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Minister’s Message

As Minister of the Canadian Northern Economic Development Agency, or CanNor, I am pleased to present to Parliament and the people of Canada the Agency’s Report on Plans and Priorities for 2011–2012.

When the Prime Minister announced the creation of CanNor in August 2009 in Iqaluit, Nunavut, it was an honour for me to be part of the event and to share in the celebration of this important milestone in the implementation of the government's Northern Strategy. Now, as CanNor begins its second full year of operation, it is an even greater honour for me to be leading the Agency as its Minister.

In the months since it was established, CanNor has made great strides. Regional offices have been established in all three of the territorial capitals and the Agency's headquarters building is under construction in Iqaluit. CanNor delivered its core programs — the Strategic Investments in Northern Economic Development initiative and a suite of Aboriginal business and economic development initiatives — but also successfully led the implementation of Canada's Economic Action Plan in the North. At the same time, CanNor worked to fulfill the government's vision for the Agency by establishing the Northern Projects Management Office and collaborating with regulators and developers to co-ordinate and streamline federal regulatory processes in the territories.

Looking forward, CanNor will continue to play a leaderhip role in fostering economic development in Canada's North. Economic growth in Canada's North is an important part of the nation's recovery from the global economic downturn. CanNor will continue to work in partnership with territorial governments, businesses, northern Aboriginal people and other federal departments to support the development of key economic sectors and to lay the foundation for future growth and economic diversification across northern communities.

CanNor’s core strength is its presence in the North and the breadth of its network of partners. The Agency leverages this strength to gain maximum advantage from its program investments and to help other federal departments, other levels of government and other stakeholders in northern economic development achieve better returns on their own investments of effort and resources in the territories.

In the coming year, CanNor will continue to drive progress in northern economic development, in the co-ordination of federal activities in the North, and in laying the foundations for long-term sustainable development in northern communities. I look forward to sharing CanNor’s achievements in future reports to Parliament.

 

Section I — Departmental Overview

Raison d’être

Responsibilities

The 2008 Speech from the Throne committed to establishing Canada’s first stand-alone agency dedicated to northern economic development. In January 2009, CanNor was announced in the Federal Budget. The Agency was formally created eight months later in August 2009 when Prime Minister Stephen Harper announced the creation of CanNor and the establishment of its headquarters in Iqaluit. CanNor has since established regional offices in all three northern capitals, as well as a liaison office in Ottawa. After operating for 19 months, CanNor will be entering its second full fiscal year of operation in 2011–2012.

The Minister responsible for CanNor is also the Minister of Health. The Agency is led by a President, who is also CanNor’s Deputy Minister. CanNor operates as an independent federal department under Schedule I.1 of the Financial Administration Act.

In May of 2010, CanNor marked an important milestone with the opening of the Northern Projects Management Office (NPMO). The NPMO supports economic development in the North by co-ordinating federal regulators and working to ensure the timeliness, transparency and predictability of federal regulatory processes on northern projects. Further, the NPMO has an important role in helping federal departments and project proponents undertake Aboriginal consultation in the territories.

CanNor is one of six regional economic development agencies. Beyond delivering its own programs, the Agency fulfils the same role as other regional economic development agencies, such as co-ordination and delivery of a number of federal programs at the regional level, including Aboriginal economic development programs on behalf of Indian and Northern Affairs Canada, infrastructure programming on behalf of Infrastructure Canada, and economic development programming for official language minority communities on behalf of Industry Canada. CanNor also works closely with Human Resources and Skills Development Canada on interventions targeting skills needed for the growing northern economy. Like all regional development agencies, CanNor is the host department for the three Regional Federal Councils in the territories.

Contribution to the Federal Sustainable Development Strategy

CanNor is not required to report under the Federal Sustainable Development Act but nonetheless adheres to the Act’s principles. Many of CanNor’s activities contribute positively to addressing climate change and air quality, maintaining water quality, protecting nature, and shrinking the government’s environmental footprint. The Agency is committed to the use of information and communication technologies to reduce the impact of the geographic distance between its offices while also reducing some of the environmental impacts arising from its operations. CanNor is also committed to the Policy on Green Procurement and is integrating green procurement considerations into its contracting processes.

