington
  • Chatham–Kent
  • Prince Edward
  • Lambton
Figure 1 - Federal Economic Development Agency for Southern Ontario (FedDev Ontario) - Catchment Area and Census Divisions (the long description is located below the image)
Description of figure: FedDev Ontario - Catchment Area and Census Divisions

According to Statistics Canada's annual population estimates for 2015, this area has a population of more than 12 million, representing 94 percent of Ontario's total population and 36 percent of Canada's total population.

Strategic Outcome and Program Alignment Architecture

The 2016–17 PAA is consistent with the previous year's and reflects FedDev Ontario's areas of focus and activities, as well as its various roles in support of its innovative agenda aimed at promoting jobs, growth and prosperity across southern Ontario.

  1. 1. Strategic Outcome: A competitive southern Ontario economy
    1. Program 1.1: Technological Innovation
      1. Sub-Program 1.1.1: Advanced Manufacturing
      2. Sub-Program 1.1.2: Commercialization Partnerships
    2. Program 1.2: Business Development
      1. Sub-Program 1.2.1: Business Investment
      2. Sub-Program 1.2.2: Business Growth and Productivity
      3. Sub-Program 1.2.3: Business Services
    3. Program 1.3: Community Economic Development
      1. Sub-Program 1.3.1: Community Futures Program
      2. Sub-Program 1.3.2: Eastern Ontario Development Program
      3. Sub-Program 1.3.3: Official Language Minority Communities
      4. Sub-Program 1.3.4: Regional Diversification
      5. Sub-Program 1.3.5: Infrastructure Delivery
  2. Internal Services

Organizational Priorities

Priority: Support efforts to develop an Innovation Agenda

Description
Supporting businesses and sectors to increase productivity and innovation is a priority for the ISED portfolio. This priority includes helping businesses grow, innovate and export through strategic investments in key growth sectors; working with incubators and accelerators; engaging key stakeholders; and collaborating across all regional development agencies and with other members of the ISED portfolio, other federal partners and the Province of Ontario.

Priority typeFootnote 1
New.

Key Supporting Initiatives
Key Supporting Initiatives
Planned Initiatives Start Date End Date Link to Department's Program Alignment Architecture

Leverage Ontario's capacity for innovation through investments in large-scale transformative advanced manufacturing projects, to support Ontario's competitiveness in global markets

April 2014 March 2019 1.1.1 – Advanced Manufacturing

Collaborate with other stakeholders to support sectors of competitive advantage and strategic importance to Ontario, such as health and life sciences, information and communication technologies and clean technologies

April 2014 March 2019 1.1.2 – Commercialization Partnerships

Continue to support investments that build the region's innovation capacity and support cluster development, including work with regional incubators and accelerators

April 2014 March 2019 1.3.4 – Regional Diversification

Strengthen networks between businesses, governments, post-secondary institutions and not-for-profit organizations

April 2014 March 2019 1.1 – Technological Innovation

Continue to collaborate with ISED portfolio partners, federal departments and agencies, the Province of Ontario and stakeholders to advance innovation

April 2014 March 2019 1.1 – Technological Innovation
1.2 – Business Development
1.3 – Community Economic Development
Internal Services
Priority: Foster business and community economic development

Description
The long-term economic competitiveness and prosperity of southern Ontario greatly depends on the success of its small and medium-sized businesses and the ability of its communities to diversify and build on regional advantages to encourage economic growth and sustainability.

Priority type
New.

Key Supporting Initiatives
Key Supporting Initiatives
Planned Initiatives Start Date End Date Link to Department's Program Alignment Architecture

Support greater productivity and improve the competitiveness of southern Ontario businesses through mentorship and entrepreneurial support, access to capital, and partnering with investment networks (including venture capitalists and angel investors) to increase investments in high growth/high potential firms

April 2014 March 2019 1.2.1 – Business Investment

Through Canada Business Ontario, continue to act as primary point of contact for entrepreneurs and business clients seeking information on starting or growing their business

June 2013 Ongoing 1.2.3 – Business Services

Represent southern Ontario interests through ongoing involvement in defence procurement opportunities, facilitating connections between firms, and promoting the capabilities of southern Ontario companies to defence contractors with Industrial and Technological Benefits obligations

April 2013 March 2019 1.2.3 – Business Services

Invest strategically to support economic diversification and to build on competitive regional advantages in communities throughout southern Ontario through continued collaboration with Community Futures Development Corporations, along with Francophone and Indigenous communities

April 2014 March 2019 1.3 – Community Economic Development

Invest in the rehabilitation, renovation and expansion of community infrastructure through the Canada 150 Community Infrastructure Program

April 2016 March 2018 1.3.5 – Infrastructure Delivery
Priority: Advance the interests of the region

Description
In addition to providing funding to eligible recipients, FedDev Ontario can advance the competitiveness of southern Ontario’s economy by promoting regional benefits to key stakeholders and by communicating back to Ottawa at the federal level to ensure that the region’s perspectives are reflected in decision-making.

