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Enabling Challenges through Impact Canada

To enable federal organizations to deliver challenges, Impact Canada established a comprehensive set of tools, flexible funding arrangements, resources, and capacity-building supports for the first time in the Government of Canada.

This section of the report provides details on how these elements work in tandem to support the co-design and delivery of outcomes- based challenges across government.

Partnering with the Impact Canada Centre of Expertise

Collaborating with the Centre of Expertise

The Impact Canada Centre of Expertise is a small team of subject matter and technical experts that support the development and implementation of innovative approaches to address complex public policy problems.

The Centre of Expertise provides customized support to federal organizations through a co-design approach, adapted to the organizational readiness of the federal partner. The team assists federal organizations through challenge ideation planning to execution, as necessary, and provides guidance in applying the highest standards of rigour in program design and implementation. Being at the centre of government, the Centre of Expertise is uniquely positioned to bridge partnerships across organizational boundaries.

The Centre of Expertise also provides access to key resources that support federal partners to implement innovative methods, including providing support to help federal organizations use the Impact Canada Terms and Conditions or alternative flexible funding mechanism; a Fellowship program; and a centralized web platform supported by in-house visual and graphic design experts. These tools and supports offer Impact Canada partners the ability to more effectively and efficiently design and launch high-impact challenges..

The Impact Canada model also enables federal partners to build internal capacity to implement innovative tools. While only three years into implementation, early insights point to the mix of centralized and distributed expertise as a success factor in the delivery of challenges in a federal government context.

Building Capacity with the Fellowship Program

The Fellowship program provides Impact Canada with a mechanism to extend its supports to organizations in the face of increasing demand of specialized skills. The Fellowship program recruits external talent with expertise in four discrete disciplines – behavioural science, impact measurement, innovative finance, and challenges. Fellows remain Privy Council Office employees throughout their placements in host organizations, ensuring a valuable connection to Impact Canada. Placements typically range from 12-24 months, depending on individual project scope. The Challenge Prize stream is currently being tested in two federal departments.

Learn more about the Fellowship program and see what is has to offer.


The Impact Canada Fellowship program attracts external talent with specialized skills in four disciplines: Behavioural insights, Impact Measurement, Innovative finance, and Challenge Prizes.

Unlike traditional government processes, we run entire campaigns within only 3 months. Our fastest one was in just 42 days!

We’re focused on identifying the right people with the right skills and pairing them with organizations advancing key government priorities.

The Fellowship program benefits both the successful candidates and our partners. On one hand, candidates join a growing network of fellows and apply their skills to exciting projects. On the other, our partners gain valuable in-house expertise. This helps build public sector capacity to deliver the best policies and programs for Canadians.

Interested in hosting a Fellow? Don’t miss out on placement opportunities!

Want to become a Fellow? Go to

Delivering through a Data and Program Management Platform

The Impact Canada platform is a centralized website for Impact Canada initiatives that includes a public-facing site and a comprehensive user-restricted back- end for data sharing and managing site content.

End-to-End Partner Support

Services provided through the platform are:

Content and Design

In-house web and graphic design support, ensuring a common look and feel across all challenges

Document Processing

Automated application processing and branding

Application Tracking

Secure and real-time access to partially completed and submitted applications and statistics

Data Analytics

Timely site usage data reporting and analysis for optimum design and performance

Ticket-based Support

Electronic system to manage site update requests efficiently and ensure timely revisions


Promoting ongoing initiatives on social media with original graphics, animations, and videos

Support for Potential Applicants

Challenges featured on the platform provide resources to guide potential applicants through the submission process. Impact Canada can provide advice and templates to support federal departments in developing applicant resources, which may include:

Process Maps

Detailed timelines outlining key milestones and prize structure

Applicant Guides

Comprehensive reference materials, including background, evaluation criteria, prizes, etc.

Frequently Asked Questions

Common questions and answers related to specific challenges

Online Forms

Electronic form submission with custom form tracking and reporting

A User-Restricted Back-End for Sharing Data

Secure user-restricted ‘portals’, accessible on the Impact Canada platform, enable data sharing between federal partners, applicants, evaluators, and jury members. Each portal is fully customized to meet the needs of partners.

Applicants progressing to later stages of challenges, for example, access valuable resources, guidance, and stage requirements directly on the platform using customized finalist portals.

Increased Innovative Funding Flexibility

The Impact Canada Terms and Conditions for innovative funding are a key tool for federal partner organizations who are governed by the Treasury Board Policy on Transfer Payments.

The Treasury Board Policy on Transfer Payments applies to most federal government departments and agencies’ funding instruments. Transfer payments are: “a monetary payment, or a transfer of goods, services or assets made, on the basis of an appropriation, to a third party... that does not result in the acquisition by the Government of Canada of any goods, services or assets. Transfer payments are categorized as grants, contributions and other transfer payments. Transfer payments do not include investments, loans or loan guarantees.”

Federal partner organizations can draw on all or only some of the authorities contained in the Terms and Conditions depending on what the challenge design process requires. This is determined through a Terms and Conditions analysis undertaken by the Impact Canada Centre of Expertise during program stream or individual project conception, in collaboration with the accountable federal organization.

While the Terms and Conditions are a significant step forward in more modern program management within the Government of Canada, they present a number of complexities in managing innovative funding approaches within traditionally more rigid departmental structures and cultures.

An observed best practice has seen potential federal partners seek early engagement with the Impact Canada Centre of Expertise, as well as their own internal corporate, financial, and legal services on these flexibilities. This collaborative approach has helped determine and co-design the most appropriate funding and program management approaches.

