Evaluation of Rural and Co-operative Development

Background

About one in five Canadians lives in more than 4,500 rural communities across the country. These communities are part of the infrastructure that supports industries such as fisheries, forestry and agriculture. For the agriculture sector, rural communities are particularly important for providing sources of off-farm income that help sustain farm families and the infrastructure and services that support agricultural businesses. Rural communities share common challenges such as an aging population, the migration of people and businesses to urban centers, economic dependency on a limited number of industries, limited resources and, in some cases, remote locations. Targeted federal funding to respond to the needs of Canadians in rural and remote regions was initiated in 1998 through the creation of the Canadian Rural Partnership initiative (CRP). This funding was in addition to a limited amount of ongoing departmental resources focused on supporting rural communities. Funding for the CRP was renewed two times over the past 14 years, most recently in 2009-10 as part of the four-year Growing Forward agricultural policy framework.

Co-operatives, by nature of their structure, allow citizens to pursue common goals in sectors or geographic areas where traditional businesses often do not find it profitable to operate. Targeted federal funding for the Co-operative Development Initiative (CDI) was established in 2003 to facilitate the creation of new co-operatives in the following priority areas: adding value to agriculture, access to health care services, rural development, immigrant integration, Aboriginal community development and community solutions to environmental challenges. The program was expanded in 2006-07 to provide assistance to farmers' co-operatives that wanted to participate in the development of biofuel and other value-added initiatives (Agricultural-CDI). Funding for CDI including support for agricultural value-added co-operatives was renewed for a four-year period in April 2009 (to March 2013). This funding was in addition to a limited amount of ongoing departmental resources that were allocated to support activities such as co-operative policy development and coordination, co-operative research and statistics collection and maintenance of the co-operative database.

Targeted federal funding for both the CRP and CDI will sunset in March 2013. As a result, the evaluation focuses on program achievements to date and lessons learned that could serve to inform the design of future federal programming in this area.

Methodology

The methodologies used to conduct the evaluation consisted of: an analysis of program performance information; a document review; key informant interviews with staff of the Rural and Co-operatives Secretariat, as well as representatives of the Canadian Co-operative Association (CCA) and the Conseil canadien de la coopération et de la mutualité (CCCM); and a review of academic literature to validate the rationale for providing support for rural communities and co-operative development.

Key Findings

In terms of ongoing relevance, rural communities, as part of the support structure for Canadian resource industries, play an important role in fostering competitiveness and innovation. Co-operatives are important to the Canadian economy and the agriculture sector, and there is a need for continuing support for the Co-operatives Database, which contains over 30 years of historical data on co-operatives in Canada. Support for rural and co-operative development aligns with federal and departmental priorities for economic development, competitiveness and innovation.

Rural and Co-operative Development programming has contributed to a broad range of achievements including the development and facilitation of a horizontal approach to rural issues within the Government of Canada; the provision of assistance to rural and northern regions to improve competitiveness; and knowledge building.

The CDI has addressed a wide range of needs, including job creation, agricultural development, rural economic development, healthcare, environment, community development and housing. The Advisory Services component of CDI has made a significant contribution to the capacity of the co-operative sector to develop and sustain co-operatives.

Federal support for rural and co-operative development projects allowed recipients to leverage significant funding from other sources. While program expenditures were less than budgeted amounts, the difference between program allocations and expenditures can be attributed to a number of factors including slow program uptake, and decisions regarding the ongoing management of the programs.

While providing support to rural and co-operative economic development aligns with federal roles and responsibilities, AAFC's rural and co-operative development programming extends beyond the agricultural sector. As a result, there is potential for overlap with other government departments.

Although the CRP and CDI have achieved their objectives and are being wound down, AAFC will continue to provide support for rural communities and co-operatives related to the agricultural sector through its existing programs.

Lessons Learned

The following lessons learned should be considered in the design of future federal programs targeted at rural and co-operative development:

• In order to support sustainable communities over the long-term, government support should be "place-based" and focus on strategic investments to strengthen and develop local assets and secure competitive advantage. Such investments should support multi-community collaboration whereby communities in a region work together to improve services, assets and/or infrastructure.
  
