This report sets out the findings, conclusions and recommendations from a Formative Evaluation of Industry Canada's CANtex/TPEC component of the Canadian Apparel and Textile Industries Program. The Evaluation was undertaken during the summer and fall of 2006.

Background

Canada's textile industry is made up of companies who manufacture fibres, yarns, fabrics, and finished textile products. In recognition of the removal of tariffs and quotas on textile and apparel imports from 48 Least Developed Countries, the Government created a $33 million Canadian Apparel and Textile Industries Program (CATIP) to operate from 2002 to 2005. On February 27, 2004, the Government announced a new Textile Production Efficiency Component for CATIP, called "CANtex", aimed at improving the global competitiveness of Canadian textile manufacturers. CANtex concentrates on encouraging improvements to production processes to increase productivity as well as a re-orientation of textile production towards higher value-added products.

CANtex includes both non-repayable and repayable contributions. Non-repayable contributions are provided up to 50% of eligible project costs, to a maximum of $100,000. Repayable contributions are provided at a rate of 50% on the first $2 million of eligible costs, 40% on the next $2 million, and 30% on costs above this amount, to a maximum total repayable contribution of $3 million. CANtex is delivered by Industry Canada and Canada Economic Development for Quebec Regions (CED-Q). The CATIP program will sunset March 31, 2010.

Evaluation Methodology

The methodological approach used reflected the standards of Program Evaluation and the expectations set out in Canada's Treasury Board Policy on Evaluation. The Evaluation examined program rationale, program design and delivery, and progress on results to date. It also identified lessons learned.

The methodology included multiple lines of inquiry, including a review of documents, interviews with multiple stakeholder groups, survey of program recipients, case studies, and horizontal analysis across all lines of inquiry. Forty seven individuals were interviewed from Industry Canada, CED-Q, and companies. External interviews covered 55 of the 200 total CANtex projects as of July 2006. Interviews were also held with 15 companies identified as having a rejected project. All recipient companies who were not selected for an interview were asked to complete an internet-based survey; 25 companies completed the survey. Finally, three case studies were completed.

Overall, the research methods used in this Formative Evaluation provides a good level of confidence that the conclusions reached are valid.

Findings and Conclusions

The Evaluation findings relate to CANtex's design; CANtex's delivery; and progress on results.

CANtex's Design

Overall, the Evaluation findings indicate that CANtex's design is suitable for the program and for applicants' and recipients' needs. In general, interviewed companies and those surveyed responded very favourably to all elements of the program's design that they were asked about with very few concerns or issues.

CANtex's objectives and activities have remained reasonably stable since the beginning of the program. None of the interviewed companies indicated that these changes had adversely affected them.

Interviewed companies and survey respondents were asked to provide comments on four aspects of CANtex's design: the application, the terms and conditions, the reporting requirements, and the disbursement process.

With respect to the program's application process, the large majority of interviewed companies and survey respondents provided high marks, strongly suggesting that the CANtex application process was well designed and suitable to the program.

With respect to CANtex's terms and conditions, the large majority of interviewed companies and survey respondents indicated these were suitable for this type of program. Furthermore, the $100,000 ceiling on non-repayable contributions did not appear to present a significant challenge.

With respect to the program's reporting requirements, the large majority of interviewed companies and survey respondents indicated that these were also suitable for this type of program.

In general, interviewed companies and survey respondents replied positively regarding CANtex's disbursement process.

Even the companies with rejected projects are satisfied with the program's design.

The few comments received from respondents regarding how to improve the program were suggestions on simplifying the application process and to alter the scope of certain elements to allow more flexibility. Even so, those providing the suggestions were still satisfied with how the program is currently run.

CANtex's Delivery

The Evaluation determined that, in the main, CANtex is well delivered. However, the findings suggest that a number of factors appear to have led to uneven program delivery in some regions.

Interviewed companies that dealt with Industry Canada provided very high praise for the support provided by program officers, indicating a very high level of satisfaction with program delivery.

Interviewees and survey respondents from Quebec companies, who dealt with CED-Q, also rated the delivery of CANtex highly. The findings also indicated some concerns about program delivery in Quebec, specifically related to a long approval process and unevenness in delivery. Interviews with CED-Q officers revealed that there were differences in how the program was delivered across Quebec, suggesting there was variability in the officers' understanding of the program eligibility parameters. Further, because CED-Q officers located outside of Montreal were not easily "backed up" by other knowledgeable colleagues, the companies they dealt with were affected by the availability of those officers. As a result, there was unevenness in delivery, and the overall delivery of CANtex was not as effective as it could have been.

The findings indicate that, because of the different program management approaches implemented by Industry Canada and CED-Q, companies are receiving a different level of service from the two Departments. This indicates a need to take steps to ensure that all applicants and recipients are treated as intended.

CANtex's Results To Date

Evaluation findings indicate that CANtex is likely achieving the types of results that were intended. Specifically, CANtex projects are contributing to the program's intended results, as well as those of the CATIP program.

The program data indicates that CANtex projects in the area of improved management systems or automation processes are more prevalent, with about half as many again in the area of improvement of production processes.

Also, the majority of projects are helping companies keep up with expected productivity improvements prevalent in the textile industry. These changes relate to areas such as financial management, production, and supply-chain management. A few of these interviewees indicated that, without the changes brought through the CANtex project, their company might not be in existence today.

Of particular note, most interviewed companies were able to describe in some detail the types of results that were being achieved as a result of the project, and many recipients are able to identify and report a quantitative impact from their CANtex project.

Companies indicated that the guidance provided by officers at the application stage has been useful to shape their projects so that they generate intended benefits.

The findings provide strong support for the view that CANtex continues to be relevant to the Canadian textile industry: the majority of CANtex projects are contributing to productivity improvements, many companies can readily identify the results from their projects, and without the support that was provided, some of the companies might not have survived financially.

Finally, CANtex program management now collects some of the performance information necessary to support a future Summative Evaluation of the program. However, more effort needs to be allocated to collecting the required performance information.

Recommendations

Recommendation 1: To ensure that CANtex clients are served consistently, CED-Q should take the steps necessary to ensure that program officers are fully informed and that backup capabilities are in place to support its officers in delivering the program.

Recommendation 2: Industry Canada and CED-Q should take the steps necessary to ensure that CANtex is uniformly and consistently delivered across Canada.

Recommendation 3: To ensure that Industry Canada is able to report on the results achieved through CANtex, program management should establish a complete and systematic process for collecting and compiling results information, based on the contents of the Results-Based Management Accountability Framework.

Final Report (PDF - 158 KB - 38 pages)

Management Response (PDF - 14 KB - 3 pages)

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