INDU Committee Meeting

STANDING COMMITTEE ON INDUSTRY

COMITÉ PERMANENT DE L'INDUSTRIE

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, May 11, 2000

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[English]

The Acting Chair (Mr. Ian Murray (Lanark—Carleton, Lib.)): I call this meeting to order pursuant to the order of reference of the House dated February 29, 2000, the main estimates for the fiscal year ending March 31, 2001, votes under Industry, and the performance report of Industry Canada for the period ending March 31, 1999.

We are pleased to welcome the Honourable Martin Cauchon, Secretary of State for the Economic Development Agency of Canada for the Region of Quebec.

Minister, I understand you have a statement, and perhaps you could introduce the officials you have brought with you.

[Translation]

Hon. Martin Cauchon (Minister of National Revenue and Secretary of State (Economic Development Agency of Canada for the Regions of Quebec, Lib.): Thank you very much, Mr. Chairman. I am pleased to be making my fourth consecutive appearance before this committee. As you requested, I will begin by introducing my team: Mr. André Gladu, Deputy Minister, Economic Development Agency of Canada; Mr. Jean-Guy Saint-Martin, Assistant Deputy Minister, Strategy and Liaison; Mr. Jocelyn Jacques, Assistant Deputy Minister, Operations; Mr. Pierre Bordeleau, Director General, Resources Management; Mr. Jean-Pierre Thibault, Director General, Communications; Ms. Rita Tremblay, Executive Assistant to the Deputy Minister; and Mr. Joachim Normand, Executive Assistant to yours truly.

[English]

As you mentioned, Mr. Chair, I would like to start first with some brief remarks. Of course, I'll try to be as short as possible, knowing that to provide members with room for a question period would be very much appreciated.

[Translation]

As you know, Canada Economic Development is primarily a regional development agency under Industry Canada's broad portfolio. Our main focus is promoting economic development throughout all regions of Quebec.

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In performing this task, we focus on two areas of activity: promoting enterprise development and, equally as important, improving the support environment to help regions acquire the tools they need to create a climate conducive to economic development.

Naturally, we are in the process of reviewing the department's strategic framework and would like to allocate our budget resources equally to these two fields of activity. Of course, we don't want to paint ourselves into a corner, if you'll pardon the expression, but we would like to achieve this equal split as much as possible.

To this end, we rely on the development of entrepreneurship in all of the regions and, to a great extent, on the development of youth entrepreneurship as well.

[English]

Of course, we all know, Mr. Chair, that over the past decades the economic situation has changed a lot. The economic realities have moved ahead in quite a significant way, in the sense that we're living in a global marketplace. We're also living in a new knowledge-based economy, we have new means of doing business, and we have new tools for the development of small and medium-sized enterprises—that is to say, of course, information technology.

In order to achieve those goals as a government—and of course the private sector has faced the same situation.... We've had to change both our mind and our self. We all remember that back in 1994-95 we did proceed as a government, as a regional development agency, with some changes to our programmation within the parameters of program review. Under NAFTA we came forward with, first and foremost, one program called IDEA-SME. The second one we created a few years ago, called l'Initiative régionale stratégique.

I would just like to tell you that those programs have been appreciated over the years by our clientele, and we just want to make sure we're going to keep pace with the needs of the population, the needs of all the regions across the province of Quebec. We are in touch with our clients, and we're making sure that on a yearly basis we proceed with fine-tuning those programs.

[Translation]

Mr. Chairman, I mentioned earlier that we are living in a new world and as such, we have had to develop new programs which seem to be working well today, judging from the figures we have and the needs expressed by clients. We have also launched special initiatives to help businesses function in this new environment.

As noted, one of these special initiatives is the Regional Strategic Initiative which is geared to the special needs of individual regions. It was developed in partnership with various stakeholders. If we look at the regional strategic initiatives announced province wide, we will see that they vary considerably, depending on needs and circumstances.

For instance, in the Lower St. Lawrence-Gaspé region, the Marine Technopole initiative has been launched. A special $5.5 million fund has been established to address the particular problems of the Amiante RMC which is facing rather difficult economic circumstances.

Several weeks ago, I was able to report on the Amiante fund's achievements. Over the past year, a total of $1.7 million has been invested in 12 separate projects. In addition, 83 new jobs have been created in the Amiante region as a result of this initiative.

Furthermore, we are looking at ways to help companies thrive in this new world. Last year, we launched our e-commerce strategy which represents a commitment of $50 million in separate phases over the next three years. Phase I was completed last December, with the results scheduled to be announced shortly. At the same time, we will be unveiling our criteria for Phase II.

In this era of global markets, we must also mention another component of our programs, namely the IDEA-SME program which places tremendous emphasis on exports.

