Summative Evaluation of the
2000-2009 Canada/ESA
Cooperation Agreement
Final Report
Prepared for:
Canadian Space Agency
Prepared by:
Goss Gilroy Inc.
Management Consultants
Suite 900, 150 Metcalfe Street
Ottawa, ON K2P 1P1
Tel: (613) 230-5577
Fax: (613) 235-9592
E-mail: ggi@ggi.ca
Feb 22, 2010
Summative Evaluation of the 2000-2009 Canada/ESA Cooperation Agreement: Final Report
Table of Contents
Executive Summary ......................................................................................... iii 1.0 Introduction ............................................................................................. 1 1.1 2.0 Overview of Methodology ...................................................................... 3 2.1 2.2 2.3 2.4 3.0 History .................................................................................................. 12 Objectives of the Agreement ................................................................ 17 Key Stakeholders .................................................................................. 20 Organization and Governance Structure .............................................. 22 Canada’s Participation in ESA ............................................................. 26 Previous Reviews and Evaluations ....................................................... 31 Findings .................................................................................................. 36 4.1 4.2 4.3 4.4 5.0 Evaluation Issues .................................................................................... 3 Approach and Methodology ................................................................... 5 Economic Analysis ................................................................................. 9 Limitations ............................................................................................ 10 Background on the Agreement ............................................................ 12 3.1 3.2 3.3 3.4 3.5 3.6 4.0 Scope and Objectives of the Evaluation ................................................. 2 Rationale for the CSA-ESA Agreement ............................................... 36 Design and Delivery Issues .................................................................. 43 Results and Impacts of the CSA-ESA Agreement ............................... 49 Cost Effectiveness and Alternatives ..................................................... 71 Summary of Findings and Conclusions .............................................. 78 5.1 5.2 5.3 5.4 Rationale and Relevance ...................................................................... 78 Design and Delivery ............................................................................. 79 Results .................................................................................................. 79 Recommendations ................................................................................ 81 Appendix A: Expenditures and Commitments ............................................. 84 Appendix B: Bibliography ............................................................................... 87 Appendix C: Data-Collection Instruments .................................................... 93 GOSS GILROY INC.
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CSA/ESA Case Study Template ...................................................................... 94 C.1 CSA & OGD Stakeholders - Interview Guide ........................................... 95 C.2 ESA & Other European Officials - Interview Guide ................................. 99 C.3 Beneficiaries of ESA Contracts – Interview Guide ................................. 101 C.4 ESA Contract Beneficiaries - Follow-up Questionnaire.......................... 105 C.5 Non-Beneficiaries of ESA Contracts - Interview Guide ......................... 110 Appendix D: Roles and Responsibilities of Agreement Stakeholders ....... 114 Appendix E: Evaluation Issues & Matrix .................................................... 118 Appendix F: Canada’s Return-Coefficient Rank, by Area ........................ 125 Appendix G: Economic Impact Analysis ..................................................... 131 Appendix H: Technology and Skills Development...................................... 147 Appendix I : Management Action Plan ....................................................... 152 GOSS GILROY INC.
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Summative Evaluation of the 2000-2009 Canada/ESA Cooperation Agreement: Final Report
Executive Summary
This Report presents the findings, conclusions and recommendations for the summative
evaluation of the 2000-09 Canada/European Space Agency (ESA) Cooperation Agreement
(Agreement).
This summative evaluation was undertaken for the Canadian Space Agency (CSA) by Goss
Gilroy Inc (GGI), Management Consultants, in accordance with the TB policy on program
evaluation. The evaluation was carried out under the direction of CSA’s Evaluation
Committee during the period from November 2008 to November 2009.
The primary role of the evaluation as identified in the CSA Statement of Work (SOW) was to
assess:




The rationale for programs (funded under the Agreement);
The extent to which the programs have been successful in meeting their objectives;
The program’s cost-effectiveness compared to alternative means of delivery; and,
The program’s relevance to government priorities, with advice and recommendations
based on the results of the work.
The issues addressed in this summative evaluation respond to the scope and objectives of the
evaluation and address the following areas:




Rationale and Relevance: the consistency of the Canada/ESA Agreement with the
priorities of the Government of Canada, Canada’s Space Program, and the science
information needs of the government;
Design and Delivery: Canadian companies’ need for assistance in obtaining contracts on
ESA programs, and the ability of Canadian companies to benefit from the opportunities
presented by the Canada/ESA Agreement;
Results: the extent to which the Agreement achieved its primary objectives; and
Cost-effectiveness: cost-effectiveness of Agreement compared to other alternative means
of delivery.
1. Evaluation Approach
The approach to this evaluation builds on the results of the 2004 Formative Evaluation and
the RMAF Evaluation Strategy. Consistent with the TB Evaluation Policy1, the evaluation
team utilized multiple lines of evidence in reviewing the issues.
Data sources used varied by question and included:



1
An administrative and performance data review;
Key informant interviews at CSA, ESA and other Canadian government departments;
A survey of recipients of ESA contracts;
Treasury Board Policy on Evaluation, April 1, 2001.
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Summative Evaluation of the 2000-2009 Canada/ESA Cooperation Agreement: Final Report


Case studies of selected recipients of ESA contracts; and,
A survey of organizations that did not receive ESA contracts.
The report is based on information available up to September 30, 2009.
The statistical information, collected by CSA and ESA on activities under the Agreement,
information provided by Canadian organizations in the survey, and information obtained
through the case studies were analyzed in conjunction with Statistics Canada’s recently
released National Accounts and its most recent 2006 Input/Output Table (I/O) in order to
complete the economic assessment of the 2000-09 Agreement.
The following table indicates the number of Canadian company establishments surveyed or
interviewed by GGI that were recipients of ESA funds over the period 2000-2008. The table
also describes the percent coverage of establishments through the survey, as well as the
percentage of ESA funding covered. It should be noted that establishments does not equate to
companies, but rather to individual facilities operated by the companies. For example, MDA
has multiple establishments, which each operate as different businesses.
Sample Coverage (by establishment receiving ESA contracts)
Establishments
% of
Establishments
Covered
% of ESA
Contracts Covered
by dollar value
Case Study
25
21.2%
80.9%
Surveyed
39
33.1%
6.1%
Total Covered
All establishments receiving
ESA contracts
Establishments receiving
ESA contracts that were out
out-of-business and invalid
contacts
Overall Coverage of
establishments receiving
ESA contracts that could be
contacted
64
54.2%
86.9%
12
10.2%
0.2%
106
60.4%
87.1%
Status
118
2. Canada/ESA Cooperation Agreement
ESA was established in 1975 as an autonomous international organization dedicated to the
exploration of space, with funding provided by its member states. The 18 current member
states include Austria, Belgium, Czech Republic, Denmark, Finland, France, Germany,
Greece, Ireland, Italy, Luxembourg, The Netherlands, Norway, Portugal Spain, Sweden,
Switzerland and the United Kingdom. As well, Hungary, Romania and Poland participate in
the Plan for European Cooperating States (PECS). In addition, Estonia and Slovenia have
recently signed cooperation agreements with ESA. Canada, which is also classified as a
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cooperating state, has had Agreements with ESA since 1979.
ESA is headquartered in Paris, with a staff numbering just over 2,000 and an annual budget of
about €3.6 billion (or CDN $5.9 billion) in 2009. Canada’s contribution to ESA’s total 2008
income from member and cooperating states was about €20.0 million or 0.83% of the total
budget. In that year, Canada contributed 0.77% (or €4.6 million) of the mandatory activities,
which was a slightly lower percentage than the 0.85% (or €15.4 million) contributed to the
optional programs.
The Canadian Space Agency (CSA) is the Canadian government agency responsible for
Canada’s space program. It was established in March 1989 by the Canadian Space Agency
Act and sanctioned in December 1990. The legislated mandate of the CSA is: “To promote
the peaceful use and development of space, to advance the knowledge of space through
science and to ensure that space science and technology provide social and economic benefits
for Canadians.”
Canada’s working relationship with ESA has been in existence since the first cooperation
agreement was put in place, covering the period from January 1, 1979 to 1983. This initial
agreement, which predated the establishment of the CSA, included the fields of space
research and technologies as well as associated space applications. Since then, the agreement
has been renewed on three occasions, covering the periods from 1984 to 1988; from 1989
through 1999; and, most recently, from January 1, 2000 to December 31, 2009.
The Agreement is a treaty that is formally negotiated between ESA and Canada. The
agreement is managed for Canada by the CSA. Notably, Canada is the only non-European
country that participates in ESA programs.
Generally speaking, the Agreement contributes to maintaining Canada’s world leadership in
its traditional niches (e.g., civilian radar technology for Earth observation, and advanced
satellite communications services) and enhancing the international competitiveness of the
Canadian manufacturing industry through the development of space technologies, innovative
advanced systems, and terrestrial applications.
The current Agreement differs from the two preceding agreements between CSA and ESA in
that it includes a clear obligation (as compared to best efforts) to provide an industrial return
to Canada on par with that of ESA Member States in optional programs, and also guarantees
Canada the same rights as ESA Member States in optional programs.
The CSA Program’s strategic outcomes have likewise changed over the years. According to
the Program Activity Architecture (PAA) in its Report on Plans and Priorities (RPP) for
2009-2010, the CSA Program has one strategic outcome, namely, “Canada’s presence in
space meets the needs of Canadians for scientific knowledge, space technology and
information.” The 2009-2010 PAA notably differs from the Program’s previous PAAs in that
it is highly streamlined with respect to strategic outcomes.2
2
By contrast, consider the 2004-2005 RPP, in which there were seven (potentially overlapping) strategic outcomes: economic
benefits; technological development and diffusion; understanding of the environment; contribution to the quality of life; worldclass space research; social and educational benefits; and promotion and awareness of the CSP. The 2009-2010 RPP is also
streamlined compared to the RPPs from fiscal years 2005, 2006, and 2007, which contained the following three strategic
outcomes: knowledge, innovation and economy; sovereignty and security; and environment and sustainable development.
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Summative Evaluation of the 2000-2009 Canada/ESA Cooperation Agreement: Final Report
The current unique strategic outcome is supported by activity in four main areas/thrusts: earth
observation, space science and exploration, satellite communications and generic
technological activities. In the most recent RPP, the objectives of the CSA/ESA partnership
are highlighted, each corresponding to one of these four areas/thrusts:




ESA Programs in earth observation – Objective: “Through key international partnerships,
enhance the Canadian industry's technological base and provide access to European
market for value-added products and services in the field of earth observation.”
ESA Programs in space science and exploration – Objective: “Through key international
partnerships, foster the participation of Canadian academia and the demonstration of
Canadian space technologies in European space science and exploration missions.”
ESA Programs in satellite communications – Objective: “Through key international
partnerships, enhance the Canadian industry's technological base and provide access to
European market for value-added products and services in the field of satellite
communications.”
ESA Programs in Generic Space Technologies: “Through key international partnerships,
enhance the Canadian industry’s technological base and provide access to the European
market for value added products and services in the field of generic space technologies”
The Canadian space sector generates revenues close to $2.8 billion of which $399 million
were from European sales3 and employs 6,742 people4 in 213 organizations5 across Canada.
Significantly, this group includes at least 27 large organizations and 100 SMEs.6,7 While the
size of all the players in the industry is unknown, these figures indicate that the Canadian
space sector includes a large percentage of SMEs. Also noteworthy is the fact that the sector
contains 12 not-for-profits and 32 government organizations.
The principles governing Canadian participation in ESA, defined in the 2000-09 Cooperation
Agreement, are as follows:


Canada, with its cooperating-member status, contributes to the General Budget at 50% of
the rate of ESA Member States (based on a GNP scale). Canada contributes to all
elements of the General Budget of ESA, except the costs related to the Scientific Program
(SP) and the Technical Research Programs (TRP) for which Canada is ineligible.
However, Canada is eligible for other contracts made under the General Budget.
Canada’s contribution to the General Budget is mandatory for participation in the
Optional Programs.
Canada’s contributions to Optional Programs are made at Canada’s request, and are
subject to the unanimous approval of Member States participating in the Program. In
addition, the contributions are subject to adjustments due to inflation, program cost
increases, and exchange-rate variation. The single-object development programs, in
particular, are subject to a maximum of 20% in cost increases over the initial program
contributions.
3
Source: CSA, State of the Canadian Space Sector, 2008.
Ibid.
5
Source: CSA website, retrieved May 2009
6
These figures are based on the qualification of organizations with fewer than 200 employees as SMEs. Source: Organization
websites.
7
The size of the remaining organizations is unknown.
4
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In March 2000, Treasury Board (TB) approved contributions to ESA of up to $30 million per
fiscal year for the duration of the Agreement (1999/00 to 2008/09). These contributions were
provided for the General Budget and for Optional Programs in which Canada participated.
In 2005, so as to comply with the 2000 Transfer Payment Policy, the CSA sought approval
for class terms and conditions governing Canada’s contribution to ESA. The revised terms
and conditions included the authority to commit up to a maximum of CDN $200 million to
ESA over the last five years of the agreement (i.e. between January 1, 2005 and December 31,
2009) and the setting of a CDN $200 million ceiling for the contributions to be paid over that
five-year period. In addition, recognizing the multi-year nature of space programs, the CSA
was granted the authority to pay contributions to ESA after December 31, 2009 (the end of
the Agreement) to honour commitments made prior to the end of the term.
Total CSA expenditures and commitments under the Agreement from 2000 to 2018-19
amount to $441.7 million. CSA entered into multi-year commitments and expenditure
totalling $217.6 in the first five years under TB’s Program approval of 2000, while
expenditures and commitments for the second 5 years, under TB’s Program approval of 2005,
amounted to $224.1 million. This leaves $149.4 million in commitments for the 2010 to
2018/19. A year-by-year breakdown of those commitments and expenditures is provided in
Appendix A.
The budgetary emphasis on earth observation has generally been declining. It fell from
45.8% of the budget in the first five years to 33.6% in the second five years. At 34.4%, As of
September 30, 2009, it accounted for a slightly greater share of outstanding commitments.
Satellite communications (SC) has declined from 47.4% of expenditures over the first five
years to 39.8% in the second five years and now amounts to 28.6% of outstanding
commitments. In contrast to the above, there has been a growing emphasis on space
exploration (SE), which has increased from 2.3% during the first five years of the Agreement
to 23.3% in the last five years, currently accounting for 34.9% of outstanding commitments. .
Generic Technological Activities (GTA) make up the remainder of the budget. There have
been only minor fluctuations in GTA as a percent of the budget.8.
3. Findings
Follow-Up on Past Evaluations
Management has followed up on the recommendations from prior evaluations. In each of
those areas where management has pursued a course of action, it believes it has accomplished
all that was possible. One issue, in particular – achieving the technology transfer objective –
is no longer applicable, as the objectives of the 2000 Agreement were reworded to exclude
technology transfer in 2005. The evaluation found that previous concerns raised by
organizations vis-a-vis a lack of a systematic CSA mechanism for keeping companies
apprised of contract opportunities at ESA, and CSA priorities with respect to ESA remain a
concern and have not been adequately addressed. The evaluation team realizes that there are
limited funds invested by CSA in ESA to accommodate all of the companies that would like
to benefit from ESA contracts, given ESA’s formula of matching contacts awarded to dollars
8
CA_01JAN00_31DEC08_TO CANADA 230909
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invested by Canada in its programs.
Continuing Relevance of the Canada/ESA Agreement
The evaluation team reviewed the continuing relevance of the Agreement and determined
that:





The needs and conditions that led Canada to enter into the Agreement continue to exist.
The study found strong support for continuing the Agreement. Specifically, the rationale
for continuing the agreement derives from several factors. Given its relatively small
budget, the activities that the Canadian Space Agency can pursue are limited in scope
compared to those pursued by ESA. The breadth and depth of technologies under
development are considered much greater in ESA programs than what CSA can support
in its own programs due to the much greater ESA budgets and the diversity of partners
and programs involved in ESA. In addition, recent US regulations (ITAR) have restricted
the amount of space-related work originating from NASA and the USA in general. A
healthy and expanding Canadian space industry must look beyond North American
borders and find opportunities to participate in international missions and programs.
Federal organizations such as the Canada Centre for Remote Sensing (CCRS) and
Environment Canada have information needs that are satisfied by technologies developed
under the ESA program.
The Agreement is consistent with the priorities of the Canadian Government and the
CSA. The Agreement supports many science information needs in the areas of Internet
access, earth observation, search and rescue, telemedicine, and resource management.
Without the Agreement, Canadian companies would, with minor exceptions, not have
received contracts from ESA. Certainly not at the level of activity that has been achieved.
Canada is participating in the ESA programs in which the Canadian space industry has a
competitive advantage. Whether these are the most appropriate programs for Canada in
the long term is the subject of some debate. At this point in time, CSA has not finalized a
long-term plan for Canada’s involvement in space.
Delivery Issues
With respect to delivery issues, the evaluation team found that:



CSA is not communicating opportunities to Canadian firms as effectively and
consistently as it could. At the same time, the Agency must be careful not to create
unrealistic expectations, since demand for ESA opportunities exceeds available Canadian
funding.
The major challenges faced by Canadian firms relate to the relatively small and
sometimes uncertain Canadian funding of ESA programs, the complexity and difficulty of
the ESA bidding process, and the firms’ distance from Europe. The challenge most often
cited from the case studies was the level of funding that Canada contributes to ESA.
Given the “pay-to-play” nature of ESA programs, the unavailability of Canadian funds
appears to be the most significant obstacle to Canadian industry.
Another challenge faced by CSA with respect to program delivery is that created by
market fluctuations and their effect on currency values. Specifically, CSA’s contributions
to ESA are made in Euros and are therefore subject to exchange-rate variation.
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Results and Impacts of the Canada/ESA Cooperation Agreement
The evaluation team found the following with respect to the results and impacts of the CSA
Agreement:









Contracts awarded to Canada have achieved an overall “return coefficient” of 1.09
according to ESA calculations.9 This exceeds the ESA target of .94. Canada ranks second
of all ESA member states in achieving the calculated return coefficient.10
The Canada/ESA Agreement has significantly contributed to the:
1) enhancement of the existing technological/innovation capabilities; and
2) development/demonstration of advanced technologies, systems, components, and tools
of the companies and organizations that received ESA contracts, with some firms using
the programs to increase their capabilities in areas of core competence and others using
the programs to explore new areas.
The Canada/ESA Agreement has generated more flight opportunities to space-qualify
Canadian technologies or products; for those companies who develop flight hardware,
ESA provided flight opportunities.
The number of organizations, excluding universities, participating in the Canada/ESA
program since January 2005 has increased by 27. There were also 8 new university
participants.
Penetration of the European space market is premised strongly on being a member of
ESA, which is the major contractor in Europe for space-related work. Canada can also
work through bilateral agreements; however, it is difficult to assess other options, as the
ESA Agreement has been Canada’s main entry into the market.
Intelligence gained through CSA participation in ESA is beneficial for CSA and other
government departments in terms of keeping the Canadian government informed on the
directions that ESA is taking in research and development in space technologies.
However, Canadian companies have not all uniformly benefited from the intelligencegathering process regarding trends in the European market conditions.
Although a significant number of new space collaborations/initiatives have resulted from
work attributed to the Canada/ESA Programs, Canadian firms in the space sector have
been unable to capitalize more on the ESA contracts due to the relatively modest CSA
contributions to ESA programs.
There are no more cost-effective means of developing the technologies/capacity that have
been developed through contracts with ESA; however, paperwork and travel costs were
noted as making this investment less cost-effective than it could be.
Discontinuation of the Agreement would result in the severance of industry ties and the
loss of opportunities. Moreover, it would communicate the message that Canada is
uninterested in participating in international collaboration in the space arena.
The economic impacts of the Canada-ESA Agreement were established based on reported
contracts and follow-on sales, i.e. sales that were over and above the ESA contracts and
attributable to the technologies and experience gained from the ESA contracts. No extrapolations
9
Source: European Space Agency, Industrial Policy Committee. (April 2009). Geographical Distribution of Contracts,
Situation as per 31 December 2008
10
Ibid.
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were made for firms that did not provide financial sales information for either the survey or case
studies. Since some case study and survey respondents did not provide financial data on follow on
sales, follow-on sales and economic impacts are probably underestimated.
Information on follow-on sales, including reports of no follow-on sales, covering the entire period
2000-2011 was provided by 58 establishments. The 58 establishments represented 61.6% of the
value of ESA contracts for the 2000-2008 period. The vast majority of this information came
from 21 establishments covered through the case studies. The 21 establishments represented
56.9% of the value of ESA contracts. An additional 32 establishments responded to the survey
representing 4.6% of ESA contracts. Finally five firms were no longer in business. They
accounted for 0.1% of ESA contracts
Documented follow-on revenues for the period 2000-11 attributable to the ESA contracts for the
case study participants and survey respondents amounted to $221.5 million. When added to the
value of the ESA contracts 2000-2008 ($177.5 million), Canadian firms have benefited or are
expected to benefit from $399.0 million in incremental revenues due to the ESA contracts and
follow-on work. This result implies a revenue multiplier of 2.25 for every ESA contract dollar.
After accounting for import leakages, the Input/Output analysis estimates direct current dollar
GDP impacts at $184 million and total (direct, indirect, and induced) GDP impacts of $367
million yielding a GDP multiplier for direct GDP of 2.0011.
Excluding the self-employed, ESA employment impacts included 4,055 full-time equivalent years
(FTEs) consisting of 2,056 direct FTEs, 986 indirect FTEs, and a further 1,012 induced FTEs12.
The impact on labour force incomes as a result of the ESA contracts to Canadian firms was to
increase them by $228.6 million of which $123.9 million was direct, $53.7 million indirect, and
$51.0 million was induced.
These estimates conform to Treasury Board Guidelines and are very conservative. However, if
we had extrapolated the above estimates to cover establishments that did not provide financial
data, the estimated direct economic impacts would increase.
Indeed, although all ESA contracts were taken into account in those estimates, only 58
establishments which received 61,6% of the ESA contracts (in dollars) provided information on
follow-on sales.
Additional details on this analysis can be found in Appendix G.
4. Recommendations:
Based on our conclusions, the evaluation team recommends the following:
11
Statistic Canada’s induced estimate encompasses only those induced impacts arising from increased consumption out of
incremental personal income generated by the direct and indirect impacts. Statistics Canada’s estimates of induced impacts
exclude the impacts of any incremental investments arising from personal or government incomes or even consumption from
induced personal incomes. As a result, they are very conservative estimates.
12
Self employed are not taken into account by Statistics Canada.
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RECOMMENDATION 1: CSA should seek renewal of the Agreement for an additional
10-year period. If feasible, additional resources should be allocated to the Agreement either
from an increase in the allocation of Government of Canada resources or through a
reallocation from other CSA programs.
This recommendation is based on the strategic importance of the Agreement at both the
political as well as the industrial level. The Agreement permits the Canadian space sector, as
well as the Canadian government to maintain a window on technological advances in space,
and upcoming programs that could be of interest to Canadian firms. It also provides
credibility to Canada that assists it obtaining contracts with NASA and with other
international space programs. Finally, CSA expenditures alone cannot ensure the array of
program opportunities and linkage to the base of R&D available within ESA.
RECOMMENDATION 2: Clarify the role of ESA within the long-term space plan
in order to guide industry on Canadian priorities in space, including ESA
participation.
RECOMMENDATION 3: Develop & publicize a more coherent set of policies & programs
for supporting organizations in the sector & developing new entrants.
Many of the SMEs that are trying to access contracts from ESA indicated a lack of
information on CSA’s policies and priorities with respect to ESA programs. They also are
not always aware of what funding is available for the different program areas supported by
CSA.
RECOMMENDATION 4: Develop a coherent plan for communicating targeted ESA
industrial opportunities.
The newsletter on Earth Observation opportunities and developments could serve as a starting
point for development of an appropriate communication format.
RECOMMENDATION 5: Continue to monitor the impacts, if any, of the 2007 European
Space Policy and EU trends on Canada, and, if necessary, take steps to mitigate any
adverse effects.
CSA along with DFAIT should also undertake a policy review of Canada’s role in ESA,
given the changes occurring in Europe as a result of the 2007 European Space Policy.
A review of the EU Space Policy (2007) and trends in Europe with respect to the EU indicates
a growing linkage of ESA with EU long-term plans and strategies. This poses a potential
threat to Canada as a non-EU member. Although the limited interviews with ESA
representatives indicated that there is no immediate concern that Canada may be excluded, the
gradual increase in the number of ESA members and the declining importance of the
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Canadian contribution both financially and technically could lead to Canada being
marginalized at some point in the future. This could have a negative impact on Canada’s
ability to participate in ESA, and the extent to which Canada can participate in the
downstream implementation of the prototypes and developments funded under ESA, but
which are implemented through other more commercially oriented European agencies.
Monitoring these developments will be an important component of CSA’s representation in
Europe.
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Acronyms
ADM
AFC
ARTES
CCRS
CMS
CO2
CO2eq
CRC
CSA
CSP
DFAIT
DND
EC
EGNOS
EO
EOEP
ERC
ESA
ESOC
ESP
FTE
GaN
GDP
GMES
GNP
GPS
GTA
GSTP
HQP
IC
I/O
IP
IPC
IRC
ISS
ITAR
NASA
NEST
Atmospheric Dynamics Mission
Administrative and Finance Committee
Advanced Research in Telecommunications Systems
Natural Resources’ Canada Centre for Remote Sensing
Environment Canada’s Canadian Meteorological Service
Carbon Dioxide
Carbon Dioxide Equivalence
Industry Canada’s Communications Research Centre
Canadian Space Agency
Canadian Space Program
Foreign Affairs and International Trade Canada
Department of National Defense
European Commission
European Geostationary Navigation Overlay Service
Earth Observation
Earth Observation Exploratory Program
Expenditure Review Committee
European Space Agency
European Space Operation Centre
European Space Policy
Full Time Equivalent
Gallium Nitride
Gross Domestic Product
Global Monitoring for Environment and Security
Gross National Product
Global Positioning System
Generic Technological Activities
General Support Technology Program
Highly Qualified Personnel
Industry Canada
Statistics Canada’s 2005 Input Output Table
Intellectual Property
Industrial Policy Committee
International Relations Committee
International Space Station
Traffic in Arms Regulations
National Aeronautics and Space Administration
Nest ESA Toolbox
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NRCan
OH
PAA
PAS
PRAB
R&D
RBAF
RMAF
RPP
ROI
SAR
SC
SCA
SDR
SDRRCS
SE
SM
SMOS
SP
SPC
TB
TRP
Natural Resources Canada
Overhead
Program Activity Architecture
Program Approval Submission
Program Review Advisory Board
Research and Development
Risk-Based Audit Framework
Results-Based Management and Accountability Framework
Report on Plans and Priorities
Return on Investment
Synthetic Aperture Radar
Satellite Communications
Software Communications Core Architecture
Software Defined Radio
Software Defined Radio Regenerative Communications Satellite System
Space Exploration
Soil Moisture
Soil Moisture and Ocean Salinity
Scientific Program
Science Program Committee
Treasury Board
Technological Research Programs
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1.0 Introduction
This Report presents the findings, conclusions and recommendations for the
Summative Evaluation of the 2000-09 Canada/European Space Agency (ESA)
Cooperation Agreement (Agreement).
This Summative Evaluation was undertaken for the Canadian Space Agency (CSA) by
Goss Gilroy Inc. management consultants, in accordance with the TB policy on
program evaluation. The evaluation was carried out under the direction of CSA’s
Evaluation Committee during the period from November 2008 to November 2009.
The report is organized as follows:
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Section 1.0 – outlines the report and objectives;
Section 2.0 – presents our evaluation approach and methodology;
Section 3.0 – contains a profile of the CSA-ESA Agreement
Section 4.0 – provides our key findings; and
Section 5.0 – outlines our conclusions and recommendations.
Appendix A – provides the CSA’s expenditures and commitments from
2000 – 2008;
Appendix B – lists the documents reviewed in the evaluation;
Appendix C – provides the data-collection instruments;
Appendix D – provides the roles and responsibilities of Agreement stakeholders;
Appendix E – provides a list of evaluation issues;
Appendix F – provides charts indicating Canada’s rank with regards to return
coefficient, by area;
Appendix G – is an economic impact analysis covering direct impact on ESA
contractors, indirect impacts of their supply chains and induced impacts arising
from consumer expenditures based on incremental earned incomes;
Appendix H – highlights the Agreement’s contribution to Canadian technology
and skills development; and,
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1.1
Scope and Objectives of the Evaluation
The primary role of the evaluation as identified in the CSA Statement of Work (SOW)
was to assess:
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The rationale of programs (funded under the Agreement);
The extent to which the programs have been successful in meeting their objectives;
The programs cost-effectiveness compared to alternative means of delivery; and,
The programs relevance to government priorities, with advice and
recommendations based on the results of the work.
In addition to the above areas of rationale/relevance, performance and costeffectiveness, the SOW requested that the evaluation also address issues not identified
in the Agreement’s Results-Based Management and Accountability Framework
(RMAF), such as:
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The impact of the change in the European space environment with the
endorsement of the European Space Policy (ESP) in May 2007;
An examination of the expenditures made under the Agreement in the context of
the criteria used by the Federal Government’s Expenditure Review Committee;
and
The extent to which the recommendations in the 2004 Formative Evaluation
Report have been implemented.
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2.0 Overview of Methodology
This Section describes the evaluation questions, approach and methodology, economic
analysis and limitations to the methodology employed in the summative evaluation.
2.1
Evaluation Issues
2.1.1
Development of Evaluation Issues and Questions
As requested in the SOW, the issues and questions used in the evaluation were
developed based on the RMAF Evaluation Strategy, and supplemented where
appropriate with the criteria used by the Federal Government’s Expenditure Review
Committee (ERC), and recommendations provided in the 2004 Formative Evaluation.
The following describes the approach used in the development of the issues and
questions.
RMAF Evaluation Strategy
The consulting team carefully reviewed the issues in the RMAF Evaluation Strategy to
consolidate and streamline them for use in data collection. The original 76 issues were
too numerous to be implemented effectively in an evaluation, and similar issues were
grouped to reduce the total number – i.e., the issues were either retained or became an
indicator within one of the grouped issues. In some cases, and for some stakeholder
groups, the original questions were used as probes in eliciting information on the
revised set of evaluation issues.
Expenditure Review Committee (ERC) Criteria
As requested in the Statement of Work, the consultant team also examined the criteria
used by the Federal Government’s Expenditure Review Committee (ERC) to assess
existing programs and government spending. These criteria yielded the following
questions which were incorporated into the evaluation issues and questions:
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Public Interest – Does the program area continue to serve the public interest?
Role of Government – Is there a legitimate and necessary role for government in
this program area or activity?
Federalism – Is the current role of the federal government appropriate, or is the
program a candidate for realignment with the provinces?
Partnership – What activities or programs should or could be transferred in whole
or in part to the private/voluntary sector?
Value-for-money – Are Canadians getting value for their tax dollars?
Efficiency – If the program or activity continues, how could its efficiency be
improved?
Affordability – Is the resultant package of programs and activities affordable? If
not, what programs or activities would be abandoned?
Endorsement of the European Space Policy (ESP)
The evaluation questions were designed to include an assessment of the change in the
European space environment with the endorsement of the European Space Policy
(ESP) in May 2007.
Previous Evaluation Reports
Previous evaluation reports, in particular the 2004 Formative Evaluation Report, were
reviewed in terms of the issues identified, recommendations made and management’s
response to the recommendations (see Section 3.6), to take them into consideration,
where appropriate, in developing the questions for this evaluation.
In addition, the methodology used in this evaluation took account of those used in
previous evaluations to facilitate comparison of quantitative results to the extent
possible.
2.1.2
Overview of Evaluation Questions
The issues addressed in this summative evaluation responded to the scope and
objectives of the evaluation given in Section 1.1, and addressed the following areas:
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Rationale and Relevance - the consistency of the Canada/ESA Agreement with the
priorities of the Government of Canada, Canada's Space Program, and the science
information needs of the government.
Design and Delivery - Canadian companies’ need for assistance in obtaining contracts
on ESA programs, and the ability of Canadian companies to benefit from the
opportunities presented by the Canada/ESA Agreement;
Results - the extent to which the Agreement achieved its primary objectives, namely:
 Increased staff among Canadian companies that received ESA contracts;
 Enhanced existing technological and innovation capabilities of the companies that
received ESA contracts;
 Advanced technologies, systems, components, and tools;
 Increased flight opportunities;
 Increased business opportunities for Canadian companies;
 Increased competitiveness of Canadian companies;
 Diversified international space partnerships for Canadian companies; and
 Increased/improved intelligence on European space-related policies, programs and
markets.
Cost-effectiveness - cost-effectiveness of the Agreement compared to other alternative
means of delivery.
2.2
Approach and Methodology
The approach to this evaluation built on the results of the 2004 Formative Evaluation,
and the RMAF Evaluation Strategy. Consistent with the TB Evaluation Policy13, the
consultant team utilized a multiple lines of evidence approach in reviewing the issues.
The data sources used varied by question and included:
13
Treasury Board Policy on Evaluation, April 1, 2001.
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A document review;
An administrative and performance data review;
Key informant interviews with Canadian government and ESA officials;
A survey of recipients of ESA contracts;
Case studies of selected recipients of ESA contracts; and,
A survey of organizations that did not receive ESA contracts.
Document Review
A total of 48 documents formally transmitted by CSA (6 financial and 42 other
documents) were reviewed in this evaluation. A complete list of documents consulted
is included in Appendix B. Various websites were also consulted in the course of the
work.
Key Informant Interviews with Canadian Government and ESA Officials
A total of 32 key informants were interviewed for this evaluation (some were
interviewed in groups). Exhibit 2.1 below lists the organizations and the number of
corresponding key informants for each organization.
Exhibit 2.1: Numbers of Interviewees by Organization
Organization
Number of Interviewees
CSA
16
CSA/ DFAIT Europe
1
ODG
(CRC, DFAIT, IC, NRCAN)
9
ESA
5
EU
1
Total Number of Interviewees
Total= 32
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Case studies of Organizations that Benefited from the Agreement
A group of 32 organizations14 that benefitted from the ESA contracts were initially
identified as candidates for case studies. A final selection of 25 organizations was
made, taking account of corporate re-structuring, mergers and acquisitions. Of these
25 interviews, one case study could not be completed, leading to information gaps in
this one case. The case study organizations included the larger participants in ESA
contracts, as well as those ESA contracts, which CSA considered to have yielded good
results. To the extent possible, case studies also spanned the program areas funded by
the Agreement and geographic regions across Canada. Case studies provided in-depth
information about key evaluation issues. Case study organizations did not participate
in the survey.
The case study instruments are provided in Appendix C.
Survey of Organizations that Benefited from the Agreement
A telephone survey was employed to acquire information from all organizations that
had benefitted from ESA contracts since 2000 that had NOT been selected for case
studies. In aggregate, 39 organizations responded to the phone survey. In addition, 1
respondent to the survey of organizations that had not received ESA contracts
indicated they had received ESA contracts through the agreement, during the time
frame covered by the evaluation and were thus added to the recipient survey.
Survey respondents included private firms or institutions such as NGOs and
universities. Non-respondents generally resulted from invalid contact information;
refusal by the targeted person to participate in the survey; or the targeted person could
not be reached by phone.
The organizations surveyed were asked to respond to a series of evaluation questions
similar to those answered by case study organizations, after which they were requested
to provide additional economic benefit information (e.g., information on sales,
employment, follow-on joint ventures, new products, etc) through a follow-up email
approach. The survey instruments are provided in Appendix C.
14
In a few cases, where an organization had multiple locales (establishments), case studies were done at each locale.
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Exhibit 2.2 indicates the sample coverage by numbers of establishments and by the
percentage of ESA funding.
The effort in the case studies was concentrated among the large recipients as well as
organizations CSA considered to have yielded sufficiently good results to be able to
give detailed information success factors. Since case studies covered organizations
awarded some of the biggest contracts, the dollar value of ESA contracts awarded to
survey recipients is proportionately smaller than that awarded to case study
organizations.
Exhibit 2.2: Sample Coverage (by establishment receiving ESA contracts)
Establishments
% of
Establishments
Covered
% of ESA
Contracts Covered
by dollar value
Case Study
25
21.2%
80.9%
Surveyed
39
33.1%
6.1%
Total Covered
All establishments receiving
ESA contracts
establishments receiving
ESA contracts that were out
out-of-business and invalid
contacts
Overall Coverage of
establishments receiving
ESA i.e., valid contacts
64
54.2%
86.9%
12
10.2%
0.2%
106
60.4%
87.1%
Status
118
Survey of Organizations that Did Not Benefit from the Agreement
A telephone survey was also undertaken with 19 organizations that did not receive
ESA contracts during the time period of the current Agreement. This survey focused
on awareness and delivery issues, aiming to solicit responses concerning why the
organizations had been unsuccessful in securing ESA contracts. The survey
instrument is provided in Appendix C.
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2.3
Economic Analysis
Statistical information collected by ESA on activity under the Agreement and
information collected in the survey and case studies from the Canadian organizations
that benefited from ESA contracts were analyzed in conjunction with the Statistics
Canada’s recently released National Accounts15 and the 2006 Input Output Table
(I/O)16 in order to provide an assessment of the economic impacts of the 2000-09
Agreement.
The economic analysis proceeded in two steps. The first step required summing the
revenues derived directly from ESA contracts to Canadian firms over the period 20002008 and revenues from follow-on sales for the period 2000-2011 derived directly
from the ESA contracts as reported/estimated by the case study firms and the firms
responding to the questionnaires. Step 2 involved taking the total ESA contracts and
follow-on sales as an input to the national Input/Output analysis. The Input/Output
analysis allowed us to estimate the direct, indirect and induced impacts on GDP, tax
revenues and employment of the ESA contracts and follow on sales for the entire
period, not annually.
This approach is considered to be conservative, as, although it accounts for all ESA
contracts to Canadian firms, it does not take into account additional follow-on sales
revenues, where explicit information was not provided.
To use the Input/Output structure, the ESA contracts to Canadian firms and follow-on
revenues had to be assigned to a particular industry classification using the North
American Industry Classification (NAICs) codes based on their listings in Industry
Canada’s business directory. The model was then run at the most feasible detailed
industry level in order to derive the direct impacts (of ESA contracts and follow on
revenues) on economic output and employment for the firms benefitting directly from
the contracts, and the indirect impacts on economic output and employment of firms
that benefited through the supply chain (vendors to ESA contracted firms). The
induced impacts are based on expenditures of disposable income earned by direct
employment and indirect employment. Statistics Canada excludes any expenditure
15
Statistics Canada, National Income and Expenditure Accounts: Data tables, catalogue number 13-019-X. June 1, 2009.
Statistics Canada I/O tables were run at the larger industry detail by industry to establish supply chain relationships by
assigning NAICS codes to all establishments in the ESA file from Strategis, Industry Canada’s file on firms. The induced
impacts are weighted across the years of expenditures from 2000 to 2011 based on annual expenditure patterns from the
National Accounts with extrapolated shares for 2009-2011.
16
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impacts from induced employment. This process derives conservative multipliers for
the national impacts of ESA contracts and follow-on sales.
2.4
Limitations
The evaluation results are subject to the following types of limitations:
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
The number of non-responses;
Survey respondent self-selection, and,
Limitations in access to ESA representatives for interviews
Number of Non-Responses
Although the methodology employed for the telephone survey of contract recipient
firms usually results in a higher response rate than other approaches (e.g. web
surveys), GGI was able to reach only 54.2% of the contract recipient firms in the
population. Further, some respondents did not have answers to certain survey
questions because contracts had been awarded quite a number of years previously and
in some cases there had been staff turnover. Data on future employment and followon sales was estimated by some respondents. Some respondents refused to provide
data on follow-on sales or employment for confidentiality reasons.
Respondent Self-Selection Bias
Since some firms chose not to participate in the survey, only a sample of contracted
firms answered the questions. Non-participants tended to be smaller firms, firms with
fewer contracts, firms whose contracts had been awarded further in the past, and/or
firms with negative experiences with ESA17. These factors are an important
consideration in the analysis and in drawing generalizations from the survey results.
Limited Access to ESA Key Informants
Although a visit to ESA offices in Europe was planned in the evaluation workplan,
the GGI team could not visit ESA offices and interviews with ESA representatives
were restricted to interviews with representatives who travelled to Canada on other
17
While this statement is generally true, lack of responses by several large firms to questions on revenues meant that those that
did respond were reasonably representative of the industry.
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matters. For these reasons, GGI had to rely on documents from ESA without an
opportunity to discuss their interpretation and validity. This constraint also impacted
the understanding of changes in the European Space Policy.
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3.0 Background on the Agreement
The following section provides background on the Agreement, including a brief
history of ESA, CSA, and the Canada-ESA Cooperation Agreement. In addition, it
provides the objectives of the Agreement, describes Canada’s funding contributions to
ESA, and discusses previous reviews and evaluations.
3.1
History
3.1.1
ESA and the European Union (EU)
ESA was established in 1975 as an autonomous international organization dedicated to
the exploration of space with funding provided by its member states. The 18 current
member states include Austria, Belgium, Czech Republic, Denmark, Finland, France,
Germany, Greece, Ireland, Italy, Luxembourg, The Netherlands, Norway, Portugal
Spain, Sweden, Switzerland and the United Kingdom. As well, Hungary, Romania and
Poland participate in the Plan for European Cooperating States (PECS). In addition,
Estonia and Slovenia have recently signed cooperation agreements with ESA. Canada,
which is also classified as a cooperating state, has had Agreements with ESA since
1979.
ESA is headquartered in Paris, with a staff numbering just over 2,000 and an annual
budget of about €3.6 billion (or CDN $5.9 billion18) in 2009.19 The breakdown of
ESA’s 2009 budget by program areas is as follows:
18
19
Exchange rate is $1.65 per Euro (€), as of January 15, 2009.
Source: ESA website
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Exhibit 3.1: Budget by Program Areas (2009)
(Euros in 000’s)
Financed by
third parties
€ 47,641
Technology
€ 112,855
Space Situational
Awareness
€ 9,000
Launchers
€ 659,103
European
Cooperating
States Agreement
€ 3,206
6.7%
6.3%
12.1%
18.4%
General Budget
€ 239,749
Associated to
General Budget
€ 196,760
Science
€ 434,449
Exploration
€ 115,505
Human
Spaceflight
€ 386,958
10.8%
16.3%
10.8%
Microgravity
€ 93,696
Navigation
€ 387,249
8.9%
Earth Observation
€ 586,151
Telecom
€ 319,459
Source: ESA website (retrieved May 28, 2009)
In terms of the contributions made by member and cooperating states, the following
exhibit shows their percentage contributions to ESA’s Mandatory activities (i.e.,
ESA’s general budget and scientific program) and Optional Programs in 2008:
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Exhibit 3.2: 2008 Contributions to ESA Programs by ESA Member Countries
(€ in 000’s)
% of
Total
Mandatory
15.50%
Optional
Programs
€
462,781
% of
Total
Optional
25.51%
Total
Contributions
€
556,491
% of
Grand
Total*
23.01%
France
Mandatory
Programs
€
93,710
Germany
€
132,101
21.86%
€
401,369
22.12%
€
533,470
22.06%
Italy
€
77,689
12.85%
€
265,357
14.63%
€
343,046
14.18%
UK
€
107,011
17.71%
€
157,889
8.70%
€
264,900
10.95%
Spain
€
44,316
7.33%
€
108,515
5.98%
€
152,831
6.32%
Belgium
€
16,566
2.74%
€
121,835
6.72%
€
138,401
5.72%
Netherlands
€
27,085
4.48%
€
70,941
3.91%
€
98,026
4.05%
Switzerland
€
20,677
3.42%
€
66,459
3.66%
€
87,136
3.60%
Sweden
€
15,598
2.58%
€
39,080
2.15%
€
54,678
2.26%
Norway
€
12,454
2.06%
€
31,505
1.74%
€
43,959
1.82%
Austria
€
13,543
2.24%
€
19,257
1.06%
€
32,800
1.36%
Denmark
€
10,641
1.76%
€
13,277
0.73%
€
23,918
0.99%
Canada
€
4,638
0.77%
€
15,362
0.85%
€
20,000
0.83%
Portugal
€
7,255
1.20%
€
9,405
0.52%
€
16,660
0.69%
Finland
€
8,464
1.40%
€
7,936
0.44%
€
16,400
0.68%
Ireland
€
6,711
1.11%
€
6,589
0.36%
€
13,300
0.55%
Greece
€
5,249
0.87%
€
6,151
0.34%
€
11,400
0.47%
Luxemburg
€
693
0.11%
€
10,407
0.57%
€
11,100
0.46%
Totals
€
604,401
100%
€ 1,814,115
100%
€ 2,418,516
100%
Source: Hulsroj, Peter. January 2009. Participation in ESA programmes. Eurisy Conference. Budapest.
Note: Due to rounding, column percentages may not add up to totals shown.
*Grand total of contributions made by member states and Canada
From the above exhibit, Canada’s contribution to ESA in 2008 was €20.0 million or
0.83% of the ESA budget. Canada contributed 0.77% (or €4.6 million) of the
Mandatory Programs, and 0.85% (or €15.4 million) to the Optional Programs. Within
the mandatory program, Canada contributes to neither the Scientific Program nor
Technology Research Programs (TRP) of the General Budget.
The main contributors to the ESA budget were France, Germany, Italy, UK, and
Spain. Combined they accounted for the majority (76.5%) of ESA’s total 2008
income of €2.4 billion.
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Europe’s Space Policy Environment - In recent years, Europe’s space policy
environment has evolved considerably with the development of a European Space
Policy (ESP) under the aegis of the European Commission. Twenty-nine European
countries unveiled a new space policy on 22 May 2007, unifying the approach of the
European Space Agency with those of the individual European Union member states.
The European Space Policy has for the first time created a common political
framework for space activities in Europe. Jointly drafted by the European
Commission and ESA’s Director General, Jean-Jacques Dordain, the European Space
Policy sets out a basic vision and strategy for the space sector. It tackles issues such as
security and defense, access to space, and exploration20. The goals of the ESP were to
develop and exploit space applications to serve Europe’s public policy objectives and
the needs of European enterprises and citizens; to meet Europe’s security and defence
needs in regards to space; to ensure a strong and competitive space industry; to
contribute to the knowledge-based society by investing in space-based science; and to
secure unrestricted access to new and critical technologies. The goal of the ESP is to
bring all EU and ESA space activities and all European member states’ national space
programs under a consistent policy framework, with the aim of ultimately allowing
member states to improve European coordination and ensuring that Europe’s
investment in space is as efficient and effective as possible.
Adopted by the 'Space Council’ of ESA and by EU ministers, the approach is intended
to equip Europe for space study and exploration, prepare it for new challenges and
bring a new dimension to the EU's external relations. Through the ESP, the EU, ESA
and its Member States all commit to increasing coordination of their activities and
programs and their respective roles relating to space.
ESA will continue with its development of space technologies and systems, and with
its support of innovation and global competitiveness, while the EC promotes the
exploitation of these technologies (i.e., Galileo and GMES) to achieve European
policy priorities. As Canada is not part of the EC, Canada may have difficulty
benefitting from the commercialization of the technologies developed by ESA.
These developments are of particular interest to Canada, due to Canada’s established
long-term strategic relationship with ESA, and the impact that the implementation of
ESP may have on Canada’s future involvement.
20
ESA Website July 2009
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In November 2008, the Draft ESA ten-year Long-Term Plan (LTP) for the years 20092018 was presented to the ESA’s Ministerial Council. The LTP covers the ESA’s
long-term strategic objectives and priorities, as well as the corresponding financial
plan for a ten-year period. The LTP noted that governmental spending for space
programmes at a global level in 2006 amounted to about $61 billion (of which Canada,
at $355M, contributed only 0.2% of the total). Some of the long-term strategies
include an enhanced, highly competitive European Space Program, with financing
schemes easing accession of new member states and cooperation with third parties,
especially the EU. This will lead to increased coordination between ESA, the
European community and national activities within the frame of the ESP, as well as
synergies with the security and defense actors.
Some of the key long-term goals of ESA is to become an Agency of the EU by 2014,
as well as to increase the number of ESA member states to 22 or more by 2011 (in
conjunction with new nations joining the European Union), and associate both existing
and new members to ESA programs and activities. Another key goal is to increase
funding of ESA by not only increasing contributions by current EU member states but
also receiving funding from new EU members.
These new goals as elaborated by ESA raise important questions regarding the
continuing role for Canada within the framework of the Agreement. With the ESA
becoming a quasi-agency of the EU, questions could be raised about Canada’s
participation within the ESA, as it is possible that only EU member states would be
able to participate in ESA activities. In addition to this, with the proposed increased
funding of ESA as well as the addition of new member states as a result of increasing
membership in the EU, questions could be raised due to the fact that Canada’s
contribution may continue to decline as percent of the total budget. Canada could
possibly become an increasingly marginalized player, which may lead some within the
European sphere to question Canada’s continued participation within the Agreement
and the framework of the ESA as a whole.
From this perspective CSA in concert with DFAIT should undertake a policy review to
assess the best scenario for Canada to maintain a position with ESA.
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3.1.2
Canada’s Involvement with ESA
CSA is the Canadian government agency responsible for Canada's space program. It
was established in March 1989 by the Canadian Space Agency Act and sanctioned in
December 1990. The legislated mandate of the CSA is: “To promote the peaceful use
and development of space, to advance the knowledge of space through science and to
ensure that space science and technology provide social and economic benefits for
Canadians.”
The CSA is achieving this mandate in cooperation with other government
departments/agencies, industries, and universities, as well as with international
partners. In addition to delivering its own programs, the CSA is responsible for
coordinating all federal civil space-related policies and programs pertaining to science
and technology (S&T) research, industrial development, and international cooperation.
Canada’s working relationship with ESA has been in existence since the first
cooperation agreement was put in place, covering the period from January 1, 1979 to
1983. This initial agreement, which predated the establishment of the CSA, included
the fields of space research and technologies as well as associated space applications.
Since then, the agreement has been renewed on three occasions, covering the periods
from 1984 to 1988; from 1989 through 1999; and, most recently, from January 1, 2000
to December 31, 2009.
The Agreement is a treaty that is formally negotiated between ESA and Canada. The
agreement is managed for Canada by the CSA. Notably, Canada is one of four
countries with a cooperating-member status, and the only non-European country that
participates in ESA programs.
3.2
Objectives of the Agreement
Generally speaking, the Agreement contributes to maintaining Canada’s world
leadership in its traditional niches (e.g., civilian radar technology for earth
observation, and advanced satellite communications services) and enhancing the
international competitiveness of the Canadian manufacturing industry through the
development of space technologies, innovative advanced systems, and terrestrial
applications. The programs funded under the Agreement contribute to CSA’s
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strategic outcome: meeting the needs of Canadians for scientific knowledge, space
technology and information.
The objectives of Canadian cooperation with ESA were aimed at achieving policy,
programming and industrial development objectives, as follows:
1. To diversify Canada's international space partnerships by fostering close
collaboration with Europe, complementing its long-standing priority relationship
with the United States.
2. To support the implementation of the Canadian Space Program (CSP) in the areas
of satellite communications, satellite navigation & positioning, earth observation
and space exploration by participating in ESA optional programs yielding
important programmatic benefits, including flight opportunities for Canadian
technologies.
3. To sustain the competitiveness of the Canadian space sector (including industry,
universities and not-for-profit organizations) through the development of leading
edge technologies and products for global markets.
4. To position Canadian space companies (including Not-for-Profit Organizations)
with large European prime contractors and key sub-contractors.
5. To facilitate strategic alliances between Canadian and European companies and
thereby, create opportunities for Canadian industry in the European markets.
6. To obtain strategic information about emerging European technologies and
encourage the dissemination of knowledge between Canadian and European
stakeholders.
One objective, regarding the technology transfer between Canadian and European
companies was removed in 2005 due to the lack of reported technology transfer in the
1997 and 2004 evaluations. A second revision to the previous objectives concerned
not-for-profit organizations and universities, which, along with industry, were made
eligible for ESA contracts, as per the recommendation of the 2004 Formative
Evaluation.
The current Agreement differs from the two preceding agreements between CSA and
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ESA in that it includes a clear obligation (as compared to best efforts) to provide an
industrial return to Canada on par with that of ESA Member States in optional
programs, and also guarantees Canada the same rights as ESA Member States in
optional programs.
The CSA Program’s strategic outcomes have likewise changed over the years. In its
Report on Plans and Priorities (RPP) for 2009-2010, the CSA Program has one
strategic outcome, namely, “Canada’s presence in space meets the needs of Canadians
for scientific knowledge, space technology and information.” The 2009-2010 PAA
notably differs from the Program’s previous PAAs in that it is highly streamlined with
respect to strategic outcomes.
By contrast, in the 2004-2005 RPP, there were seven (potentially overlapping)
strategic outcomes:







Economic benefits;
Technological development and diffusion;
Understanding of the environment;
Contribution to the quality of life;
World-class space research;
Social and educational benefits; and,
Promotion and awareness of the CSP.
The 2009-2010 RPP is also streamlined compared to the RPPs from fiscal years 2005,
2006 and 2007, which contained the following three strategic outcomes:
1) knowledge, innovation and economy; 2) sovereignty and security; and 3)
environment and sustainable development.
The current unique strategic outcome is supported by activity in four main
areas/thrusts: earth observation, space science and exploration, satellite
communications and generic technological activities. In the most recent RPP, four
objectives of the CSA/ESA partnership are highlighted, each corresponding to one of
these areas/thrusts:

ESA Programs in earth observation – Objective: “Through key international
partnerships, enhance the Canadian industry's technological base and provide
access to European market for value-added products and services in the field of
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


3.3
earth observation.”
ESA Programs in space science and exploration – Objective: “Through key
international partnerships, foster the participation of Canadian academia and the
demonstration of Canadian space technologies in European space science and
exploration missions.”
ESA Programs in satellite communications – Objective: “Through key
international partnerships, enhance the Canadian industry's technological base and
provide access to European market for value-added products and services in the
field of satellite communications.”
ESA Programs in Generic Space Technologies: “Through key international
partnerships, enhance the Canadian industry’s technological base and provide
access to the European market for value added products and services in the field
of generic space technologies.”
Key Stakeholders
The key stakeholders in the Agreement are grouped as: ESA Institutions, Canadian
Space Agency (CSA), Canadian Industry and Research Organizations, and Canadian
Government Departments.
3.3.1
ESA Institutions
Within ESA, the following institutions are the most relevant to the Agreement.
ESA Council - is composed of representatives of the Member States and is the ESA
governing body. The ESA Council meets either at the ministerial or the official levels,
as required. Reporting to the Council are Working Groups, Plenary Subordinate
Bodies, Program Boards and the chief executive officer of the Agency. Currently there
are four Subordinates Bodies in operation: the Science Program Committee (SPC), the
Administrative and Finance Committee (AFC), the Industrial Policy Committee (IPC),
and the International Relations Committee (IRC).
Program Boards - are entrusted with the responsibility of monitoring Optional
Programs making up a space area (“thrust”, in CSA terminology). The Program
Boards are composed of Member States participating in the optional programs. There
are currently six Program Boards: Earth Observation, Satellite Communications,
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Navigation, Human Space Flight, Microgravity and Exploration, as well as Launcher
and Space Situational Awareness.
ESA Director General and Staff - the Council appoints a Director General, who is the
chief executive officer responsible for the management of the Agency, the
implementation of its policies and programs in accordance with the directives issued
by the Council. Scientific, technical and administrative staff assists the Director
General. The Council, based on recommendations of the Director General, appoints
senior management staff; the Director General appoints other staff members. All staff
is appointed on the basis of their qualifications, taking into account an adequate
distribution of posts among nationalities of the Member States.
3.3.2
Canadian Space Agency (CSA)
The Agreement is designed to be a significant vehicle for the CSA to achieve its
strategic goals. CSA also administers the Agreement on behalf of Canada.
3.3.3
Canadian Industry & Research Organizations
Canada’s space industry consisted of 213 organizations across Canada in 2009
(Source: CSA website, May 2009). Significantly, this group includes at least 27 large
organizations and 100 SMEs.21,22 The 213 organizations in the sector also include at
least 12 not-for-profits and 32 government organizations.
According to the most recent State of the Canadian Space Sector report (2008), the
Canadian space sector generates revenues of close to $2.8 billion and employs over
6,742 persons.
3.3.4
Canadian Government Departments
Canadian government department stakeholders involved in the Agreement are:

Foreign Affairs and International Trade (DFAIT) – DFAIT has ultimate
responsibility for all treaties with foreign countries and organizations and holds
21
These figures are based on the qualification of organizations with fewer than 200 employees as SMEs. Source: Organization
websites.
22
The size of the remaining organizations is unknown.
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


authority on negotiations, which it may delegate to the CSA as the managing
government agency for the Agreement. Arrangements governing Canada’s
participation in ESA optional programs may be concluded by the CSA, subject to
internal approval processes.
Industry Canada (Communications Research Centre – CRC) – Industry Canada
(IC) provides input into activities at CSA as well as policy development as it
pertains to the space sector. IC has also contributed directly and indirectly to ESA
contracts through the CRC. IC has representation, with CSA, on ESA Satellite
Communications and Navigation Programme Boards.
Natural Resources (Canada Centre for Remote Sensing – CCRS) – Natural
Resources Canada (NRCan) provides the European Space Operation Centre
(ESOC) with GPS data from Canadian tracking stations. ESOC uses this data for
orbit calculations of the GPS system. Besides this relationship, there is also an
agreement between CSA and NRCan that allows ESA data to be shared with
CCRS (e.g., data from the USA as well as from European missions, including
ENVISAT, ERS, and RADARSAT 1 & 2) and results in some funding flowing
from ESA to CCRS for contracts. CCRS has representation, with CSA, on the
ESA Earth Observation Programme Board.
Environment Canada (EC) – EC, similar to NRCan, is a key participant in
Canadian EO programs and also benefits from the data and expertise stemming
from ESA initiatives, both directly and indirectly through its involvement in the
international network of environment stakeholders. EC is a participating
department in the RADARSAT program, Canada’s Earth Observation (EO)
satellite. In coordination with Transport Canada, National Defense and Fisheries
and Oceans, EC’s Canadian Ice Service implemented the Integrated Satellite
Tracking for Polluters initiative using RADARSAT data to monitor targeted
areas. Additionally, EC’s Quebec Water Quality Monitoring Section has used
information from EO satellites to monitor changes in land use in the St. Lawrence
Valley and the Great Lakes watershed.
3.4
Organization and Governance Structure
3.4.1
The ESA - CSA Agreement Governance Model
The principles governing Canadian participation in ESA, defined in the 2000-09
Cooperation Agreement, are as follows:
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
Canada, with its cooperating-member status, contributes to the General Budget at
50% of the rate of ESA Member States (based on a GNP scale). Canada is not
eligible for the Technical Research Programs (TRP) but is eligible for the scientific
program, however it chooses not to participate. Canada contributes to all elements
of the General Budget of ESA, excepting the Scientific Program (SP) and the
Technical Research Programs (TRP). Canada’s contribution to the General Budget
is mandatory for participation in the Optional Programs.
Canada’s participation in and contribution to Optional Programs are made at
Canada’s request, but are subject to the unanimous approval of Member States
participating in the Program. In addition, the contributions are subject to
adjustments due to inflation; program cost increases, and exchange-rate variation.
The single-object development programs, in particular, are subject to a maximum of
20% in cost increases over the initial program contributions.
The entire procurement process (i.e., planning and preparation of invitations to
tender, release of invitations to tender; reception, evaluation and selection of
proposals; award of contracts; and debriefing to unsuccessful bidders) continues to
be managed by ESA. The CSA role is to position Canadian industries favorably with
ESA, such as monitoring ESA opportunities for Canadian industries, and marketing
Canadian capabilities to ESA. In some programs, such as the GSTP and some
ARTES programs, ESA will consult the Canadian delegation before they initiate
negotiations with a Canadian company, to ensure that Canada supports the contract.
Canadian contractors are responsible for executing the tasks as per ESA
requirements, and the administration of these contracts is an ESA responsibility.
ESA continues to invoice CSA three times a year and the contributions are payable
in Euros.
For both the Mandatory Activities and the Optional Programs, ESA awards contracts
(excluding contracts under the Scientific Program and the Technical Research
Programs contracts under the General Budget), to Canadian organizations in
proportion with Canada’s level of contribution to the specific program. This is
governed under an agreed principal of Fair Industrial Return in all ESA programs, and
is the same for all ESA Member States. By contrast, the 1989 – 1999 Agreement only
required ESA to employ best efforts concerning industrial returns to Canada.
Under the current ESA industrial regime, each member country’s return for the overall
program return and for its individual optional programs must be satisfactory; otherwise
ESA takes proactive measures to increase returns.
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Canada participates in ESA meetings at all levels, and has the right to vote on
questions relating to the activities and programs in which Canada participates. Canada
may also attend a variety of other meetings as an observer.
3.4.2
Roles and Responsibilities of CSA and OGDs
At the CSA, the principal interface role with the ESA involves its Space Technologies
Branch and the External Relations Branch.
CSA Space Technologies Branch - responsibilities include:











Director General of Space Technologies is accountable for the management of the
Program
Appoints Canadian delegates on Subordinates Bodies and Program Boards, jointly
with the Director - External Relations;
Represents Canada on ESA Program Boards and DOSTAG (Data Operations
Scientific and Technical Advisory Group);
Identifies opportunities and consults industry for participation in new optional
programs, organizes consultations with industry, and prepares the Program
Approval Submission (PAS);
Consults with concerned Departments and Agencies (e.g., DFAIT, DND, NRCan/
CCRS, IC/CRC) to reach an interdepartmental consensus on ESA optional
programs;
Presents PAS on the participation in new optional programs for Executive
Committee (EC) approval;
Submits annual work plans on Canada/ESA Programs;
Coordinates ESA budgets, approves commitments and payments to ESA;
Monitors the implementation of Canadian participation in ESA programs;
Implements the information systems required by the Ongoing Performance
Measurement and Evaluation strategies;
Represents Canada on the ESA Administration, Industrial Policy Committee (IPC),
and Finance Committee; and
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CSA External Relations - responsibilities include:






Represents Canada at ESA Council meetings;
Appoints Canadian delegates on Subordinates Bodies and Program Boards, jointly
with the Director General - Space Technologies;
Prepares Canadian positions for meetings of the ESA Council and International
Relations Committee;
Prepares the mid-term review of the Canada/ESA Cooperation; and
Prepares bilateral Canada/ESA meetings at policy level.
Prepares annual review of cooperation agreement at policy level in consultation
with the Space Technologies and Space Sciences branches.
The permanent Canadian Delegate to the ESA in Paris is a CSA employee, seconded to
DFAIT to take on this responsibility. The delegate’s role, inter alia, comprises the
following two tasks: representing Canada’s interests with ESA officials and at ESA
meetings including Council, Program Boards, subordinate committees, collecting
intelligence on European policies, programs and technologies of interest to Canada and
involvement and support to bilateral relations with European countries
The roles and responsibilities of stakeholders in the Agreement are summarized in
Appendix D.
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3.5
Canada’s Participation in ESA
3.5.1
ESA Programs in which Canada Participates
The ESA Programs in which Canada participates under the Agreement are summarized
below in Exhibit 3.3, categorized by CSA’s Activity Areas. Descriptions of Canada’s
participation in the ESA General Budget and each of the ESA Optional Programs, and
the amount of funding provided, are also shown.
Exhibit 3.3: Principal ESA Programs in which Canada has Participated
(2000-2009)
ESA Programs
Description of Canada’s Participation
General Budget - $63.6 million
General Budget
Canada’s contribution to the General Budget of ESA is
mandatory and provides certain rights and privileges, the
most important one being the right to participate in optional
programs.
Earth Observation (EO) - $140.2 million
ENVISAT
ENVISAT is the largest satellite built for EO, and it
provides data on the earth’s atmospheres, oceans, land
and ice.
Canada has participated in the design, construction and
deployment of ENVISAT. More than 23 Canadian teams
are participating in exploiting the data generated by
ENVISAT.
EOEP
EOEP comprises two main components: the Earth
Explorer Component (which covers the definition,
development, launch and operations of Earth Explorer
Core and Opportunity missions) and the Development
and Exploitation Component (which covers preparatory
activities for Earth Explorer candidate missions, Earth
Watch definition, Instrument pre-development, data
exploitation, and mission continuity and ground
segment).
Canadian industry, and scientists of other government
departments (MSC, DFO, AAFC, CCRS) as well as the
universities are well positioned to take advantage of the
opportunities in Earth Explorer missions; in terms of
technology such as Lidar (Light Detection And Ranging),
hyperspectral, radar, antenna subsystems, spectrometer
instruments, uncooled microbolometer detector array, and
ground segment processor areas. . In the areas of useroriented application, many Canadian value-added
companies and scientific investigators are participating in
the exploitation of satellite imagery. Canada participates in
all of the EOEP program components.
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Earth Watch – Global Monitoring for Environment
and Security (GMES)
The GMES Service Element Program establishes
service infrastructure that will use space-based Earth
Observation data to generate information for policy
makers and other users relating to the environmental
and climate change issues.
The GMES Space Component develops the required
space segment infrastructure (i.e., satellites and the
receiving stations) to generate the EO data required by
GMES users and also includes the operations of all
satellite and ground segment infrastructure providing
the required data streams
Canada participates in the GMES Service Element (GSE)
and the GMES Space Component programs. In GSE,
Canada is playing the leading role in Polar View providing
services on Northern environment. For GMES Space
Component, Canadian companies are involved in
developing SAR processor and antenna systems. Canadian
companies are also involved in the development of ground
and space components of the GMES Sentinel 1 to 5.
Telecommunications - $112.8 million
Advanced Research in Telecommunications Systems
(ARTES)
ARTES started in 1994 with two major aims: to develop
technologies to be used in future satellite
communication and navigation programs, and to help
develop new markets so as to improve the
competitiveness of the industry on the commercial
market. These goals are broadly defined and permit the
ARTES program to evolve with the rapidly changing
needs of the field.
Canada participates in the ARTES-1, 3, 4, 3-4 (a merger of
the ARTES-3 and ARTES-4 program elements), 5, 8, and 9
programs to develop and demonstrate the technologies
required for future satellite communications missions and
enhance industry competitiveness.
Navigation - $28.3 million
Galileosat
Galileo will be Europe’s own global navigation satellite
system, providing highly accurate, guaranteed global
positioning service under civilian control. It will be
interoperable with GPS and Glonass, the two other
global satellite navigation systems.
Canada participates in the development and validation
phase of GalileoSat, i.e., in the development of the receiver
and in some space components. This minimum
participation will position industry for the large volume
orders expected to be procured commercially in later
phases of the Program. Canada is also involved in the
European GNSS Evolution.
Space Exploration - $62.2 million
Aurora
The Program defines a European strategy for the
exploration of the solar system over the next 30 years,
including manned expeditions to the Moon, Mars, to
asteroids and even beyond.
Canada participates in the Aurora preparatory activities; the
Aurora core programs; and the Aurora ExoMars enhanced
and MREP programs. Canadian participation in Aurora
establishes international partnerships and develops new
space technologies, notably Lidar, robotics and scientific
instruments for future missions to Solar system bodies.
European Transportation and Human Exploration
Preparatory Activities Programmes: Canada participates
in these since November 2008 (ARV, IBDM, MREP,
MELISSA, etc.)
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Science - $8.5 million
The CSA involvement in Science is through the
SWARM program. Canada’s contribution amounts to
$8.5 million for this program.
The Swarm mission will study the geomagnetic field
evolution with precision, using a fleet of three satellites
orbiting in the ionosphere. ESA has invited Canada to
provide all three Swarm satellites with a Canadian electric
field instrument (CEFI) based on the suprathermal ion
imager (SII)-a Canadian particle detector design that has
already proven its capability-in order to gather precise
measurements of ion winds.”
General Support Technology Program (GSTP) -$12.025 million
The GSTP develops technologies for space applications, Canadian companies have developed innovative spacecraft
and raise it to a proper readiness level for future ESA
attitude control software and fiber-optic based monitoring
missions.
of spacecraft temperature and pressure which will be flown
on the Proba 2 satellite, scheduled for launch in November
2009.
Microgravity $13.9 million
Canada participates in the ELIPS-2 and the ELIPS-3
ELIPS
The ELIPS program promotes life and physical sciences programs.
and applications using the European Columbus module
on the International Space Station.
Source: Canada-ESA Cooperation Agreement Expenditures and Commitments from 2000 to Future Fiscal Years
3.5.2
Canada’s Funding Contributions to ESA
In March 2000, Treasury Board (TB) approved contributions to ESA of up to $30
million per fiscal year for the duration of the Agreement (1999/00 to 2008/09). These
contributions were provided for the General Budget and for Optional Programs in
which Canada participated.
In 2005, the terms and conditions for the Contributions under the Canada/ESA
Cooperation Agreement were revised and included the following:



Authority to commit up to a maximum of CDN $200 million to ESA over the last 5
years of the Agreement (i.e., between January 1, 2005 and December 31, 2009;
Authority to pay contributions to ESA after December 31, 2009 (the end of the
Agreement) to honor commitments made prior to the end of the term, and;
Setting of a to $200M ceiling for the contributions that CSA will pay to ESA over
the last five years (January 1, 2005 to December 31, 2009) for both the General
Budget and Optional Programs in which Canada participates.
Exhibit 3.4 provides a pie chart of CSA’s expenditures and commitments for the
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Agreement by the CSA’s activity areas.
Exhibit 3.4:
Canada/ESA Cooperative Agreement
Expenditures and Commitments by Activity Areas (20002009)
General Support
Tech Program
(GSTP)
$12,025
Microgravity
2.7%
$13,917
3.2%
Navigation
$28,339
6.4%
Science*
$8,520
1.9%
Earth Observation
(EO)
$140,202
31.7%
Space Exploration
$62,282
14.1%
Mandatory Activities
(General Budget)
$63,590
14.4%
Telecommunications
, $112,820
25.5%
Source: CSA (September 2009) Canada- ESA Cooperation
Agreement Expenditures and Commitments from 2000 to
Future Fiscal Years
Appendix A displays the expenditures and commitments as authorized by the TB
Submissions. Total CSA expenditures and commitments under the Agreement from
2000 to 2018-19 amount to $441.7 million. CSA entered into multi-year commitments
and expenditure totaling $217.6 in the first five years under TB’s Program approval of
2000, while expenditures and commitments for the second 5 years, under TB’s
Program approval of 2005, amounted to $224.1 million. This leaves $149.4 million in
commitments for the 2010 to 2018/19. A year-by-year breakdown of those
commitments and expenditures is provided in Appendix A.
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The budgetary emphasis on earth observation has generally been declining. It fell
from 45.8% of the budget in the first five years to 33.6% in the second five years. At
34.4%, As of September 30, 2009, it accounted for a slightly greater share of
outstanding commitments. Satellite communications (SC) has declined from 47.4%
of expenditures over the first five years to 39.8% in the second five years and now
amounts to 28.6% of outstanding commitments. In contrast to the above, there has
been a growing emphasis on space exploration (SE), which has increased from 2.3%
during the first five years of the Agreement to 23.3% in the last five years, currently
accounting for 34.9% of outstanding commitments. Generic Technological Activities
(GTA) make up the remainder of the budget. There have been only minor fluctuations
the GTA as a percent of the budget.23
23
CA_01JAN00_31DEC08_TO CANADA 230909
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3.6
Previous Reviews and Evaluations
The table on the following page provides an assessment of the disposition of findings
and recommendations from prior evaluations led by CSA Audit and Evaluation. The
final column of the table presents GGI comments on the pertinence of the prior
findings, in the light of the findings of the current summative evaluation.
As indicated in Exhibit 3.6, management has followed up on the recommendations
from prior evaluations. In each of those areas where management has pursued a course
of action, it believes it has accomplished all that was possible. One issue, in particular
– achieving the technology transfer objective – is no longer applicable, as the
objectives of the 2000 Agreement were reworded to exclude technology transfer in
2005.
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Summative Evaluation of the 2000-2009 Canada/ESA Cooperation Agreement: Final Report
Exhibit 3.6: Findings and Recommendations from Prior Evaluations
Issue
Recommendation
Management Response
1. The European
Union's close
relationship with
ESA is affecting
Canada's
opportunities for
keeping European
markets open to
Canadian
corporations.
The CSA should intensify its efforts to secure a
cooperation agreement with the European Union
that will ensure that Canada maintains a presence
in European markets.
Since the strengthening of relationship between the
EU and the ESA, considerable efforts have been
made in making sure that the interests of Canadian
corporations are being taken into consideration.
Furthermore, the CSA is working on implementing
a program that would help companies access EU
markets – more specifically, emerging markets
from the EU’s Seventh Framework Program. Funds
have been located for the 2009-2010 fiscal year.
However, the program could be delayed due to the
complexity of its implementation. Management
recommends that the CSA encourage Canadian
corporations to use other programs from the
Canadian government that could help them access
foreign markets.
2. Achieving the
technology transfer
objective.
The CSA should study the possibility of
developing a program for companies that want to
use the European Union's Sixth Framework
Programme to penetrate the European market. The
program should complement the existing
Agreement.
The CSA should review the technology transfer
objective, which is not being met, according to the
information gathered from businesses.
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Given that the CSA’s regulations limit the
organization’s actions in providing direct support
for commercialization, CSA management believes
it has taken all possible actions within its authority
and its sphere of influence with regards to this
matter.
N/A
Comments based on the evaluation
findings
This objective was removed from the post
2005 agreement.
32
Summative Evaluation of the 2000-2009 Canada/ESA Cooperation Agreement: Final Report
Issue
Recommendation
Management Response
3. Achieving the
objective of
positioning SMEs
with prime
contractors in
European markets.
The CSA should review its methods of helping
SMEs to penetrate the European market and
thereby increase their competitiveness. This
recommendation is linked to the one made in 1997.
4. Difficulty
commercializing
space products that
have not received
flight qualification.
The CSA should offer a wider choice of programs
that could offer flight opportunities to Canadian
companies so as to increase the chances of
commercializing Canadian products.
5. Consultation
mechanisms are
poorly publicized and
do not facilitate
industry participation
in the selection of
Canada/ESA
programs, as
instructed by the
Program Terms &
Conditions.
To meet program requirements, the CSA should
implement a well-structured and transparent
process for holding consultations with industry to
support the selection of and promote optional
programs.
The CSA continues to support a number of SMEs
in their participation in the ESA program. The
summative evaluation of the ESA program that is
still under way will look at questions regarding
commercialization support and access to foreign
markets, and will make recommendations as to
whether such efforts should be a part of the CSA
mandate. Management indicated that a soon-to-be
released evaluation report of ESA would cover
those questions and make specific
recommendations. Management has chosen not to
pursue this recommendation for the time being.
Canada has confirmed that it will augment its
participation in the optional GSTP program, which
will allow Canada to participate in the PROBA-3
program of the ESA. However, invested funds in
the GSTP have been too low. The investment will
need to be increased in upcoming years in order for
Canada to participate fully in missions that allows
for space qualification. Considering the efforts and
success that have been obtained in this area,
management has chosen not to pursue this
recommendation further.
N/A
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Comments based on the evaluation
findings
The limited budget and the role of selected
Canadian firms in critical technology
development activities is a constraint to
expanded participation by other SMEs. The
envelope programs, however, such as Earth
Observation Market Development have
enabled participation of SMEs. For
additional comments please see findings
and recommendations.
Much of the contract work for ESA is not
related to or dependent on flight
qualification. At the same time, there is a
general sentiment that CSA activities at
ESA are already spread very thinly.
The evaluation found that this is still an
issue.
33
Summative Evaluation of the 2000-2009 Canada/ESA Cooperation Agreement: Final Report
Issue
Recommendation
Comments based on the evaluation
findings
The CSA continues to support common events with The chief comment received from industry
6. The industry feels The CSA should continue holding information
ESA. Management believes that the best practice is relates to uncertainty on whether adequate
it is missing out on
sessions promoting ESA programs.
to integrate Canadian activities in events organized budget remains under the Canadian funding
many business
envelope for a specific contract.
by ESA, so as to encourage as many Canadian
opportunities because The CSA should ensure that information given to
corporations as possible to participate in the event. Strengthening support in Europe to
of a lack of
industry covers all relevant political aspects so as
tendering companies really relates to the
information.
to allow companies to prepare tenders that meet the Notably, CSA management organized an event in
level of resources available in Europe
2008 where the ESA informed the participants
requirements of ESA calls for tenders. More
(SMEs from the spatial industry) of programs and assigned to the CSA – ESA Agreement.
specifically, this information should cover the
Under the present business environment it
Canada/ESA context of the program, funding, the initiatives of the ESA. Comments from the
participants indicated that they were satisfied with would be appropriate for industry, acting
European competition and the prime contractor
through national and provincial
the information they received. Management
likely to be chosen by ESA.
associations, to take the initiative
believes that the CSA has accomplished all that
concerning trade missions and market
was necessary in this area.
The CSA should identify and bring together
intelligence.
Canadian firms interested in establishing domestic
alliances or consortiums to prepare tenders for ESA
calls for tenders.
7. Managers are
responsible for
measuring the
performance of the
Agreement.
Management Response
The CSA should strengthen Canadian efforts and
actions in Europe to promote and support
companies that have submitted tenders to ESA.
The CSA should identify or organize trade
missions in partnership with other agencies or
departments to help Canadian SMEs
commercialize their goods and services with a view
to marketing them to ESA and Europe.
The CSA has hired an experienced manager in
Program managers should review the ResultsBased Management and Accountability Framework performance measurement and RMAF
implementation.
(RMAF). The CSA should provide them with the
resources they need to implement the RMAF so
that information can be collected on a regular basis
and ensure accountability for performance.
Evaluation verified that progress is being
made.
The CSA should use tests to verify the information
it receives from ESA concerning contracts awarded
to Canadian corporations so as to ensure that the
data used to measure the performance of the
Agreement are reliable.
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Summative Evaluation of the 2000-2009 Canada/ESA Cooperation Agreement: Final Report
Issue
Recommendation
8. Canadian funding In consultation with TB, the CSA should
is limited and subject implement a mechanism for mitigating the risks of
exchange rate fluctuations and inflation.
to pressure from
exchange rates and
inflation. These
factors limit the
availability of funds
for programs and
may lead to cost
overruns.
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Management Response
N/A
Comments based on the evaluation
findings
A Canadian dollar trust fund would help
mitigate any reduction in available dollars
to industry due to exchange rate costs of
currency conversion. CSA advised that this
is not feasible due to ESA legislation.
35
4.0 Findings
This section provides the evaluation findings for issues of relevance, design and
delivery, and results. A number of evaluation questions that are inter-related have
been grouped together. A complete list of the evaluation issues is included in
Appendix E.
4.1
Rationale for the CSA-ESA Agreement
Q1: Do the policy, programmatic and industrial conditions/needs that led CSA to
enter into a Cooperation Agreement with ESA in 2000 still exist today? If not,
how have they changed?
Q5: Is there a rationale to continue the Canada/ESA Cooperation
for another ten years (2010 – 2019)? What is it?
FINDING: The needs and conditions that led Canada to enter into the Agreement
continue to exist. The study found strong support for continuing the Agreement.
CSA and Canadian government representatives agreed that the policy, programmatic
and industrial needs that existed in 2000 still exist today. They noted that the
Agreement allows Canadian firms access to European prime contractors and
important scientific data. Due to the fact that space endeavours are becoming
increasingly multi-partner due to high costs and accessing required expertise, linkages
with other organizations are of great importance. Canada has strength in SATCOM
but the market for this is limited in Canada – thus requiring the need to look beyond
our borders. Other countries such as China, India, and Japan are developing their own
space programs so Canada needs to have an international perspective.
CSA representatives also reported that the program has slowly changed from its
original focus on science and technology cooperation to a program with an industrial
development focus. Also ESA programming has expanded and there are now more
programs that Canada would like to participate in than was the case in 2000. For
example, CSA may now wish to invest differently, e.g., to better balance its limited
funding between Earth Observation and Telecommunications with Navigation and
Space Exploration.
ESA representatives noted that one of the main motivations to continuing the
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agreement with Canada, from their perspective was that Canada has a substantial and
interesting technology base, and that there are indirect benefits derived due to the
Canadian knowhow and skills developed as a result of access to the US defense
market. In sum, Canada is a “silent and preferred partner.”
It was also noted that, if Canada participated in the science program, it would be of
great benefit to Canadians. Another motivation for continuing the Agreement from an
ESA perspective is that many ESA participants value having Canadian involvement,
and value the Canadian approach and ideas, as Canada is less inclined to “play
politics.” Despite the arrival of many new ESA members all trying to seek benefits,
Canada still has some critical advantages: Canada has been involved with ESA over a
long time period, and Canada has the industrial credibility that helps to generate
benefits.
ESA representatives believe that although Canada pays only half of a normal share for
the general contribution, its approach has been strategic and has rendered good value
for both Canada and ESA. ESA representatives said that they valued having
Canadian involvement. Specifically, they value the Canadian approach to issues and
the way in which Canada brings in new ideas.
All of the key informants interviewed believed that there is a continued need for the
Agreement, and therefore its renewal. All of the organizations that participated in the
case studies believed that the opportunity for their organization to participate in the
ESA program is important. This was consistent with the survey results in which 72%
(28/39) of the survey respondents reported that the opportunity for their organization
to participate in the ESA program was important.
The rationale for continuing the agreement derives from several factors:
 Given its relatively small budget, the activities that the Canadian Space
Agency can pursue are relatively small in scope compared to those pursued
by ESA.
 The breadth and depth of technologies under development are considered
much greater in ESA programs than what CSA can support in its own
programs due to the much greater ESA budgets and the diversity of partners
and programs involved in ESA.
 Recent US regulations (ITAR) have restricted the amount of space related
work originating from NASA and the USA in general.
Interviewees believe that a healthy and expanding Canadian space industry must
look beyond the North American borders and find opportunities to participate in
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international missions and programs.
In the coming years, ESA will be defining and pursuing its flagship missions (e.g.,
Aurora’s ExoMars and Mars Sample Return as well as the Outer Planets: Europa
Jupiter System Mission, Titan Saturn System Mission, etc.), which will be a very
large endeavor requiring the participation of many countries and multiple space
industries (e.g., ESA, NASA, and JAXA). These upcoming missions represent
tremendous opportunity for Canada given its strength in SATCOM and robotics, and
the perception of Canada as an intermediary that understands how to work
effectively with NASA.
The Agreement is also important for Canadian SMEs engaged in technologies that are
applicable in the space sector, especially to those firms looking to test their
technologies in space. The Agreement allows Canadian firms to be at the forefront of
technology development by providing access to technical specialists in space agencies
in Europe countries. The case studies reinforced the fact that the Agreement provides
firms advantageous access to ESA for Canadian SMEs working in the sector.
According to one firm that participated in the case studies, ESA flight opportunities
“made the reputation of the company.” Several case study firms reported that the
ability to list ESA as one of their clients provides a competitive advantage and has
helped them win business with prospective clients.
As well, federal organizations such as the Communications Research Centre (CRC)
and the Canada Centre for Remote Sensing (CCRS) have information needs that are
satisfied by technologies developed under the ESA program. In several cases,
Canadian firms participating in ESA programs developed these technologies. The
Canadian departments can use alternative data sources to some extent, but the
availability of data from ESA funded projects increases the richness of the data
available.
ESA representatives consider Canada one of the leading countries technologically,
and in some areas Canada provides an important source of technical know-how that
would be filled by others if Canada left the Agreement. If European firms were left to
fill the gap, it could also undermine Canadian firms’ competitive advantage in some
key technologies.
Using a shorter timeframe, DB Geoservices Inc. found that incremental contracts
arising from the ESA contracts amounted to 2.7-4.9 times the value of the ESA
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contracts24. Our analysis, based on the conservative assumptions outlined earlier,
indicated that follow on sales resulting from ESA contracts were at least 1.25 times
the original ESA contracts.
Finally, both ESA representatives and Canadian government officials underlined the
importance of the Agreement as an instrument for reinforcing Canada-European
relations, and that discontinuance of the Agreement would be seen negatively by the
European participants in ESA, not only because of the technical value of Canada’s
participation but also because of the diplomatic message that it will send.
Q2: Is the Canada/ESA Agreement consistent with the priorities of the
Government of Canada? And with the priorities of Canada's Space Program?
Q3: Does the program support the science information needs of the government?
FINDING: The Agreement is consistent with the priorities of the Canadian
Government (Government of Canada) and the CSA. The Agreement supports many
science information needs in the areas of Internet access, earth observation, search
and rescue, and resource management.
Consistency with Government of Canada Priorities
Evaluators conducted interviews with representatives from CSA and pertinent
government departments, including DFAIT, NRCan, and Industry Canada, to address
this issue. All key informants agreed that the Agreement was consistent with
government priorities as well as with the priorities of CSA.
Support for Canadian Science information Needs and Participation by Canadian Scientists
The evaluation team found numerous areas where Canada’s participation in the ESA
program supports the science information needs of the government. For example,
interviews conducted with government departments revealed that ESA involvement in
ERS1 and ERS2 assisted in the development of RADARSAT. The ESA Agreement
gives Canada access to ESA earth observation satellites that complement and provide
back-up for Canada’s earth observation resources, so that Canada is not solely
dependent on RADARSAT. Following are some examples:

24
The Communication Research Center (CRC) is participating in an ESA
DB Geoservices, Evaluation of the Canadian/European Space Agency (ESA Cooperation Agreement p. 12.
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
communication program that promises to bring multimedia to remote
Canadian communities. Services could include Internet access, medical
expertise, and improved search and rescue capability for the Canadian Coast
Guard.
A Canadian firm has and will continue to utilize synthetic aperture radar
(SAR) imagery from the SAR missions for applications for the wider user
community including the Federal, Provincial and Territorial governments for
use in different application areas such as oil-spill monitoring, natural disaster
assessment and monitoring, flood monitoring, agriculture and forestry.
From a historical perspective, during the ESA ERS development (i.e., 1980’s),
Canadian scientists from CCRS (Canada Centre for Remote Sensing) played a major
role in the development of SAR (Synthetic Aperture Radar) measurement and
processing techniques which, in turn, enabled the Canadian company MacDonald
Dettwiler and Associates (MDA) to become prime contractor for the ERS-1 ground
segment. The MDA has been successful ever since in capitalizing on this opportunity
to become the world leader in SAR processors.
For the follow-on ENVISAT missions, Canadian scientists were selected to be
members of various mission advisory groups (MAGs), and more than 28 proposals
were submitted by the Canadian scientific community in response to an
Announcement of Opportunity (AO) for Calibration/validation (CAL/VAL) and data
exploitation, most of which were accepted.
Presently, within the Earth Observation Envelope Programme (EOEP), a Canadian
scientist from University of Toronto is serving in the ESAC (Earth Science Advisory
Committee) which oversees the overall science aspects of the ESA EO. The
Canadian scientists from Environment Canada (MSC), the Université du Québec à
Montréal (UQAM) and the University of Calgary are serving as members of MAG in
EarthCARE and Swarm Earth Explorer missions. In particular, exploiting the
expertise gained from the CloudSAT mission of NASA, Canadian scientists from
MSC (Meteorological Service of Canada) are expected to play a major role in
CAL/VAL and development of algorithms for the EarthCARE mission. Based on
Canada’s long-standing experience in the study of the ionosphere using space borne
and suborbital probes, a Canadian team led by University of Calgary designed an
Electric Field Instrument for the SWARM mission, and they will exploit the data.
Due to the large landmass of Canada (as large as all of Western Europe) and its
location (Northern and Arctic), many of the scientific objectives of the Earth Explorer
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missions such as the SMOS, CryoSAT-2, and CoReH2O (a candidate mission) are of
considerable interest to Canada. For CryoSAT-2, more than six PIs (Principle
Investigators) are involved in CAL/VAL activities, most of which are taking place in
Devon Island.
In terms of data access, the Sentinel missions of GMES are expected to generate a lot
of data required for operational monitoring of the environment, the state of
vegetation, the coastal ocean areas, etc. Government departments such as NRCan,
MSC/EC, DFO, CFS, CIS and AAFC are very interested in receiving these data.
Through Canada’s current participation in ESA, and the GMES Space Component, it
will be possible to arrange direct reception over Canada of data of Canadian interest
as it is done currently for the ENVISAT, ASAR, and MERIS.
Consistency with S&T Strategy
The CSA aligns its priorities with the priorities outlined in Canada's Science and
Technology (S&T) Strategy, Mobilizing Science and Technology to Canada's
Advantage, the goals of which are to improve Canada's S&T-related competitiveness
and to promote entrepreneurial innovation and creativity. The strategy seeks to foster
Canada's S&T competitiveness through investments and activities in three key areas:
entrepreneurial advantage, knowledge advantage and people advantage. The goal of
the strategy is to foster three distinct Canadian S&T advantages: an Entrepreneurial
Advantage (translating knowledge into commercial applications that generate wealth
and support a high quality of life); a Knowledge Advantage (positioning Canada at the
leading edge of developments that generate health, environmental, societal, and
economic benefits); and a People Advantage (building a well-educated, highly-skilled,
and flexible workforce in order to thrive in the modern global economy). The S&T
strategy also identifies four priority areas for enhanced investment and activity:
environmental science and technologies; natural resources and energy; health and
related life sciences and technologies; and information and communications
technologies.
The Agreement is consistent with the priorities outlined in the S&T Strategy. The
Agreement follows the three key areas outlined in the Strategy. The Agreement has
led to a number of developments in areas such as Internet access, earth observation,
search and rescue, and resource management which have been wealth generators and
allowed Canada to be at the forefront of scientific developments that generate strong
benefits. In addition, the Agreement has contributed to the strengthening of Canada’s
workforce by building a skilled, well-educated workforce.
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Q4: Would companies have obtained contracts on these ESA programs without
the Canadian contribution?
FINDING: Without the Agreement, ESA could not have provided Canadian
companies with the contracts it received.
Although a small number of firms that participated in the evaluation (13%, or 3 of
25case studies and 10%, of respondents in the survey) believe they might have
obtained some work with ESA and/or its contractors without the Canadian
contribution to ESA, there is general consensus amongst case study respondents and
all key informants that the reality of ESA’s “pay to play” system would have likely
precluded Canadian companies from making a significant mark in the European space
arena. Even small contracts that were obtained outside of ESA by Canadian firms
were, in fact, the result of connections with ESA, albeit indirectly in some cases.
Q6: Is Canada participating in the most appropriate ESA programs?
FINDING: Canada is participating in the ESA programs in which the Canadian
space industry has a competitive advantage. Whether these are the most
appropriate programs for Canada in the long term is the subject of some debate. At
this point in time, CSA has not finalized a long-term plan for Canada’s involvement
in Space.
According to CSA key informants, the selection of ESA programs is done in
consultation with Canadian industry. Generally, the ESA programs chosen are
focused on areas where there are industrial opportunities for Canada and that match
Canada’s Space objectives and are compatible with the priorities of the government.
Key informants from government departments were of the opinion that the CSA focus
for ESA program selection is primarily on industrial benefit as compared to
informational and policy needs of departments. Nevertheless, departmental units that
rely on the ESA program for data (e.g., CCRS) have quarterly reviews with CSA and
have the opportunity to advise CSA of potential benefits to Canada from participating
in a particular ESA programs.
The evaluation found that 80%, or 20 out of 25 firms that participated in the case
studies believe that Canada is participating in the most appropriate ESA programs.
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Key informant interviews (federal government staff) reinforced the findings of the
case studies. Fifteen (15) of 27interviewees believe Canada has chosen appropriate
programs. Eight interviewees could not comment, and three felt Canada is
participating in too many ESA programs. The possibility that Canada is participating
in too many programs and is spread too thinly was also raised in interviews with some
CSA officials.
Canadian companies that participated in the survey generally had less involvement in
ESA programs than the case study companies. More than half (24 of 38 firms25)
indicated that they were not familiar enough with the various ESA programs to judge
whether or not Canada was participating in the most appropriate programs.
Nevertheless, the ESA contract opportunities appear to align reasonably well with
many of them, since 22 of 39 firms (56%) reported that they align well with their
organization’s strengths.
Not surprisingly, firms in the space sector that have never participated in an ESA
contract that were also surveyed indicated that ESA opportunities do not align
particularly well with their own strengths. Only 16% percent of these respondents felt
that the interests of their firms aligned well with the ESA opportunities, 37% felt
some opportunities aligned well and others did not; 32% said the opportunities did not
align well at all, and 15% did not know enough about ESA opportunities to answer.
The CSA program supports areas where Canada has been traditionally strong (Earth
Observation and SATCOM), with some further diversification into newer areas in the
second half of the 10-year period. This is consistent with the expenditure data for
ESA reviewed by the evaluation team.
Overall, the evaluation team concluded that the selection of ESA programs in which
to participate by CSA is based on alignment with Canadian industrial and
technological strengths and to a lesser extent with the science research and data needs
of Canadian government departments.
4.2
Design and Delivery Issues
Q7: Is CSA promoting and communicating the Canada/ESA Agreement and its
25
One of 39 original respondents did not answer this question according to the original meaning, leaving 38 actual respondents.
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opportunities effectively to Canadian firms?
FINDING: CSA is not communicating opportunities to Canadian firms as
effectively and consistently as it could. At the same time, the Agency must be
careful not to create unrealistic expectations, since demand for ESA opportunities
exceeds available Canadian funding.
CSA presents upcoming ESA opportunities to industry at the CSA’s annual
Technology Days symposium. Every few years, CSA holds discussions with select
firms to obtain feedback concerning how the ESA program is managed by CSA and
to identify ways through which it can be improved.
Canadian firms are welcome to register with and monitor the EMITS system of ESA
for announcement of procurement opportunities. It is important for firms to fully
understand the ESA opportunity, the availability of Canadian funds in the ESA
program, and the CSA attitude toward the opportunity. Furthermore, in some ESA
optional programs, formal requests come from ESA asking whether CSA supports a
particular Canadian company. For these reasons, informed companies will generally
verify the status of the project with the requisite CSA program manager before
deciding whether to submit a proposal.
CSA interviewees mentioned some difficulties in promoting the Canada/ESA
Agreement and its opportunities to Canadian firms. First it is difficult to convince
“unproven” organizations to position themselves for contracts, given the limited ESA
funds available for contracts, many companies’ limited resources to engage in
marketing and the limited support available from DFAIT in the promotion of
opportunities with ESA. Some respondents felt that it was the responsibility of each
CSA program area to inform its client companies of opportunities in their sector
while others felt that it was the responsibility of the firms to keep themselves
informed (either through EMITS, attending Technology Days, or contacting CSA
personnel directly). This is supported by the findings from the contract recipient
survey as well as the case studies.
Stakeholders believe that CSA could improve how it communicates ESA
opportunities to Canadian industry. The majority of survey respondents that had
participated in ESA contracts (32 of 39 firms, or 82%), which represents
organizations that were less engaged in ESA contracts than the case study
organizations, stated that the CSA could improve how it communicates the
Canada/ESA Agreement and its opportunities. Only 6 of 39 firms (15%) believe that
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the CSA is effective in communicating opportunities. These findings were
reinforced by the case studies, in which only 8 firms (33%) reported that CSA was
communicating ESA opportunities effectively. These findings are consistent with the
findings of the 2004 evaluation.
Firms that have not participated in ESA contracts indicated in the survey that CSA
was not promoting and communicating the Canada/ESA Agreement and its
opportunities effectively to Canadian firms (79% or 15/19)26. For example 15 of 19
firms (79%) reported not having had any contact from CSA promoting and
communicating the Canada/ESA Agreement and its opportunities to them; two firms
(11%) reported they had received occasional communications; and another two firms
(11%) reported they received communication from CSA concerning opportunities.
Overall, only 3 firms (16%) felt that communications from CSA had been
appropriate.
Those interviewed who reported CSA was not effective in its communications
claimed that much of the information they acquired and many of the contracts they
obtained resulted from their own efforts, not from information provided by CSA.
Those who thought CSA was only somewhat effective in its communications were
positive about the Agency’s care in responding to questions and concerns posed by
industry players, but criticized the Agency’s passive approach to communication.
One case study interviewee suggested that CSA could produce an information
bulletin with opportunities that might be of interest to Canadian firms, while another
noted that CSA could be more pro-active in involving Canadian industry in its
strategic and tactical decisions.
One of the larger case study firms noted that if you don’t know about an opportunity
before it arrives on EMITS, you have little chance of winning.
Q8: What challenges have Canadian firms faced in trying to access ESA
contracts? How do they overcome them?
FINDING: The major challenges faced by Canadian firms relate to the relatively
limited and sometimes uncertain Canadian funding of ESA programs, complexity
and difficulty of the ESA bidding process, and distance from Europe.
The principle challenges facing Canadian firms are the level of funding, and more
26
One respondent said: “They made a presentation that I attended concerning the topic. My understanding from that is that there
are no opportunities. If that’s correct, they have effectively communicated that.”
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particularly obtaining timely information on the availability of funding, knowledge of
whom to contact at ESA for information and the role of the return coefficient in the
decision making process. In addition, the general level of competition is viewed by
many firms as a challenge. Some firms also claimed a lack of support from CSA in
the proposal process. This was particularly the case for firms that have yet to win an
ESA contract
The challenge most often cited from the case studies was the level of funding that
Canada contributes to ESA. Given the “pay-to-play” nature of most ESA programs,
the unavailability of Canadian funds appears to be the most significant obstacle to
Canadian industry. One rather large case study firm indicated that they have had to
pass on about 70% of the ESA opportunities in which they were interested, due to
insufficient Canadian funding in ESA programs. The lack of funding has, it is
reported, lead to innovative Canadian ideas being exploited by international
competitors who have ESA funding availability. According to a case study
interviewee this has permitted competitors to catch up with or surpass Canadian firm
capability in some areas.
More critical, however, is the need to for companies to know whether funding is
available within the Canadian contribution envelope in order to decide whether to
prepare a bid. This issue can be resolved by appropriate contacts at CSA, and
successful firms report that they have done this. Sometimes, however, information
on funding availability was not conveyed in a timely manner. Thus, for example
Canadian companies may learn of an opportunity, build a team and partnership, and
even receive preliminary approval from CSA, but later, CSA may indicate that there
is insufficient funding left in the program to accommodate a Canadian bid.
According to the key informant, this is unfortunately what occurred with the
ExoMars mission.
A related challenge is the lack of sufficient Canadian funding in specific ESA
program areas that are areas of specialization for Canadian firms. Three surveyed
firms that have participated in ESA contracts, and another two surveyed firms that
have not participated, specifically mentioned this as a challenge.
Related to the funding issue is the issue of the target return on CSA expenditures in
terms of contracts to Canadian organizations (geo-return). At least one key informant
referred to contracts lost by Canadian firms under circumstances that would indicate
that the decision was made on the basis of Canada already exceeding its geo-return
for a program.
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Generally, firms that have faced contracting challenges report having learned to work
through CSA channels, particularly the program managers and delegates. A key
avenue for information on ESA, in this respect, is the Space Counselor at the
Canadian Embassy in Paris. In addition, successful firms have developed their own
information networks in Europe.
Key informant interviews with CSA and government staff members pointed out that
given the relatively modest Canadian contributions to ESA, Canadian firms,
especially the smaller ones, must gain considerable credibility before competing at
the ESA level. Where the level of technology development is an issue, CSA has in
many cases been instrumental in issuing contracts to a firm to advance its capabilities
to the point where it can bid on and win ESA contracts. ESA also has a special SME
program under its EMITS system. At least one firm case study firm successfully used
this route.
The process for accessing ESA contracts is viewed by some case study firms as being
complex, and subject to delays and uncertainty. For example, forty-four percent of
firms surveyed reported the process was heavily bureaucratic, and another 19%
reported that they lack sufficient knowledge about ESA and/or CSA procedures and
politics. One key informant noted that even big firms sometimes have difficulties in
determining whom to speak with at ESA on specific topics. As mentioned earlier,
various CSA program managers and delegates to ESA, as well as the Space
Counselor in Paris, are cited as sources to address such issues.
Firms that have yet to win an ESA contract have similar challenges with the proposal
process. Forty-three percent of those surveyed reported they did not receive enough
support from CSA before and during the application process, 29% reported that they
did not have enough staff to support the application process, and 50% reported they
do not understand ESA and/ or CSA policies well enough. The majority of surveyed
firms that have participated in ESA contracts (69%) recommended improvements to
the process. Of those surveyed firms providing recommendations, 45% mentioned
that CSA should provide support for Canadian firms before and during the process of
applying for ESA contracts; that CSA should help firms identify relevant upcoming
ESA opportunities (35%); and that CSA should share more information about the
European space industry and market (15%).
The cost of travel to Europe and dealing with European partners are also challenging.
Fifteen percent of surveyed firms that participated in ESA contracts reported
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problems dealing with partners, and 11% reported the cost of travelling back and
forth to Europe as a challenge. Firms that have yet to win an ESA contract reported
similar challenges. The majority of these firms (64%) felt that a challenge in trying
to access ESA contracts was that ESA preferred to use European firms; 50% had
difficulty in locating appropriate European firms with which to partner; and 14% felt
the geographical distance from Europe was a challenge.
Nineteen percent (5/26) of the respondents who mentioned challenges had not been
able to overcome them. Respondents had resolved issues by being patient and taking
the time to go through the sometimes lengthy processes (23% or 6/26), hire someone
new to meet the requirements (8% or 2/26), or only bid on smaller contracts (8%).
Other solutions mentioned (by one respondent each) were: negotiating, finding
appropriate partners in Canada or Europe, finding another route to get ESA projects
without first getting CSA approval (e.g. going through the ESA General Budget),
getting support from CSA staff, and travelling to Europe.
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4.3
Results and Impacts of the CSA-ESA
Agreement
Q9: Have the contracts awarded by ESA to Canadian companies and
organizations achieved the minimum overall return coefficient of 0.94 as set out
by the ESA Council?
Q10: Have contracts awarded under the General Budget and individual Optional
Programs achieved a minimum guaranteed return of 0.84 as set out by the ESA
Council?
FINDING: Contracts awarded to Canada have achieved an overall return
coefficient of 1.09 for the 2000-08 period, according to ESA data.27 This means that
between 2000 and 2008 Canadian firms received a greater share of the overall
weighted value of contracts awarded by ESA in Programs in which Canada
participates than the ideal value set for Canada for these programs. The minimum
overall return coefficient approved by the ESA Council for the current period is
.94. Canada ranks second only to the Netherlands in achieving the calculated
return coefficient, according to the same data.28
As described in Section 3.4, Canadian organizations receive contracts from ESA
commensurate with CSA’s contribution. The following shows Canada’s comparative
position, especially with respect to other ESA members.
Canada’s Comparative Position
The ESA return calculations are computed in accordance with the European Apace
Agency Council Resolution ESA (98)92 Regulation 5:
“ The overall return coefficient per Member State shall be calculated by totaling
the weighted values of all contracts placed with industry and organizations of that
State under each of the Agency’s programmes (or “overall value of contracts”)
and then comparing that value with the sum of ideal values (or “overall ideal
value”) for the same programmes for that State.”
In calculating these returns, ESA excludes overhead (OH) or administration in
determining the amount of return received by a country. In addition to the ESA
27
Source: European Space Agency, Industrial Policy Committee. (April 2009). Geographical Distribution of Contracts,
Situation as per 31 December 2008.
28
Ibid.
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General Budget, of which only a portion is available for contracts, each of the
Optional Programs includes an overhead or administrative component. The
overhead/administrative component varies by Optional Program, and, based on data
provided by the CSA, evaluators estimated that it has been found to average
approximately 25% of the contributed amounts.
ESA’s document Geographical distribution of contracts (April 2009), Exhibits 4.1,
and 4.2, below, respectively, show Canada’s return coefficients for the Mandatory
Programs, and overall; as well as Canada’s rank in comparison with other contributing
states. Charts illustrating Canada’s rank in each area are provided in Appendix F.
Exhibit 4.1: Canada’s Return Coefficients and Rank, for Mandatory Programs
1.4
1.26
Return Coefficient for
Mandaotry Programs (All)
1.2
1.16 1.14
1.1
1
1.0
1
0.98
0.91
0.9
0.86 0.85 0.85 0.83
0.76
0.8
0.69
0.6
0.64
0.59
0.4
0.2
0.12
0.0
ESA Member States and Canada
Source: ESA. Industrial Policy Committee. April 2009. Geographical distribution of contracts,
Situation as per 31 December 2008.
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Exhibit 4.2: Canada’s Return Coefficients and Rank, Overall
Overall Return Coefficients
1.25
1.15
1.15
1.09
1.05
0.95
1.06
1.03 1.03 1.02 1.02 1.01 1.01
1
0.98 0.98 0.96
0.93 0.93 0.92 0.91
0.89 0.87
0.85
0.79
0.75
0.65
0.55
0.5
0.45
ESA Member States and Cooperating States
Source: ESA. Industrial Policy Committee. April 2009. Geographical distribution of contracts,
Situation as per 31 December 2008.
Based on ESA’s calculations, Canada is shown to have the second-highest return
coefficient overall for the Mandatory Programs.
On an individual program basis, Canada’s return coefficient varies. Exhibit 4.4
indicates that:


Although we have contributed only about .7% of program budgets for both
mandatory and optional programs, Canada’s performance has been good with a
return coefficient of 1.09 overall;
Canada’s performance has led to our rank of 2nd of the 21 countries
participating in ESA.
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Exhibit 4.3: Canada’s Contribution to Each Program and the Return Obtained
by Canada on ESA Contracts as Well as Rank Achieved, by Program Area
Program
Mandatory Activities
Optional Programs
Earth Observation (EO)
Telecommunications
Navigation
Manned Space Exploration
Microgravity
Science*
Technology
Percentage
Contribution
0.3%
Return
Coefficient
1.16
2 out of 18
1.9%
2.4%
1.1%
0.2%
1.0%
N/A
0.6%
1.17
1.01
1.02
1.64
0.38
N/A
1.08
5 out of 19
3 out of 17
9 out of 16
3 out of 14
14 out of 15
N/A
3 out of 19
Rank
Overall
0.7%
1.09
2 out of 21
Source: Geographical distribution of contracts – Situation as per 31 December 2008
[ESA/IPC(2008)13, rev.3]
* Contracts awarded for SWARM are accounted for under EO in ESA’s statistics
The figures in Exhibit 4.3 are based on ESA’s calculations. The methodology used
by ESA is described in The ESA methodology is provided in document ESAC (98)92
GEO RETURN pdf29.
Exhibit 4.4 displays the total contracts to Canadian organizations (as reported by
ESA and not weighted by quality of contract) as a multiple of CSA contributions to
ESA (as per CSA financial reports) less the overhead paid to ESA. The intention of
these calculations was to determine how much of the Canadian contributions to ESA
have actually been returned to Canadian firms/organizations, in terms of contract
dollars after all overheads including the mandatory payment for general budget
support. (However, it is important to note that for a given year, there is no direct
correlation between the contributions made and the contracts obtained by Canadian
firms. The best that can be done is to try and match contributions to ESA with CSA
expenditures over an extended period of time, recognizing that the match is never
complete, as ESA contracts tend to lag the CSA contributions.)
29
The overall return coefficient per Member State is calculated by totaling the weighted values of all contracts placed with
industry and organizations of that State under each of the Agency’s programmes (or “overall value of contracts”) and then
comparing that value with the sum of ideal values (or “overall ideal value”) for the same programmes for that State.
1. The value of contracts placed with industry and organizations of a Member State under each of the Agency’s programmes
shall be weighted by using the technological weighting factors, which are in force in the Agency at the time of calculation and
entered by the Agency, in EURO, in the Agency’s geographical return data bank; whereby the value entered shall represent the
weighted sum of payments made in EURO together with weighted outstanding commitments expressed in EURO. All payments
made in national currencies and, where necessary, outstanding commitments are converted into EURO in the manner specified
in the Agency Financial Regulations in force at the time of calculation of the geographical distribution of contracts.
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Exhibit 4.4: Total Contracts to Canadian Organizations as a Multiple of Expenditures
Minus Overhead, Based on GGI’s Calculations (2000-08)
Category
Total ESA
Contracts to
Canadian Firms*
ESA
Progam
Overhead
CSA
Expenditures**
Net CSA
Expenditures
Available for
Contract
(after ESA
Overhead)
$70,409
30.9%
$89,482
$61,870
1.14
$6,807
27.1%
$15,849
$11,561
0.59
$ 66,743
18.4%
$90,000
$73,451
0.91
$4,999
20.0%
$8,501
$6,801
0.74
$55,568
$55,568
0.51
Earth Observation
(EO)***
Science &
Exploration
Satellite
Communications
GSTP
Mandatory Activities
(General Budget)
$28,520
Ratio of
Contracts to
Net CSA
Expenditures
TOTAL
$177,477
$259,400
$209,249
0.85
Source: Canada-ESA Cooperation Agreement Expenditures and Commitments from 2000 to Future Fiscal Years,
List of ESA contracts to Canada, 2000-2008
* Includes Contracts from January 2000 through December 2008
** Includes contributions to ESA budget years 2000 to 2008 (i.e from January 2000 to October 2008)
*** Expenditures include additional funding provided for SWARM so as to ensure proper comparison with
contracts awarded by ESA
Exhibit 4.5 demonstrates, that contracts to Canadian firms amounted to 68% of the
gross CSA expenditure for ESA programs, but as is seen in Exhibit 4.4 this number
rises to 85% when overheads are netted out and net expenditures used as the base.
Canada’s Actual Dollar Return
Based on ESA contracts to Canadian organizations under the Agreement since 2000,
the following exhibit shows the dollar amount of contracts, by program area, received
by Canadian firms from January 2000 through December 2008 (the latest data
available), according to CSA’s document, “List of ESA Contracts to Canada, 20002008,”30 as a fraction of CSA’s expenditures related to the Agreement over the same
period (i.e., January 2000 through December 2008). Although more recent follow-on
expenditure data are available, the consultant considered expenditures only until
December 2008 in order to appropriately compare them to contract data for the same
period.
30
Data in this document is only available to December 2008.
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Exhibit 4.5: Canada’s Return Contribution, in Terms of Contracts (2000 – 2008)
CSA Expenditures
($ in millions)*
Canadian
Contracts
($ in millions)**
Canadian
Contracts/CSA
Contribution
55.6
28.5
0.51
Earth Observation (EO)
89.5
70.4
0.79
Telecommunications
71.0
53.7
0.76
Navigation
19.0
13.1
0.69
Space Exploration
10.1
5.2
0.51
Microgravity
5.8
1.6
0.29
GSTP
8.5
5.0
0.59
CSA Activity Areas
Mandatory Activities (General Budget)
***
TOTAL
259.4
177.5
0.68
Source: Canada-ESA Cooperation Agreement Expenditures and Commitments from 2000 to Future Fiscal Years,
List of ESA contracts to Canada, 2000-2008
* Includes contributions to ESA budget years 2000 to 2008 (i.e. from January 2000 to October 2008)
** Includes Contracts from January 2000 through December 2008
*** Expenditures include additional funding provided for SWARM so as to ensure proper comparison with
contracts awarded by ESA
The exhibit indicates that, based on the assumptions noted, Canada received just
about $0.68 in contracts for each dollar it contributed to ESA. The return varies by
activity area, with EO and Telecommunications showing the highest return at .79 and
0.76, respectively.
Q11: To what extent have the Canadian companies that received ESA contracts
maintained or increased their complement of core scientists, engineers and
technicians?
FINDING: More than half of Canadian firms report that ESA contracts have
maintained or increased their scientific staff. These numbers were extrapolated
from the sample to the entire population. Since 2000, ESA contracts to Canadian
companies have provided 1297 person years of work, of which 182 person years
were new hires. Of this amount an estimated 821 were HQP person years. This last
number represents 63% of the total person years of work. In comparison,
approximately 33% of the space sector workforce in Canada overall are engineers
or scientists31.
Firms also reported that the experience and relationships developed in ESA
31
Source: “State of the Canadian Space Sector: Policy and External Relations”, 2007, p.18.
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contracts also allowed them to win non-ESA work requiring the hiring of an
additional 291 persons.
Twenty-seven (27) of 37surveyed firms (73%) and 16 of 24 case study firms (67%)
reported that the ESA contracts had helped them maintain or increase their
complement of core scientists, engineers and technicians32. For example, roughly four
of the 12 people currently working in geomatics at one case study firm were hired
because ESA contracts directly led them to win non-ESA follow-on work. Another
case study firm estimates that it hired 21 new employees due to winning ESA
contracts over the period 2000-2009.
Q12: To what extent have Canada/ESA programs contributed to enhancing
existing technological and innovation capabilities of the companies that received
ESA contracts?
Q13: To what extent has the Agreement facilitated the development and
demonstration of advanced technologies, systems, components, or tools?
FINDING: Canada/ESA programs appear to have contributed to the 1)
enhancement of the existing technological/innovation capabilities; and the
2) development/demonstration of advanced technologies, systems, components, and
tools of the companies that received ESA contracts, with some firms using the
programs to increase their capabilities in areas of core competence and others
using the programs to explore new areas. The evidence for this is primarily
anecdotal.
Without a baseline, it is difficult to measure the extent to which Canada/ESA
programs have contributed to enhancing existing technological and innovation
capabilities of the companies that received ESA contracts. That said, the evidence
presented below is basically anecdotal.


In one case, a firm obtained experience via ESA’s European Remote Sensing
(ERS) satellites I and II, which helped the firm build its capacity for the
RADARSAT program.
In another case, the contract to a particular company for the production of an
Electric Field Instrument has allowed that company to re-establish itself in
the business of Satellite Payload and Instrumentation, a niche that it had
32
Two respondents stated that this question was not applicable to them, as they worked in academia, and these questions were
only relevant to industry respondents. One respondent skipped this question.
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
abandoned for several years.
In a third case, an aerospace company that started as a university-based
contract was able to acquire the critical mass necessary to form a start-up
company following the receipt of several ESA contracts.
In light of these and other examples, it can be said that some of the companies have
used the Canada/ESA programs to increase their technological/innovation capabilities
in one or more of their core-competence areas (e.g., iceberg detection, circuit-board
manufacture), while others have used the Canada/ESA programs to “bring them up a
notch and do work somewhere else,” and have thus used the programs for leverage.
Regardless, 77% (or 27 out of 3533) of the survey respondents reported that the ESA
contract(s) had allowed their firms to develop new skills or technologies, and 96% (or
23 out of 2434) of the case-study key informants reported that the programs had
increased their firms’ innovation capability.
A number of newly developed skills and technology advancements that have been
derived from the ESA contracts were reported in our case studies and interviews.
These skills can be put into two groups: general skills, which can be applied to a
variety of areas, and skills specific to a certain sector or area of technology. A
complete list can be found in Appendix H.
Some of the general skills reported included: an enhanced knowledge of European
markets; increased familiarity with European standards; development of skilled teams
in space technologies; development of skills to transfer space technologies to
terrestrial applications; improved handling of IP to maintain secrecy requirements;
expanded geomatics capabilities; and, training of part-time employees into full-time
workers.
The more specific skills reported included the development of expanded technology
capacity to handle L-Band data and develop Ka-Band multi-beam antennae;
establishment of teams with partners to market outside of Europe; updated flight
skills; and increased GaN R&D capabilities.
The program also led to significant development of advanced technologies and
systems. Examples of developments of advanced technologies and systems within
the field of soil moisture include contributions to the development of the ground
33
4 respondents indicated that their ESA contract(s) were did not include the development of skills or technologies, one skipped
this question
34
One respondent did not respond
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segment for an instrument to measure soil moisture (SM) for ESA’s Soil Moisture
and Ocean Salinity (SMOS) mission, which included the development, procurement
and verification of the SM processor; EO to assess market forces that influence and
drive the fisheries and aquaculture sector; and the Earth Explorer Atmospheric
Dynamics Mission (ADM-Aeolus) which will provide global observations of wind
profiles from space to improve the quality of weather forecasts, and to advance our
understanding of atmospheric dynamics and climate processes.
Within the sphere of communications and navigation, a number of advanced
technologies and systems were developed, most notably in the fields of Software
Defined Radio, GaN and GPS receivers. In developing a platform that forms the core
of the Software Defined Radio Regenerative Communications Satellite System Array
(SDRRCS), the developer blended its own architecture with the Software
Communications Core Architecture (SCA). GaN is a semiconductor with inherent
material properties, that when used in devices can deliver vastly superior performance
compared to currently available semiconductors. The most important of these are the
ability to operate with: high power, high voltage, high temperature, high speed, high
tolerance for radiation and low noise. GPS receivers were developed for the
European Geostationary Navigation Overlay Service (EGNOS) and subsequent
ground receivers.
Within the synthesis and analysis sphere, several technologies were developed,
including the Nest ESA Toolbox. The NEST toolbox is designed to read, postprocess, analyze and visualize Synthetic Aperture Radar (SAR) data from past,
present and future ESA SAR satellite missions. There were also developments within
EO applications for the rapidly expanding aquaculture industry and specifically
monitoring programs of multinational companies, such as Mainstream Chile. In
addition to these remote sensing products and services, companies developed
technologies for mapping of mine activity, progressive reclamation, and sustainable
development reporting.
Q14: To what extent has the Canada/ESA Agreement generated more flight
opportunities to space-qualify Canadian technologies or products?
FINDING: The Canada/ESA Agreement has generated more flight opportunities to
space-qualify Canadian technologies or products; however, most companies do not
have this type of requirement.
In the space industry, flight opportunities are of paramount importance. If a firm has
not flown its technology, it will not likely be able to sell it. In fact, flight
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opportunities are considered critical for those in the space segment to develop
credibility among contractors. That said, many of the companies that participated in
this evaluation had no need for such opportunities due to the type of work they
conducted (e.g., ground testing); the type of product they produced; or the stage of
development they had attained. In fact, 16 (or 67%) of 2435 case-study key
informants indicated that this question was not applicable to them.
Of those that said the Agreement has, in fact, generated more flight opportunities,
most did not elaborate, but three indicated that they would realize flight opportunities
in the future and four indicated that flight opportunities had arisen for them. Of the
firms surveyed, two had had one opportunity to space-qualify their technologies or
products, and two firms had had two such opportunities while one had an opportunity
planned in the near future. Furthermore, one case-study interviewee remarked that
the close integration between CSA and ESA has enabled technology developed to a
certain Technology Readiness Level (TRL) under funding from one agency to be
further developed under funding from the other, with the typical pattern being to
bring technology to TRL-3 under CSA and then take it to flight certification under
ESA.
Q15: To what extent has the number of new companies that participate in the
Canada/ESA programs increased?
FINDING: The number of participants in the Canada/ESA program since January
2005 has increased by 27 companies and 8 universities. A breakdown of the new
contracts by CSA Activity/Thrust is included below. This is a positive result of the
program over the last five years.
Exhibit 4.6: Contracts by Organizations (Excluding Universities) New to the
Canada/ESA Agreement by CSA Activity/Thrust (2000-08)
EO
GSTP
Telecom
Gen. Budget & Other
Total
# of companies
13
3
7
4
27
Value $
1,548,965
496,324
1,299,341
491,931
3,836,561
Source: Canadian Space Agency, List of ESA Contracts to Canada 2000-2008; GGI’s own
calculations.
35
One case study respondent did not answer this question
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In addition, the distribution of contract dollars to Canadian universities is broader
than reported in earlier evaluations, as indicated in the following exhibit.
Exhibit 4.7: Contracts by Universities New to the Canada/ESA Agreement by
Activity/Thrust (2000-08)
CSA Activity/Thrust
General Budget
# of Universities
$ of Contract
3
216,439
EO
2
312,911
Science
3
989,922
Total
8
$1,519,273
Source:: Canadian
Space Agency, List of ESA Contracts to Canada 2000-2008; GGI’s own calculations.
As indicated by Exhibit 4.8 ESA expenditures have remained concentrated with 44.9
to 49.6% of contracts accruing to three firms and over 75% to the top ten contractors
in each of the periods 2000-2004 and 2005-2008. Contract awards are somewhat less
concentrated over long timeframes as demands and industry-supplier capabilities ebb
and flow.
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Exhibit 4.8: Percentages of Contract Funding Received by the Top 3/Top 10 Organizations
Previous Evaluations
Current Evaluation
1997
2004
Jan. 2000 –
Jan. 2005 –
Jan. 2000 –
Firms Receiving
36
37
38
Evaluation
Evaluation
Dec. 2004
Dec. 2009
Dec. 2009
Contracts
78 %
43 %
44.9 %
49.6 %
34.8 %
Top 3
76.1 %
76.8 %
78.2 %
74.4 %
Top 10
Source: Canadian Space Agency, List of ESA Contracts to Canada 2000-2008. GGI calculations.
Q16: To what extent have the Canada/ESA contracts contributed to: new
business opportunities for Canadian companies in domestic and international
markets; increased competitiveness?
FINDING: Benefits of the Agreement have been realized in terms of increased
competitiveness, follow-on contracts, commercialization prospects, and increased
access to new markets.
Increased Competitiveness
Most of the companies that responded positively to this question (67%, or 16 out of
2439 respondents to the case-study interviewees; and 69%, or 25 out of 3640 survey
respondents) believed that Canada/ESA contracts had contributed to their
competitiveness in a general (i.e., unspecific) way, although one respondent specified
a sector in which his firm had gained a stronger foothold, and another specified that
increased competitiveness had resulted from major cost reductions and the ability to
spread fixed overhead costs over a larger array of activities. Those who felt that
competitiveness was only somewhat increased implied that their level of
competitiveness had merely kept pace with the industry.
In one case study, add-on contracts have contributed to growth in a particular practice
area as well as in the company’s main business line, where the ability to use new and
powerful tools has provided the company with a competitive edge, differentiating it
from its peers.
36
The top 3 companies were not necessarily the same ones for in each period
Evaluation covered period from 1979-80 to 1996-97, a 17-year period.
38
Evaluation covered period from January 1997 until December 2003.
39
One case study respondent did not answer this question
40
Three respondents stated that such opportunities would certainly happen during later stages of their projects, and two
respondents stated this question was not applicable, as they had engaged in basic research.
37
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Follow-on Contract
The majority of case-study interviewees (57%, or 13 out of 2341) responded positively
to the question of whether follow-on work had resulted from ESA contracts. One
company indicated that the experience/credibility it had gained through ESA-funded
programs had assisted it in winning contracts all over the world, and another
estimated that, for every dollar in ESA contracts it received, it obtained $10 in spinoff work.
Besides these respondents, an additional two indicated that the Canada/ESA contracts
contributed only indirectly to new business opportunities (e.g., “ESA work looks
impressive [to potential clients]”), but that the causal relationship was nonetheless
there.
Commercialization Prospects
Through participation in ESA contracts, one firm was able to accelerate the
development of its Internet satellite technology to meet European and worldwide
requirements. The developed technology was subsequently commercialized with
success. As well, another firm is on the threshold of significant commercial export
success (estimated at $2 million in 2009 and $2.75 million in 2010) due to work it
contracted through ESA.
Access to New Market
Fifty-one percent (51%, or 18 out of 3542) of survey respondents reported that their
firm had entered new markets as a result of their ESA contract(s), while the rest did
not.
Q17: To what extent have the Canada/ESA Programs contributed to diversify
Canada’s international space partnerships through the establishment of new
alliances or the strengthening of existing alliances between Canadian companies
and European primes and major sub-contractors?
FINDING: Although a significant number of new space collaborations/initiatives
have resulted from work attributed to the Canada/ESA Programs, Canadian firms
in the space sector have been unable to capitalize more on the ESA contracts due to
41
42
Two case study respondents did not answer this question
Four participants reported that this question was not applicable to them, as they were in academia.
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the relatively modest CSA contributions to ESA programs.
Many individual firms said that they had built important networks as a result of the
Canada/ESA Programs. An overwhelming majority of case-study key informants
(88%, or 21 out of 2443 respondents), in particular, could cite partnerships created with
academia and/or industry that resulted from ESA projects. Partnerships were created
or strengthened with partners in Canada (either other Canadian firms or academia) as
well as in Europe (sometimes directly with ESA as well as other European primes or
sub-contractors).
Likewise, a significant number of survey respondents indicated that new space
collaborations/initiatives had resulted from their work with ESA both outside of
Europe (42% of survey respondents, or 15 out of 3644 respondents) and within
Europe45 (42%, or 15 out of 36 respondents). It must be noted that Canadian firms are
restricted in the amount of follow-on ESA work in partnership with European primes
because of the relatively small size of the CSA contribution to ESA programs. This is
a particular issue for some of the larger firms.
ESA representatives would like Canada to be more active players in the emerging
network of space industries; as opposed to remaining self contained as has tended to
be the dominating Canadian pattern/image. But, they would also like to see the
Canadian partners doing more to get business for European partners with NASA.
More benefits to Europe would be a win-win situation.
Q18: What have been the economic benefits to Canada of the Agreement?
FINDINGS:
Our analysis of the economic benefits of the CSA-ESA Agreement indicated the
following:

Follow-on revenues for the period 2000-11 attributable to the ESA contracts by
case study participants or questionnaire respondents are documented at $221.5
million. When added to the value of the ESA contracts 2000-2008 ($177.5
million), Canadian firms have benefited or are expected to benefit from $399.0
million in incremental revenues due to the ESA contracts and global follow-on
43
One case study respondent did not answer this question
Three respondents did not answer this question
45
Not including follow-on work done with ESA
44
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


work. This implies a revenue multiplier of 2.25 for every ESA contract dollar.
After accounting for import leakages, the Input/output analysis estimates direct
current dollar GDP impacts at $184 million and total (direct, indirect, and
induced) GDP impacts of $367 million yielding a GDP multiplier relative to
incremental ESA expenditures of 2.07.
Excluding self-employed, ESA employment impacts included 4,055 full-time
equivalent (FTE) years consisting of 2,056 direct FTE years, 986 indirect FTE
years, and induced of a further 1,013 FTE years.
Labour force incomes are augmented by $228.6 million of which $123.9 million
was direct, $53.7 million indirect, and $51.0 million induced.
In this section, the macro-level economic impacts of the CSA-ESA Agreement are
reported. Data for the analysis came from the empirical results from surveys and case
studies completed by GGI which were then input into the Statistics Canada National
Accounts and Input Output (I/O) Tables. Those results were analyzed at an
aggregated level to maintain confidentiality. Utilization of the Statistics Canada I/O
tables permitted the evaluation team to estimate the direct, indirect, and induced
impacts of ESA expenditures and related industry activities in Canada.
The economic analysis described more fully in Appendix G quantifies impacts
attributable to the ESA expenditure back in Canada on contracts on Gross Domestic
Product (GDP), employment, labor income, and government tax revenues. In this
context, the “direct” impacts are the impacts due to ESA expenditures in Canada for
contracts (2000-2008) as well as any expected future revenues up to 2011 that
Canadian ESA contractors reported as being attributable to the ESA contracts.
Impacts may arise from gains in intellectual property, ongoing teaming arrangements,
and/or increased market access. The indirect impacts occur in the supply chain from
the original ESA contracts and follow on sales as well from the induced impacts,
which give rise to incomes earned from the increased employment.
The resulting multipliers from both the perspective of CSA expenditures on the
Agreement, and ESA contract expenditures in Canada to the end of 2008 are shown in
Exhibit 4.9.
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Exhibit 4.9: GDP and Labour Income Impact Multipliers for ESA and CSA
Expenditures in Canada to End of 200846 (1,000s $)
GDP
ESA CDN Contract Expenditures
CSA Contribution to ESA
Labour Force Income
ESA CDN Contract Expenditures47
CSA Contribution to ESA48
Direct
Direct and
Indirect
Direct, Indirect
and Induced
1.04
0.71
1.50
1.02
2.07
1.42
0.70
0.48
1.00
0.69
1,29
0.88
The I/O Analysis also estimated impacts on revenues for all levels of government. Of
the $259.4 million spent by CSA 2000-2008 by year-end at ESA, $15.3 million
accrued to one government or another and at least $6.1 million accrued back to the
federal government via import duties and federal commodity taxes.
The economic impacts of the Canada-ESA Agreement were established based on
reported contracts and follow-on sales, i.e. sales that were over and above the ESA
contracts and attributable to the technologies and experience gained from the ESA
contracts. In the initial estimates, no extrapolations were made for firms that did not
provide financial sales information for either the survey or case studies. Since some
case study and survey respondents did not provide financial data on follow on sales,
follow-on sales and economic impacts are probably underestimated.
Information on follow-on sales, including reports of no follow-on sales, covering the
entire period 2000-2011 was provided by 58 establishments. The 58 establishments
represented 61.6% of the value of ESA contracts for the 2000-2008 period. The vast
majority of this information came from 21 establishments covered through the case
studies. The 21 establishments represented 56.9% of the value of ESA contracts. An
additional 32 establishments responded to the survey representing 4.6% of ESA
contracts. Finally five firms were no longer in business. They accounted for 0.1% of
ESA contracts
Documented follow-on revenues for the period 2000-11 attributable to the ESA
contracts for the case study participants and survey respondents amounted to $221.5
million. When added to the value of the ESA contracts 2000-2008 ($177.5 million),
Canadian firms have benefited or are expected to benefit from $399.0 million in
46
Appendix G, Table 13.
Impacts multipliers computed based on dividing GDP impacts by the ESA expenditures in Canada
48
Impact multipliers computed based on diving the GDP expenditures by the CSA contribution to ESA
47
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incremental revenues due to the ESA contracts and follow-on work. This result
implies a revenue multiplier of 2.25 for every ESA contract dollar.
After accounting for import leakages, the Input/Output analysis estimates direct current
dollar GDP impacts at $184 million and total (direct, indirect, and induced) GDP
impacts of $367 million yielding a GDP multiplier for direct GDP of 2.00.
Excluding the self-employed, ESA employment impacts included 4,055 full-time
equivalent years (FTEs) consisting of 2,056 direct FTEs, 986 indirect FTEs, and a
further 1,012 induced FTEs .
The impact on labour force incomes as a result of the ESA contracts to Canadian firms
was to increase them by $228.6 million of which $123.9 million was direct, $53.7
million indirect, and $51.0 million was induced.
These estimates conform to TB Guidelines and are very conservative. However, if we
had extrapolated the above estimates to cover establishments that did not provide
financial data, the estimated direct economic impacts would increase.
In addition to the tangible and monetized economic benefits, twenty-one of the 24
respondents to the case studies indicated several examples of where newly developed
technologies generated social benefits. In nearly all instances, the infrastructure
stemming from ESA assisted projects was necessary to enable, but not sufficient to
attain, these benefits. In many of the instances, as illustrated in the following
examples, the benefits generated extend beyond Canada’s national borders; thereby,
underlining the advantages of international cooperation. Among the case studies
there were references to:





Tele-health which extends improved healthcare to remote areas in the Canadian
north and elsewhere (2);
Distance learning to facilitate delivery of training and education to remote sites (3)
and stimulate education on the science of space (1);
Improved government services to northern Canada including Nunavut (3);
Environmental monitoring of airborne transmission via plumes, including the
blackening of the Arctic Ice Cap from emissions, as the first line of evidence to
curtail such emissions and the resulting rising sea levels and environmental damage
(4) – Canada would be well served by further participation;
Other improved observation systems designed to assist meteorological services
and/or mitigate diverse threats arising from crop failures and other degradation,
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


such as remote pipeline inspection and monitoring (6);
Improved communication systems (5) resulting in better data on resources
(minerals, forestry, fish and crops) (5), Internet (3), emergency communications
(2), search and rescue (4), navigation for shipping and avoidance of ice damage to
oil and gas drilling and production rigs (5) and road transportation with reduced
emissions (2);
Prevent environmental damage through the development of more energy efficient
technologies (3); and
Positioning Canada’s HQP to continue to participate in the space industry (1).
Twenty-six completed responses from the questionnaires indicated that 67.1% of new
direct FTE years created were for HQPs. It should be noted that the Input/Output
Analysis results cover a broader set of employers, since the entire supply chain
employment is captured in the direct and indirect impacts. An even broader group is
captured in the induced impacts.
Direct employment is concentrated in the high-tech industries and professional
services such as engineering and medicine, which hire above average levels of HQPs.
High-tech industry includes computer and peripheral manufacturing, other
communications equipment manufacturing, navigational and measuring medical
control instrument manufacturing and, aerospace and aerospace parts.
According to the I/O analysis, 97.8% of the total direct employment impact was
concentrated in the high tech industries and services. An estimated 81.9% of
incremental total direct and indirect employment was concentrated in these sectors as
was 72.4% of total employment, which includes direct, indirect and induced. The
evidence indicates that ESA expenditures in Canada stimulate supply-chain
employment among a relatively high share of HQPs relative to employment shares
generated by consumer expenditures in general.
Q19: To what extent has the Canada/ESA Cooperation Agreement facilitated
the obtaining of intelligence on European space-related policies, programs and
markets? To what extent is it used for strategic purposes by Canadian
government departments/agencies and Canadian industry?
FINDING: Intelligence gained through CSA participation in ESA is beneficial for
CSA and other government departments in terms of keeping the Canadian
government informed on the directions that ESA is taking in research and
development in space technologies. However, Canadian companies have not all
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uniformly benefited from the intelligence-gathering process regarding trends in the
European market conditions.
Many of the companies interviewed for this evaluation indicated that intelligence on
European market conditions is an important benefit of participating in ESA, and that
such intelligence has been used fairly frequently for strategic purposes by Canadian
government departments/ agencies and Canadian industry. However, some people
specifically desired that the process for obtaining intelligence become more
systematic, while others generally noted that intelligence could be better and more
plentiful.
The majority of survey respondents (71%, or 12 of 17 respondents) and of case-study
interviewees (58%, or 14 of 24), who had obtained intelligence49, reported benefiting
from it, in spite of an impression that the process could be improved. Respondents
believe that the Agreement has helped Canadian industry players learn about the
European market, in general, and has given them insight into the way European
companies operate, in particular.
According to CSA program staff, there is no formal process for collecting, analyzing
and disseminating intelligence gained through interactions with ESA, but rather it is
done on an opportunistic basis. However, market intelligence gained from the
SatCom and ExoMars programs have been key to forming alliances and links to
prime contractors. By virtue of the agreement, Canada has had the privilege of
having delegates participate on the Program Board and technical sub-committees for
Earth Observations, which has given Canada access to information on future
European missions and advance notice of RFPs coming “down the pipe”. These are a
good heads-up for Canadian firms to prepare bids. Canadian industry thereby obtains
links to European industry and hence partnerships have developed outside of the
ESA.
Finally, it is worth noting that through the privilege of having delegates on the
program board and technical subcommittees, Canadian delegates are able to obtain
and assess good information on future potential projects and programs according to
more than one CSA representative. Examples cited included the Satcom program,
where Canadian involvement on the technical committees and knowledge gained of
the Satcom plans, assisted in supporting the formation of alliances and forming
49
52% (17/33) of respondents from contracted firms had obtained intelligence through their participation in the Canada-ESA
agreement; 48% (16/33) had not, 3 said this question was not applicable as they had not tried gathering any intelligence, 2 said
they did not know the answer to the question, while 1 did not answer this question.
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linkages to prime contractors. Another example of the use of intelligence gained for
pre-positioning was the Exo-Mars program.
Q20: To what extent has Canada’s other international S&T objectives (e.g.,
climate change) benefited from technologies or information originating from the
Canada/ESA agreement?
FINDING: Several of Canada’s S&T objectives have benefited from technologies or
information originating from the Canada/ESA Agreement.
The following Canadian S&T objectives50 have benefited from technologies or
information originating from the Canada/ESA Agreement:
OBJECTIVE: To direct resources to priority areas where Canada can build
global research and commercial leadership: environmental science and
technologies, natural resources and energy, health and related life sciences and
technologies, and information and communications technologies (ICT).
Projects related to the Canada/ESA Agreement have touched on two of these areas, in
particular: environmental science and technologies and ICT. With regards to
environmental science, a few of the case-study projects have produced significant
quantities of data via earth-observation activities that pertain to climate change,
allowing Canada to build global research leadership in this area. (ENVISAT, in
particular, has provided access to data for monitoring climate change.) With regards
to ICT, Internet/broadband communications have been improved as a result of the
Agreement, especially in northern Canada.
In terms of data access interests, the Sentinel missions of GMES are expected to
generate a lot of data required for operational monitoring of environment, state of
vegetation, coastal ocean colour, etc. The government departments such as NRCan,
MSC/EC, DFO, CFS, CIS and AAFC are very interested in receiving this data.
Through Canada’s current participation in ESA GMES Space Component, it will be
possible to arrange a direct reception over Canada for those data of Canadian interest
as it is done currently for the ENVISAT ASAR and MERIS data.
To strengthen Canada’s ties to the global supply of ideas, talent, and technology.
The Agreement has strengthened Canada’s ties to the global supply of ideas, talent,
50
Government of Canada. Industry Canada. 2007. Mobilizing Science and Technology to Canada's Advantage — 2007.
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and technology by providing access to the European scientific establishment; enabling
Canadian firms to partner with European firms; and giving Canada a voice in the
international space-related policy-making process.
To ensure that federal departments and agencies have access to the S&T
capacity required to fulfill their important policy and regulatory mandates in
areas such as health, environment, and safety.
Projects related to the Canada/ESA Agreement have improved access to safety-related
science, in particular. Canada’s participation in the GMES – Europe’s contribution to
the Global Earth Observation System of Systems – will provide, inter-alia, policy
makers with an instrument to monitor environmental laws and treaties in the area of
climate change and other EO-related matters/environmental concerns and thus
contribute to the fulfillment of environment-related policy and regulatory mandates in
Canada. Finally, GMES will also provide for better data for climate change, natural
hazards, water, etc., which, in turn, will help ensure that federal departments and
agencies have access to the S&T capacity required to fulfill their policy and
regulatory mandates in areas such as health, environment, and safety.
Most of the environmental issues and impacts addressed by ESA are international in
their origin. The international abatement of environmental releases will result in
international benefits in which Canada and other nations will partake. Consequently,
ESA’s related space initiatives warrant international attention.
Q21: To what extent has the CSA influenced ESA programming?
FINDINGS: While it is not possible to know for certain if ESA programming would
be different if Canada had never participated in ESA, it is generally believed that
Canada is a reasonably effective, well-respected contributor to ESA. Furthermore,
CSA adds substantial value to ESA decision-making by supplying a politically
neutral perspective.
It is not possible to know for certain if ESA programming would be different if
Canada had never participated in ESA. However, ESA interviewees generally
believe that Canada is well respected and that there is genuine interest in Canada’s
views. Canada is considered to be a reasonably effective contributor to ESA technical
development in core areas where Canadian expertise is recognized.
Furthermore, key informant interviewees remarked that CSA adds value to ESA
decision-making by supplying a politically neutral perspective. Canada only has one
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vote at ESA meetings, but Canada does have some influence in areas where Canada
is technically strong (i.e., robotics). Interviewees commented that, in the absence of
Canadian participation, European companies would likely develop the necessary
technologies on their own, without relying on Canadian expertise. However, as
Canadians are already in a position to provide certain in-demand technologies, ESA
utilizes Canadian capacities.
Interviewees with the European Space Agency revealed that the Canadian delegation
always makes a very positive contribution, playing a constructive role on boards and
councils. It was also noted that ESA seeks Canada’s voice and that Canadian
delegates and staff participate over and above our simple national interest.
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4.4
Cost Effectiveness and Alternatives
Q22: What percentage of the CSA/ESA program budget is allocated to
administration and overhead? Is it reasonable?
Q23: Is the percentage of ESA General Budget Support paid by Canada
reasonable given the dollars it invests in other ESA programs?
FINDING: The part of the CSA contribution to ESA which is allocated by ESA to
its overheads was found to be relatively high (estimated to be about 35% - see
below), due to the addition of the required General Budget Support component, and
the overhead charge on each of the optional programs. Because the CSA budget
available for programming, after paying the mandatory General Budget Support for
program activities is limited, the total funds paid into overhead is quite high. As the
General Budget Support payments are fixed, an increase in the Agreement funding
(which would be directed towards programs) would reduce the overhead component
as a share of total Canadian contribution.
The General Budget Support component paid by Canada not only is a mandatory
requirement to participate in the Agreement but also permits Canada an important
seat at the table at ESA meetings at all levels.
Our analysis indicated that currency exchange costs for the contribution to ESA
(paid in Euros) which is substantially returned to Canada through contracts from
ESA to Canadian companies consumes additional program overhead due to the cost
of converting from Canadian dollars to Euros to contribute to ESA, and the need of
Canadian firms to then convert the ESA funds back into Canadian dollars.
The Contribution to ESA includes both funding of direct program expenditures as
well as a contribution to ESA overheads of at both the general level, and for each
mandatory and optional program to which Canada subscribes. The first level is the
General Budget Support, which amounts to $64.6 million or 21.9% of the CSA
contribution of $295.4 million (2000-2009). Part of this contribution is allocated to
contracts to Canadian firms.
The second level is overhead for the optional programs, which ranges from 11.5% 53.2% with an average of 25.1%. The table below indicates the minimum, maximum
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and mean percentages of ESA program budget allocated to administration and
overhead for various ESA programs.
As a result the overhead component of the CSA contribution to ESA will average
about 35%. This assumes that about 25% of our contribution is allocated to direct
overheads for the mandatory and optional programs, and about half of the payment to
General Budget support (or about 10%) can be considered overhead. . This estimate
does not include any of the administrative overheads to manage the program at CSA.
Exhibit 4.10: Percentage of ESA Program Budget Allocated to Overhead51
Program Activities
Earth Observation
Science and Exploration
Satellite Communications
General Support Technology
Average
Overhead*
Min
21.3%
Max
38.4%
Mean
31.2%
Min
18.0%
Max
38.4%
Mean
22.9%
Min
11.5%
Max
53.2%
Mean
23.9%
Min
20.0%
Max
20.0%
Mean
20.0%
25.1%
* Overhead = 1-Development Costs/Total Expenditures
Source: European Space Agency. No date. Indicative Overhead % by Optional Programme
Elements.
The question of the overhead associated with the contribution to the CSA/ESA
Agreement was presented to the interviewees. The question provoked mixed results
from key informants. According to some interviewees, overhead is high, due to the
large amount required for the General Budget Support requirement and the limited
funds then left for investment in optional programs. However, each program also has
its own overhead structure that determines the funds available for contracted work.
Overhead is considered more reasonable at the level of individual programs,
according to these interviewees. Other interviewees remarked that overhead is
reasonable overall, but that there may be issues at the level of individual programs.
51
NB: No date range indicated in the source for this table.
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In any case, most interviewees who were able to answer this question believed that
entrance to the “European [space] club” is worth the current cost of overhead.
Furthermore, the fact that various Canadian companies get significant follow-on work
from the CSA Agreement with ESA and associated financial contributions makes the
overhead more palatable than the figures alone would imply.
While some key informants found the percentage to be high, others commented that
Canada is “getting a good deal compared to other member states, given its industrial
returns.” Members of the latter group pointed out that, given the tremendously high
cost of obtaining flight opportunities, “if it takes a few million dollars to obtain
access to space missions, then it is worth it. You have to look beyond just the
dollars.”
Interviewees also indicated that the percentage of the ESA general budget paid by
Canada was a small price to pay, given that Canada’s voice is taken seriously at ESA
meetings. Anything less than Canada’s current contribution to the general budget
might not be considered credible by Member States.
Q24: How cost-effective have ESA contracts been to help Canadian companies
penetrate the European/international space market, as compared to other CSA
technology-oriented programs?
FINDING: The primary finding here is that penetration of the European space
market for Canadian firms is premised strongly on Canada being a member of
ESA, which is the major contractor in Europe for space related work. Canada can
also work through bilateral agreements. Since the ESA Agreement has been
Canada’s main entry into the market it is difficult to assess other options.
Our assessment indicated that membership in ESA is an important pre-condition to
participation in ESA run space programs. At present, there are no other CSA
programs targeted at positioning Canadian firms in the European space market.
Another option would be to carry out bilateral arrangements with some of the
countries in Europe that have their own space programs or with ESA itself. However,
most countries work through the ESA programs, with ESA as the procurement agent.
Interviews with CSA officials indicated that working through ESA on early-stage
R&D programs is the most effective way to gain entry into European space contracts.
Revenues earned by Canadian firms resulting from ESA contracts and the follow-on
work obtained from ESA contracts provides a quantitative means of measuring the
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cost-effectiveness of the ESA Program. The fact that total sales generated by
Canadian firms as a result of reported ESA contracts and follow-on work of $399.0
Million was larger than the $259.4 Million CSA contributed to ESA indicates that the
Agreement has been a cost-effective means of providing a pathway for Canadian
companies to penetrate the European/International market (as stated earlier, without
the ESA Agreement, the evaluation team believes very little of this work would have
been obtained by Canadian firms). The team’s found that a total of 4,055 FTEs
(including direct, indirect and induced jobs) have been created from the above ESA
and follow-on contracts.
Q25: Are there more cost-effective space programming/investment options
available for reaching the objectives pursued with the Canada/ESA
Cooperation?
FINDING: There are no more cost-effective means of developing the
technologies/capacity that have been developed through contracts with ESA;
however, there are issues that make this investment less cost-effective than it could
be.
There are a limited number of options for developing Canadian technologies/capacity
in space. The first option is to fund Canadian-based programs that are made in
Canada, and that are solely Canadian sponsored programs. The second option is to
fund bilateral programs, which involve partnerships with other countries to enlarge
the scope of the Canadian effort. The third option is to engage in broader multilateral
programs such as the International Space Station or ESA.
While the first two options may appear less costly than the third option of an
Agreement with ESA, they have the disadvantage of limiting the scope of the
programs that can be undertaken, as the overall Canadian budget will be significantly
smaller that the multilateral programs available through ESA. Secondly, through the
Canada/ESA Agreement, the potential for alliances, technology transfer and for
exposure to new technologies and trends in space are much higher. Therefore, the
evaluation team believes that a multilateral approach, such as ESA is much more cost
effective in the long-term development of the sector.
This was validated in the surveys and interviews:

The majority of respondents, i.e., 63% of survey respondents and 58% of casestudy interviewees, could not suggest more cost-effective means of developing the
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
technologies/capacity that have been developed through contracts with ESA.
However, 29% of survey respondents and key informants mentioned issues that
make this pursuing ESA business costly. This includes excessive paperwork
(“there is a mountain of documentation that small companies must produce for
ESA”) and the cost and time needed to travel to Europe for marketing and for the
actual work on ESA contracts.
Of the 29% of survey respondents who offered suggestions on how to improve
cost-effectiveness, five stated that investing directly in Canadian R&D projects
would be more beneficial; while others suggested that small contracts be
exempted from the burden of excessive “red tape.” Many informants pointed to
bilateral agreements as an alternative and less costly vehicles for reaching the
objectives pursued with the Cooperation; however, these interviewees also noted
that bilateral agreements would not permit Canadian firms to compete on ESA
contracts. Additionally, interviewees remarked that bilateral agreements alone
would not allow Canada to influence international space policy as the nation's
participation in ESA has done.
In summary, bilateral agreements may be less costly, but they do not permit Canadian
firms to directly participate in ESA sponsored contracts. Therefore, bilateral
agreements would not offer Canada access to the ESA science and technology and to
the broader opportunities that can be derived from joint ventures and alliances with
European firms engaged in ESA. Bilateral agreements involve higher risks for CSA as
CSA would then be responsible for the delivery and integration of the subsystems.
Q26: What would be the impact of discontinuing the Agreement?
FINDING: Discontinuation of the Agreement would result in the severance of
industry opportunities to contract with ESA and thereby would reduce potential
opportunities and partnerships with the European space industry. It would also
communicate the message that Canada is not interested in participating in
international collaboration in the space sector. Finally, some Canadian
companies would be forced to move research facilities to Europe to maintain their
positioning in the market.
Respondents answered this question from both a macro, i.e., industry perspective, and
a micro, i.e., firm perspective. At the macro level, interviewees almost unanimously
responded that the industry would be hurt by the discontinuation of the Agreement.
Specifically, many respondents indicated that discontinuation would result in both the
severance of some ties with European industry and the loss of opportunities – for
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example, opportunities to deal with European suppliers; to participate in large-scale
programs, and to access satellite systems; as well as opportunities to participate in
major missions – by Canadian companies. “Canada would be out of the club,” in the
words of one respondent; “[to discontinue the Agreement] would isolate us in the
world of space.” In order to avoid such isolation, Canada would need to turn its focus
to bilateral agreements, according to respondents, forging closer ties with NASA, and
partnering with other national space agencies (e.g., Asian and perhaps Australian
agencies).
However, interviewees believed that even new relationships such as these could not
replace the current ties with the EU, which exist largely as a result of the Agreement.
Moreover, interviewees pointed out that, because international relationships with
NASA would likely be complicated by security concerns, a strategy for the Canadian
space industry that is dependent on NASA might be a tenuous one. Several key
informants noted that the ties that have been forged could not be replaced with new
ties to the United States.
Respondents also observed that discontinuation of the Agreement would go against
recent trends in industry. Over the last decade, the forces of globalization have
increasingly influenced the scope and scale of space-related research.
Correspondingly, international collaboration has become an essential means of
accessing the most current knowledge and expertise available – especially for
medium-sized countries such as Canada. It follows, then, that a discontinuation of
international collaboration – such as that facilitated by the Agreement – would mean a
loss of access to intelligence and emerging technologies, which, in turn, would
diminish Canada’s competitiveness in the sector. A discontinuation would also
prevent Canada from reaping the economies of scale that typically result from
international alliances.
The majority of case-study interviewees (86%) and survey respondents (58%)
indicated that a discontinuation of the Agreement would impact their firms negatively.
Some noted that their firms’ long-term competitive advantage, in general, would
suffer, while others pointed to specific hardships that might occur as a result of a
discontinuation, such as downsizing52 and probable loss of contracts.53 A couple of
small firms, in particular, noted that they would not be able to afford to partake of
52
Sixty-six percent (66%, or 25/38) of survey respondents indicated that their firm would be smaller without the contract(s) they
have as a result of the Agreement; while 11% (4/38) said their firm would probably not exist.
53
Most survey respondents felt that their company would not have had contracts with ESA without Canada’s participation in the
agreement: 67% (20/30) said they would not have obtained contracts, while 17% (5/30) said maybe they would have won
contracts.
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major space missions without a vehicle such as the Agreement. Additionally, two
respondents said that they would have to move much of their operations/centers of
activity to Europe as a result of a discontinuation in order to retain their markets.
CSA interviewees also pointed out that approximately 25 Canadian jobs at ESA
would disappear if the Agreement were not sustained. This would have some
negative consequences on Canada’s ability to obtain intelligence on technology and
market trends in the European space sector. A cessation of the Agreement may
communicate a message that Canada is now less interested in participating in
international space projects.
Interviewees from the European Space Agency noted that, although Canada only
contributes €20 million to the ESA’s overall, a withdrawal by Canada would send a
negative signal, as Canada’s participation is “key” for the development of some of the
main elements at the program level, namely – for the development of the capsule to
transport humans and cargo; and for moon exploration.
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5.0 Summary of Findings and Conclusions
5.1
Rationale and Relevance
The access that the Canada-ESA Agreement bestows on Canada satisfies needs
beyond those that are scientific in scope; it also satisfies needs that are political (with
respect to Canadian-European relations), informational (in areas related to the Internet
and multimedia, earth observation, search and rescue, and resource management) and
industrial (developing new technologies and assessing new markets). These needs
exist today as much or more than they did when the Agreement was renewed in 2000,
making the Agreement a highly relevant collaboration.
The rationale for continuing the agreement derives from several factors. Given its
relatively small budget, the activities that the CSA can pursue are relatively small in
scope compared to those pursued by ESA. In the coming years, ESA will be defining
and pursuing its flagship missions, which will be very large endeavors requiring the
participation of many countries. These upcoming missions represent tremendous
opportunity for Canada.
The Agreement is also important for Canadian SMEs engaged in technologies that are
applicable in the space sector, especially to firms looking to test their technologies in
space. The Agreement allows Canadian firms to be at the forefront of technology
development and provides Canadian SMEs working in the sector with advantageous
access to ESA. Additionally, the ability to list ESA as one of their clients provides
Canadian firms with a competitive advantage that has helped them win business with
prospective clients other than ESA and CSA.
As well, federal organizations such as the CCRS and Environment Canada have
information needs that are satisfied by technologies developed under the ESA
program. These needs are specifically in areas related to the Internet, earth
observation, search and rescue, and resource management.
Additionally, the Agreement is an important instrument for reinforcing CanadaEuropean relations. The discontinuance of the Agreement would be seen negatively
by the European participants in ESA, not only because of the technical value of
Canada’s participation, but also because of the diplomatic message that it would send.
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Finally, the potential for incremental revenues arising from the ESA contracts from
2000 to 2011 amounted to several times the original contract dollars spent by ESA,
based on the analysis conducted by the evaluation team. Thus, the rationale for
continuing the agreement derives from economic reasons as well.
5.2
Design and Delivery
With regards to the design and delivery, the evaluation team found that CSA is not
communicating with Canadian firms as effectively and consistently as it could.
Interviewees specifically indicated that, although the Agency takes care to respond to
the questions and concerns posed by industry, it makes insufficient attempt to
proactively communicate with firms about opportunities. It is not too surprising, then,
that organizations in the sector specifically requested that the process for obtaining
intelligence on the European market via CSA become more systematic; and that the
information itself be improved in quality and quantity.
Major challenges faced by Canadian firms in trying to access ESA contracts relate
primarily to the 1) relatively limited and sometimes uncertain Canadian funding of
ESA programs;2) complexity and difficulty of the ESA bidding process; and 3)
distance from Europe. Given the “pay-to-play” nature of ESA programs, however, the
unavailability of Canadian funds appears to be the most significant obstacle to
Canadian industry. Some interviewees contend that the fact that insufficient funding
hampers Canadian participation in ESA programs sometimes results in innovative
Canadian ideas being exploited by international competitors.
5.3
Results
It is not possible to know for certain if ESA programming would be different if
Canada had never participated in ESA; however, it is generally believed that, within
the scope of what it can do, Canada is a reasonably effective, well-respected
contributor to ESA that adds substantial value to ESA decision-making.
With regards to return on investment, GGI found that contracts awarded to Canada
have achieved an overall return coefficient of 1.09, as calculated by ESA.54 This
exceeds the .94 minimum overall return coefficient (Approved by the ESA Council)
54
European Space Agency, Industrial Policy Committee. (April 2009). Geographical Distribution of Contracts, Situation as per
31 December 2008. NB: No explanation is given in this document regarding ESA’s methodology for calculating return
coefficient.
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and places Canada second among all ESA member states in terms of return
coefficient, indicating a strong return on Canada’s financial contribution to ESA in
terms of contract dollars for Canadian firms. Also indicating a strong return for
Canada is the fact that the country has received nearly 68% of its contribution to ESA
back in contracts since 2000. Returns to Canada also occur through increased
numbers of HQPs employed in Canada due to the ESA contracts. Furthermore, the
experience and relationships developed in ESA contracts have led firms to win nonESA work requiring the hiring of additional persons. This outcome is in line with
Canada's S&T objective to enhance opportunities for S&T graduates.
Unlike returns measured in terms of dollars and HQPs, it is difficult to measure the
extent to which the Canada/ESA programs have contributed to enhancing the existing
technological and innovation capabilities of the companies that received ESA
contracts. And while some of the companies have used the Canada/ESA programs
merely to increase their technological/innovation capabilities within their corecompetence areas, others have gone a step further, using the Canada/ESA programs as
leverage to increase their capabilities outside their core areas. In any case, the
majority of firms that contributed to the evaluation have had some opportunity to
develop and/or demonstrate advanced technologies.
Still other benefits of the Agreement have been realized in terms of maintaining or
increasing overall competitiveness; follow-on contracts (with ESA as well as with
NASA); commercialization prospects (especially in the area of internet satellite
technology); and increased access to new markets. The question as to whether
significant numbers of Canadian companies in the space sector will obtain follow-on
work outside of ESA as a result of partnerships with European firms still remains to
be seen.
Although a number of new space collaborations have resulted from work attributed to
the Canada/ESA programs, there have not been as many alliances between Canadian
and European firms as there perhaps could have been. That said, many individual
firms indicated that they have nurtured important partnerships – some old, others new
– as a result of the Canada/ESA Programs. This outcome is in line with Canada’s
S&T objective to strengthen the country’s ties to the global supply of ideas, talent,
and technology.
Our analysis of the economic benefits of the CSA-ESA Agreement indicated the
following:
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