  
• Ongoing performance measurement that reaches beyond individual program funding cycles is needed to chart the longer term impacts of federal support to complex areas such as building the capacity of rural communities.
  
  
• Local communities must play a direct role in developing rural economic development initiatives. For communities to take the lead in charting their future direction, they require leadership development and access to professional expertise and information, including details of the government programs available to assist them.
  
  
• For co-operative development, services are more effective when linked and supported by local development agencies and federal or provincial departments and agencies whose mandates include co-operative development.
  
  
• For rural communities and co-operatives, federal funding is often essential seed money that helps to leverage further funding from other partners.
  
  

1.1 Evaluation Scope

A decision was taken to wind-down current AAFC rural and co-operatives development programming in 2012-13. As a result, the evaluation collected primary data to assess the programs' activities over the past four years (2008-2009 to 2011-2012) and draws on the results of previous evaluations to review accomplishments and lessons learned over the past 14 years. The evaluation is national in scope and assesses rural and co-operatives initiatives and activities funded underthe Agricultural Policy Framework (APF), the Growing Forwardagricultural policy framework (GF) and through on-going departmental "A-base" funding allocations. As the programs are not continuing, this evaluation focuses on lessons learned that can serve to inform future federal programming in this area.

In accordance with the TB Directive and Standard on Evaluation (2009), the evaluation examines the relevance and performance of AAFC's support to rural communities and co-operative development. Specifically, the evaluation examined: continued need for the initiatives; alignment with government priorities and departmental strategic outcomes; alignment with federal roles and responsibilities; achievement of intended outcomes; and the extent to which the initiatives demonstrated efficiency and economy.

1.2 Evaluation Approach

The evaluation used a summative mixed-method, non-experimental design^{Footnote 1}, incorporating multiple lines of evidence, both qualitative and quantitative to address the evaluation issues and questions. Qualitative data was used to provide context around available quantitative data.

1.3 Evaluation Methodology

The evaluation included several lines of evidence.

• Analysis of program performance information helped to answer evaluation questions related to performance by providing information on the achievement of expected outcomes. This included an analysis of contribution funding to rural communities, performance information based on the Co-operative Development Initiative (CDI) performance measurement strategy (PMS), and national statistics on the co-operative movement produced by the Rural and Co-operatives Secretariat.
  
  
• The document review examined previous evaluation reports, TB submissions, federal budgets, throne speeches, parliamentary and program reports, presentations, publications, Canada's Rural Partnership (CRP) and CDI Performance Measurement Strategies, the CRP Zone Measurement Strategy (ZMS) and communications materials. The document review provided information on program history and design and helped to answer evaluation questions related to relevance. Please see Annex A for a list of documents reviewed.
  
  
• Key informant interviews were undertaken with 14 staff of the Rural and Co-operatives Secretariat between June and September of 2011 as part of a comprehensive evaluation assessment. These were supplemented by five further interviews with AAFC staff and one interview with program delivery agents in December 2012 and January 2013. Key informant interviews helped address evaluation questions related to relevance and performance.
  
  
• A review of academic literature was undertaken to validate the theoretical underpinnings of support to rural communities and co-operative development to assist in answering evaluation questions related to relevance. A list of literature reviewed is included in Annex B.

1.4 Methodological Constraints

There are several considerations or limitations to note when reading this evaluation.

2.1 Background

The federal government has provided targeted support for rural development over the past 14 years. For the agriculture sector, rural communities are particularly important in providing the sources of off-farm income that help sustain farm families. While the changing global economy presents new opportunities for Canada's rural resource-based communities, they are dealing with significant adaptation issues as the sectors to which they are linked are restructuring in response to competitive realities. Funding provided for Rural Development was targeted at building community capacity and creating the conditions for success in rural Canada.

Targeted federal funding for co-operative development programming was established in 2003. Co-operatives, by nature of their structure, allow citizens to pursue common goals in sectors or geographic areas where traditional businesses often do not find it profitable to operate. Funding for co-operative development was targeted at creating an environment in which Canadians can find local solutions to local challenges using the co-operative model.