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Lastly, it should be noted that we focus in particular on certain regions. For example, we have instituted special measures for the Gaspé region, where I will be heading tomorrow. Our efforts are already starting to produce some results.

[English]

Of course, as government we had to face brand-new realities in that global marketplace, and also living with a brand-new communications system. The way we're doing business with people in the field has changed a lot, if you compare it with the programmation back in 1993. Actually, we're providing people with more experience. We're using more the experiences of our human resources, and we're trying to get involved with as many partnerships as possible in the field in order to create brand-new links.

At the end of the day, the aim and goal of the department in creating new partnerships is to provide the regions across the province of Quebec, and of course to a certain extent the SMEs, with more information using the new means of communication, to provide them with good, accurate information in order to give them an inch, in order to make sure they will be more competitive, not only on a national basis but also, first and foremost, in the international marketplace.

[Translation]

When we refer to improving the lines of communication, we mean finding ways of better communicating with all partners and of better informing people about what we do. Mr. Chairman, I pointed out last year that we launched Info-Fair, which targets SMEs, several years ago. In fact, my colleague, the Minister of Industry, is responsible for this initiative. I am planning to attend an Info-Fair scheduled for this coming Saturday in the Trois-Rivières area. These events give entrepreneurs in the region an opportunity to share their experiences and to obtain information from various departments about the services available to SMEs. To date, 22 such events have been staged across the province and across Canada, reaching out to over 28,000 entrepreneurs in Quebec alone.

Still on the topic of improving communications and forging better ties, I would just like to mention Ressources Entreprises, a group established several years ago to help entrepreneurs gain access to new means of communication, notably the Internet and sites like Strategis, one of the best e-commerce sites in Canada, if not North America.

Finally, I'd like to say a word about youth entrepreneurship. Throughout the regions, we are seeing an exodus of talent, particularly young talent. We have observed this development along with our first-line partners, the Community Futures Development Corporations. This is a partnership of which we are especially proud. The Community Futures Development Corporations are knowledgeable of the situation in the regions throughout Quebec and provide services as well as attractive funding to SMEs. Working together with the CFDCs, we have noted a shortage of youth entrepreneurs, which has prompted us to launch a number of initiatives such as entrepreneur centres in universities and youth entrepreneur clubs in CEGEPs. Nor can we forget the CFDC-CED Youth Strategy designed primarily to help businesses get off the ground in the regions.

CED also invests in technology sectors. The CESAM group of Montreal, for instance, is working to establish companies to work in new technology industries. Another initiatives is the Youth Foundation of the Mayor of Montreal which targets urban communities.

[English]

That's all I want to say for the time being, Mr. Chair.

In conclusion, since we established the brand-new programmation back in 1995, it seems we established at the same time a pretty good partnership with the stakeholders in all the regions across the province of Quebec, with the SMEs. We're providing people with pretty good services, and the results are there and are pretty good.

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As I said, we'd like to give you more room for a question period, so I'll turn it over to the chair.

[Translation]

The Acting Chairman (Mr. Ian Murray): Thank you, Mr. Minister.

[English]

Mr. Hill, do you have a question?

Mr. Grant Hill (Macleod, Canadian Alliance): Thank you, Mr. Chair, and thank you, Mr. Minister, for your opening remarks and for the gentlemen who are here.

I think it's safe to say that there has been a fair amount of scrutiny put on economic development programs and their accountability—HRDC as well. Since at least February there's been a heightened interest in these areas. Some commentators feel that these programs are subject to patronage, subject to some patting on the back, if funds are given to one business.

I'd like to specifically go to the issue of internal audits of these programs, and I'd like to have some indication of when the last audit was. You might give me a summary of what that audit said about the program.

Mr. Martin Cauchon: Mr. Chair, the question is indeed more than welcome.

First of all, as I said, back in 1993 the programs we had as an agency were quite different. At that time, we had something like 40 programs. We were getting involved in basically everything across the province of Quebec. So with program review, we came forward with two programs. We are targeting more small and medium-sized enterprises.

We've had to change our way of doing business. You all remember in 1993 that people in the business community were saying to the different parties running that they wanted government to get involved first in partnerships, and second, that subsidies for commercial business weren't really deserved at that time. They said, if we believe in what we want to do, first the SME will put money on the table. They would be willing to get involved in a partnership with the government if the government provided what we call today loans or repayable contributions. There are no more subsidies when it's a commercial business. So it's a big change in terms of approach, in terms of philosophy.