Strategic Outcome and Program Activity Architecture

 

CanNor Program Activity Architecture

Government of Canada Outcome: Strong Economic Growth

CanNor Strategic Outcome	Program Activities	Program Sub-activities
Developed and diversified territorial economies that support prosperity for all Northerners Tag Legend Theme I: Addressing Climate Change and Air Quality Theme II: Maintaining Water Quality and Availability Theme III: Protecting Nature Theme IV: Shrinking the Environmental Footprint — Beginning with Government	1.1 Business Development	1.1.1 Innovation and Knowledge 1.1.2 Entrepreneurship 1.1.3 Sectoral Development
	1.2 Community Development	1.2.1 Aboriginal Economic Development 1.2.2 Community Adjustment 1.2.3 Capacity and Skills Development 1.2.4 Infrastructure
	1.3 Policy, Advocacy and Co-ordination	1.3.1 Policy 1.3.2 Advocacy 1.3.3 Co-ordination
	1.4 Internal Services	1.4.1 Governance and Management Support 1.4.2 Resource Management Services 1.4.3 Asset Management Services

 

Planning Summary

Financial Resources ($ millions)

2011–2012	2012–2013	2013–2014
44,179	44,179	44,043

 

Human Resources (Full-time Equivalents — FTEs)

2011–2012	2012–2013	2013–2014
105	105	105

CanNor’s total budget in 2010–2011 was $61.2 million. The Agency’s important role in the delivery of the Community Adjustment Fund and Recreational Infrastructure Canada Program in the territories as the lead department for the implementation of Canada’s Economic Action Plan in the North brought a budget increase in 2009–2010 and 2010–2011. CanNor delivered these programs without increasing in size, so no downward adjustment will be made to the size of the Agency’s team after these programs have sunset.

For 2011–2012, CanNor’s activities focus on the delivery of the Strategic Investments in Northern Economic Development Program (which received funding to March 31, 2014, under Canada’s Economic Action Plan), the ongoing work of the Northern Projects Management Office, and delivery of the suite of Aboriginal economic development programs, infrastructure programs and other initiatives for which CanNor is responsible on behalf of other departments. CanNor will also invest effort and resources in co-ordinating federal activities in the North and working with partners to respond to economic development challenges across northern communities.

The following table identifies CanNor’s program activities, program targets and allocated resources; it also provides details on how CanNor’s work contributes to the broader outcomes of the Government of Canada. CanNor works toward its strategic outcome by supporting business and community development and by undertaking policy advocacy and federal co-ordination. These program activities depend on internal corporate and enabling services.

In its first year of operation, CanNor invested time and resources into the development of a Performance Measurement Framework that includes indicators for the measurement of program success. In its second year of operation, CanNor will establish baseline data and benchmarks for these indicators and for measuring the outcomes of its program activities as well as their contributions to CanNor’s strategic outcome. This means that, for fiscal year 2011–2012, targets established for program delivery relate only to program outputs. In future Reports on Plans and Priorities, program targets for outcomes will be established based on the baseline data and benchmarks gathered and developed by the Agency in 2011–2012.

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

Performance Indicators	Targets*
Economic Development Stakeholder / partner / client satisfaction Total CanNor annual funding plus amount of funding leveraged	Targets will be established based on benchmarks developed in 2011–2012
Diversification Distribution of CanNor investments and projects by economic sector	Targets will be established based on benchmarks developed in 2011–2012
Increased Prosperity Business development arising from CanNor investments Improved foundations for economic growth in northern communities	Targets will be established based on benchmarks developed in 2011–2012
Effective Program Implementation Percentage of projects undertaken that successfully met / exceeded performance targets	Targets will be established based on benchmarks developed in 2011–2012

* Note: In its first year of operation, CanNor invested time and resources into the development of a Performance Measurement Framework that includes indicators for the measurement of program success. In its second year of operation, CanNor will establish baseline data and benchmarks for these indicators and for measuring the outcomes of its program activities, as well as their contributions to CanNor’s strategic outcome. This means that, for fiscal year 2011–2012, targets established for program delivery relate only to program outputs. In future Reports on Plans and Priorities, program targets for outcomes will be established based on the baseline data and benchmarks gathered and developed by the Agency in 2011–2012.

Program Activity	Forecast Spending 2010–2011 ($000s)	Planned Spending ($000s)			Alignment to Government of Canada Outcomes
		2011–2012	2012–2013	2013–2014
Business Development	$6,156	$6,156	$6,156	$6,137	Strong economic growth
Community Development	$47,823	$30,799	$30,799	$30,704	Strong economic growth
Policy Advocacy and Federal Co-ordination	$5,473	$5,473	$5,473	$5,456	Strong economic growth
Internal Services	$1,751	$1,751	$1,751	$1,746	N/A
Total Planned Spending		$44,179	$44,179	$44,043

 

Contribution of Priorities to Strategic Outcome

CanNor has four immediate priorities:

1. Achieving excellence in program delivery;
2. Building a strong agency;
3. Launching the Northern Projects Management Office; and
4. Promoting a strategic approach to northern development.