Rural and co-operative development activities share the goal of building capacity among target groups to facilitate local economic development. AAFC's support to rural and co-operative development was comprised of two federal-only initiatives: Canada's Rural Partnership (CRP) and the Co-operative Development Initiative (CDI). The Rural and Co-operatives Secretariat provided overall federal coordination, management and oversight for these programs^{Footnote 2}. The CRP was established in 1998, with funding of $20M over five years. The CRP was renewed from 2003-2009 (CRP II - part of the Agricultural Policy Framework), and again from 2009-2013 (CRP III - part of the Growing Forward agricultural policy framework).

The CDI was established in 2003 as part of the Agricultural Policy Framework, with funding of $15M over five years (2003-2008). In 2006-2007, Agricultural (Ag)-CDI was created to provide assistance to farmers' co-operatives that wanted to participate in the development of biofuel and other value-added initiatives. The CDI and Ag-CDI were extended through 2008-09, and the CDI was renewed for another four year period in 2009 as part of the Growing Forward framework. The renewed program combined both the support for farmers available under Ag-CDI along with support to other priority areas. Both rural and co-operative programs conclude in March 2013.

2.2 Rural Development (PAA #3.3.1)

2.3 Co-Operative Development (PAA #3.3.2)

The CDI was established in 2003 as a five-year program to facilitate the creation of new co-operatives in the following priority areas: adding value to agriculture, access to health care services, rural development, immigrant integration, Aboriginal community development and community solutions to environmental challenges.

The original CDI had two components: co-operative advisory services and innovation and research projects to explore and test the use of the co-operative model in new areas. The Canadian Co-operative Association (CCA) delivered the advisory services component in English while the Conseil canadien de la coopération et de la mutualité (CCCM) delivered advisory services in French.

In 2006-2007, Ag-CDI was created to focus on providing assistance to farmers' co-operatives that wanted to participate in the development of biofuel and other value-added initiatives. With additional funding Ag-CDI was extended through 2007-2009. The government provided continuity funding for CDI in 2008-2009 as the transition was made to the Growing Forward Framework. During the transition year CCA/CCCM administered the contribution program for farmers under Ag-CDI.

In April 2009, CDI was renewed for four years. The renewed program included both agricultural value-added and other priority areas.

CDI's objective was to enhance the contribution of co-operatives in meeting the economic needs of Canadians by working collaboratively with local, regional and national co-operatives, academic and government sector stakeholders to create an enabling environment for co-operative development and growth.

Specifically, the program aimed to:

• strengthen the co-operative sector's capacity to provide advisory services that enable co-operative development;
• fund innovative co-operative projects that respond to public policy priorities; and
• support research and knowledge development to facilitate innovation and growth.

3.1 Relevance - Ongoing Need

In assessing relevance, the evaluation assessed whether there is a need for targeted programming to support rural economic and co-operative development. It also examined AAFC's role in providing horizontal coordination for federal activities to support rural and co-operatives development, as well as the alignment of AAFC's secretariat role with the department's mandate and priorities.

Overall, rural Canada comprises more than 4,500 communities that, according to the 2011 Census, are home to 6.3 million Canadians or about 19% of the country's population.

These rural communities are important contributors to economic growth and competitiveness, forming a key component of the infrastructure that supports Canada's resource industries. Those industries are directly responsible for more than 15% of Canada's gross domestic product (GDP) and are projected to be an important driver of future economic growth^{Footnote 12}. Rural communities also provide key supports to urban economies through agriculture, water, waste management, carbon sequestration and recreation.

An interdependent relationship exists between rural communities and the resource sectors. Industry supplies the jobs and an economic base and communities provide skilled workers, infrastructure, services, additional business and employment opportunities, and the amenities that retain and attract the labour and knowledge that industry needs. The ability of communities to address challenges and implement change can affect ongoing sectoral adjustment. Communities dealing with population loss, diminished public services, and reduced tax bases are ill-positioned to address the skilled labour and innovation requirements of industries in constant adaptation. They may be unable to maintain the support infrastructure, services and institutions required by the sector and sectoral participants, and may lack the critical mass of human creative and financial capital that would enable them to innovate and move forward on new opportunities. At the same time, many such communities continue to possess underutilized strengths and assets (natural, physical, social, cultural, environmental, human) that could be mobilized more effectively to meet adjustment challenges, strengthen adaptation, expand local economic bases, and increase their support to sectoral growth, innovation and competitiveness.