Second, and maybe central to your question, is the question of the audit. As I said, we've changed our mind. We changed the programmation back in 1994-95. The programmation came into force in 1995. Audits have been demanded. We haven't been forced to get into audits; the audits have been demanded by the department, because as it was brand-new programmation, we've had to make sure that on a yearly basis those audits would provide the department with accurate information with regard to where we have to adjust ourselves in order to provide the best services possible and suitable for small and medium-sized enterprises.

Some have been asked for by the department. I would like to tell you that there were internal audits in the department in 1997, 1998, and 1999. There's one that was conducted by the AG back in 1995, but we all remember that in 1995 there was the official launch of those brand-new programs.

Indeed, we've had a few comments on that new programmation. I'm proud to report that the very last audit of the AG was back in 1998, and if you look at the comments that have been made by the AG's department with regard to the improvements vis-à-vis those comments made in 1995...I'm pretty pleased and proud to report that the comments were quite positive.

Mr. Grant Hill: Could you just summarize the last audit for me, the 1999 audit, please?

Mr. Martin Cauchon: No, the last one that took place was in 1998.

Mr. Grant Hill: Would you summarize that one for me, please?

Mr. Martin Cauchon: Broadly speaking, you're asking me to summarize.... I don't have all the details, but I know that basically he said that if you compare what has been said in 1995 with regard to the brand-new programmation established, there was a major improvement in the system, and in terms of service delivery as well. They recognized that there was a major improvement on that side.

I have a huge piece of paper I can provide you with regard to comments made by the AG, but to go into all the details of the report....

Maybe what I should do, Mr. Chair, is provide the member with the 1998 chapter that targeted the agency.

The Acting Chair (Mr. Ian Murray): That seems reasonable.

Mr. Grant Hill: I was really hoping I could get a brief summary of what the audit said, because we've asked for this in the House and it basically got about the same answer. That isn't an answer.

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Mr. Martin Cauchon: I'm sorry, but that is an answer. I said they didn't force the department to get into an audit. I said we wanted to have an audit and we are going to have more in the future—

Mr. Grant Hill: You've already been there. As I say, we've tried to go down this road in the House and we have basically not received what I consider to be a pretty straightforward answer as to the improvements.

Let me go to a specific question then. Some of the things that are funded are tourist oriented. Would that be fair to say?

Mr. Martin Cauchon: Of course.

Mr. Grant Hill: A fishing operation in one part of Quebec has a competitive fishing operation across the lake. The one organization gets some financial help. What do you say to the one that got nothing, in terms of competitiveness? They say to me that that doesn't seem fair.

Mr. Martin Cauchon: The question is quite appropriate, Mr. Chair.

As I said, we changed our mind back in 1995, when we came forward with brand-new programs. There's a sort of understanding with the Quebec government that of course the Canadian government will keep being involved in tourism, but as long as tourism is internationally oriented. So of course when we're going across the province of Quebec and there's a project that has an international capacity, the department is there to have a look at it and to provide the support needed, with of course repayable contributions when it meets the criteria.

We have been involved in some projects, for example, with respect to auberges with an international capacity and pourvoiries with an international capacity. But if you go across the province of Quebec, there are not many of them. As well, we have to make sure that in doing that we will be involved in an area where we have a pool of organizations that is capable of attracting an international market or international tourism.

We have done it in some places. Our involvement in Mont Tremblant is one of the very good examples, actually. We've been able to develop an outstanding resort there. We've been involved in partnership with the Province of Quebec and the private sector, and it provides not only the immediate population but all the surrounding area with start-up operations, just because they're involved in that area. Honestly, we've developed, still in partnership, an international capacity capability as well.

The Acting Chair (Mr. Ian Murray): You have one more question, Mr. Hill.

Mr. Grant Hill: Thanks, indeed.

One of the things that economic development looks at is the Community Futures corporation. Is there oversight of these corporations? Is there some way to say that the money that has been spent is spent well and is in fact doing what it's supposed to be doing? Do you have a mechanism of oversight?

Mr. Martin Cauchon: We have 54 Community Futures programs across the province of Quebec. Basically, they are community-driven, in the sense that the managing board is composed of stakeholders from the region.

With regard to the question of the accountability of those Community Futures, I would like to draw to your attention the fact that we signed some years ago a brand-new contract, and we have parameters as well to proceed on a yearly evaluation with regard to what they are doing.

On the other hand, we have to bear in mind that as minister responsible for economic development, I'm accountable to the House of Commons. So I have to make sure I keep a link with those organizations. It could happen from time to time that some people will raise concerns about loans that have been made by Community Futures across the province of Quebec. Based on the terms and conditions of the contract we've signed with them, we're just proceeding with the appropriate investigation or proceedings.

The Acting Chair (Mr. Ian Murray): Thank you very much.

[Translation]

Mr. St-Julien.