Operational Priorities	Type*	Links to Strategic Outcome	Description
Excellence in program delivery	New	Developed and diversified territorial economies that support prosperity for all Northerners	Why is this a priority? CanNor’s programs support economic development in a wide range of sectors and in communities across the North. A wide variety of regional and community organizations as well as businesses rely on CanNor for efficient and effective program delivery. Plans for meeting the priority Continuously refine and improve CanNor business processes and program delivery. Continue to foster strong working relationships with partners and stakeholders.
Building a strong agency	New	Developed and diversified territorial economies that support prosperity for all Northerners	Why is this a priority? CanNor is a key component of the government’s Northern Strategy and the first federal department with its headquarters in the North. CanNor’s programs make important contributions to economic development across the territories. Plans for meeting the priority Strengthen CanNor’s headquarters presence in Iqaluit and its regional offices in all three northern capitals. Continue to improve program delivery, key engagement and co-ordination activities, policy development and strategic planning, as well as communications and outreach.
Building relationships with Northerners and federal government partners to promote a strategic approach to northern development	New	Developed and diversified territorial economies that support prosperity for all Northerners	Why is this a priority? A key aspect of CanNor’s role and functions is to build partnerships and co-ordinate action among stakeholders in the North and federal departments to help strengthen community and economic development in the territories. Plans for meeting the priority Collaborate with key northern and federal government partners on infrastructure, skills and entrepreneurial capacity, regulatory processes and improvement, business development, and natural resource development in the North. Work with federal departments to increasingly align federal investments to improve the impacts of federal activities and programs.
Establish the Northern Projects Management Office (NPMO)	New	Developed and diversified territorial economies that support prosperity for all Northerners	Why is this a priority? The NPMO’s regulatory co-ordination and outreach function is critical to regulatory improvement in the North and to the efficient regulatory review of northern projects. Plans for meeting the priority Work with federal regulatory departments, northern environmental assessment and regulatory boards, and private sector project proponents to facilitate and co-ordinate the efficient regulatory review of northern project proposals.

Management Priorities	Type*	Links to Strategic Outcome	Description
Excellent internal management	New	Developed and diversified territorial economies that support prosperity for all Northerners	Why is this a priority? It generally takes three to five years to build a new public institution and be fully operational. Taking measures to ensure a solid organizational foundation results in operational efficiency and effectiveness. Plans for meeting the priority Information management practices will be developed and implemented. Corporate Secretariat services and procedures will be developed and implemented to ensure high-quality support to the Agency’s senior management committee and the Minister. Corporate policies and procedures will be developed and implemented. Progress with the implementation of the Agency’s administrative systems and revisions to the Agency’s business processes will form an input to the Treasury Board Secretariat performance assessment framework, as part of the government’s Management Accountability Framework.
Excellent human resources management	New	Developed and diversified territorial economies that support prosperity for all Northerners	Why is this a priority? Employees are a critical CanNor asset. Working for an Agency in its infancy can be challenging at times, so the success of CanNor depends on employee engagement and continuity. Plans for meeting the priority Promote a corporate culture of excellence based on integrity, trust, respect and service. Develop a human resources strategy in line with the renewal of the Public Service to identify current status, requirements and gaps, staffing priorities, and training requirements. Develop innovative recruitment strategies to target Northerners. Seek opportunities to encourage mobility between regional offices. Develop clear performance management agreements linked to the Agency’s priorities for all executives. Require all staff to complete an employee performance management form and a learning plan.
Performance measurement	New	Developed and diversified territorial economies that support prosperity for all Northerners	Why is this a priority? In 2010–2011, CanNor finalized its Performance Measurement Framework. In 2011–2012, CanNor will gather baseline program data and information with the goal of establishing benchmarks for program outcomes. Plans for meeting the priority Develop a data collection strategy to effectively track data related to performance measurement. Introduce a performance reporting process to track progress against established performance targets and support organizational decision making.

* Note: All priorities are considered new because the Agency was established in August 2009. Fiscal year 2010–2011 was its first full year of operation.

Risk Analysis

CanNor delivers its programs in a singular operational and business environment. Business development in the North needs to deal with the exigencies of the climate, remote communities, sparse population, dependence on natural resource extraction and associated challenges, such as underdeveloped infrastructure. Program delivery in the North therefore requires a strong focus on risk management and mitigation.