Rural communities across the country require support to address the complex issues they face such as declining population and rural poverty. Many of these communities face common challenges such as dependence on a limited number of industries, and many are seeing an exodus of people and businesses to urban centres leading to declining and aging populations, limited resources and capacities, and the loss of services.

Parliamentary reports and research over the past 20 years^{Footnote 13} have highlighted the problems facing rural Canada and the need for all levels of government to be part of the solution. Evaluation evidence highlighted the need for the federal government to have the capacity to examine how public policies affect citizens living in rural communities. There is also a need for the federal government to coordinate its efforts and adapt its policies and programs to respond to problems facing rural citizens.

Many of the issues facing rural communities such as poverty and out-migration are complex problems that require multi-faceted interventions. Reports and academic literature reviewed for this evaluation make it clear that there is no "one-size, fits all" solution. The Canadian and international literature highlights that responses to the problems facing rural communities must be "placed-based" with communities taking the lead.

A number of regions in Canada, including resource-based communities that have experienced significant downturns and declines, have demonstrated that with strong leadership and citizen engagement, supportive networks, enabling partnerships, and strategic investments, new and viable economic opportunities and growth can be generated. Achieving regional and sectoral development goals requires collaborative partnerships and strategies.^{Footnote 14}

Other jurisdictions provide targeted support to rural communities as an explicit component of their agricultural policies. The United States Department of Agriculture has a number of programs designed to build the capacity of rural communities, including support for business development, community facilities and local utility services. In Europe, the European Commission combines responsibility for agriculture and rural development under the same Directorate-General with a mission to promote the sustainable development of Europe's agriculture sector and to ensure the well-being of its rural areas.

Over the past 14 years, the CRP has focused on building the capacity of rural communities through developing knowledge and tools, fostering networks and partnerships and testing innovative models for community development. It has shared the lessons from its work with departments across the federal government. It will only be apparent over time whether these investments have built capacity that can be sustained.

In order to support sustainable communities over the long-term, government support should be "place-based" and focus on strategic investments to strengthen and develop local assets and secure competitive advantage. Such investments should support multi-community collaboration whereby communities in a region work together to improve services, assets and/or infrastructure.

Co-operatives play an important role in the country's economy. As of 2008, there were 5,686 non-financial co-ops in Canada with 6.9 million members. These co-operatives employed 88,000 workers, had $35.7 billion in volume of business and 20.7 billion in assets.^{Footnote 15}

Co-operatives have a long history in Canada, especially in the agricultural sector. In the late 19th century, producers in Quebec, Ontario and Atlantic Canada developed co-operative creameries and cheese factories to meet the needs for the growing demand for dairy products. Producers in western Canada began to organize co-operatives in the early 1900s in an effort to market their products.^{Footnote 16} These co-operatives, along with co-operatives in other sectors such as financial services and fisheries, were critical to early economic development in Canada.

The evaluation found that there are three main benefits of the co-operative model:

• Co-operatives, by nature of their structure, allow citizens to pursue common goals in sectors or geographic areas where traditional businesses often do not find it profitable to operate. Within co-operatives, individuals pool resources and skills for diverse purposes such as creating self-employment opportunities (e.g. worker co-operatives), capturing revenue streams from the value chain (e.g. value-added processing in agriculture) and providing essential services (e.g. health care co-operatives).
• Co-operatives in rural and outlying areas often succeed where other forms of business fail. For example, a study published by Quebec's Department of Economic Development, Innovation and Export Trade in 2008 found that the survival rates of co-operative enterprises (excluding those in the housing sector) were 44.3% after 10 years compared to 19.5% for private businesses.
• Co-operatives help to increase market efficiency. Since they pool individual resources, co-operatives make it possible to share knowledge and increase competitiveness. This pooling of resources is also the basis of a countervailing power that can be exercised against large organizations in a given market, resulting in more competitive prices and service.