Canadian firms responding to our surveys reported that have benefited or are
expected to benefit from $399.0 million in incremental revenues due to the ESA
contracts and follow-on work. This implies a revenue multiplier of 2.25 for every
ESA contract dollar
After accounting for import leakages, the Input/output analysis estimates direct
current dollar GDP impacts at $184 million and total (direct, indirect, and induced)
GDP impacts of $367 million yielding a GDP multiplier of 2.00,
Excluding self-employed, ESA employment impacts included 4,055 full-time
equivalent years (FTEs) consisting of 2,056 direct FTEs, 986 indirect FTEs, and a
further 1,013 of induced of FTEs55.
Labour force incomes are augmented $228.6 million of which $123.9 million was
direct, $53.7 million indirect, and $51.0 million induced.
These estimates conform to Treasury Board Guidelines and are very conservative.
However, if we had extrapolated the above estimates to cover establishments that did
not provide financial data, the estimated direct economic impacts would increase.
Indeed, although all ESA contracts were taken into account in those estimates, only
58 establishments which received 61,6% of the ESA contracts (in dollars) provided
information on follow-on sales.
Additional details on this analysis can be found in Appendix G.
5.4
Recommendations
Based on our conclusions, the evaluation team recommends the following:
RECOMMENDATION 1: CSA should seek renewal of the Agreement for an additional
10-year period. If feasible, additional resources should be allocated to the Agreement either
from an increase in the allocation of Government of Canada resources or through a
reallocation from other CSA programs.

55
This recommendation is based on the strategic importance of the Agreement at both
the political as well as the industrial level. The Agreement permits the Canadian
space sector, as well as the Canadian government to maintain a window on
technological advances in space, and upcoming programs that could be of interest
to Canadian firms. It also provides credibility to Canada that assists it obtaining
Self employed are not taken into account by Statistics Canada.
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contracts with NASA and with other international space programs. Finally, CSA
expenditures alone cannot ensure the array of program opportunities and linkage to
the base of R&D available within ESA.
RECOMMENDATION 2: Clarify the role of ESA within the long-term space plan
in order to guide industry on Canadian priorities in space, including ESA
participation.
RECOMMENDATION 3: Develop & publicize a more coherent set of policies & programs
for supporting organizations in the sector & developing new entrants.
Many of the SMEs that are trying to access contracts from ESA indicated a lack of
information on CSA’s policies and priorities with respect to ESA programs. They
also are not always aware of what funding is available for the different program areas
supported by CSA.
RECOMMENDATION 4: Develop a coherent plan for communicating targeted ESA
industrial opportunities.
The newsletter on Earth Observation opportunities and developments could serve as a
starting point for development of an appropriate communication format.
RECOMMENDATION 5: Continue to monitor the impacts, if any, of the 2007 European
Space Policy and EU trends on Canada, and, if necessary, take steps to mitigate any
adverse effects. CSA along with DFAIT should also undertake a policy review of Canada’s
role in ESA, given the changes occurring in Europe as a result of the 2007 European
Space Policy.
A review of the EU Space Policy (2007) and trends in Europe with respect to the EU
indicates a growing linkage of ESA with EU long-term plans and strategies. This
poses a potential threat to Canada as a non-EU member. Although the limited
interviews with ESA representatives indicated that there is no immediate concern that
Canada may be excluded, the gradual increase in the number of ESA members and
the declining importance of the Canadian contribution both financially and technically
could lead to Canada being marginalized at some point in the future. This could have
a negative impact on Canada’s ability to participate in ESA, and the extent to which
Canada can participate in the downstream implementation of the prototypes and
developments funded under ESA but implemented through other more commercially
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oriented European agencies. Monitoring these developments will be an important
component of CSA’s representation in Europe.
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Appendix A: Expenditures and
Commitments
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CSA’s Expenditures and Commitments per Fiscal Year, by Program Area
$000s
TB-2000
TB-2005
Earth
Observation
TB-2000
TB-2005
Exploration
TB-2000
TB-2005
Microgravity
TB-2000
TB-2005
Science *
TB-2000
TB-2005
Science &
Exploration
TB-2000
TB-2005
Telecom
TB-2000
TB-2005
Navigation
TB-2000
TB-2005
Satellite
Communications
TB-2000
TB-2005
General Budget
TB-2000
TB-2005
Technology
TB-2000
TB-2005
Generic Space
Activities
TB-2000
TB-2005
TOTAL
EXPENDITURES
OUTSTANDING COMMITMENTS
GRAND
1/1/001/4/04- 1st Five 1/1/051/4/09- 2nd Five 10 YEAR 1/1/10O/S
31/3/00 2000-01 2001-02 2002-03 2003-04 31/12/04 Years 31/3/05 2005-06 2006-07 2007-08 2008-09 31/12-09 Years
TOTAL 31/3/10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 Commit. TOTAL
(A)
(B)
(C)=(A+B)
(D)
(E)=(C+D)
4,213
7,589
6,147 10,985
9,205
6,945
4,290
9,151
6,464
3,916
2,764
1,320
879
1,904
958
8
45,084
27,905
72,989
3,749
76,738
2,141
3,431
3,338
4,648
2,277
1,518
7,357 10,324
10,449
7,233
3,925
311
219
1,965
4,328
15,835
15,835
47,629
63,464
4,213
7,589
6,147
10,985
408
408
408
-
9,205
884
884
884
-
6,945
955
955
955
-
45,084
2,247
2,247
2,247
-
5,054
5,054
2,568
2,568
7,622
-
408
884
9,138 12,268
9,138 12,268
841
261
841
261
9,978 12,529
-
955
4,792
4,792
1,618
1,618
6,411
-
7,622
4,812
4,812
1,045
1,045
5,857
-
9,978
6,088
6,088
2,128
2,128
8,216
-
-
-
-
3,951
3,951
3,951
-
5,457
5,457
791
791
6,248
-
3,951
3,090
3,090
3,090
-
6,248
4,976
4,976
4,976
-
3,090
4,976
5,857
8,216
6,728
11,254 18,813
11,254 18,813
19,626
19,626
29,587
29,587
29,346
29,346
GOSS GILROY INC.
12,529
5,451
5,451
1,277
1,277
6,728
-
4,290
944
944
944
11,292
409
483
892
2,254
2,254
409
2,737
9,895
122
2,231
2,353
2,553
2,553
929
929
122
5,713
7,254
7
3,016
3,023
1,971
1,971
1,865
1,865
7
6,852
7,412
15
4,327
4,342
2,405
2,405
1,484
1,484
15
8,216
3,597
3
3,624
3,627
1,163
1,163
512
512
3
5,299
43,740
556
13,681
14,237
8,092
8,092
7,988
7,988
556
29,761
88,824
2,803
13,681
16,484
8,092
8,092
7,988
7,988
2,803
29,761
2,397
2
2,416
2,418
775
775
341
341
2
3,532
9,261
1
8,317
8,318
1,344
1,344
191
191
1
9,852
11,282
2
7,809
7,811
1,847
1,847
2
9,656
10,457
5,138
5,138
1,284
1,284
6,422
7,233
4,470
4,470
575
575
5,045
3,925
5,193
5,193
5,193
311
6,284
6,284
6,284
219
4,577
4,577
4,577
1,965
1,143
1,143
1,143
4,328
446
446
446
51,378
5
45,793
45,798
5,825
5,825
532
532
5
52,150
140,202
2,808
59,474
62,282
13,917
13,917
8,520
8,520
2,808
81,911
2,247
40,660
40,660
6,079
6,079
46,739
-
944
864
1,759
2,623
811
811
1,675
1,759
3,146
1,600
5,051
6,651
1,465
1,465
3,065
5,051
5,835
1,290
6,397
7,687
2,740
591
3,331
4,030
6,988
6,859
712
8,216
8,928
3,980
826
4,806
4,692
9,042
8,231
289
5,271
5,560
5,302
48
5,350
5,591
5,319
5,302
156
1,856
2,012
412
2,129
2,541
568
3,985
30,317
4,911
28,550
33,461
14,710
3,594
18,304
19,621
32,144
32,564
45,571
28,550
74,121
20,788
3,594
24,382
66,360
32,144
3,534
104
1,235
1,339
1,694
1,694
104
2,929
9,853
6
7,358
7,364
888
888
6
8,246
9,658
1,030
8,212
9,242
862
862
1,030
9,074
6,422
2,361
5,769
8,130
416
416
2,361
6,185
5,045
4,475
4,475
97
97
4,572
5,193
3,124
3,124
3,124
6,284
2,490
2,490
2,490
4,577
2,535
2,535
2,535
1,143
-
446
-
52,155
3,501
35,198
38,699
3,957
3,957
3,501
39,155
84,719
49,072
63,748
112,820
20,788
7,551
28,339
69,861
71,299
6,411
3,373
3,373
3,373
-
46,739
27,790
27,790
4,450
4,450
32,240
-
3,434
3,452
3,452
189
189
3,641
-
8,116
6,404
6,404
976
976
6,404
976
11,018
6,826
6,826
1,887
1,887
6,826
1,887
13,734
6,660
6,660
678
678
6,660
678
10,910
7,986
7,986
321
321
7,986
321
4,553
4,472
4,472
332
332
4,472
332
51,765
35,800
35,800
189
4,194
4,383
35,989
4,194
98,504
63,590
63,590
4,639
4,194
8,833
68,229
4,194
3,033
221
221
221
8,252
1,097
1,097
1,097
10,104
1,181
1,181
1,181
8,546
693
693
693
4,572
-
3,124
-
2,490
-
2,535
-
-
-
42,656
3,192
3,192
3,192
141,160
63,590
63,590
4,639
7,386
12,025
68,229
7,386
3,373
32,240
3,641
7,380
8,713
7,338
8,307
4,804
40,183
72,423
221
1,097
1,181
693
-
-
-
-
-
-
3,192
75,615
17,684 126,310
9,606
2,703
17,684 126,310 12,309
19,029
10,905
29,934
17,442
18,019
35,461
15,275
19,910
35,185
16,356
18,504
34,860
6,363
84,071
11,893
81,934
18,256 166,005
210,381
81,934
292,315
985
1,911
8,200 26,552
9,185 28,463
1,990
30,235
32,225
2,369
23,749
26,118
16,850 12,242
16,850 12,242
9,085
9,085
7,331
7,331
3,108
3,108
7,255
4,774 142,126
4,774 149,381
217,636
224,060
441,696
85
Activities by Period Excluding General Budget % of CSA Expenditures
First Five Years
TB-2000
TB-2005
TOTAL
EO
45.8%
SE
2.3%
SC
47.4%
GTA
4.5%
45.8%
2.3%
47.4%
4.5%
EO
57.8%
19.3%
33.6%
SE
1.2%
36.3%
23.3%
SC
40.6%
39.2%
39.8%
GTA
0.4%
5.1%
3.4%
EO
51.7%
33.5%
34.4%
SE
0.1%
36.7%
34.9%
SC
48.3%
27.5%
28.6%
GTA
0.0%
2.2%
2.1%
Second Five Years
TB-2000
TB-2005
TOTAL
OS
TB-2000
TB-2005
TOTAL
EO: Earth Observation
SE: Space Science and Exploration
SC: Satellite Communiactions
GTA: Generic Technological Activities
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Appendix B: Bibliography
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Bibliography
March 2000. Canada/European Space Agency Cooperation Agreement: Proposal to
Treasury Board. Saint-Hubert, Quebec/Ottawa, Ontario
2002. Logic Model – Entente ESA-Canada.
2005. Contributions under the Canada/European Space Agency (ESA) Cooperation
Agreement: Proposal to Treasury Board. Saint-Hubert, Quebec/Ottawa, Ontario
April 2006. Norwegian statement from the 187th Council meeting on the item
“Towards a transition in the ESA-EC relationship for GNSS.”
October 2006. Notes on a possible informal meeting with the European Commission
on Galileo Activities.
2007. Tableau récapitulative commenté des actions de suivi.
May 2007. Notes on the meeting with EC GMES Bureau. Brussels, Belgium.
November 2007. Statement by the European Commission Services on the GMES
Space Component. Brussels, Belgium.
November 2008. Point of contact – ESA Summative Evaluation.
January 2009. Canadian Space Industry – Major Ownership Transactions.
No date. Autorisation – ESA.
No date. Cooperation Agreement between the Government of Canada and the
European Space Agency.
Beland, Sylvie. May 2008. Cda-EU relations - key messages.
Burbidge, Mark. No date. Invite to Canada. Brussels, Belgium.
Burbidge, Mark and Beland, Sylvie. May 2006. Final Report: Mid-Term Review of
Canada-European Space Agency Cooperation Agreement (2000-2010). Longueuil,
Quebec.
Burbidge, Mark and Beland, Sylvie. February 2007. Meeting between CSA, Foreign
Affairs Canada and the European Commission. Brussels, Belgium.
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DB Geoservices Inc. November 2004. Evaluation of Canada/European Space Agency
(ESA) Cooperation Agreement: Data Collection and Analysis.
Dordain, Jean-Jacques. October 2006. Agenda 2011.
Dordain, Jean-Jacques. November/December 2006. Creating a global space agency.
ESA Today.
Dotto, Lydia. May 2002. Canada and The European Space Agency - Three Decades
of Cooperation. Noordwijk, the Netherlands.
European Space Agency. January 2009. ESA Budget for 2009/ESA Budget by
Programme (2009). Available from http://esamultimedia.esa.int/docs/corporate/
ESA_2009_Budgetsweb.pdf. Retrieved June 3, 2009.
European Commission. Bringing space down to earth. February 2008.
European Space Agency. 2002. ESA Review – CSA Core Function Sectors.
European Space Agency. 2002. Minutes of Meeting: ESA Review – Industry.
European Space Agency. 2002. Minutes of Meeting: Government Departments.
European Space Agency. September 2005. Convention for the Establishment of a
European Space Agency. Noordwijk, the Netherlands.
European Space Agency Council. October 2006. Declaration on the European Earth
Watch Programme. Paris, France.
European Space Agency Council. November 2006. Revised Declaration covering the
GalileoSat Programme. Paris, France.
European Space Agency Council. February 2007. Declaration on the European
Programme for Life and Physical Sciences and Applications in Space (ELIPS). Paris,
France.
European Space Agency Council. September 2007. Declaration on the European
GNSS Evolution Programme. Paris, France.
European Space Agency Council. October 2007. Declaration on the GMES Space
Component Programme. Paris, France.
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European Space Agency Council. February 2008. Declaration on the European Space
Exploration Programme – Aurora. Paris, France.
European Space Agency Council. May 2008. Revised Declaration covering the Earth
Observation Envelope Programme. Paris, France.
European Space Agency Council. May 2008. Revised Declaration on the General
Support Technology Programme. Paris, France.
European Space Agency Council. September 2008. Programme Declaration on
Advanced Research in Telecommunication Systems (ARTES). Paris, France.
European Space Agency. October 2008. The European Space Agency.
European Space Agency. November 2008. Draft ESA Long-Term Plan 2009-2018.
Paris, France.
European Space Agency. November 2008. The Director General’s proposal: The role
of space in delivering Europe’s global objectives. Paris, France.
Government of Canada. Canadian Space Agency. No date. Canada - ESA
Cooperation Agreement Expenditures and Commitments from 2000 to Future Fiscal
Years ($000's). Saint-Hubert, Quebec
Government of Canada. Canadian Space Agency. No date. ESA- E Summative –
Matrice v5. Saint-Hubert, Quebec
Government of Canada. Canadian Space Agency. No date. Indicative Overhead % by
Optional Programme Elements. Saint-Hubert, Quebec
Government of Canada. Canadian Space Agency. No date. Notional Breakdown of
CSA Partnerships. Saint-Hubert, Quebec
Government of Canada. Canadian Space Agency. No date. Review of ESA
Cooperation.
Government of Canada. Canadian Space Agency. Audit, Evaluation and Review
Directorate. November 2004. Evaluation report: Evaluation of the Canada/ESA
Cooperation Agreement (PROJECT #04/05 02-02). Saint-Hubert, Quebec
Government of Canada. Canadian Space Agency. March 2007. Canadian
Participation in GMES under EC FP7 funding and Canada / EU Relationships. SaintHubert, Quebec
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Government of Canada. Canadian Space Agency. Audit and Evaluation Directorate.
June 2008. Management Action Plans Follow-Up: Annual Report as at March 31,
2008. Saint-Hubert, Quebec
Guillemette, Raymond. Government of Canada. Canadian Space Agency. October
2008. ESA Program.
Guillemette, Raymond. Government of Canada. Canadian Space Agency. February
2009. List of ESA Contracts to Canada, 2000 – 2008.
Hickling Corporation (in association with AstroCom Associates Inc. and Nordicity
Group Ltd.). May 1997. Evaluation of Canada’s Participation in the Program of the
European Space Agency: Final Report.
Hulsroj, Peter. January 2009. Participation in ESA programmes. Eurisy Conference.
Budapest, Hungary.
Industrial Policy Committee. June 2008. Geographical Distribution of Contracts.
Paris, France.
Industrial Policy Committee. December 2008. Geographical Distribution of
Contracts. Paris, France.
Jha, V., Giroux, M. and Leclerc, G. Government of Canada. Canadian Space Agency.
Space Technologies Branch – External Relations Directorate. March 2002. Report on
the Review of Canada's Cooperation with the European Space Agency: Presentation
to the Executive Committee.
Jha, Virendra and Giroux, Michel. Government of Canada. Canadian Space Agency.
Space Technologies Branch – External Relations Directorate. March 2002. Review of
Canada's Cooperation with the European Space Agency: Final report.
Kinsman, Jeremy. June 2006. Letter to EC DG Energy & Transport. Brussels,
Belgium
Leclerc, G., Guillemette, R., et. al. Government of Canada. Canadian Space Agency.
November 2008. Ministerial Council of ESA –"Strawman" towards a Canadian
Position.
MacLaren, Sandy. April 2008. Canada–EU bilateral commercial relations. DFAIT
Media lines for use by HOMs and STCs in Europe
MacLean, Steve. November 2008. ESA Ministerial Council Meeting: Opening
Statement by Head of Canadian Delegation. The Hague, the Netherlands.
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Ockwell, Patricia and Beland, Sylvie. April 2006. Meeting between European
Commission (EC) and Canadian Department of Foreign Affairs and International
Trade (DFAIT) on Possible Cooperation on GALILEO Navigation System. Brussels,
Belgium
Ockwell, Patricia and Beland, Sylvie. April 2006. Meeting between European
Commission (EC) and Canadian Department of Foreign Affairs and International
Trade (DFAIT) on Possible Cooperation on GALILEO Navigation System. Brussels,
Belgium
Ockwell, Patricia and Beland, Sylvie. April 2006. Notes on recent meetings between
the CSA and the European Commission on Galileo. Brussels, Belgium.
Reute, Matthias. June 2006. Receipt of Your Letter of 21st June 2006. Brussels,
Belgium.
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Appendix C: Data-Collection Instruments
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CSA/ESA Case Study Template
1. Description of Methodology (0.25 pages)
 Description of data sources used to develop case study (documents reviewed, number
of interviews with various organizations, etc.)
 Do not use people’s names in case studies – please use positions only.
2. Background on Proponent Organization (0.5 pages)
 Short description of organization in terms of years in business, their industry, the main
products/services they offer. The CSA website is a good place to obtain this if you
missed it during the interview. http://www5.asc-csa.gc.ca/eng/industry/csd.asp
3. Overview of ESA Contracts Received Since 2000 (0.5 pages)
 Brief description of each project including its overall objective, partners involved,
amount of funding from ESA, prime or subcontractor, when project began and its
completion or anticipated completion date
 Description of what has been accomplished to date such as products and technologies
developed, (but do not discuss impacts to organization in this section)
4. Impacts to Organization and its Partners (0.75-1.5 pages)
 Discuss impacts to organization and any Canadian partners in terms of qualitative
benefits such as improved employee skill levels, increased productivity, increased
R&D or innovation capability, partnerships created, potential markets identified for
further work, etc.
 Describe the financial benefits (if any) to the organization and Canadian partners from
participating in ESA since 2000. Quantify where possible the impacts on revenues,
profits, exports, and job creation.
5. Importance of Partners and Alliances Created (0.25 -0.5 pages)
 Discuss any impacts or benefits of new relationships created or strengthened for
Canadian firm from participating in ESA contract
6. Social Benefits (0.25-0.5 pages)
 If applicable, describe any social benefits that have resulted (environment, safety,
health)
7. Summary (0.25-0.5 pages)
 Summarize the main findings of the case study in a short paragraph or two.
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C.1 CSA & OGD Stakeholders - Interview Guide
The Canadian Space Agency (CSA) has retained the services of the management
consulting firm Goss Gilroy Inc. (GGI) to conduct a Summative Evaluation of the
Canada/European Space Agency (ESA) Cooperation Agreement. The purpose of the
evaluation is to assess the extent to which the Canada/ESA Agreement has been
successful in meeting its program objectives and to assess its relevance, performance,
and cost-effectiveness.
The Canada/ESA Cooperation Agreement
Canada and ESA have been cooperating since the early 1970’s in space activities,
with the original Canada/ESA Cooperation Agreement commencing in 1979. Since
then, the Agreement has been renewed on three occasions, with the most recent
covering the period from January 1, 2000 to December 31, 2009.
In the 2000-09 Cooperation Agreement, Canada contributes to the General ESA
Budget at 50% of the rate of other ESA members, and benefits from all activities
carried out under the General Budget, except for the scientific program and the basic
technological research programs. Canada also participates in the following optional
ESA programs: Earth Observation, Satellite Communications, and Space Exploration.
The Agreement guarantees Canada the same rights as ESA Member States in optional
programs, including an industrial return to Canada that is the same as that of ESA
Member States in optional programs.
The evaluation involves comprehensive interviews, document and file reviews, an
analysis of program data, and case studies with a sample of organizations that have
benefitted from ESA contracts. In the evaluation, interviews are being conducted with
key stakeholders at CSA and ESA, and with organizations that have and have not
been beneficiaries of ESA contracts. In addition, organizations that have benefited
from the Agreement may be asked to complete a tailored follow-up questionnaire to
more clearly define some of the impacts of the Agreement or to participate in a case
study.
This interview relates to Canada/ ESA Cooperation Agreement covering the
time period from January 1, 2000 to December 31, 2008. Your participation in
this exercise is voluntary, and your responses will be treated confidentially by GGI.
Results will be reported at an aggregate level only. The interview will take
approximately 30-45 minutes to complete.
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Respondent’s Profile:
Name:
____________________________________________
Position Title:
____________________________________________
Company:
____________________________________________
one Number:
____________________________________________
E-mail Address:
____________________________________________
In responding to the questions below, please provide specific examples where
possible:
Introduction
1.
Please describe your role within your organization and with the Canada/ESA Agreement.
a. What specifically has been your involvement with the Canada/ESA Agreement?
b. Since when have you been involved?
Rationale & Relevance
2.
Do the policy, programmatic and industrial needs that led CSA to enter into a
Cooperation Agreement with ESA in 2000 still exist today? (I-1)
a. If not, how have they changed?
b. How do environmental changes, such as the development of a European Space
Policy (ESP) affect Canada’s future role?
3.
Are the objectives of the Canada/ESA Agreement consistent with the priorities of the
Government of Canada? (I-2)
a. Are the Agreement’s objectives consistent with Canada's Space Program?
b. (I-3) Does the agreement support the science information needs of the
government?
c. (I-4) Would companies have obtained contracts from these ESA programs
without the Canadian contribution?
4.
Is there a rationale to continue the Canada/ESA Cooperation for another ten years (2010 –
2019)? Please elaborate. (I-5)
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Design & Delivery
5.
How do you ensure that CSA is participating in the ESA programs that make the most
sense for Canada? (I-6)
a. On what basis were the ESA programs selected?
b. Were potential for industrial returns and socio-economic benefits considered
when selecting?
c. How do you ensure you understand stakeholder priorities and capabilities?
6.
How are opportunities under the Canada/ESA Agreement communicated and promoted to
Canadian firms? (I-7)
a. Has this been effective? Please explain.
7.
What challenges have Canadian firms faced in trying to access ESA contracts? (I-8)
a. How have they been able to overcome these?
Results
8.
Can you provide examples where ESA contracts have enhanced the technological and
innovation capabilities of Canadian companies? (I-12)
a. Do you believe that the contracts awarded by ESA to Canadian companies are as
leading edge technically as those provided to European firms?
9.
Can you provide any examples where, because of an ESA contract (I-13):
a. Canadian firms have developed and / or demonstrated advanced technologies,
systems, components or studies
b. Canadian firms have participated in high-profile European space missions.
c. ESA contracted technologies have been incorporated into Canada's other space
activities or where CSA or OGDs have been able to benefit from capabilities
developed.
10. Have flight opportunities to space-qualify Canadian technologies or products increased,
decreased, or remained the same in recent years? (e.g. Were there more opportunities
over 2000-2009 versus the 1990s?) (I-14)
11. Can you provide examples where intelligence on European space-related policies,
programs, and markets was obtained that would not have been in the absence of the
Agreement? (I-19)
a. Can you provide examples where such intelligence has been used for strategic
purposes by Canadian government departments/agencies and Canadian
industry??
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12. Can you provide any examples where Canada’s other international S&T objectives (e.g.,
climate change) have benefited from technologies or information originating from the
Agreement? (I-20)
13. To what extent has CSA influenced ESA programming and decisions through its
involvement as a member of ESA? Please elaborate on why or why not. (I-21)
Cost-Effectiveness & Alternatives
14. Is the percentage of the CSA/ESA Agreement budget that is allocated to administration
and overhead reasonable? (I-22)
a. Can you think of ways to trim administration and overhead costs?
15. Is the percentage of ESA general budget paid by Canada reasonable given the dollars it
invests in ESA (optional) programs? (I-23)
16. What alternatives are available to the traditional Canada/ESA Cooperation Agreement for
reaching the same objectives? (I-25)
a. What are the advantages/disadvantages of these alternatives?
b. Which alternative do you consider to be the most cost-effective?
17. What would be the impact of discontinuing the Agreement? (I-26)
Thank you for your participation!
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C.2 ESA & Other European Officials - Interview
Guide
The Canadian Space Agency (CSA) has retained the services of the management consulting
firm Goss Gilroy Inc. (GGI) to conduct a Summative Evaluation of the Canada/European Space
Agency (ESA) Cooperation Agreement. The purpose of the evaluation is to assess the extent to
which the Canada/ESA Agreement has been successful in meeting its program objectives and to
assess its relevance, performance, and cost-effectiveness.
The Canada/ESA Cooperation Agreement
Canada and ESA have been cooperating since the early 1970’s in space activities,
with the original Canada/ESA Cooperation Agreement commencing in 1979. Since
then, the Agreement has been renewed on three occasions, with the most recent
covering the period from January 1, 2000 to December 31, 2009.
In the 2000-09 Cooperation Agreement, Canada contributes to the General ESA
Budget at 50% of the rate of other ESA members, and benefits from all activities
carried out under the General Budget, except for the scientific program and the basic
technological research programs. Canada also participates in the following optional
ESA programs: Earth Observation, Satellite Communications, and Space Exploration.
The Agreement guarantees Canada the same rights as ESA Member States in optional
programs, including an industrial return to Canada that is the same as that of ESA
Member States in optional programs.
The evaluation involves comprehensive interviews, document and file reviews, an analysis of
program data, and case studies with a sample of organizations that have benefitted from ESA
contracts. In the evaluation, interviews are being conducted with key stakeholders at CSA and
ESA, and with organizations that have and have not been beneficiaries of ESA contracts. In
addition, organizations that have benefited from the Agreement may be asked to complete a
tailored follow-up questionnaire to more clearly define some of the impacts of the Agreement or
to participate in a case study.
This interview relates to Canada/ ESA Cooperation Agreement covering the time period
from January 1, 2000 to December 31, 2008. Your participation in this exercise is voluntary,
and your responses will be treated confidentially by GGI. Results will be reported at an
aggregate level only. The interview will take approximately 45 minutes to complete.
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Respondent’s Profile:
Name:
____________________________________________
Position Title:
____________________________________________
Company:
____________________________________________
one Number:
____________________________________________
E-mail Address:
____________________________________________
In responding to the questions below, please provide specific examples where possible:
Introduction
1.
Please describe your role within your organization and what specifically is/has been your
involvement with the Canada/ESA Cooperation Agreement?
Rationale & Relevance
2.
Do you believe Canadian participation in ESA programs is valued and why (elaborate)
a. by ESA personnel, whether program or technology managers?
b. by Members States or other stakeholders close to the ESA program?
3.
Are there situations that you are aware of, where access by ESA to Canadian technology
(via the awarding by ESA of contracts to Canadian firms) was hampered/ limited by lack
of sufficient subscription (funding) in an optional program?
4.
(I1) Do you think the value/ benefits of the participation by Canada to ESA will be
impacted 1) by the European Space Policy (ESP), 2) by the « rapprochement » between
ESA and the European Union, 3) by the increased participation by EU in the funding of
ESA programs recognizing that, while Canada would remain a cooperating state of ESA,
it could never be part of the EU?
5.
(I18) Do you think the ESA program would be different/ would lose something, if
Canada would terminate/ not renew the agreement?
6.
(I3) Recognizing that Canada and ESA have begun formal negotiations to extend the
Cooperation Agreement beyond 2010, in your view, what are the main motivations
for renewing this longstanding agreement? Please elaborate.
Design & Delivery
7.
Is ESA satisfied with the quality of the participation by the Canadian delegation to ESA
governing bodies/ boards/ committees?
Thank you for your participation!
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C.3 Beneficiaries of ESA Contracts – Interview Guide
The Canadian Space Agency (CSA) has retained the services of the management
consulting firm Goss Gilroy Inc. (GGI) to conduct a Summative Evaluation of the
Canada/European Space Agency (ESA) Cooperation Agreement. The purpose of the
evaluation is to assess the extent to which the Canada/ESA Agreement has been
successful in meeting its program objectives and to assess its relevance, performance,
and cost-effectiveness.
The Canada/ESA Cooperation Agreement
Canada and ESA have been cooperating since the early 1970’s in space activities,
with the original Canada/ESA Cooperation Agreement commencing in 1979. Since
then, the Agreement has been renewed on three occasions, with the most recent
covering the period from January 1, 2000 to December 31, 2009.
In the 2000-09 Cooperation Agreement, Canada contributes to the General ESA
Budget at 50% of the rate of other ESA members, and benefits from all activities
carried out under the General Budget, except for the scientific program and the basic
technological research programs. Canada also participates in the following optional
ESA programs: Earth Observation, Satellite Communications, and Space Exploration.
The Agreement guarantees Canada the same rights as ESA Member States in optional
programs, including an industrial return to Canada that is the same as that of ESA
Member States in optional programs.
The evaluation involves comprehensive interviews, document and file reviews, an
analysis of program data, and case studies with a sample of organizations that have
benefitted from ESA contracts. In the evaluation, interviews are being conducted with
key stakeholders at CSA and ESA, and with organizations that have and have not
been beneficiaries of ESA contracts. In addition, organizations that have benefited
from the Agreement may be asked to complete a tailored follow-up questionnaire to
more clearly define some of the impacts of the Agreement or to participate in a case
study.
This interview relates to Canada/ ESA Cooperation Agreement covering the
time period from January 1, 2000 to December 31, 2008. Your participation in
this exercise is voluntary, and your responses will be treated confidentially by GGI.
Results will be reported at an aggregate level only. The interview will take
approximately 30-45 minutes to complete.
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Respondent’s Profile:
Name:
____________________________________________
Position Title:
____________________________________________
Company:
____________________________________________
one Number:
____________________________________________
E-mail Address:
____________________________________________
In responding to the questions below, please provide specific examples, and where
possible, refer to the ESA contract(s) involved.
Introduction
1.
Please describe your role within your organization and with the CSA and ESA.
a. What specifically has been your involvement with the ESA program?
b. Since when have you been involved?
2.
What contract(s) has your organization received from ESA?
Rationale & Relevance
3.
How important is it for your organization to have the opportunity to participate in the
ESA program? (I-1)
a. How important do you think it is for the Canadian space industry?
b. How have the circumstances of your organization changed since 2000 (when the
Agreement was signed)?
Design & Delivery
4.
How well do the ESA contract opportunities align with your organization’s strengths? (I6)
a. Has Canada chosen to participate in the most appropriate ESA programs for
Canadian firms?
5.
To what extent is CSA promoting and communicating the ESA program and its
opportunities to Canadian organizations? (I-7)
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6.
What challenges have you had in trying to access ESA contracts? (I-8)
a. How have you overcome them?
b. What changes to processes do you suggest to help Canadian firms in accessing
ESA contract(s)?
Results
7.
Have ESA contracts helped your organization increase or maintain your core scientists,
engineers, and technicians? (I-11)
8.
What new skills or technologies has your organization acquired as a result of the ESA
contract(s)? (I-12)
a. Is participation in ESA a strategy that your organization uses to enhance your
technology base?
9.
Have your contracts allowed you to develop and demonstrate your advanced
technologies, systems, components, or related studies, where otherwise you would not
have had the opportunity? (I-13)
10. How many flight opportunities have you had where you could space-qualify your
technologies or products because of ESA contracts? (I-14)
11. To what extent (I-16):
a. Have sales increased as a result of completing the ESA contract(s)?
b. Have new markets been entered as a result of the ESA contract(s), which you
would not have otherwise entered?
c. Has your competitiveness increased as a result of the ESA contract(s)?
12. As a result of your company's work with ESA, to what extent have (I-17):
a. New space collaborations or initiatives within Europe, but outside ESA,
resulted?
b. New space collaborations or initiatives outside Europe resulted?
13. Have ESA contracts allowed you to obtain intelligence on European space-related
policies, programs and markets that you otherwise would not? (I-19)
a. To what extent have you benefited from this intelligence?
14. How would your firm be different if you hadn’t participated in ESA? (I-1)
a. Would your company still have obtained contracts from ESA or its contractors?
(I-2)
15. Can you suggest more cost effective means to develop the technologies / capacity that
you have has achieved through contracts with ESA? (I-24)
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16. What would be the impact on your company if the Canada-ESA agreement were not
renewed? (I-26)
17. Do you think the ESA program would be different if Canada had not participated? (I-21)
Thank you for your participation!
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C.4 ESA Contract Beneficiaries - Follow-up
Questionnaire
Based on your responses to the interview on the Canada/ESA Cooperation
Agreement, you are requested to provide, to the best of your ability, additional
information on the areas indicated below:
1.
Please provide details of any new or previously existing technology(ies) or system(s)
that your organization has developed or enhanced in ESA-funded contract(s) since
2000, and complete the columns in the following table.
Technology or System 1
a) Please describe the technology or system, whether it is new or an enhanced
technology or system, its purpose, and how it is used:
b) If the technology has resulted in a new product or service, please describe
c) If the product or service has generated sales revenue for your firm, please complete
the table below as thoroughly as possible.
Year
Sales Revenue
Export Sales as %
of Revenue
Cost of
purchased raw
materials and
components as
% of Revenue
Estimated Profits
2000
2001
2002
2003
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Year
Sales Revenue
Export Sales as %
of Revenue
Cost of
purchased raw
materials and
components as
% of Revenue
Estimated Profits
2004
2005
2006
2007
2008
2009 (estimated)
2010 (estimated)
2011 (estimated)
Future years
(timespan)
c. Do you have any comments related to the above new or enhanced technologies or
systems, products and sales revenue?
Technology or System 2
i) Please describe the technology or system, whether it is a new or enhanced
technology, or system, its purpose, and how it is used:
ii) If the technology has resulted in a new product or service, please describe
iii) If the product or service has generated sales revenue for your firm, please complete
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the table below as thoroughly as possible.
Year
Sales Revenue
Export Sales as %
of Revenue
Cost of
purchased raw
materials and
components as
% of Revenue
Estimated Profits
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009 (estimated)
2010 (estimated)
2011 (estimated)
Future years
(timespan)
c. Do you have any comments related to the above new or enhanced technologies or
systems, products and sales revenue?
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Technology or System 3
i) Please describe the technology or system, whether it is a new or enhanced
technology or system, its purpose, and how it is used:
ii) If the technology has resulted in a new product or service, please describe
iii) If the product or service has generated sales revenue for your firm, please complete
the table below as thoroughly as possible.
Year
Sales Revenue
Export Sales as %
of Revenue
Cost of
purchased raw
materials and
components as
% of Revenue
Estimated Profits
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009 (estimated)
2010 (estimated)
2011 (estimated)
Future years
(timespan)
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c. Do you have any comments related to the above new or enhanced technologies or
systems, products and sales revenue?
2.
Please estimate the employment, by year, maintained or created (person years):
 During the ESA Contracts
 From Sales of Ensuing Products and/or Services
Please indicate the numbers below in person years
(e.g. 1 person working for 6 months = 0.5 person years
Year
Total person years
of all employees
working on ESA
contracts
# of person
years that were
from new hires
# of person years
considered to be
highly qualified
persons (HQP)
Please indicate how many
people you have hired
due to sales or follow on
contracts that occurred
because of ESA contracts
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
(estimated)
2010
(estimated)
2011
(estimated
Future years
(timespan)
b. Do you have any comments about employment maintained or created during or after
ESA contracts?
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3.
Please provide details on new or strengthened Canada-Europe alliances or partnerships
resulting from ESA contracts. Alliances include joint proposals, subcontracts, cocontractor56, joint venture or long-term strategic alliances. Please be sure to indicate the
start and end date of the alliances and the impact of these alliances on your organization.
a. If the alliances or partnerships resulted in sales revenue for your organization in addition
to that provided in the previous tables, please provide this information in the table
below.
Year
Sales Revenue
Export Sales as %
of Revenue
Cost of
purchased raw
materials and
components as
% of Revenue
Estimated Profits
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009 (estimated)
2010 (estimated)
2011 (estimated)
Future years
(timespan)
b. Do you have any comments about alliances with European companies?
C.5 Non-Beneficiaries of ESA Contracts - Interview
56
An example of a co-contractor alliance could be a situation where a scientific instrument is integrated on a spacecraft by a
system integrator, in which case the instrument builder and system integrator could be co-contractors with ESA.
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Guide
The Canadian Space Agency (CSA) has retained the services of the management
consulting firm Goss Gilroy Inc. (GGI) to conduct a Summative Evaluation of the
Canada/European Space Agency (ESA) Cooperation Agreement. The purpose of the
evaluation is to assess the extent to which the Canada/ESA Agreement has been
successful in meeting its program objectives and to assess its relevance, performance,
and cost-effectiveness.
The Canada/ESA Cooperation Agreement
Canada and ESA have been cooperating since the early 1970’s in space activities,
with the original Canada/ESA Cooperation Agreement commencing in 1979. Since
then, the Agreement has been renewed on three occasions, with the most recent
covering the period from January 1, 2000 to December 31, 2009.
In the 2000-09 Cooperation Agreement, Canada contributes to the General ESA
Budget at 50% of the rate of other ESA members, and benefits from all activities
carried out under the General Budget, except for the scientific program and the
basic technological research programs. Canada also participates in the following
optional ESA programs: Earth Observation, Satellite Communications, and Space
Exploration. The Agreement guarantees Canada the same rights as ESA Member
States in optional programs, including an industrial return to Canada that is the
same as that of ESA Member States in optional programs.
The evaluation involves comprehensive interviews, document and file reviews, an
analysis of program data, and case studies with a sample of organizations that have
benefitted from ESA contracts. In the evaluation, interviews are being conducted with
key stakeholders at CSA and ESA, and with organizations that have and have not
been beneficiaries of ESA contracts. In addition, organizations that have benefited
from the Agreement may be asked to complete a tailored follow-up questionnaire to
more clearly define some of the impacts of the Agreement or to participate in a case
study.
This interview relates to fact that your organization has not received a contract
under the Canada/ESA Cooperation Agreement since January 1, 2000. Your
participation in the survey is voluntary, and your responses will be treated
confidentially by GGI. Results will be reported at an aggregate level only. The
questionnaire will take approximately 10 minutes to complete.
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Respondent’s Profile:
Name:
_______________________________________________________
Position Title:
_______________________________________________________
Company:
_______________________________________________________
Phone
Number:
_______________________________________________________
E-mail
Address:
_______________________________________________________
In responding to the questions below, please provide specific examples where
possible:
Introduction
1.
Please describe your role within your organization.
a. What specifically has been your involvement with ESA contract opportunities
and since when?
b. Has your firm tried to obtain ESA contracts under the Canada-ESA agreement?
c. Has your firm worked with European clients outside of the Canada-ESA
Agreement?
Design & Delivery
1.
Are you aware of the opportunities from ESA available to Canadian firms? (I-7)
a. Is CSA promoting and communicating the Canada/ESA Agreement and its
opportunities effectively to Canadian firms?
b. Have you had any contact from CSA in promoting and communicating the
Canada/ESA Agreement and its opportunities to you?
2.
Have you expressed an interest in participating in contract opportunities with ESA? (I-7)
a. Have you made CSA aware of your interest?
b. Have you discussed opportunities with ESA or their prime contractors?
c. Have you registered on ESA’s EMITS supplier database?
d. Have you bid on one or more opportunities? If yes, how many opportunities?
3.
How well do the interests of your firm align with the program areas from which ESA
contract opportunities originate? (I-6)
a. If not, how do your existing technological and innovation capabilities differ from
the areas being supported?
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4.
What challenges do you face in accessing ESA contracts under the Agreement? (I-8)
5.
In your opinion, what do you consider the primary reason(s) for not obtaining ESA
contracts? (I-8)
Thank you for your participation!
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Appendix D: Roles and Responsibilities of
Agreement Stakeholders
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Organizations/
Individuals
Minister of Industry
Roles and Responsibilities