Mr. Guy St-Julien (Abitibi—Baie-James—Nunavik, Lib.): I'm delighted to welcome a minister who is a go-getter and a Quebecker to boot.

My first question has to do with CFDCs. We hear at lot about these corporations. As a matter of fact, I'm pleased to see my colleagues opposite. There are over 50 CFDCs in Quebec and I'd like to know what the future holds for CFDCs in Canada. It's a known fact that Quebec moved to established its CLDs some time after the federal government launched its own initiative. There were many who said that the federal government would be duplicating the efforts of the province, but in fact, the opposite occurred. Quebec duplicated efforts already made. Many volunteers work with these corporations. Speaking of CFDCs, I have here a newspaper....

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Mr. Martin Cauchon: Have your questions ready.

Mr. Guy St-Julien: I have here the April issue of Le Jamésien, a northern Quebec newspaper. Mention is made of CFDCs on page one. We aren't allowed to show newspapers in the House, but here in committee, that's not a problem. I'm delighted in fact to do so. Mr. Chairman, the paper contains information on how to access the Matagami CFDC on the Internet and an entire page is devoted to this subject. There's also a photo of one of your officials, Daniel Ricard, the Director of Northern Quebec. As you know, my riding of Abitibi—Baie-James—Nunavik covers a vast area.

I'd like to focus on your initiatives and on those of your officials. I already know about some of them. I've known Mr. Gladu since 1984. He's a man of action and I'm pleased that he has joined your team. However, what I would like to talk about is the future of CFDCs.

Mr. Martin Cauchon: That's a very broad topic.

Mr. Guy St-Julien: Well, I know you're a good minister and that you can tackle a broad topic like this.

Mr. Odina Desrochers (Lotbinière, BQ): It sounds to me like this is a planted question.

Mr. Guy St-Julien: Not at all. If that were the case, I would have written to him. It's all well and good to talk about planted questions, Mr. Desrochers, but he has to know that I'm referring to my own notes. I'm a down-to-earth kind of guy. I'm from the largest riding in all of Canada and if I have something to say to the minister, I don't need to hear any comments from the Bloc Québécois member, thank you very much. Please go ahead, Mr. Minister.

Mr. Martin Cauchon: Mr. Chairman, the Community Futures Development Corporation program has been around in one form or another for over 20 years. Originally, the program operated under the auspices of Human Resources Development and was referred to as the BDC or CFC. When the new government took office in 1993, some changes were introduced. The two programs were merged and are now known in Quebec as the Community Futures Development Corporations.

Back when CFCs came under the umbrella of Human Resources Development, their role was quite different, given the primary mandate of the department. Since being transferred to the Economic Development portfolio, their role has shifted. Now the focus is on economic development initiatives, which basically ties in with the Agency's mandate.

The Agency has signed a new agreement with CFDCs, identified as first-line partners in the regions. This partnership will grow stronger in time. CFDCs assist the Agency in developing special programs.

Earlier, I alluded to the Youth Initiatives developed in concert with the CFDCs, which also deliver front-line services and programs, not only on behalf of the Agency, but also on behalf of other departments. Therefore, as we evolve, the nature of the partnership will grow stronger. These 54 organizations possess considerable expertise across the Quebec regions.

You asked what the future holds in store. I think the CFDCs' prospects for the future are excellent. In terms of economic development, CFDCs work fairly closely with other stakeholders.

Mr. Guy St-Julien: My second question concerns your report on economic spending for the Quebec regions. Words may soon be forgotten, but the written text lives on. Your report is quite well done. As I said earlier, you are a man of action. We may not always agree, but it is possible to devise solutions for our regions' populations. You note the following on page 13 of your report:

The metropolitan areas of Sherbrooke, Trois-Rivières and Chicoutimi-Jonquière and the Rimouski and Rouyn-Noranda clusters are increasingly capitalizing on their universities to participate in the knowledge economy....

Universities are important, particularly in the more remote regions of the province. People often tell me: “Guy, everything is centralized in Montreal”. I tell them that that's not the case, that we have the Université du Québec en Abitibi-Témiscamingue, which is located in Rouyn-Noranda and has campuses in Amos and Val- d'Or. Last year, a $7.4 million project was proposed for the university in Rouyn-Noranda. The plans will be sent to your offices this afternoon. This is a major proposal, one that takes into account the history of regional distribution and the populations of Amos, Val-d'Or and Rouyn-Noranda.