Co-operatives today are found in almost every sector of the Canadian economy from retail, health and social services, to natural resources and manufacturing. The housing and agriculture sectors have the highest number of co-operatives (see Figure 1); however, in terms of volume of business the wholesale and retail (49.0%), and agriculture sectors (43.6%) are by far the most important (see Figure 2).

Description - Figure 1: # of Co-operatives by Sector (2008)

Housing - 2,315;
Agriculture - 886;
Other Services - 861;
Wholesale and Retail - 496;
Health and Social Services - 423;
Recreation, Accomodation and Food Services - 314;
Natural Resources and Manufacturing - 235;
Arts, Culture and Communication - 150.

Source: co-operative Secretariat, 2012

Description - Figure 2: Revenue as a % of all Co-operatives (2008)

Wholesale and Retail - 49%;
Agriculture - 43.6%;
Housing - 2.7%;
Other Services - 1.9%;
Natural Resources and Manufacturing - 1.4%;
Health and Social Services - 0.6%;
Arts, Culture and Communication - 0.5%;
Recreation, Accomodation and Food Services - 0.1%.

Source: co-operative Secretariat, 2012

In terms of the agriculture sector, 888 agricultural co-operatives reported having more than 32,000 employees, 584,000 members and $6.2 billion in total assets in 2008.

Support for the development of co-operatives is important due to the unique nature of the co-operative model. It differs from other business models and requires specialized support services to assist members with complex issues, such as governance. Co-ops that are less commercial in nature (e.g. daycare, senior care, housing) may also have development needs that are different from that of commercially oriented co-ops, such as agri-business. The CDI program is one of the few sources of funding to assist Canadians in establishing and supporting co-operatives.

The importance of the co-operative sector to the Canadian economy was emphasized in the 2012 Report of the House of Commons Special Committee on Co-operatives.^{Footnote 17} The Committee found that there are a broad range of programs intended for small and medium-sized enterprises that are also available to co-operatives. The Committee recommended that the federal government work closely with regional economic development agencies to promote the co-operative business model along with other business models.

Since 1928, the Government of Canada has been collecting data on Canadian co-operatives. The responsibility for this data collection was moved to AAFC in 1933. The data is viewed by the sector and other government departments as critical to policy development and research on co-operatives, including the measurement of the key contributions of agricultural co-operatives. The Secretariat sends an annual "survey"^{Footnote 18} to all non-financial co-ops in Canada, the results of which are analyzed and published each year in "Co-operatives in Canada". The Secretariat is the only organization collecting this data, as Statistics Canada only collects data on financial co-operatives. The information provides a detailed picture of the non-financial co-op sector in Canada, including number, type and location of co-ops, volume of business, assets and number of employees. The information is used internally for policy development. A protocol is in place to share the data with co-op sector partners and academic researchers. Reports are distributed and made available to diverse audiences, both domestic and international.

Interviews for this evaluation and witnesses at the Standing Committee emphasized the importance of maintaining this database, as otherwise this valuable information for federal policy formulation and analysis could be lost. In recognition of this fact, AAFC's Rural and Co-operatives Secretariat is undertaking a $566,000 upgrade of the database.

3.2 Relevance - Alignment With Federal and Departmental Priorities

Federal support for rural and co-operative development aligns with federal economic development priorities. Parliamentary Committee Reports and interviews emphasized that it is the responsibility of the federal government to provide access to federal services to citizens across the country whether they live in rural or urban areas. Further, the co-operative sector is primarily comprised of small and medium sized businesses and, as described earlier, makes an important contribution to the creation of jobs and the growth of the Canadian economy.

The 2011 Speech from the Throne emphasized the current governments' commitment to supporting small and medium sized business in order to create jobs and growth for both rural and urban communities.

Our strategy for the economy must create the conditions for continued success in the industries that are the foundation for Canada's prosperity and support thousands of communities, both rural and urban.^{Footnote 19}

Small and medium-sized businesses are the engines of the Canadian economy, responsible for the creation of most new jobs. To support them, our Government will continue to identify and remove unnecessary, job-killing regulation and barriers to growth. [...] Jobs and growth remain the top priority.