Minister of Foreign
Affairs and
International Trade
CSA President




Represents Canada at ministerial ESA Council meetings
Initiates Memoranda to Cabinet for the negotiation (if required) and
signature/ratification of arrangements governing Canadian
participation in ESA programs
Negotiates, with the CSA, arrangements governing Canadian
participation in ESA programs
Co-signs with the Minister of Industry Memoranda to Cabinet to
obtain approval of arrangements on Canada’s participation in ESA
programs
Represents Canada at ESA Council meetings
Could sign treaties governing Canada's participation in the optional
program, if authorized by Order in Council


Approves (or rejects) Canadian participation in ESA optional
programs, after reviewing PRAB recommendations and Program
Approval Submissions (PAS)
Establishes total financial contributions and percentages of the
subscription to Canadian participation in optional programs
Allocates required funds to approved optional programs from CSA
Reference Levels for ESA
Sets Reference Levels for ESA through the ARLUs
Reviews PASs on optional programs and makes recommendations
on Canadian participation to the Executive Committee
Prepares the Strategic Plan for the Canadian Space Program (CSP);
Enunciates the Canadian space priorities guiding the selection of the
ESA optional programs in which Canada may participate in order to
achieve the CSP objectives
Represents Canada at ESA Council meeting
Appoints Canadian delegates on Subordinates Bodies and Program
Boards, jointly with the Director General - Space Technologies
Prepares Canadian positions for meetings of the ESA Council and
International Relations Committee
Prepares the annual review of the Canada/ESA Cooperation
Prepares bilateral Canada/ESA meetings at policy level
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CSA Executive
Committee (EC)


CSA PRAB
CSA Strategic
Development






CSA External
Relations

Organizations/
Individuals
Roles and Responsibilities





CSA Space
Technology






Department of
Foreign Affairs
Canada and
International Trade
(DFAIT)


Canadian Delegate to
ESA in Paris


Privy Council Office
CSA Corporate
Management Financial Advisor


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Appoints Canadian delegates on Subordinates Bodies and Program
Boards, jointly with the Director - External Relations
Represents Canada on Program Boards and DOSTAG
Identifies opportunities for participation in new optional programs,
organizes consultations with industry, and prepares PAS
Consults with concerned Departments and Agencies (e.g., DFAIT,
DND, NRCan/CCRS, IC/CRC) to reach an interdepartmental
consensus on ESA optional programs
Presents PAS on the participation in new optional programs for the
PRAB and EC approval
Submits annual work plans on Canada/ESA Programs
Coordinates ESA budgets, approves commitments and payments to
ESA under the General Budget and Optional Programs
Monitors the implementation of Canadian participation in ESA
programs
Implement the information systems required by the Ongoing
Performance Measurement and Evaluation strategies
Represents Canada on the ESA Administration and Finance
Committee
Negotiates with the CSA and interested departments arrangements
governing Canadian participation in ESA optional programs
Assists in the drafting of a Memorandum to Cabinet (MC) co-signed
by the Minister of Industry and the Minister of Foreign Affairs and
International Trade seeking approval for the negotiation (if
necessary), signature and ratification of arrangements
Represents Canada’s interests with ESA officials and Program
Boards
Collect intelligence on European policies, programs and
technologies of interest to Canada
Obtains Order in Council authority necessary for issuing a legal
instrument of Full Powers and identifying those authorized to sign
the treaty
Sets annual ESA budgets through ARLU and work plans and
monitors financial evolution of approved programs
Authorizes and processes payments to ESA
116
Organizations/
Individuals
Roles and Responsibilities


Conducts internal audits
Coordinates the Summative Evaluation provided for in the
Evaluation Strategy
Other Government
Departments:
NRCan/CCRS
IC/CRC


Delegates to Program Boards, cooperation on program management
Implements tasks provided for in contracts as per ESA requirements
Other Government
Departments: DND

Consultations on security aspects of Canada/ESA programs
CSA Audit,
Evaluation and
Review

Industry/Not-for profit

Organization

Prepares proposals to ESA invitations to tender
Implements tasks provided for in contracts as per ESA requirements
Cooperates with CSA to collect data on performance
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Appendix E: Evaluation Issues & Matrix
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ERC Questions (where
applicable)
Evaluation Issues/Questions
Indicators
Data Sources
Rationale and Relevance: Is the Agreement still relevant and appropriate as an Instrument of Government Policy?
ERC1 – Does the program area
or activity continue to serve the
public interest?
ERC1 – Does the program area
or activity continue to serve the
public interest?
ERC2 – Is there a legitimate
and necessary role for
government in the program area
or activity
ERC 4: What activities should
or could be transferred in whole
or in part to the private sector?
ERC3 – Is the current role of
the federal government
appropriate? Is the program a
candidate for realignment with
the provinces?
1. Do the policy, programmatic and industrial
conditions/needs that led CSA to enter into a
Cooperation Agreement with ESA in 2000 still
exist today? If not, how have they changed?

2. Is the Canada/ESA Agreement consistent with
the priorities of the Government of Canada?
And with the priorities of Canada's Space
Program.

3. Does the program support the science
information needs of the government?


Evidence that conditions (needs and gaps)
still exist that warrant government
involvement
Overall positive results from the impact
assessment
 Interviews with CSA staff (C1.2)
 Interviews at OGDs (C.1.2)
 Survey of contracted companies
(C3.3; C3.14))
 Case studies.
 Analysis of industrial and science
benefits
Evidence that the objectives of the
Agreement support the goals of CSA long
term planning, the priorities of the
Government of Canada, science needs of
OGDs.
Evidence of unique / highly competitive
capabilities of Canadian companies.
 Documents such as the CSA
enabling act, and government
policy documents, CSA strategic
plan
 Interviews with CSA staff (C1.3)
 Interviews at OGDs (C1.3)
 Surveys of contracted companies
(C3.14)
 Case studies
Opinions that the current federal role
remains appropriate.
Opinions that CSA is the most appropriate
organization to deliver the Agreement.
Evidence that there have been science and
industrial benefits from the last
agreement.




4. Would companies have obtained contracts on
these ESA programs without the Canadian
contribution?
5. Is there a rationale to continue the Canada/ESA
Cooperation for another ten years (2010 –
2019)? What is it?



Interviews at ESA (C2.6)
Interviews with CSA staff (C1.4)
Interviews at OGDs (C1.4)
Surveys of contracted companies
(C3.16)
 Case studies

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ERC Questions (where
applicable)
Evaluation Issues/Questions
Indicators
Data Sources
Design & Delivery: Has the design philosophy behind the Agreement been appropriate?
6. Is Canada participating in the most appropriate
ESA programs?



7. Is CSA promoting and communicating the
Canada/ESA Agreement and its opportunities
effectively to Canadian firms?



8. What challenges have Canadian firms faced in
trying to access ESA contracts? How do they
overcome them?

Opinions of CSA and industry on the ESA
programs in which Canada should
participate?
Opinions of CSA and S&T community on
impact of Canada's exclusion from ESA
S&T program.
Evidence that the potential science,
industrial and socio-economic benefits
had been considered
 Interviews with CSA staff (C1.5)
 Interviews at OGDs (C1.5)
 Surveys of contracted companies,
(C3.4)
 Survey of rejected/non
participating firms (C5.3)
 Case studies.
 Admin data
Evidence of promotion by CSA
Attendance/response rates by invited
firms
Opinions of surveyed firms on the
effectiveness of information diffusion
 Admin data,
 Interviews with CSA staff (C1.6)
 Survey of contracted companies.
(C3.5)
 Survey of rejected/non
participating firms (C5.1; C5.2)
Challenges faced and suggestions or
evidence of how they were overcome
 Interviews with CSA staff (C1.7)
 Survey of rejected/nonparticipating firms (C5.4; C5.5)
 Survey of firms receiving ESA
contracts (C3.6)
 Case studies.
Results: To what extent has the CSA /ESA Agreement achieved the intended results and objectives?
9. Have the contracts awarded by ESA to
Canadian companies and organizations achieved
the minimum overall return coefficient of 0.94
as set out by the ESA Council?
10. Have contracts awarded under the General
Budget and individual Optional Programs
achieved a minimum guaranteed return of 0.84
as set out by the ESA Council?
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
A cumulative overall return coefficient of
0.94, in accordance with ESA’s
calculation of geographical return
coefficients.
Minimum return coefficients of 0.84 for
the contracts awarded under the General
Budget and individual Optional Programs
 Geographical distribution of
contracts reports from ESA
 Geographical distribution of
contracts reports from ESA
120
ERC Questions (where
applicable)
Evaluation Issues/Questions
Data Sources
11. To what extent have the Canadian companies
that received ESA contracts maintained or
increased their complement of core scientists,
engineers and technicians?

Change in employment levels of
scientists, engineers, and technicians at
participating firms
 Survey of contracted firms (C3.7)
 Case studies (C6.4)
12. To what extent have Canada/ESA programs
contributed to enhancing existing technological
and innovation capabilities of the companies
that received ESA contracts?

Examples of / extent to which new/more
complex technologies have been
developed or incorporated by firms
Number of firms for which participation
in ESA programs has been a strategy to
enhance their technology basis




Survey of contracted firms (C3.8)
Case studies (C6.4)
ESA contract data
Interviews with CSA staff (C1.8)
13. To what extent has the Agreement facilitated the
development and demonstration of advanced
technologies, systems, components, or tools?

Examples of / extent to which Canadian
contractors successfully delivered the
technologies, products, services, or
studies in conformity with ESA technical
requirements, within costs and timelines
Examples of incorporation of ESA
contracted technologies into Canada's
other space activities.
Examples of how CSA or OGDs have
been able to benefit from capabilities
developed under ESA contracts.
Extent to which new technologies have
been developed or incorporated by firms
that received ESA contracts
Participation of Canadian firms in highprofile European space missions.





Survey of contracted firms (C3.9)
Case studies,
Admin data,
Interviews with CSA staff (C1.9)
Interviews with OGDs (C1.9)





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Indicators
14. To what extent has the Canada/ESA Agreement
generated more flight opportunities to spacequalify Canadian technologies or products?

Number of flight opportunities during the
2000-2009 period.
 Admin data,
 Interviews with CSA staff (C1.10)
 Survey of contracted firms (C3.10)
15. To what extent has the number of new
companies that participate in the Canada/ESA
programs increased?

Number of companies and identification
of new companies obtaining ESA
contracts
 Procurement registration data from
ESA,
 Contract award data from ESA
121
ERC Questions (where
applicable)
Evaluation Issues/Questions


16. To what extent have the Canada/ESA contracts
contributed to: new business opportunities for
Canadian companies in domestic and
international markets; increased
competitiveness?




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Indicators
Data Sources
Identification of company size (SMEs,
large, etc.)
Evidence of contracts to Canadian sub
contractors that have not participated
before
 Canada Space Directory and CSA
bi-annual industry profile
Number of follow on contracts
attributable to ESA program
Number of new business opportunities
identified and market developed that are
attributable to ESA
Extent to which contracts are one-offs or
ongoing opportunities
Extent to which profitable niches have
been developed
 Surveys of contracted firms
(C3.11)
 Case studies
Number and importance of new alliances
forged between Canadian firms and
European primes and major subcontractors
Number and importance of new alliances
forged between Canadian firms outside of
Europe
 Surveys of contracted firms
(C3.12)
 Case studies
17. To what extent have the Canada/ESA Programs
contributed to diversify Canada’s international
space partnerships through the establishment of
new alliances or the strengthening of existing
alliances between Canadian companies and
European primes and major sub-contractors?

18. What have been the economic benefits to
Canada of the Agreement?

Computation of value added, revenues,
spin off businesses and products, direct
tax revenue generated, temporary and
permanent employment created that can
be attributed to the Agreement
 Surveys of companies (C3.9;
C3.11) and follow up (C4)
 Case studies and
 Economic impact analysis
19. To what extent has the Canada/ESA
Cooperation Agreement facilitated the obtaining
of intelligence on European space-related
policies, programs and markets? To what extent
is it used for strategic purposes by Canadian
government departments/agencies and Canadian
industry?

Opinions that intelligence has been
obtained that would not have been in the
absence of the Agreement
Examples of intelligence gained and how
it was used for strategic purposes
 Interviews with CSA staff (C1.11)
 Interviews with OGDs (C1.11)
 Surveys of contracted companies
(C3.13)
 Case studies


122
ERC Questions (where
applicable)
Evaluation Issues/Questions
Indicators
Data Sources
20. To what extent have Canada’s other
international S&T objectives (e.g., climate
change) benefited from technologies or
information originating from the Canada/ESA
agreement?

Examples of / important ways in which
other Canadian S&T objectives have
benefitted from the Agreement
 Interviews with CSA staff (C1.12)
 Interviews with OGDs (C1.12)
 Case studies
21. To what extent has the CSA influenced ESA
programming?

Extent to which Canadian developed
technologies are critical for ESA space
missions
Evidence that ESA programming would
be different if Canada did not participate
in ESA





Interviews with CSA staff, (C1.13)
Interviews with ESA staff (C2.2)
Interviews with OGD staff (C1.13)
Surveys with contracted
companies (C3.17)
 Case studies
Cost-effectiveness & Alternatives: Can the same results be achieved through different means?
22. What percentage of CSA-ESA program budget
is allocated to administration and overhead? Is
it reasonable?



ERC5 – Are Canadians getting
value for their tax dollars?
23. Is the percentage of ESA general budget paid by
Canada reasonable given the dollars it invests in
other ESA programs?

24. How cost-effective have ESA contracts been to
help Canadian companies penetrate the
European / international space market, as
compared to other CSA technology-oriented
programs?





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CSA/ESA budget breakdown
Comparison of admin costs with other
CSA programs
Perceptions of reasonableness
 Admin data
 Interviews with CSA staff (C1.14)
Comparison of general budget to program
costs for Canada versus other countries
Perceptions of reasonableness
 Admin data
 Interviews with CSA staff (C1.15)
Ratio of CSA contributions to revenues
and employment generated by Canadian
firms in European space market over
2000-09 period compared with other CSA
technology oriented programs
Ratio of CSA contributions to revenues
and employment generated
Evidence that Canadian funding is
sufficient to attain objectives.
Opinions of CSA and company reps.
 Admin data,
 Survey of contracted companies.
(C3.15)
 Case studies
123
ERC Questions (where
applicable)
ERC6 – How could its efficiency
be improved?
ERC7 – Is the resultant package
of programs and activities
affordable? If not, what
programs or activities would be
abandoned?
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Evaluation Issues/Questions
25. What are the alternatives to the traditional
Canada/ESA Cooperation Agreement? Are
there more cost effective space programming /
investment options available for reaching the
objectives pursued with the Canada/ESA
Cooperation?