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For the first time ever, I plan to go along with Jules Arsenault and support Rouyn-Noranda on this initiative. Of course we want infrastructure projects, but we also want the ability to grow and develop in our region. In terms of economic development, what steps can you take to help the larger regions? In economic terms, Abitibi-Témiscamingue is on par with the Gaspé region. I think we may be a little worse off than the Gaspé region these days because, as you stated earlier, the economy is showing some signs of life in the Gaspé while in Abitibi, we have been losing ground these past few months. In Abitibi, unemployment hovers at 24 or 25 per cent. Statisticians tell us that it is holding at 13.4 per cent, but if you take a closer look, you will see that the youth unemployment rate is at 28 per cent.

We can you do to help our region grow and develop?

Mr. Martin Cauchon: Let me reiterate something I say when I make presentations. With the advent of the global economy, and in particular, the emergence of new means of communication and the new economy, if the regions as a whole can find a way to utilize all of the tools at their disposal, then the future may well belong to all of regions in Quebec and Canada.

The regions are a storehouse of knowledge. Populations enjoy a fairly high standard of living. However, regions must have the means to position themselves in the marketplace. To this end, they need research centres and universities. In fact, universities, research centres and the business community need to develop a better working relationship.

Across the province, whether it be at the University of Sherbrooke or the University of Quebec at Chicoutimi, Canada Economic Development has endeavored to assist people with research in specific fields, through the Regional Strategic Initiative program.

Earlier, you talked about developing knowledge, working in concert with universities. Industry Canada has taken a number of steps in this direction. Among other things, it established the Canadian Foundation for Innovation which funds activities in various research centres and in universities.

A number of projects are currently being considered for your regional university. These interesting projects, which were submitted under the CFDC-CED Youth Strategy, will help the region better meet the challenges of the new economy. I hope to be able to provide you with more specific details shortly. Things are moving forward, however. One program, the name of which I've forgotten, is designed to help people develop an idea and run with it. In Quebec, we call these people “inventors”. While their minds are full of ideas, they can't translate these ideas into reality, either because they can't obtain a patent for their invention or because they don't have the necessary ability or knowledge to market their product. Working with the university, we set up an organization several years ago to work with people who fall into this category. So far, the results have been fairly positive.

Mr. Guy St-Julien: I have another question that deals with the same topic. This is a highly informative report, one that makes for good reading. Here's a case of a good government that is working very hard. Page 43 of the report contains a reference to Abitibi- Témiscamingue....

A voice: The member speaks quite eloquently indeed.

Mr. Guy St-Julien: It's true that I'm beginning my twelfth year as a Member of Parliament, but I've always spoken on behalf of the people. It's true that I defeated the Bloc Québécois last time around, and I will again when the next election rolls around.

Mr. Chairman, I'd like to discuss with the minister the comments on page 44. Reference is made to prospectors. On page 43 in particular, the mining sector, technological capability and entrepreneurship are discussed. I'd like to talk to you about the mining sector for a moment.

I know that last year, you traveled to the area northwest of Val-d'Or and spoke of RSW-Béroma, of portable mills and so forth. I'd like to know what your department can do to help the mining sector. Could you also tell us a little about the Association des prospecteurs du Québec? I believe you also went to the OECD in Europe.

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The biggest problem we're experiencing is the collapse of mining exploration activities as a result of metal prices. Does our region's exploration sector have any kind of future?

Mr. Martin Cauchon: First of all, your region is obviously seriously affected by these developments. Your economy relies heavily on mining exploration and mining activities. The value of goods, metals and basic commodities produced by this sector fluctuates tremendously.

As I have already noted, the role of Canada Economic Development is to help regions diversify their economy, while not losing sight of economic realities. A Regional Strategic Initiative was developed for your region, one that takes into consideration not only the tourist attractions in the region, but the mining sector as well. Our goal is to help businesses develop technologies geared to the mining sector and subsequently to produce products not only for the Canadian market, but for the international export market as well.

Earlier, you alluded to a company that developed a small machine to filter mineral deposits extracted from the ground. The process is rather revolutionary. Our goal was to help the company develop a prototype and get it into production in order to export its knowledge worldwide. This revolutionary small-scale product which I've seen firsthand can replace an entire mineral extraction process.

Basically, we want to help businesses develop technologies. Imagine how useful such a technological advance could be to mining operations in developing countries.

Finally, my colleague's last budget called for certain investments in the mining sector across Canada. Close to $6 million will be earmarked for the industry in Quebec, with these funds to be managed by Canada Economic Development, through our RSI program.

Mr. Guy St-Julien: Which office will manage these funds?

Mr. Martin Cauchon: The Val-d'Or office.

Mr. Guy St-Julien: Thank you.

Mr. Martin Cauchon: That office is headed by the honourable Léo Couture.

Mr. Guy St-Julien: He's a fine director.

The Acting Chairman (Mr. Ian Murray): Thank you, Mr. St- Julien.

Mr. Desrochers.

