Evaluation of the Client Service Fund (CSF) and Integrative Trade Strategy Fund (ITSF) - Summary Report

Evaluation of the Client Service Fund (CSF) and Integrative Trade Strategy Fund (ITSF) Full report

Why is it important?

The CSF was launched in April 2002 as the Department’s principal fund for supporting proactive initiatives undertaken by the Trade Commissioner Service (TCS). The fund is used to assist Canadian industry to compete globally and influence foreign decision-makers to select Canada as a source of goods and services.

In April 2009, the Integrative Trade Strategy (ITS) was introduced whereby 50% of the total CSF allocation was devoted to funding strategic initiatives aligned with the Department’s priority markets and sectors through a competitive application process. In 2013-14, the Global Value Chains (GVC) Fund and the Canadian Direct Investment Abroad (CDIA) Fund were amalgamated under the ITS, establishing a single, larger fund known as the Integrative Trade Strategy Fund (ITSF).

What the evaluation assessed:

Following consultations with senior management in the International Business Development and Innovation Branch (Chief Trade Commissioner) (BFM), the CSF and ITSF were identified for evaluation in FY 2016-2017.

Notably, the CSF had not been evaluated in six years and the ITSF had not undergone an evaluation since its creation.

The focus of the evaluation was on the relevance, performance and efficiency of the CSF and ITSF, as well as stakeholder observations on the funds’ usefulness.

The Corporate Social Responsibility (CSR) and Edu Canada funds are allocated and tracked through the same processes as ITSF funds, but are administered separately from the ITSF funding envelope, and were therefore not part of the evaluation.

The evaluation questions that were asked:

Relevance:

• To what extent do the CSF and ITSF continue to be relevant to the TCS community to  support Canadian business clients in their efforts to participate in global markets?

Performance:

• To what extent have the CSF and ITSF contributed to departmental international business development objectives and results for Canadian businesses?

Efficiency:

• Are the governance structure, program practices and processes efficient and effective?

• Evaluation Scope: 2013-2014 to 2016-2017
• Program Resources (annual): $4.9M to $5.8M
• Data Sources:
  • Interviews with program staff and other key stakeholders (n=51)
  • Online survey of STCs and TCs (n=164)
  • Database review of CSF and ITSF funded initiatives at 8 missions
  • Document review
• Evaluation Completed: June 2017

What the evaluation found

Relevance

• The Trade Commissioner Service (TCS) relies on the CSF and ITSF to fund strategic initiatives, projects and services that help Canadian businesses to participate and expand into global markets. As a proportion of total trade budgets, the CSF and ITSF represent an increasingly important source of funding to Commercial-Economic sections due to a decline in funding from Other Government Departments and partners.
• The ITSF serves as a highly targeted and strategic source of funding aligned with the Sector Analysis and Priorities for the TCS, while the CSF continues to be a discretionary source of funding that allows the TCS to respond to local, market-driven opportunities and client demands. Access to discretionary CSF and targeted ITSF funding enhances TCS capacity to serve Canadian businesses in their efforts to expand into global markets.

Performance

• Trade initiatives, funded in part through the CSF and ITSF, support the advancement of Departmental international business development objectives by contributing to the expansion of Canadian business participation in global markets, increasing interactions between Canadian clients and global business partners, and generating new business opportunities and results for Canadian clients.  For example, the Report on Plans and Priorities reported that in 2015-2016, the TCS supported Canadian companies by conducting 1,220 trade initiatives funded through the CSF and ITSF (and Edu Canada) which contributed to 963 commercial agreements concluded as compared to 934 commercial agreements concluded in 2014-2015.
• Strategic guidance provided by the Trade Sectors Bureau for the ITSF was found to be clear for all of the TCS’s priority sectors, however, greater clarity and consistency in the provision of operational guidance across all sectors is needed. Further, stakeholders at missions and headquarters expressed a need for greater access to hospitality to support CSF and ITSF- funded initiatives since hospitality is considered an essential cost of doing business.
• The CSF and ITSF-funding mechanisms are well-managed and have effective governance structures that provide oversight and support the achievement of results through sound project planning and implementation. The financial monitoring and reallocation systems in place are highly effective and contribute to low lapse rates. However, uncertainty of the ITSF budget and timing of ITSF disbursements to posts was found to adversely impact on program delivery, and the transaction costs of administering the ITSF was reported to be high at missions, headquarters and Common Service Delivery Points.
• Finally, the database review demonstrated a lack of interoperability between CSF and ITSF planning (Strategia) and reporting (TRIO2) systems which increases the administrative burden on posts, introduces a risk that data will be entered inaccurately, and limits effective performance measurement of the funds.

Our Recommendations