CanNor has identified six key risk areas:

1. operational environment;
2. human and knowledge capital;
3. alignment with priorities and needs;
4. clients, partners and stakeholders;
5. public communications; and
6. legal, statutory and land claims.

Operational Environment. The North’s tremendous economic potential is coupled with enormous challenges in the delivery of economic development programming and regulatory co-ordination in the Arctic. Even the large centres in the three territories are far from markets, and economic and community infrastructure is limited. Logistics are challenging in the North and the cost of doing business is very high. CanNor needs to manage operational costs related to maintaining offices in the North. At the same time, as a new organization, CanNor must develop the suite of tools, practices, policies and procedures required to operate effectively as a federal government department. To manage this risk, CanNor has undertaken a staged plan for the management of office accommodation and the establishment of its headquarters in Iqaluit. In its policy and procedures development, the Agency is also working to ensure that business processes and tools are appropriate to the northern operating environment.

Human and Knowledge Capital. CanNor must manage the risks associated with maintaining a sufficient and representative workforce with the appropriate skill mix, as well as timely access to complete and appropriate information for effective operations and decision making. To manage recruitment and retention of skilled staff in the small northern labour market, CanNor is implementing a comprehensive human resources plan. CanNor has also undertaken alternative methods of hiring, such as engaging highly skilled personnel for short-term engagements to fill critical needs and establish the organizational foundation for the new Agency. These employees are also working to transfer their knowledge to long-term CanNor staff.

Alignment with Priorities and Needs. As a new organization in a specialized environment, CanNor has to give careful consideration to its organizational alignment of activities, priorities and financial resources to meet service expectations or organizational priorities. Risks relate to ensuring that scarce resources are allocated to priority activities. Mitigation tools include CanNor’s Program Activity Architecture (which clearly identifies the Agency’s business lines) and its Integrated Business Plan. CanNor is revising and standardizing its business processes and is also developing a strategic policy framework and economic research function to refine the Agency’s goals and priorities.

Clients, Partners and Stakeholders. Most of CanNor’s program delivery involves some element of partnership or collaboration, making it critical that the Agency manage risks associated with other actors in economic development. But as collaboration creates the risk it also mitigates it. CanNor has worked with partners across all three territories to develop consensus on five-year investment plans for the Strategic Investments in Northern Economic Development Program. CanNor is also working closely with Aboriginal economic development organizations to influence federal programming so that it aligns well with the needs of northern Aboriginal people. CanNor has established a model for collaboration with federal departments, such as Human Resources and Skills Development Canada, through memoranda of understanding. The Northern Projects Management Office is developing a variety of tools to be used to co-ordinate federal regulatory activities relating to major development projects in the North. These are examples of the Agency’s important role as a convenor of diverse interests.

Public Communications. In support of its mandate, CanNor must: effectively communicate its role and activities under the government’s Northern Strategy and Canada’s Economic Action Plan; provide information on program delivery successes; engage the public, partners and stakeholders; and deliver consistent messages about the Agency so that Canadians understand its role and functions. Inaccurate or negative perceptions about CanNor can develop as a result of ineffective communications. To manage public communications, CanNor employs a suite of tools, including communications plans, engagement activities and standard business practices for announcements, media relations, and outreach.

Legal, Statutory and Land Claims. A number of policies and legislative requirements set the context for CanNor’s operations. CanNor must also adhere to the terms of Aboriginal land claim and self-government agreements in the North. These agreements also influence the regulatory environment in which the Northern Projects Management Office must operate. To align with statutory and other legal requirements, CanNor is designing its own internal practices and models for business delivery. CanNor is striving to reflect in these practices the role played by comprehensive land claims and Aboriginal self government agreements in the North.

Expenditure Profile

The following figure illustrates CanNor’s spending trend from 2010–2011 to 2013–2014. Because CanNor was created in 2009–2010, no historical spending data exists for the Agency. Spending allocated from Canada’s Economic Action Plan (CEAP) is reflected in the total spending but also shown separately. While the Community Adjustment Fund and the Recreational Infrastructure Canada Program will not be renewed for fiscal year 2011–2012, the Strategic Investments in Northern Economic Development Program and CanNor’s base funding also form part of the Action Plan and will continue to fiscal year 2013–2014.

[D]

 

Estimates by Vote

For information on our organizational votes and/or statutory expenditures, please see the 2011–2012 Main Estimates publication.

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