Mr. Odina Desrochers: I can tell you right now that my questions will concern all of Quebec, not just my riding. Lotbinière is a wonderful riding, but I will try to broaden my field of vision.

I have a question for you. We hear much talk of economic development, rural development and regional development. Internet programs are being announced right, left and centre. Two weeks ago, Mr. Gagliano announced a number of such programs, as indeed you yourself and your associate Mitchell did. How does all of this work? Given that you have responsibility for economic development in the Quebec regions, is there a program in place which guarantees that all of the promises made by your colleagues will in fact be carried out? At some point, we will be contending with too many promises if this keeps up.

Mr. Martin Cauchon: Our involvement in this area goes back several years. You may recall that Minister Manley had reviewed all of Industry Canada's programs and, as part of the Connecting Canadians program, set out to make Canada the most connected country in the world. I think we can declare "mission accomplished".

As part of the strategy to make Canada a connected nation, as I recall, two or three years ago the Prime Minister called upon all federal economic stakeholders to bring in measures to lend support to their respective mandates. Agencies in particular were asked to do their part to implement this strategy.

Therefore, working through the Connecting Canadians program, we took a very significant, if not the most significant, step. We focused our efforts on e-commerce which does not target any one business or individual, but rather weighs the impact for a given community or given geographical or administrative region.

Following the launch of this e-commerce initiative, I had an opportunity to meet with my provincial counterpart, David Cliche, before similar e-commerce initiatives or steps were taken at the provincial level. He therefore was able to familiarize himself with my programs and thus ensure a linkage between the two departments.

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Mr. Odina Desrochers: While we're on the subject of CFDCs, do you intend to broaden the mandate of existing corporations or to establish new ones in 2000-2001?

Mr. Martin Cauchon: Since you appear to be well versed on the subject of regional development, you undoubtedly know that a year and a half ago, I announced a review of the geographical distribution of CFDCs. At the same time, I hinted that one of the following was possible: either new CFDCs could be established, either the area of responsibility of existing CFDCs could be expanded or new partnerships could be created.

We are currently holding talks with the CFDC Network, a provincial organization representing all 54 CFDCs in Quebec. We are also in contact with other agencies and hopefully we should be able to launch our initiative in the not too distant future.

Mr. Odina Desrochers: Do you have a particular time frame in mind?

Mr. Martin Cauchon: When I made my initial announcement, we were thinking in terms of one year. However, this was a somewhat optimistic projection. Be that as it may, I think that when we do move forward with our proposal, we will be meeting the needs of the community. The idea of dividing the territory in a different way or of expanding the areas of responsibility is not a new one. In fact, it has been advanced on several occasions by different economic stakeholders as well as by several different mayors.

As I said earlier, when Human Resources Development was responsible for the CFDCs' mandate, the corporations operated in a different way. Today, they have become a valuable economic development tool, one that all communities wish to avail themselves of.

Mr. Odina Desrochers: Do CFDCs operate independently? Are their operations decentralized and are they attuned to the needs of the community they serve?

Mr. Martin Cauchon: Yes, they operate independently. Board members are all equal and represent a cross-section of the community. They are truly representative boards.

The principle of ministerial accountability is probably the only restriction as far as their autonomy is concerned. As I indicated earlier to a Canadian Alliance member, I am accountable to the House of Commons, in keeping with the broad principles of democracy. Therefore, agencies that manage public funds are also accountable to me. However, I do feel that we have a struck a fine balance between autonomy and the principle of accountability.

Mr. Odina Desrochers: Do I have any time remaining? I do.

Mr. Minister, you stated that you are increasing your funding of the Regional Strategic Initiative program. Which clientele will you be targeting? Do you have any particular pilot projects in mind or any regions that you hope to reach through the program? It's been announced that your budget will increase from $55 million to $75 million in 2000-2001.

Mr. Martin Cauchon: That's a timely question indeed. Canada Economic Development's budget for this year, give or take a few dollars, is $150 million. These funds are earmarked for three main programs: IDEA-SME, the Regional Strategic Initiative and the Community Development Program.

If we take a closer look at how the funds are divided between the RSI and IDEA-SME which, after Program Review, was our main program, we see that the RSI has reached cruising speed and has overtaken IDEA-SME. As I recall, the budget for IDEA-SME is pegged at approximately $50 million, whereas the budget for the RSI is somewhere between $70 million and $74 million. Let's say it's $72 million. Therefore, both programs are up and running smoothly.

Now then, where exactly do these funds go? Canada Economic Development has established partnerships with different stakeholders in each region. In some regions, a considerable number of partners are involved.

A RSI has been launched in each region in response to the expressed economic development needs of the community. Earlier, I mentioned the Maritime Technopole initiative in the Lower-St. Lawrence-Gaspé region.