Support for rural communities aligns with federal and departmental priorities for increased competitiveness in the agricultural and resource-based sectors. Many single-resource communities are being forced to adapt and AAFC rural and co-operative programming has provided support to develop partnerships, pursue new business models and foster innovation. While the CRP and CDI have achieved their objectives and are being wound down, AAFC will continue to provide support for rural communities and co-operatives related to the agricultural sector as businesses, co-operatives, and non-governmental organizations are eligible recipients for departmental innovation, business development, adaptation and other programs.

3.3 Relevance - Alignment with Federal Roles and Responsibilities

In the division of powers under the Constitution, responsibility for municipalities (where many of the CRP's activities were focused) rests with provincial governments. Conversely, responsibility for economic development, the current emphasis of AAFC's support to rural communities and co-operatives, is shared between the two levels of government.

Co-operative development

For co-operatives, there is a history of federal involvement by different government departments:

• Industry Canada is responsible for the Canada Co-operatives Act. Corporations Canada, which is part of Industry Canada, is responsible for administering the Act and for co-operative incorporations.
• Finance Canada is responsible for the Co-operative Credit Associations Act, under which credit co-operatives may be incorporated, and the Insurance Companies Act, under which mutual insurance companies, among others, may be incorporated.
• The Office of the Superintendent of Financial Institutions administers the Co-operative Credit Associations Act, the Insurance Companies Act and the Bank Act, and is responsible for incorporating federal credit co-operatives and mutual insurance companies.
• Federal regional economic development agencies also support co-operatives. For example, from fiscal year 2006-2007 until the beginning of October 2012, the Atlantic Canada Opportunities Agency provided co-operatives with over $15 million to support 99 projects in the four Atlantic Provinces. Further, as mentioned earlier, the Report on the Special Committee on Co-operatives (2012) recommended that the federal government work closely with regional economic development agencies to highlight the importance of co-operatives to Canadian economic development.

Historically, the co-operative portfolio has been managed by the Department of Agriculture as co-operatives were well-represented in the sector. However, co-operatives are also represented in most other sectors of the Canadian economy, including retail, energy and housing.

Agriculture co-operatives' revenues compared to the revenues of all other non-financial co-operatives have dropped from a high of 67% in 1998 to a low of 44% in 2008 (see Chart 1).^{Footnote 20} The co-operative sector is more diverse than it was in the past, making it important to not only the agriculture sector, but to a variety of sectors across the Canadian economy.

Description - Figure 3: Revenues of agricultural co-operatives versus all other non-financial co-operatives (Millions).

1992: All Agriculture Co-ops - 12.965; All Other Non-Financial Co-ops - 7.290;
1993: All Agriculture Co-ops - 12.598; All Other Non-Financial Co-ops - 7.773;
1994: All Agriculture Co-ops - 13.949; All Other Non-Financial Co-ops - 8.090;
1995: All Agriculture Co-ops - 15.852; All Other Non-Financial Co-ops - 8.571;
1996: All Agriculture Co-ops - 18.424; All Other Non-Financial Co-ops - 9.064;
1997: All Agriculture Co-ops - 19.239; All Other Non-Financial Co-ops - 9.268;
1998: All Agriculture Co-ops - 19.365; All Other Non-Financial Co-ops - 9.346;
1999: All Agriculture Co-ops - 18.655; All Other Non-Financial Co-ops - 9.804;
2000: All Agriculture Co-ops - 19.097; All Other Non-Financial Co-ops - 10.642;
2001: All Agriculture Co-ops - 18.015; All Other Non-Financial Co-ops - 11.317;
2002: All Agriculture Co-ops - 14.542; All Other Non-Financial Co-ops - 11.546;
2003: All Agriculture Co-ops - 13.838; All Other Non-Financial Co-ops - 12.229;
2004: All Agriculture Co-ops - 14.326; All Other Non-Financial Co-ops - 13.236;
2005: All Agriculture Co-ops - 13.176; All Other Non-Financial Co-ops - 14.510;
2006: All Agriculture Co-ops - 13.344; All Other Non-Financial Co-ops - 15.450;
2007: All Agriculture Co-ops - 14.218; All Other Non-Financial Co-ops - 16.587;
2008: All Agriculture Co-ops - 15.583; All Other Non-Financial Co-ops - 20.145;