Priority type
New.

Key Supporting Initiatives
Key Supporting Initiatives
Planned Initiatives Start Date End Date Link to Department's Program Alignment Architecture

Leverage the newly created ISED portfolio to enhance coordination of efforts within Ontario and across regional development agencies

November 2015 To be determined 1.1 – Technological Innovation
1.2 – Business Development
1.3 – Community Economic Development

Encourage collaborative ventures that maximize benefits to the southern Ontario economy through FedDev Ontario's role as a regional champion and convenor of stakeholders across the region

April 2014 March 2019 1.2.3 – Business Services
Internal Services

Continue to engage with partners, stakeholders, other federal departments and the provincial government to develop opportunities for collaboration and partnership

April 2014 March 2019 Internal Services

Gather regional intelligence and serve as a bridge between the region and Ottawa

April 2014 March 2019 Internal Services

Convey evidence-based Agency impacts and results to demonstrate the region's economic contribution to Canada's economic growth and well-being

April 2014 March 2019 Internal Services
Priority: Strengthen internal operations

Description
Efficient and effective internal operations are essential for ensuring continued support for FedDev Ontario's program delivery and external engagement activities. To help support the Agency's objectives, the following activities will be undertaken: ongoing focus on research, policy development and evaluation to ensure activities respond to regional needs; the continued use of new and innovative communication tools to bring greater awareness of the Agency's activities; and back office improvements through enterprise systems, streamlined processes and effective talent management to ensure ongoing client service excellence.

Priority type
Ongoing.

Key Supporting Initiatives
Key Supporting Initiatives
Planned Initiatives Start Date End Date Link to Department's Program Alignment Architecture

Undertake implementation reviews and evaluations of new FedDev Ontario programming to ensure Agency programs and initiatives meet their intended objectives; examine opportunities for increased efficiency and effectiveness

April 2014 March 2019 Internal Services

Strengthen performance measurement efforts and demonstration of results of Agency's activities

April 2014 March 2019 1.1 – Technological Innovation
1.2 – Business Development
1.3 – Community Economic Development

Strengthen open and transparent government through the implementation of an Open Data initiative while effectively balancing privacy, confidentiality and security of information

April 2014 March 2017 Internal Services

Promote a flexible and innovative workplace in the spirit of Blueprint 2020 principles (modern, effective, efficient workplace)

April 2014 March 2019 Internal Services

Develop and implement technological solutions, including enterprise-wide systems, tools and training, to support the government's priority of business transformation

April 2014 March 2019 Internal Services

Provide ongoing stewardship of public funds through the review and enhancement of the Agency's internal control mechanisms

April 2014 March 2019 Internal Services

For more information on organizational priorities, see the Minister's mandate letter on the Prime Minister of Canada's website.Endnote vi

Risk Analysis

Key Risks
Key Risks
Risk Risk Response Strategy Link to Program Alignment Architecture

Human Resource Management:
As a small Agency, there is a risk that the inability to recruit, retain and develop talent in key positions in offices outside the National Capital Region, particularly within the Agency's headquarters in Waterloo, will strain capacity and the Agency's ability to deliver on its mandate and support other government priorities

  • Support recruitment and ensure that pools of qualified candidates to staff positions in specialty areas are readily available; participate in activities such as student recruitment and career fairs; and increase social media presence to highlight employment opportunities at FedDev Ontario
  • Support the retention and development of talent throughout the Agency by promoting and maximizing the use of Canada School of Public Service learning resources in line with their new service delivery model
  • Encourage retention and support FedDev Ontario as an employer of choice by developing and implementing a Wellness Committee and a wellness strategy
1.1 – Technological Innovation
1.2 – Business Development
1.3 – Community Economic Development
Internal Services