Of course, we have targeted the tourism industry through our actions because we have an extraordinary product to market abroad. Moreover, each region, whether it be the Gaspé, the Lower St. Lawrence or the Magdalen Islands, has its own unique economic features.

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We work with research centres like the Maurice-Lamontagne Institute with which we have forged a partnership of sorts. Our efforts also target companies with ties to the maritime community. I hear someone mentioning the name Marinard. A number of companies manufacture beauty products containing algae, taking advantage of what the area has to offer. The Quebec region is becoming a techno region and gaining international recognition. Through the $10 million GATIQ fund, we are able to support businesses operating in leading technology sectors.

Through the Regional Strategic Initiative fund, we have supported the work of the National Optics Institute in the geomatics field. We are also looking at two interesting international tourism and infrastructure projects which will have a major economic impact, namely the aquarium and the ferry terminal. We work hard to take into account the features and needs of each region.

As you know, Mr. Chairman, I grew up in the Quebec regions. I'm originally from the Charlevoix and regional development was a popular topic of conversation. Programs were often criticized for being inflexible and for disregarding regional economic realities. When I was awarded the economic development portfolio, I decided to make the RSI program a reality. Today, I'm seeing all partners reporting fairly positive results.

Mr. Odina Desrochers: I have one last question. You mentioned two projects in the works: the ferry terminal and the aquazoo. Is that correct?

Mr. Martin Cauchon: The aquarium.

Mr. Odina Desrochers: I stand corrected. Can we expect some final decisions to be made soon? How far along are the talks? I understand that there is some controversy swirling around these proposals.

Mr. Martin Cauchon: The aquarium project was unveiled yesterday. I don't know whether or not you read about it in this morning's papers.

Mr. Odina Desrochers: I'm delighted for the residents of Sainte-Foy.

Mr. Martin Cauchon: The aquarium project has been in the works for one year now. I met with project officials for the first time one year ago and I've met with them several times since then, including a meeting a few weeks ago. Analyses are currently being completed and, since I realize the residents of the Quebec region are expecting an announcement shortly, I hope to give you a final decision in the weeks ahead.

Mr. Odina Desrochers: What can you tell me about the ferry terminal?

Mr. Martin Cauchon: There is an ongoing debate in the Quebec region about the ferry terminal proposal. A public inquiry was launched recently over a particular site. We are open to the possibility of considering other sites. Will other sites in fact be considered? I think that would be somewhat difficult, given that the inquiry is already under way. However, that doesn't mean we aren't willing to consider other sites. As I see it, the important thing is to provide the Quebec region with a tourism infrastructure that will be a boon to the economy.

Mr. Odina Desrochers: Thank you, Mr. Chairman.

The Chair: Thank you, Mr. Desrochers.

[English]

I have two more questioners on my list, Mr. Hill and Mr. St-Julien.

[Translation]

Mr. Dubé also wants to speak. We have 10 minutes.

[English]

This will be a short round, so I'll start with Mr. Hill.

Mr. Grant Hill: Mr. Dubé is welcome to....

[Translation]

Mr. Odina Desrochers: It's simply that we're interested in issues that concern Quebec.

Mr. Antoine Dubé (Lévis-et-Chutes-de-la-Chaudière, BQ): I'd like to take a moment to welcome Mr. Jacques, who used to be one of my professors. He taught me all about the systems approach method. In any event, I have a question for the minister who has had quite a lot to say thus far.

Assessing performance is very important and specific criteria must be met. I don't have with me a copy of the performance report that Mr. Hill mentioned. However, have you been able to assess the situation on the basis of criteria since 1993? Is one criteria the number of jobs created? What criteria do you use and how do you evaluate performance? What kind of progress are you able to report at this time?

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Mr. Martin Cauchon: In terms of programs and program performance, since 1995, we have requested internal audit reports precisely because we were dealing with new programs. We wanted to be able to fine-tune these programs to satisfy any needs expressed.

In addition, the department has developed a strategic framework to follow up more effectively on program data. A monitoring body has been set up.

No doubt I neglected to mention in my opening remarks that we now have a virtual office at the Agency. By surfing the Internet, you can access our site, our virtual office so to speak, as well as our monitoring body which collects programming data, allowing us to evaluate program performance.

Another important fact worth mentioning is that for several years now, the department's IDEA-SME program has been certified ISO 9002. What does this mean? It means that programs are implemented in accordance with stringent standards and internationally recognized criteria. Each file is handled the same way and regular audits are conducted. Canada Economic Development has just renewed the ISO standard for the IDEA-SME program.

I also have a sort of news flash for you. We are launching the ISO certification process for the Regional Strategic Initiative program.