Source: Co-operatives Secretariat, 2012

The growth of co-operatives beyond the agricultural sector and the number of federal departments with some involvement with co-operatives provides weight to the recommendation of the Special Committee on Co-operatives that the government study the possibility of consolidating the federal responsibility for co-operatives under a suitable department, such as Industry Canada.

In terms of provincial and territorial support for co-operatives, Quebec, Newfoundland and Manitoba provide specific programs or services for co-operatives. The Government of Manitoba's Co-operative Development Services provides support and direction to entrepreneurs including: information and advice on incorporation; counseling services; help with regulatory issues; pathfinding; and ongoing support.^{Footnote 21} The Office of Co-operatives within the Quebec Ministry of Industry and Commerce encourages new co-operatives and the growth of existing co-operative enterprises in the province. It issues regulations, compiles statistics, and offers a variety of programs to sustain the development of co-operatives.^{Footnote 22} The Government of Newfoundland has several staff who are dedicated to supporting the activities of co-operatives.

In terms of lessons learned for co-operative development, services are more effective when linked to local development agencies and federal or provincial departments and agencies whose mandates include co-operative development.

3.4 Performance - Effectiveness

In assessing performance, the evaluation assessed the achievement of AAFC's intended outcomes for the Rural and Co-operative Development programs, as well as the extent to which the programs demonstrated efficiency and economy.

3.5 Performance - Efficiency and Economy

In assessing program economy the evaluation assessed the ability of the CRP and the CDI to leverage funding in support of rural economic and co-operative development. In terms of program efficiency, given the limited performance data on program activities, the evaluation assessed program expenditures against budgeted allocations.

A 2011 report on Community Development Program projects demonstrated that the approximately $970,000 in funding provided by the program represented only about 20% of the more than $4.58 million of total project costs. According to key, informants initial funding from the CRP often allowed communities to obtain funding from other sources. This suggests that program contributions were able to leverage about four times the original funding.

Based on CDI program data for 2011-2012 (the only year for which data is available), project reporting shows that partners were able to leverage an additional $12.1 million or eight times the program's $1.4 million contribution. The bulk of this amount, $11 million, came from the private sector.

The Co-operatives Secretariat's co-ordination activities also appear to have helped to facilitate greater funding for capitalization of co-operatives in Quebec. Evaluation evidence found that the Secretariat helped to facilitate a $30 million co-op financing alliance between Business Development Canada (BDC), the Community Futures Development Corporation (CFDC) and Community Business Development Corporation (CBDC) networks in Quebec, and "coop Exxor" (a new limited partnership expected to be formed by Capital regional et coopertatif Desjardins, the Conseil québecois de la co-operation et de la mutualité, and the Government of Quebec). Once finalized, the alliance is expected to increase and simplify the access to financing for co-operatives in the province of Quebec. BDC anticipates supporting a greater number of co-operatives as a result of this agreement. It estimates that it will be able to finance 25-30 clients per year with average loans ranging from $15,000-$170,000. Overall, BDC estimates that its participation in this initiative will result in $10 million of additional financing to co-operatives over five years. Depending on the results of this pilot, this model could be explored for other provinces and territories.

In terms of overall program expenditures, the evaluation found that actual program expenditures were within 19% of budget allocations for the Rural program and 13% for the Co-operative Development program (see Table 3 below).

Program officials noted that the lack of program uptake was due in part to the fact that many applicants were focused on obtaining the larger infrastructure funding available under Canada's Economic Action Plan, and the uncertainty around ongoing funding for the program.

As part of AAFC's ongoing consolidation and transformation efforts, a restructured Rural and Co-operatives Secretariat was consolidated within the Portfolio Co-ordination Secretariat within AAFC in July 2012. Going forward, the secretariat will focus on policy and research and will include a smaller regional presence.