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Acknowledgements

Western Economic Diversification (WD) Canada would like to thank all of the key informants, focus group interviewees, case study participants, and survey respondents who generously gave of their time and knowledge to take part in the Western Diversification Program (WDP) Summative Evaluation research project. Without their participation and their insights, this report would not have been possible. WD also acknowledges the work done by R.A. Malatest & Associates in some of the data collection and completing the initial draft of the report.

Western Economic Diversification Canada

Because Western Canada is such a unique region, the economic priorities and issues distinctive to this region must be taken into account at the national level. WD was designed to allow the national government to address the unique needs of Western Canada and ensure that the region receives the recognition and resources it needs in order to garner continuing success.¹

More specifically, WD’s mandate is to promote the development and diversification of Western Canada’s economy and to advance the interests of the West in national economic policy.² WD was established in 1987 to help broaden the economic base of the four western provinces: British Columbia, Alberta, Saskatchewan, and Manitoba.³ This work is being achieved primarily through grants and contributions programs, as well as through collaboration with the private sector, government, academic, financial institutions, and research centers.

By targeting three inter-related strategic priorities - innovation, entrepreneurship, and community economic development - WD aims to improve economic competitiveness in the west, and thereby the quality of life of citizens in the region.⁴

Western Diversification Program

As WD’s major program, the Western Diversification Program (WDP) provides support to projects that develop and diversify the Western Canadian economy. The WDP works to make strategic investments designed to enhance and strengthen the economy in Western Canada.⁵ These programs may also create economic and/or employment benefits, mostly within Western Canada. The goals of the WDP include the following:

Strengthened innovation that connects research strengths with industry commercialization;
A competitive and expanded business sector;
Increased economic activity that improves viability, prosperity, and quality of life;
Improved business climate; and
Economic research in innovation, entrepreneurship, and sustainable communities.⁶

The WDP supports a variety of activities including the following:

Research and development leading to commercialization;
Community innovation and capacity building;
Cross-industry collaboration;
Participation in domestic and international markets;
Improving business productivity;
Community adjustments to economic changes; and
Investment in skills, knowledge, and competencies development to support WD’s strategic objectives.⁷

The WDP encompasses several sub-components. The most notable of these are cost-shared agreements. The Western Economic Partnership Agreements (WEPAs) are agreements between the federal and provincial governments, whereby project expenditures are divided equally. The Urban Development Agreements (UDAs), in Saskatoon, Regina, Vancouver, and Winnipeg, are agreements with the federal, provincial, and municipal governments to undertake projects at a community-based level. Another important agreement was the Saskatchewan Northern Development Agreement. The WDP is also involved in several sub-components that involve smaller-scope projects, such as Conference Support and Canada Foundation for Innovation Support Program. For detailed descriptions of the sub-components, see Appendix A.

This report provides a summative evaluation of the WDP. The evaluation covered the period June 14, 2003 to March 31, 2007. Within this period, the total number of WDP projects was 3,484 and total expenditures were $390,256,480.

The WDP administrative data showed that the regional distribution of projects from 2002 to 2007 ranged from a high of 40.3% in British Columbia to a low of 10.7% in Manitoba (Table 1-1). It is important to note that the high number of projects undertaken in BC reflects the large number of conference support projects and the greater population base in the province. The high number of projects in Saskatchewan reflects the high number of centenary projects undertaken in the region.

**Table 1-1 Distribution of Projects by Region**
Region	Percentage of Projects by Region	Expenditures by Region
British Columbia	40.3%	$135,458,642
Saskatchewan (high number of centenary projects)	30.3%	$78,793,013
Alberta	18.7%	$103,869,163
Manitoba	10.7%	$72,135,662
Total	100.0%	$390,256,480

n=3,484. Reference: Administrative Data

WDP Terms and Conditions

According to the WDP Terms and Conditions, the objective of the program is to promote economic development and diversification in, and advance the interests of, Western Canada.⁸ The expected results of the funding for this program are as follows:

To strengthen the Western Canadian innovation system;
To improve and expand the business sector and business climate, and increase competitiveness of that sector;
To improve viability in Western Canadian communities; and
To undertake economic research in innovation, entrepreneurship, and sustainable communities.

Contributions can be made to several organizations, including non-profit organizations, educational institutions, and other government departments (federal, provincial, and municipal). A wide range of costs can be covered by WDP funding, including operational costs, equipment acquisition, and personnel costs. Eligible activities include those related to community economic development and innovation and technology, as well as to business-related activities. All activities should in some way be aimed at developing and diversifying the Western Canadian economy. Funding may be allocated, based on need, on a payable or non-repayable basis, and can take the form of grants or contributions.

Evaluation Mandate

The WDP was evaluated in 2003, pursuant to the Treasury Board of Canada’s decision in January 2002 to renew the WDP’s terms and conditions. That evaluation addressed the issues of relevance, success, and effectiveness.

The current evaluation is being conducted in accordance with the stipulation outlined in the 2003 WDP renewal that the department completes an evaluation of the WDP before the expiry of the program in July 2009. The terms and conditions identify the following outcomes of the WDP to be addressed in the evaluation: innovation, entrepreneurship, community economic development, and economic research.

The objective of this evaluation is to examine the relevance, success, cost-effectiveness, and design & delivery of the WDP in order to report on the impacts of the program and to provide recommendations for its future design.

Organization of this Report

The report is organized as follows:

¹ Western Economic Diversification Canada, (2005), Working with the West.
² Western Economic Diversification Canada, (n.d.), What We Do.
³ Western Economic Diversification Canada, (n.d.), Investments in the West.
⁴ Western Economic Diversification Canada, (n.d.), What We Do.
⁵ Western Economic Diversification Canada (n.d.) Western Diversification Program
⁶ Western Economic Diversification Canada (n.d.) Western Diversification Program. Retrieved April 20, 2007
⁷ Ibid.
⁸ Western Economic Diversification Canada Western Diversification Program Terms and Conditions.