Managing Information:
There is a risk that not having access to timely, complete, consistent and accurate information could affect the Agency's ability to meet legislative responsibilities and could diminish its organizational efficiency and effectiveness, as well as the quality of its decision-making

  • Implement Recordkeeping and Open Government Action Plans to contribute to effective information management practices
  • Continue to work collaboratively across the Agency to ensure that business needs are adequately supported through existing IT infrastructure and systems
  • Further institutionalize related practices to ensure information for decision-making is disseminated in a timely manner and is quickly accessible for all employees
  • Collaborate with federal partners on the development of an Enterprise Grants and Contributions Solution, subject to financial resource considerations
1.1 – Technological Innovation
1.2 – Business Development
1.3 – Community Economic Development
Internal Services

Demonstrating Agency Impacts:
There is a risk that FedDev Ontario's five-year funding cycle could limit the Agency's ability to support strategic and complex investments and fully sustain its role as convenor and champion for the region over the long term, creating uncertainty for stakeholders and partners

  • Continue to invest in projects that can bring long-term benefits to southern Ontario by leveraging funding from other partners and by convening sustainable partnerships
  • Organize roundtables with stakeholders to discuss impact of current programming and areas for improvement
  • Develop a business case for renewal of programming with options for providing ongoing support for strategic and complex investments in southern Ontario
1.1 – Technological Innovation
1.2 – Business Development
1.3 – Community Economic Development
Internal Services

Planned Expenditures

Budgetary Financial Resources (dollars)
2016–17
Main Estimates
2016–17
Planned Spending
2017–18
Planned Spending
2018–19
Planned Spending
234,447,852 234,447,852 220,375,907 184,983,723
Human Resources (Full-Time Equivalents [FTEs])
2016–17 2017–18 2018–19
232 232 220
Budgetary Planning Summary for Strategic Outcome and Programs (dollars)
Strategic Outcome(s), Program(s) and Internal Services 2013–14
Expenditures
2014–15
Expenditures
2015–16
Forecast Spending
2016–17
Main Estimates
2016–17
Planned Spending
2017–18
Planned Spending
2018–19
Planned Spending
Strategic Outcome: A competitive southern Ontario economy
1.1 Technological Innovation 56,430,801 9,298,340 70,894,043 92,081,080 92,081,080 91,951,369 81,088,722
1.2 Business Development 87,659,299 49,467,300 62,733,724 58,571,582 58,571,582 56,898,029 55,188,671
1.3 Community Economic Development 71,120,480 27,689,452 49,011,797 66,896,145 66,896,145 55,389,017 31,802,326
Subtotal 215,210,580 86,455,092 182,639,564 217,548,807 217,548,807 204,238,415 168,079,719
Internal Services Subtotal 19,069,825 17,648,051 16,197,838 16,899,045 16,899,045 16,137,492 16,904,004
Total 234,280,405 104,103,143 198,837,402 234,447,852 234,447,852 220,375,907 184,983,723

FedDev Ontario is estimating budgetary expenditures of $234.4 million to support the achievement of its mandate in 2016–17. Of this amount, $205.5 million is allocated for transfer payments to fund projects under the Agency's three program areas in support of its strategic outcome. A further $28.9 million in operating funding has been allocated to support the delivery of programming; advance FedDev Ontario's presence as a convenor and champion for the region; and support all required Internal Services activities.

Entering the third year of its current five-year mandate, FedDev Ontario's programming is well positioned to support the Government of Canada's commitment to promote innovation. Through the Agency's Technological Innovation Program, $92.1 million has been earmarked to deliver projects through the Advanced Manufacturing Fund and the Investing in Commercialization Partnerships initiative. A further $125.5 million is targeted for project delivery through the Business Development and Community Economic Development Programs in 2016–17 to support projects with small and medium-sized businesses, not-for-profit organizations and communities.

In total, FedDev Ontario is estimating an increase of $19.2 million, or nine percent, from its 2015–16 Main Estimates. This is a result of an increase of $22.2 million for the new two-year Canada 150 Community Infrastructure Program and a $9.6 million payment to support a remediation project in Brantford, Ontario, offset by a reduction of $12.6 million to existing programming from the previous year.

Ensuring the strategic allocation of both financial and non-financial resources is critical to the overall success of the Agency. To this end, FedDev Ontario is estimating 232 full-time equivalents (FTEs) in 2016–17 to support the delivery of its programming suite, as well as carrying out its non-financial activities and ensuring the ongoing administration of its internal support services.