Finally, since we are very much a results-based agency, we don't look at how many jobs are created with x number of dollars, but rather at the overall impact of a project on economic development. Of course, one of the spinoffs is job creation. In the case of the IDEA-SME program, we survey our clients on a regular basis to ascertain the number of jobs that have been created.

Similar steps will be taken in the case of the RSI, but this program is still relatively new. However, we do want to forge ahead because in doing so, we focus increasingly on results and on economic spinoffs for the regions.

Mr. Antoine Dubé: Prior to 1993, there was an agreement in place known as the Canada-Québec Agreement. As of last year, only two provinces had yet to renew the agreement. My colleague from Lotbinière has been assigned to regional development for the past year. The process seems to have stalled in Quebec. Can you update us on the situation?

Mr. Martin Cauchon: You say that the process has stalled in Quebec.

Mr. Antoine Dubé: That's right, in terms of renewing the agreement.

Mr. Martin Cauchon: I don't know about that, but I'll have to take you at your word.

The truth of the matter is that the process has not stalled. You may recall that there was also the Industry Canada-Quebec agreement which was not renewed when it expired. I know the Government of Quebec went ahead with its own programming, specifically the FAIRE program. We opted for other intervention strategies in line with our own vision of economic development. Quite often, when you look at the concrete results that have been achieved, you will see that the programs have complemented one another.

In terms of regional development, in 1995, we retooled our programs to take advantage of the federal government's strengths, expertise and conditional jurisdiction over economic development. Today, we can see that the actions of the two levels of government are ver much complementary. Forty per cent of federal initiatives in Quebec are undertaken in partnership with the Quebec government.

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Moreover, I will be traveling with Mr. Landry to the Gaspé region tomorrow to make an announcement. Communication between both levels of government is excellent. By retooling our programs, we have been able to concentrate more on our specific areas of expertise.

The Chair: Thank you, Mr. Dubé. You have four minutes, Mr. St-Julien.

Mr. Guy St-Julien: Then I'll get right to the point. There are those who claim to speak not only for their region. The province of Quebec covers an area of 1,500,000 square kilometres, 802,000 of which encompass my riding. Compare this to the ridings of other members which might cover an area of 50, 100 or 1,000 square kilometres. I do business with 68 mayors. A distance of 2,000 kilometres separates Val d'Or, the southernmost city in the riding, from Salluit, the northernmost municipality.

My question for you is as follows. I realize that Industry Canada and Canada Economic Development have a specific mandate for Quebec's Inuit and aboriginals. I'm interested in the Regional Strategic Initiative program for the year 2001. I understand that some initiatives have not yet been finalized and that your staff is working hard on this.

I'd like you to talk about Nunavik, James Bay, the North Shore, central Quebec, the Laurentides-Lanaudière region and the non-metropolitan Montreal area.

By the way, is there any truth to the rumour that you are planning to hold a Canadian congress of CFDCs? Will the congress in fact be held in Mont-Tremblant, Quebec, as I learned recently? Could you tell us a little more about this as well?

[English]

Mr. Martin Cauchon: Mr. Chair, how much time do we have left?

The Acting Chair (Mr. Ian Murray): About three minutes.

Mr. Martin Cauchon: I'll do my best to be very brief with that question, even though I would be able to speak for maybe an hour. That question is so huge.

[Translation]

Regarding northern Quebec, the member is well aware of the fact that two years ago, Industry Canada launched the Aboriginal Business Canada initiative. All agencies were asked to contribute to this initiative. What's more, we invested $1 million in this venture which is working well.

We hope to move forward with a RSI for northern Quebec shortly. You mentioned 2001, but I hope it will be sooner than that. This initiative will include a new economic development tool that will be managed in conjunction with existing programs, whether IDEA-SME or Industry Canada programs.

As far as a national congress of CFDCs is concerned, I can indeed report that it will be held in Mont-Tremblant, Quebec at the end of May. This is the first time this event has been staged. CFDCs from across the country have a great deal in common. I'm confident that the congress will breathe new life into these corporations which, I repeat, are remarkable economic development tools.

Mr. Guy St-Julien: I want to thank the minister for bringing the national congress to Quebec. Economic development fosters prosperity. As you said, the congress is slated for the last weekend in May.

I hold the minister, the Honourable Martin Cauchon, in high regard. More than anyone else, he travels the length and breadth of the province, making his presence felt in the process. Thank you.

[English]

The Acting Chair (Mr. Ian Murray): I'm very happy to thank the minister and his officials for joining us today. We've had a very good discussion, and we learned a lot about Mr. St-Julien's riding. Again, thanks very much.

This meeting is adjourned.