26. What would be the impact of discontinuing the
Agreement?


Indicators
Data Sources
Identification of alternatives
Pros and cons of suggested alternative
approaches for reaching the objectives
Identification of costs of alternatives, if
possible
 Interviews with CSA staff (C1.16)
 Interviews at OGDs,
 Case studies
Identification of impacts to stakeholders
(industry, gov’t, etc.) from
discontinuation





Interviews with CSA staff (C1.17)
Interviews at ESA (C2.5)
Interviews at OGDs
Case studies;
Surveys of contracted companies.
(C3.16)
124
Appendix F: Canada’s Return-Coefficient
Rank, by Area
Source: ESA Industrial Policy Committee – Geographical distribution of contracts
(Situation as per 31 December 2008)
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Return Coefficient for General Budget
2.5
2.0
2.33
1.77
1.51 1.48
1.5
1.28
1.18
1.11
0.98 0.95
0.91
1.0
0.82
0.8
0.79 0.75 0.74
0.67
0.5
0.5
0.41
0.0
Return Coefficient for Telecom Area
ESA Member States and Canada
1,5
1,45
1,4
1,3
1,2
1,1
1,09 1,07
1,05 1,04 1,04
1,0
1,01 1,01
1
0,99 0,98 0,97
0,96 0,96 0,94
0,92
0,9
0,88
0,8
ESA Member States and Canada
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Return Coefficient for EO Area
1.4
1.2
1.32 1.29
1.24
1.17 1.17 1.16
1.0
1.08
1.02 0.99
0.95 0.93
0.91
0.86 0.84
0.8
0.79
0.7
0.6
0.6
0.41
0.4
0.29
0.2
ESA Member States and Canada
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3.0
2.64
Return Coefficient for
Microgravity Area
2.5
2.0
1.55
1.5
1.45
1.27
1.08
1.0
0.99
0.94
0.93
0.9
0.86
0.78
0.56
0.52
0.5
0.38
0.27
0.0
ESA Member States and Canada
Return Coefficient for
Space and Exploration Area
3.0
2.82
2.5
2.0
1.64
1.5
1.64
1.6
1.51
1.41
1.14
1.0
1.1
1.07
0.95
0.91
0.87
0.79
0.78
0.5
ESA Member States and Canada
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Return Coefficient for Tech Area
1,25
1,23
1,20
1,15
1,10
1,08 1,08
1,07
1,05
1,05
1,04
1,01 1,01 1,01 1,01
1
1
1
1
1
1
1
1
1
1,00
0,95
Return Coefficient for Navigation Area
ESA Member States and Canada
4.0
3.9
3.5
3.0
2.5
2.0
1.5
1.49
1.33
1.0
1.31
1.22
1.09
1.06
1.03
1.03
0.95
0.82
0.81
0.72
0.69
0.61
0.5
0.02
0.0
ESA Member States and Canada
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1.4
1.26
Return Coefficient for
Mandaotry Programs (All)
1.2
1.16 1.14
1.1
1
1.0
1
0.98
0.91
0.9
0.86 0.85 0.85 0.83
0.76
0.8
0.69
0.6
0.64
0.59
0.4
0.2
0.12
0.0
ESA Member States and Canada
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Appendix G: Economic Impact Analysis
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Introduction
The economic impact analysis, undertaken for this evaluation, was based on ESA contracts received by Canadian organizations under the
Canada/ESA Cooperative Agreement. The analysis was based on data obtained from CSA, ESA, the results of the surveys and case studies
undertaken as part of this evaluation, and Statistics Canada’s National Accounts and Input Output (I/O) Tables.
Analysis of the data required that the survey and case study data be extrapolated to cover the activities of all Canadian recipients of ESA funding.
The extrapolated results were then analyzed with Statistics Canada Input/Output (I/O) tables to identify the direct, indirect and induced impacts of
ESA expenditures and related industry activities in Canada. In addition, recently constructed matrices were used to estimate Greenhouse Gas
Emissions (GHGs). To maintain confidentiality of the firms involved, analyses were undertaken at an aggregated level.
Social Benefits
Twenty-one of the 24 respondents to the case studies indicated several examples of where technologies generated social benefits. In nearly all
instances, the infrastructure stemming from the ESA assisted projects was necessary but not sufficient to attain these benefits. As illustrated in the
following examples, the benefits generated extend beyond Canada’s national borders; thereby, underlining the advantages of international
cooperation. Among the case studies there were references to:
 Tele-health which extends improved health care to remote areas in the Canadian north and elsewhere (2);
 Distance learning to facilitate delivery of training and education to remote sites (3) and stimulate education on the science of space (1);
 Improved government services to northern Canada including Nunavut (3);
 Environmental monitoring of airborne transmission via plumes, including the blackening of the Arctic Ice Cap from emissions, as the first line of
evidence to curtail such emissions and the resulting rising sea levels and environmental damage (4) – Canada would be well served by further
participation;
 Improved observation systems designed to assist meteorological services and/or mitigate diverse threats arising from crop failures and other
degradation, such as remote pipeline inspection and monitoring (6);
 Improved communication systems (5) resulting in better data on resources (minerals, forestry, fish and crops) (5), Internet (3), emergency
communications (2), search and rescue (4), navigation for shipping and avoidance of ice damage to oil and gas drilling and production rigs (5)
and road transportation with reduced emissions (2);
 Prevent environmental damage through the development of more energy efficient technologies (3); and,
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
Positioning Canada’s HQP to continue to participate in the space industry (1).
Most of the environmental issues and impacts addressed by ESA are international in their origin. The international abatement of environmental
releases will result in international benefits in which Canada and other nations will partake. Consequently, ESA’s related space initiatives warrant
international attention.
Economic Impacts
The economic impacts comprise direct, indirect, and induced impacts. Direct impacts arise when the recipient is awarded an ESA contract. The
indirect ones are linked to the suppliers to the contracted company and are further up the supply chain. The induced impacts emanate from the
incremental increased incomes due to the direct and indirect impacts, and the sequential increases in income from additional rounds of induced
expenditures out of derived incomes. In its 2006 I/0 Model, Statistics Canada57 has estimated the induced impacts arising from consumer
expenditures. This is a partial analysis since both spending of increased government revenues and increased private sector investments are not
estimated.
The following sections utilize the Statistics Canada’s National Input Output tables to derive the direct, indirect and induced.
Direct and Indirect Impacts
The first step in this process was to identify the contract and follow-on sales revenues generated at the establishment and industry level, as a result of
the ESA contracts. The NAICS codes, available at the firm level on Industry Canada Business Profiles, were used to link establishment data on
revenues to Statistics Canada’
In order to allocate the impacts among the industries in Statistics Canada’s I/O Tables, all North American Industrial Classification codes (NAICS)
for ESA contract recipients were based on their listings in Industry Canada’s Strategis. Where a firm listed more than one NAICS code, the one most
applicable one was applied based on the description of the contract for each establishment of the firm that listed contracts received. Therefore, a firm
with several establishments could have several NAICS codes. This process allowed us to define the economic shock, or ESA stimulus, as incremental
revenues by NAICS at purchaser prices.
Table 3 summarizes the economic shock by NAICS category.
57
This model is the latest available from Statistics Canada
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Table 3: Incremental Revenues in Canada by Industry from ESA Expenditures and Revenues Attributable to ESA
Space Industry
Electronics and Communication Equipment
Other Manufacturing
Other Private Industry
Communications Services
Professional Services
Training
Government
Total
Expenditures (1,000s $)
182,330
155,242
433
5,433
51,225
1,128
3,248
399,049
Source: Statistics Canada special run for GGI of the I/O system.
The economic shock was applied to Statistics Canada’s I/O tables to produce impacts on the Canadian economy related to income, employment and
the labour force.
Income Impacts
The impacts on national income at the national level were captured by estimating incremental Gross Domestic Product (GDP). GDP is a gross
measure of what is produced incrementally domestically in Canada prior to taking depreciation into account. The direct, indirect and induced impacts
are shown in Table 4. The incremental revenues attributable to the ESA contracts and the follow-on sales produce a stimulus of $399.0 Million, of
which $133.4 Million is imported, based on standard ratios by industry in Canada’s I/O framework. This leaves $265.7 Million in Canadian GDP at
market prices. This figure relates not only to the firms receiving the ESA contracts but also to all suppliers in the supply chain. Some of these
contract recipients and suppliers are likely to have imported materials and supplies, upon which duties would have been paid. These have been
estimated via the Statistics Canada’s I/O tables. When they are subtracted from the stimulus, they yield the direct and indirect GDP impacts at
market prices.
As long as there are imports, the multiplier relative to the total economic shock will be fractional. The multiplier approaching or exceeding unity in
the analysis comes from induced impacts when the incomes earned from the project are spent. In this instance, the expenditure shock of $399.0
million stimulates total expenditures of $526.6 million. After taking imports into consideration, the total impact on GDP at market prices is $367.1
million.
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The GDP at market prices is distributed as indicated in Table 4. By subtracting indirect taxes on products and adding in any subsidies to the products
over and above CSA involvement, direct and indirect GDP at basic prices is derived. This metric is important since its elements identify various
income streams as noted in the Table 4.
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Table 4: Derivation of Direct, Indirect and Induced GDP from the Economic Stimulus (1,000s $)
Direct + indirect
Induced
Direct, indirect
and induced.
GDP at market prices
265,665
101,430
367,096
Final expenditure
399,049
127,577
526,626
Imports, final expenditures
0
-15,541
-15,541
Imports, intermediate inputs
-133,384
-10,606
-143,990
265,665
101,430
367,096
Indirect taxes on products (final expenditures)
0
11,670
11,670
Indirect taxes on products (intermediate inputs)
2,172
1,505
3,676
Subsidies on products (intermediate inputs)
-2,024
-1,483
-3,507
265,518
89,739
355,256
Subsidies on production
-199
-66
-264
Indirect taxes on production
5,891
6,744
12,635
Wages and salaries
150,998
37,530
188,528
Supplementary labour income
21,388
4,746
26,134
Mixed income
5,206
8,774
13,980
Other operating surplus
82,233
32,010
114,243
Expenditure-based GDP
Income-based GDP
GDP at market prices
GDP at basic prices
Source: Statistics Canada special run for GGI of the I/O system.
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Direct incomes, in contrast with direct and indirect income measures, capture incomes at the initial suppliers’ establishments. The contrasts between
direct, indirect, and induced are summarized in Table 5. The multipliers are with respect to the3 $399.0 million in ESA contracts. The ratios are as
described in the table.
Total GDP at market prices is. more than twice ESA expenditures as shown by the GDP multiplier of 2.07. In contrast the ratio of total-to-direct GDP
of 2.00 indicating that total GDP at market prices is twice its direct counterpart.
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Table 5: Direct Versus Direct and Indirect Income Measures and Multipliers
GDP at market prices *
Direct
Indirect
Induced
Total
GDP multiplier (vs ESA Contracts)
GDP Multiplier (vs direct GDP)
Thousands $
184,007
81,658
101,430
367,096
2.07
2.00
Labour income
Direct
Indirect
Induced
Total
Labour income multiplier
Ratio of total-to-direct labour income
Thousands $
123,867
53,725
51,050
228,642
1.29
1.85
Employment - full-time equivalent **
Direct
Indirect
Induced
Total
Jobs multiplier (per million dollars) in ESA & Follow-on Sales
Ratio of total-to-direct jobs
Number of jobs
2,056
986
1,012
4,055
10.16
1.97
Source: Statistics Canada special run for GGI of the I/O system.
The estimated impacts on employment of the ESA contracts and follow-on sales amounted to 2,056 direct Fulltime Equivalent (FTEs) jobs, 986
indirect FTEs, and 1,012 induced FTEs. Direct employment from the I/O analysis includes both new FTEs and employees who retain their positions
due to the ESA contracting. In this sense they are incremental to the counterfactual of, “What would have been the relative level of employment
without the funding and follow-on sales, had companies failed to find any other markets?” They may not all be incremental since the companies
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throughout the supply chain may have found other work or horded Highly-Quality Persons (HQPs) and other staff in hopes of retaining intellectual
capital.
The direct and indirect impact on GDP and employment by industry indicate the reach of CSA/ESA projects in Canada. Since I/O analysis traces
supplies back up the supply chain by project, the analysis identifies GDP and employment by industry as denoted in Table 6. The largest GDP
impacts by industry are highly linked to Computer and Electronic Product Manufacturing ($143.2 Million), Transportation Equipment Manufacturing
including Aerospace ($6,158 thousand), and Professional, Scientific and Technical Services ($47.3 Million). Major indirect linkages include
Finance, Insurance, Real Estates, Rentals and Leasing ($45.2 Million), Government Services ($6.355 thousand), and Wholesale Trade ($11,852
thousand). It is clear from the table that CSA/ESA activities indirectly percolate throughout the economy.
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Table 6: Industrial Supply Chain Reach of CSA/ESA with Canada ($1,000)
Description
GDP at Market
Prices
Employment
(FTEs)
Income (W&S,
Sup, & Mixed)
Crop and Animal Production
879
29
397
Forestry and Logging
255
3
167
40
1
30
242
4
173
Mining and Oil and Gas Extraction
5,127
8
702
Utilities
4,689
13
1,293
Construction
2,423
32
1,874
167,652
1,774
107,888
Wholesale Trade
12,047
132
7,376
Retail Trade
12,221
250
9,072
8,787
118
6,261
Information and Cultural Industries
13,214
87
5,891
Finance, Insurance, Real Estate and Rental and
Leasing
45,238
180
19,047
Professional, Scientific and Technical Services
47,303
701
39,656
Administrative and Support, Waste Management
and Remediation Services
9,040
186
7,268
Educational Services
1,223
34
1,099
Health Care and Social Assistance
2,643
47
2,418
Arts, Entertainment and Recreation
1,533
38
1,132
Accommodation and Food Services
5,180
152
3,980
Other Services (Except Public Administration)
4,105
107
3,175
Fishing, Hunting and Trapping
Support Activities for Agriculture and forestry
Manufacturing
Transportation and Warehousing
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Operating, Office, Cafeteria and Laboratory
Supplies
0
0
0
Travel, Entertainment, Advertising and Promotion
0
0
0
Transportation Margins
0
0
0
Non-Profit Institutions Serving Households
3,049
62
2,826
Government Sector
8,534
96
6,919
355,426
4,055
228,642
TOTAL
Source: Statistics Canada special run for GGI of the I/O system.
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Table 7: Direct, Direct and Indirect, and Total Income Impact Measures and Multipliers (1,000s $ Except Ratios)
GDP Impacts (Thousands $)
Direct
184,007
Indirect
Direct and Indirect GDP
Induced GDP
Total GDP
GDP multiplier relative to incremental ESA expenditures
Ratio of Total to direct GDP
Ratio of Direct and indirect-to-direct GDP
Ratio of Direct GDP-to-CSA expenditures
81,658
265,665
101,430
367,096
2.07
2.00
1.38
1.42
Labour income (Thousands $)
Direct labour income
Direct and Indirect labour income
Induced Labour Income
Total Labour Income
Labour income multiplier per $1 of ESA expenditures
Ratio of Total labour income-to-direct labour income
Ratio of Direct and indirect-to-direct labour income
123,867
53,725
51,050
228,642
1.29
1.85
1.43
Jobs (Number of full-time equivalent jobs)
Direct jobs
Indirect jobs
Induced jobs
Total Jobs (FTEs)
Jobs multiplier (per million dollars ESA expenditures in Canada)
Jobs multiplier (per million dollars CSA expenditures in Canada)
Ratio of Direct and indirect-to-direct jobs
Ratio of Total to Direct Jobs
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2,056
986
1,012
4,055
22.85
15.63
1.48
1.97
142
Source: Statistics Canada special run for GGI of the I/O system.
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Role of HQPs
Twenty-six completed responses from the questionnaire indicated that 67.1% of new direct FTE years created were for HQPs. The I/O results cover
a broader set of employers since the entire supply chain employment is captured in the direct and indirect impacts and an even broader group in the
induced impacts. Direct employment is concentrated in the high-tech industries and professional services such as engineering and medicine, which
hire above average concentrations of HQPs. High-tech includes computer and peripheral manufacturing, other communications equipment
manufacturing, navigational and measuring medical control instrument manufacturing and, aerospace and aerospace parts. Of the total direct
employment impact resulted from ESA contacts, 97.8% was concentrated in the above industries and services. The percentage of incremental
employment in high technology industries was smaller. E.G, 81.9% of direct and indirect employment was attributed to the high tech sectors, and
when induced employment is added to direct and indirect employment, only 72.4% can be traced to the high tech sectors..
Conclusions
The economic impacts of ESA expenditures are augmented by follow-up contracts attributable to ESA. The impacts on GDP and labor income are
best summarized by the multipliers relative to ESA and CSA expenditures as shown in Table 9.
Table 9: GDP and Labour Income Impact Multipliers for ESA and CSA Expenditures in Canada to End of 2008
GDP
 ESA
 CSA
Labour Force Income
 ESA
 CSA
Direct
Direct & Indirect
Direct, Indirect and
Induced
1.04
1.50
2.07
0.71
1.02
1.42
0.70
0.48
1.00
0.69
1,29
0.88
These multipliers are large compared to those of other industry studies, largely due to the identification of follow-up revenues attributable to the IP
developed in conjunction with ESA contracts.
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ESA employment impacts amounted to 4,055 full-time equivalent (FTE) years. This consisted of 2,056 direct FTE years, 986 indirect FTE years, and
induced of a further 1,013 FTE years. .
Labour force incomes were augmented $228.6 million of which $123.9 million was direct, $53.7 million indirect, and $51.0 million induced.
Table 4 indicated increased revenues to governments from various sources. Table 10 summarizes those results by type of impact and for commodity
taxes by jurisdictional levels.
Table 10: Gov’t Revenues Accruing from ESA and CSA Expenditures in Canada to End of 2008
Total federal
Federal trading profits on lottery and race tracks
Federal gas tax
Federal excise tax
Federal duty tax
Federal air tax
G.S.T
Final demand
Total
5,031
13
423
26
555
30
3,984
6,149
13
830
27
602
90
4,587
Total provincial
Provincial gallon tax
Provincial trading profits
Provincial gas tax
Provincial amusement tax
P.S.T
H.S.T
2,551
19
119
669
4
1,700
39
6,631
86
1,713
571
80
3,881
301
9,182
105
1,832
1,240
84
5,581
340
Total municipal
Municipal amusement tax
M.S.T.
8
0
7
7
1
6
15
1
14
3,676
11,670
15,346
Total
Source: Special run of Statistics Canada’s I/O model for GGI
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Intermediate
inputs
1,118
0
407
0
47
61
603
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Of the $259.4 million provided by the CSA to ESA in the 2000-2008 period $15.3 million accrued to government and at least $6.1 million accrued
back to the federal government via import duties and federal commodity taxes with the GST being the primary revenue source for the federal
government commodity taxes. In so far as the $9.2 million that accrued to the provinces, it may have offset demands for increased transfers to the
provinces.
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Appendix H: Technology and Skills Development
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The following are examples of general and specific skills and technologies reorted as firms as having been developed through ESA
contracts:
Sensors

Soil Moisture (SM) - contribution to the development of the ground segment for an instrument to measure soil moisture (SM) for ESA’s Soil
Moisture and Ocean Salinity (SMOS) mission included the development, procurement and verification of the SM processor.

Utilize EO to assess market forces that influence and drive the fisheries and aquaculture sector.

The Earth Explorer Atmospheric Dynamics Mission (ADM-Aeolus) will provide global observations of wind profiles from space to improve
the quality of weather forecasts, and to advance our understanding of atmospheric dynamics and climate processes.

Produce a key micro-bolometer infrared detector leading to significant new opportunities for cloud detection and high temperature event
(forest fire) monitoring applications.

Address the need for a better understanding of the interactions among the cloud, radiative and aerosol processes that play a role in climate
regulation.

Develop a prototype software system to determine wind speed using interferometry.

Uses satellite earth observation data from multiple satellites (ENVISAT, RADARSAT1, and RADARSAT2) in combination with ground
truth and numerous sophisticated models and automatic tools to deliver products that accurately illustrate the characteristic of ice and snow on
any given day. Services provided include iceberg monitoring, river ice monitoring, floe edge monitoring, lake ice monitoring, glacier melt
monitoring, and sea ice charts.

High power microwave amplifier – development of high power amplifier based on Extended Interaction Klystron technology for space
application.
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Communications and Navigation









Software Defined Radio (SDR) – in developing a platform that forms the core of the Software Defined Radio Regenerative Communications
Satellite System (SDRRCS), Array blended its own architecture with the Software Communications Core Architecture (SCA).
Gallium nitride (GaN) is a semiconductor with inherent material properties, that when used in devices can deliver vastly superior performance
compared to currently available semiconductors. The most important of these are the ability to operate with: high power, high voltage, high
temperature, high speed, high tolerance for radiation and low noise.
Develop GPS receivers for the European Geostationary Navigation Overlay Service (EGNOS) and subsequent ground receivers
Redressed transmission time delays (due to the distance to/from the satellite) and interference.
Support in instrument design and data analysis, and developed optical test equipment for the Michelson Interferometer for Passive
Atmospheric Sounding (MIPAS) equipment and subsequent ground support.
Improve on-board processing of Synthetic Aperture Radar (SAR) data during planetary exploration, a capability that facilitates the downlink
to earth.
Increase capability for European satellite guidance; Hazard Detection and Avoidance system for safe landing; flight software: guidance,
navigation and control; and R&D for planetary missions including Mars and moon landings.
Improve antennas with better sunshields, software, few radiating elements, and lower-risk strut design and diplexed multibeam feed arrays.
Design, develop, test and trial new service extensions to provide efficient delivery of IP-multicast traffic to mobile users via the INMARSAT4 satellites. Phase 2 IP-multicast services will be designed to support interactive communications such as push-to-talk voice and collaborative
workgroup data applications, as well as situational awareness applications, for instance, in support of disaster-relief personnel.
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Synthesis and Analysis







Nest ESA Toolbox (NEST) - contribution has been the development of the NEST toolbox designed to read, post-process, analyze and
visualize Synthetic Aperture Radar (SAR) data from past, present and future ESA SAR satellite missions.
Demonstrate EO applications for the rapidly expanding aquaculture industry and specifically monitoring programs of multinational
companies, such as Mainstream Chile.
With remote sensing products and services, develop technologies for mapping of mine activity and progressive reclamation, and sustainable
development reporting.
Modify end user devices to work over satellite, such as medical ultrasonic equipment for a tele-medicine.
Establish data generation techniques using Radiative Transfer Codes from French (UdL) and German (FUB) institutes; and establish software
requirements, architectural and detailed design, coding and testing of software.
Improve computing hardware and software.
Deliver an upgraded processor for satellites.
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General skills development
 Improve skills of staff including project management.
 Foster innovation.
 Increase competitiveness.
 Enhance knowledge of European markets.
 Maintain and grow areas of practice.
 Improve competitiveness in European markets.
 Increased familiarity with European standards.
 Generated sufficient skills to influence in setting European standards.
 Improve skills sufficiently to enhance firms’ international credibility.
 Conformation to higher quality standards is a significant benefit of a “flight opportunity.”
 Sustain skilled teams in space technologies where space environments require specialists.
 Develop the skills to transfer space technologies to terrestrial applications.
 Improved skills in handling IP to maintain secrecy requirements.
 Contributed to brainstorming and teamwork.
 Trained part-time employees into full-time skilled workers.
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Appendix I : Management Action Plan
Summative evaluation of the 2000-2009 Canada/ESA cooperation agreement
Recommendations Responsibility Identified Organization Function PER SS&T Director of PER DETAILS OF ACTION PLAN TIMETABLE RECOMMENDATION 1 a) CSA should seek renewal of
the Agreement for an
additional 10 year period.
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Head, ESA Program a) PER has been working on the renewal of the agreement since the beginning of 2009. Next Steps: - Finalize negotiations -
Submission of the MC -
Seek OiCs for Signature -
Sign the Agreement -
Submit Treaty to Parliament for 21 day sitting period -
Seek OIC to Ratify, followed by implementation. Renewal complete
d ASAP, no later than end of 2010 152
Recommendations b) If feasible, additional
resources should be
allocated to the Agreement
either from an increase in
the allocation of
Government of Canada
resources or through a
reallocation from other
CSA programs. Responsibility Identified Organization SS&T Function DETAILS OF ACTION PLAN TIMETABLE b) To support the decision making process of the CSA Executives, ESA Program Management will present an update of the financial situation of the Program before the submission for the renewal of the authorities and terms and conditions of the program are presented to Treasury Board. END OF SUMMER 2010 Head, ESA Program RECOMMENDATION 2 Clarify the role of ESA within
the Long-Term Space Plan
(LTSP) in order to guide
industry on Canadian priorities
in space, including ESA
participation. SS&T DG SS&T
The LTSP has not yet been released as a public document. Once available, if approved, the DG SS&T will ensure that the implementation of the Canada‐ESA Agreement is in line with the LTSP. GOSS GILROY INC.
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TBD Recommendations Responsibility Identified Organization Function DETAILS OF ACTION PLAN TIMETABLE RECOMMENDATION 3 Develop & publicize a more
coherent set of policies &
programs for supporting
organizations in the sector &
developing new entrants.
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SS&T SS&T SS&T DG SS&T
+ DG SE + DG SU + Head, ESA Program DG SS&T + Head, ESA Program DG SS&T + Head, ESA Program The following activities will support the development of coherent set of policies and practices to help the Canadian space sector better understand the Canada‐ESA Agreement, its implementation and its role in the CSA strategic planning: 
As part of its mandate, the CSA, in consultation with the Canadian space sector, will develop space road maps to support MARCH 2011 AND ON‐
the implementation of the Canadian space program. These GOING roadmaps will be key in the decision making process for planning Canada’s future participation in on‐going and new ESA Programs. 
When/if the LTSP is approved and released, the role of the 3 MONTHS AFTER THE Canada‐ESA agreement in the long term planning of the CSA will RELEASE OF THE LTSP. be clarified and this will be communicated to the Canadian space sector either via presentations at events such as industry days and through the update of the ESA website. Upon renewal of the Canada‐ESA agreement and Treasury Board’ approval of the authorities and T&C of the associated contribution program, the next crucial step for the Canada ESA Program will be the Ministerial Council that is currently scheduled for 2012. At that time, Canada will have to announce in which on‐going and new ESA Programs it will participate, and at what level of funding. Preparation for the Ministerial Council will be on‐going until the end of 2012 and will be done in consultation with all branches of the CSA and all stakeholders of the Canadian space sector. The programs will be selected in accordance with the program objectives approved by TB, in line with LTSP(if approved) and consistent with the roadmaps At the completion of the ministerial, the decisions will be 154
BEGINNING OF 2013 SS&T Head, ESA Program communicated to the Canadian space sector to ensure they can consider the associated opportunities in their long term business planning (either via presentations at events such as industry days and through the update of the CSA website) The development of programs to support the Canadian space sector in their efforts to overcome the challenges they face in trying to access ESA contracts would be difficult to justify now or in the near future, considering that the current level of funding is small compared to the capacity of Canadian space sector (as demonstrated by the current situation of Canadian over‐industrial return). Responsibility Identified Organization Function -
Update the ESA section of the CSA website to include relevant information and web links that could be useful to potential bidders. Ensure that canadian delegates have easy access to relevant information relating to the ESA procurement process. This will be included in a document entitled Guide for the Canadian ESA Delegate. END OF MARCH 2011 DETAILS OF ACTION PLAN TIMETABLE RECOMMENDATION 4 GOSS GILROY INC.
It is felt that an acceptable level of support can be reached by ensuring that relevant public information is made available to potential Canadian bidders (for example on the CSA web site) and by ensuring that the Canadian delegates (or ESA management team) understand the ESA procurement system at a sufficient level and have the appropriate contacts within ESA to help companies that need support. ESA Program Management will: -
Recommendations 155
Recommendations Develop a coherent plan for
communicating targeted ESA
industrial opportunities.
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Responsibility Identified Organization Function SS&T Head, ESA Program Head, DETAILS OF ACTION PLAN TIMETABLE At the moment, Canadian organisations are usually made aware of specific opportunities through informal communications from the Canadian delegates of the respective ESA Program Boards to the Canadian organisations that could potentially benefit from those opportunities (unless they find out through their respective connection with European space industry or ESA personnel). As part of updating the ESA Program management framework, the role of Canadian delegates on ESA Program boards will be clarified in order to ensure that informing the Canadian space sector of opportunities is clearly part of that role and that it is done openly, systematically and in a timely manner whenever possible. This will be included in the Guide for Canadian ESA delegate. The use of the CSA web site to inform the Canadian space sector of upcoming opportunities when feasible is also considered. It should however be noted that in the absence of sufficient funding level for the program, ESA Program Management must be careful to present these opportunities in a realistic manner so that it does not create unrealistic expectations in the Canadian space sector. In other words, it will be ensured that industry also understands the restrictions and limits associated with these opportunities. It should also be noted that there is a risk that the administrative burden related to the implementation of the Agreement will increase after the renewal of the agreement due to the requirement by ESA that all contributions be legally binding under international law. The impact of this requirement is still unclear at this point in time, but it could potentially have an adverse effect on the ability of CSA to properly inform the Canadian sector of opportunities in a timely manner. Role of delegates clarified and included in the guide and Web site MARCH 2011 156
Recommendations Responsibility Identified Organization Function SS&T ESA Program PER & SS&T PER & SS&T Head of IR
& Head ESA Program Head of IR & Head ESA Program DETAILS OF ACTION PLAN TIMETABLE updated to include applicable opportunities. RECOMMENDATION 5 Continue to monitor the
impacts, if any, of the 2007
European Space Policy and EU
trends on Canada and, if
necessary, take steps to mitigate
any adverse effects.
CSA along with DFAIT should
also undertake a policy review
of Canada’s role in ESA, given
the changes occurring in
Europe as a result of the 2007
European Space Policy.
The evolution of the ESP, EU and ESA will be monitored on an ongoing basis, including through regular contacts with the European Commission and the Canadian mission in Brussels. ON‐GOING The impact of this evolution on Canadian interests will be assessed regularly with DFAIT. Specific actions to mitigate adverse effects or capitalize on opportunities will be presented as required. These actions may include a reorientation of Canadian investments in ESA programs or the development of formal mechanisms to secure Canada’s ability to participate in programs led by the EU. Progress of this activity will be reported to the Executive Committee. GOSS GILROY INC.
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MARCH 2011 AND ON‐
GOING