Ladies and gentlemen members of the committee, good afternoon.
I am happy to see you. Thank you for striking this committee to study cooperatives.
I am the President of the Fédération des coopératives de développement régional du Québec—Quebec's federation of regional development cooperatives, commonly referred to as CDRs. During my presentation, I will discuss CDRs.
CDRs are well-established in Quebec. For over 30 years, they have been playing an important role in our province's economic development. Their mission is to promote the cooperative approach, support promoters in starting up any type of a cooperative and ensure support following the start-up process.
Eleven CDRs cover all seventeen of Quebec's administrative regions. They are brought together in one federation, which provides them with support and assistance in the carrying out of their mandate.
It is in that capacity, and following the invitation extended to us, that I will tell you about what we think about the importance of cooperatives in Quebec, and about CDRs' contribution to their development.
I would like to begin with a recommendation. We recommend that the Canadian government establish a partnership for cooperative development to support the creation of cooperatives across Canada.
I will present three separate elements in support of our request: evidence of cooperatives' stimulation of Quebec's economy; the importance of an effective network to support cooperative start-ups; and effective support measures for the creation of cooperatives.
I will begin by talking about cooperatives' stimulation of Quebec's economy. As it has been mentioned, cooperatives are present in some 40 economic sectors. Aside form the major sectors that everyone is familiar with and that have been discussed to an extent today—agricultural, funeral, forestry, school or food cooperatives—there are also cooperatives in renewable energy, housekeeping and home care, day-care centres, transportation, tourism, health, local services—an example was provided this morning—cultural industries, the manufacturing industry and many others.
Cooperatives are present in all of Quebec's regions, both in urban—which may be surprising—and rural settings. They have done very well economically. They are socially responsible and redistribute the generated wealth, while providing services to meet their members' needs by creating quality jobs.
We feel that promoting different company types is important for building a strong economy. Collective businesses—and especially cooperatives—are added to the mix of private and public companies.
We are thoroughly convinced that stimulating cooperative development and encouraging innovation in new areas of activity will help Canada's economy become stronger and contribute even further to the country's prosperity, while helping prepare for the future.
In addition, cooperatives are an excellent way to ensure the sustainability of companies and to avoid their relocation. A number of studies point out that the lack of a new generation owing to the aging of business managers is currently a key challenge for our economy. Of course, there are several solutions, but one of them is business succession through the cooperative approach.
That business succession based on the cooperative approach encourages worker mobilization and the maintenance of local jobs. It also helps keep capital in our country and encourages community revitalization.
When it comes to the performance and sustainability of cooperatives, a recent study by the ministère du Développement économique, de l'Innovation et de l'Exportation du Québec—which has already been mentioned, I am sure—indicates that cooperatives' survival rate is significantly higher than that of traditional companies. We are talking about double the survival rate of other companies. That's not insignificant.
After three years of existence, three out of four cooperative are still there, compared with one out of two for all Quebec companies. Six out of ten cooperatives reach the five-year mark, compared with slightly under four out of ten for other companies. We are talking about 62%, compared with 35% for all of Quebec's companies.
After 10 years, 4 out of 10 cooperatives are still active, compared with 2 out of 10 in the case of all other companies. That works out to 44% and 19.5%, respectively. This study was carried out twice, and both times, the results were the same after five and ten years. There are certainly some explanations for that.
That performance of the cooperative model can be partially explained through the actual structure of the cooperative business model, the legislative framework of its governance, the existence of a board of directors made up of members, the democratic operation and the obligation to establish a reserve to ensure the company's sound management. In addition, the technical or specialized assistance cooperatives receive when they are created and during their development is certainly a sure value. That is why making sure those specialized services are provided to support cooperatives is key. So we can say that the amazing survival rate of Quebec cooperatives is not unrelated to the joint efforts by the cooperative movement and the Quebec government. Those same statistics clearly show that stimulating and supporting the development of new cooperatives in the spirit of economic sustainability is a strong economic incentive.
I also want to emphasize how important an efficient network is for supporting cooperative start-ups. Regionally speaking, regional development cooperatives are a gateway for people who want to create a cooperative. They take on the stimulation of the regional cooperative life and promote the approach. They provide advisory services for start-up cooperatives and business support for existing cooperatives.
Here are some figures. The CDR network is made up of more than 1,100 cooperatives and member organizations, as well as 1,500 cooperatives created over the past 20 years. During the 2011-2012 fiscal year, 140 new cooperatives were started up, leading to the creation and maintenance of 375 jobs. The Fédération des coopératives de développement régional du Québec—which brings together CDRs and of which I am president—aims to encourage concerted efforts, help highlight and share good practices, and develop growth areas for the network. CDRs or sector federations—organizations dedicated to creating and supporting cooperatives—may be very present in Quebec, but there is another CDR elsewhere in Canada. A regional development cooperative has been operating in New Brunswick for almost 10 years. In addition, CDRs' operation and impact on cooperative development favourably attract the attention of other Canadian provinces, which are currently adopting exploratory measures on the feasibility of implementing such a model in their area.
I would like to tell you about effective support measures for cooperative development. You may know this already, but in 2008, 63.1% of new cooperatives based in Canada were from Quebec. Did you know that, from 2004 to 2010, 595 new cooperatives were started up in Quebec, thus creating or maintaining 2,845 jobs? That economic dynamism is largely due to a partnership agreement between the Government of Quebec and the Quebec cooperative movement. For the government, the purpose of such an agreement is to encourage the development of existing cooperatives' business operations, create or maintain jobs in the regions and meet the new needs of Quebeckers. We estimate that such a model of government support for cooperative development could be put forward across Canada based on a partnership with provincial cooperative boards and their partners.
In closing, we would like to remind you that cooperatives have a significant impact on the economy, that they are incredibly sustainable and efficient, and that, in Quebec, they are helped by organizations dedicated to supporting them—a key to their development success. Consequently, I want to repeat the recommendation of the Fédération des coopératives de développement régional du Québec to establish a partnership for cooperative development to ensure the creation of cooperatives across Canada.
There are some amazing cooperatives across Canada and some very nice large cooperatives. However, those nice large cooperatives have not always been big. They started out small, 50, 60 or 80 years ago. If we want to have more nice big cooperatives in 25 or 50 years, we must start structuring and supporting the cooperative movement now, and stimulate the creation of new cooperatives. The Canadian government certainly has a role to play when it comes to creating and supporting those cooperatives. Let's work together on building a better future.
Thank you for your attention.