BDP EVALUATION Presentation to Canadian Evaluation Society Darlene Jones Manager, Evaluation - ACOA June 2003

2 PRESENTATION OUTLINE Background and Approach Main Findings Challenges and Opportunities Conclusions and Lessons Learned

3 BACKGROUND ACOA: Promotes opportunities for economic development in Atlantic Canada BDP: ACOA’s Core Program $814 million to 4275 clients 75% interest-free loans to small business 25% contribution to not for profit organizations

4 APPROACH Six Issues Steering Committee Consultants/ACOA Staff Multi-method Approach: Qualitative/Quantitative

5 FINDINGS: Outcomes

6 FINDINGS: Outcomes and Impact on SMEs Comparison Group Analysis – Statistics Canada - Growth Employment: BDP four times higher than unassisted Wages: BDP six times higher than unassisted Survival (still in business after 3 years): BDP double over unassisted

7 FINDINGS: Outcomes and Impacts on SMEs (Caveat: Projects not all complete) Performance Measurement – Employment and Wages Employment: 65% achievement Wages: 40% growth (all clients) 95% growth (innovation) 52% growth (marketing projects)

8 FINDINGS: Outcomes and Impact on SMEs (Caveat: Projects not all complete) Performance Measurement – Sales and Export Sales Sales: 34% growth Export Sales: 45% growth (all clients) 93% growth (marketing projects)

9 FINDINGS: Outcomes Benefit-Cost Ratio GDP Impact: $7.5 for every $1 Net benefits to taxpayer 2:1

10 FINDINGS: Access to Capital External findings Atlantic SME debt market less developed Rural bank closures Internal findings Downward trend in numbers of establishment (1995 = 33% vs = 16%) Being used strategically (Tourism, Aquaculture) Gap in soft cost support still evident Unsecured BDP loans make projects “bankable” (leverage)

11 FINDINGS: Skills Development Very low take-up Clients satisfied with BDP Clients are growth oriented (70% exporters, 70% innovators) Awareness, promotion needed Unsecured debt/no measurables

12 FINDINGS: Business Support Projects such as Education Infrastructure, Community Development and Industry Development Leveraged nearly 60% (other investors) Outcomes: 52% Achieved; 6% Underway Outputs: 36% Achieved Need improved methods for measuring outcomes Provides affordable service to SMEs

13 FINDINGS: Strategic Priorities Innovation firms highly levered Innovation firms seeking equity financing Export firms profitable/weak cash flow Firms with >50% Export Sales highest employment generators Clients satisfied BDP responsive to needs of Innovation/Exporting

14 FINDINGS: Sectors Aquaculture: Fast growing industry with regional/species-specific strategies Tourism: Fast growing industry built on Atlantic-wide strategies and partnerships Computer Services: Emerging industry

15 CONCLUSIONS AND LESSONS LEARNED The benefit-cost ratios for GDP and returns to the taxpayer indicate that the pay-off for the BDP investment overall is positive even if the loans are not fully repaid. Access to Capital continues to be an important constraint to growth and competitiveness of Atlantic SMEs

16 CONCLUSIONS AND LESSONS LEARNED (continued) Greater relative share of Innovation/Export indicates both ACOA and clients recognize importance. Opportunities exist for greater impact of Skills Development Business support measurement and monitoring challenges made finding strong, positive results difficult

17 CONCLUSIONS AND LESSONS LEARNED (continued) Evidence shows that Innovators/Exporters are among the Top performers of the Business Development Program The BDP is most effective as a tool for sector development when used strategically in partnership (capital, soft cost, business support)

18 MAIN CHALLENGES AND OPPORTUNITIES Challenges Abundance of data Recognition of local and sectoral differences Presenting concise findings Conflicting priorities Resourcing issues based on staff turnover Time constraints related to abundance of data and resourcing Opportunities Methods and techniques for improving efficiency Value of evaluation within organization (policy outcome)

19 THANK YOU!

20