The reduction to FedDev Ontario's planned spending in future years is primarily the result of the completion of the Canada 150 Community Infrastructure Program and the project with the City of Brantford. The conclusion of the Building Canada Fund – Communities Component, which FedDev Ontario delivers on behalf of Infrastructure Canada, also helps to explain planned spending reductions beginning in 2017–18.

Alignment of Spending With the Whole-of-Government Framework

Alignment of 2016–17 Planned Spending With the Whole-of-Government FrameworkEndnote vii (dollars)
Strategic Outcome Program Spending Area Government of Canada Outcome 2016–17
Planned Spending
A competitive southern Ontario economy Technological Innovation Economic Affairs An innovative and knowledge-based economy 92,081,080
Business Development Economic Affairs Strong economic growth 58,571,582
Community Economic Development Economic Affairs Strong economic growth 66,896,145
Total Planned Spending by Spending Area (dollars)
Spending Area Total Planned Spending
Economic affairs 217,548,807

Departmental Spending Trend

Departmental Spending Trend Graph
Bar graph of Departmental Spending Trend
Description of figure: Departmental Spending Trend
Departmental Spending Trend Graph
2013–14 2014–15 2015–16 2016–17 2017–18 2018–19
Sunset Programs – Anticipated 0 0 0 0 0 0
Statuatory 3,223,378 3,056,870 3,153,140 3,214,356 3,018,698 3,018,354
Voted 231,057,027 101,046,273 210,455,999 231,233,496 217,357,209 181,965,369
Total 234,280,405 104,103,143 213,609,139 234,447,852 220,375,907 184,983,723

FedDev Ontario's spending trend over the three-year period beginning in 2016–17 represents the final three years of program delivery under its current five-year mandate, as well as time-limited spending on additional initiatives. Over the next three years, the majority of the Agency's funding will be delivered through its core programming, which is made up of the Advanced Manufacturing Fund, the Southern Ontario Prosperity Initiatives and the Eastern Ontario Development Program. The Agency will also continue to deliver national programming in southern Ontario through the Community Futures Program and the Economic Development Initiative.

FedDev Ontario's planned spending grows by $22.2 million in both 2016–17 and 2017–18 due to the delivery of the two-year Canada 150 Community Infrastructure Program. Planned spending in 2016–17 is also augmented to reflect the final year of payments for the remediation of the Greenwich–Mohawk brownfields in Brantford, Ontario.

It is of note that the significant drop in actual spending in 2014–15 can be attributed to a variety of factors. First, FedDev Ontario's five-year mandate and flat-line annual budget establish equal year-over-year spending expectations that are not necessarily reflective of the lifecycle of the types of transformative, multi-year projects funded by the Agency. Second, project proponents take time to understand new programming and its benefits, so they need extra time to develop project applications. Third, after applications are received, it takes time for assessment, due diligence and the signing of contribution agreements that clearly outline terms and conditions of federal funding. And, finally, many of FedDev Ontario's projects are multi-year in nature, and historical trends have shown that a majority of costs for these types of projects are typically incurred after the first year. As a result, lower eligible project costs were incurred before the end of 2014–15, leading to lower than forecast Agency expenditures. It is of note that in FedDev Ontario's first five-year mandate, lapsed funding was largest in the early years and decreased in each subsequent year as projects progressed and achieved results.

Recognizing that FedDev Ontario would be challenged to expend its full transfer payment budget in its first year of its renewed five-year mandate, the Agency was able to successfully reallocate a portion of its unspent funding through the Advanced Manufacturing Fund and the Massey Hall revitalization project to future years. This increased future funding is reflected in the above planned spending figures and will enable FedDev Ontario to maximize the impact that its suite of programming will have on the southern Ontario economy.

Estimates by Vote

For information on FedDev Ontario's organizational appropriations, consult the 2016–17 Main Estimates.Endnote viii

Footnotes

Footnote 1

Type is defined as follows: previously committed to—committed to in the first or second fiscal year prior to the subject year of the report; ongoing—committed to at least three fiscal years prior to the subject year of the report; and new—newly committed to in the reporting year of the Report on Plans and Priorities or the Departmental Performance Report. Note that Agency activities and planned initiatives for each priority may already be underway.

Return to footnote 1 referrer

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