The Impact Canada Terms and Conditions provide a broad range of authorities, flexibilities, and exceptions to this Policy to support outcomes-based funding. The most important features pertaining to challenges are the ability to:

  • Focus on outcomes

    Link payments to the achievement of outcomes as opposed to only paying for the expenditures of innovators that participate in a challenge (e.g. actual project costs based on proposals and invoices for eligible expenditures);

  • Take a ‘stage-gated’ approach

    Provide funding at various challenge phases to support challenge participants as they move throughout the process;

  • Fund flexibility

    Use a mix of Government of Canada transfer payment instruments (e.g. grants and contributions) to have a fit-for-purpose funding and impact reporting approach aligned to achieving better outcomes;

  • Involve partners

    Fund third-party organizations and intermediaries to support capacity-building and challenge delivery, so long as it is for general public good, as well as providing various kinds of non-financial resources to better support innovators;

  • Work with impact measurement experts

    Use grant and contribution funds to work with researchers and evaluators to rigorously and independently assess impact as a core component of a challenge, so long as results can be published and contribute to general public knowledge; and

  • Test new program and service approaches

    Introduce flexibility to certain project parameters (e.g. eligible recipients, eligible expenditures) to allow challenges to reach a broader range of potential innovators than would be typical for conventional programming efforts, as applicable.

Comparing Challenges to Regular Government Funding Mechanisms

As challenges are designed to fill a gap in the government’s policy and funding toolkit, they can seem like a completely different way of doing business. However, challenges have a number of similarities to approaches that are already used within a Government of Canada context.

Challenges take place within the same basic structures and rules as other funding mechanisms, but have certain distinct features that differentiate them from traditional funding approaches when delivered under Impact Canada.

The following table outlines the key distinguishing features between regular grants and contributions and procurement processes to those of Impact Canada challenges

Key distinguishing features between regular grants and contributions and procurement processes to those of Impact Canada challenges
  Call for Proposals Procurement Impact Canada Challenges
Purpose To gather proposals from organizations to carry out projects in line with government objectives, with the public as the primary beneficiary To acquire products or services for the benefit of the government in the most effective way possible To incentivize organizations or individuals to measurably improve outcomes in a given area of high importance to the government, with the public as the primary beneficiary
Principal Financial Instruments Grants or Contributions (with emphasis on paying for eligible expenditures at lowest possible cost) Contracts Mix of both Grants and Contributions (with emphasis on payments linked to outcomes)
Approach to Assessing Potential Funding Recipients Based on internal assessments and scoring processes by government departments Based on internal assessments by government departments Based on pre-determined and publicized outcomes criteria and the use of external juries of subject matter experts and judging processes (with a high level of autonomy)
Approach to Disbursing Funds Based on estimated costs and activities Based on estimated costs and activities Based on achievement of pre-determined outcomes and/or milestones
Approach to Engagement and Communication Emphasis on promoting open calls and announcements of funding to recipients through departmental websites and news release Use of bid publication tools and platforms such as Buy and Sell, or Vendor of Record High level of engagement with stakeholders to shape and co-design the challenge, as well as to promote the challenge among innovators and the public using Impact Canada platform
Approach to Assessing Impact Frequent use of “before and after” or theory-based program evaluations using results-based measurement approach Assessment of efficiency and cost effectiveness Emphasis on impact measurement approaches, especially where payments are linked to the achievement of outcomes

Individual Projects and Program Streams

When partnering with federal organizations, Impact Canada challenges can either be run through a “program stream”, where a portfolio of challenges is managed as a stand-alone program, or as “individual projects”, where funds are carved out of an existing program that did not originally intend to use challenge-based instruments.

A. Program Streams

Program streams are authorities given to a federal partner organization to manage a portfolio of challenges over a longer period in their policy area. This approach helps build internal capacity, dedicates specific human resources, and provides flexibilities for federal partners to adapt along the way.

Challenge planning and execution can be resource intensive, particularly at the early phases of planning a challenge. Therefore, Impact Canada generally encourages program streams over individual challenges because they enable federal partners to take full advantage of the internal capacity developed through planning and launching a challenge to sustain innovative programming and potentially mainstream these approaches into their respective departments.

In addition, program streams reduce the administrative and organizational hurdles involved with launching a new type of tool by leveraging systems developed for the first challenge for subsequent challenges and outcomesbased programming efforts.

A program stream can be initiated through the Federal Budget, Speech from the Throne, Ministerial Mandate Letters or other policy setting instruments. The Impact Canada Centre of Expertise and the relevant federal partner organization would then work together to seek the required Cabinet and Treasury Board authorities to implement the program stream.

Example of an Impact Canada Program Stream

Cleantech Impact - Natural Resources Canada launched the $75M clean technology stream to address persistent barriers in cleantech development and adoption, setting ambitious but achievable goals in order to identify and develop breakthrough solutions. Since 2018, six clean technology challenges have been launched under the Impact Canada initiative:

  • Women in Cleantech Challenge aims to help level the playing field for Canadian women entrepreneurs in the area of clean technology;
  • Sky’s the Limit Challenge is seeking a breakthrough on green aviation fuels;
  • Power Forward Challenge is a collaboration with the UK to design better power grids;
  • Crush It! Challenge is seeking transformative energy reductions in rock crushing and grinding;
  • Indigenous Off-Diesel Initiative is supporting the development and implementation of clean energy plans to reduce diesel use in remote communities; and Charging the Future Challenge seeks to accelerate Canada’s best battery technology to commercialization

B. Individual Projects

Individual projects are used when a federal partner wants to explore the use of a challenge as a program instrument in a more limited fashion, using funds carved out of an existing transfer payment program, where staff have existing priorities and responsibilities, aside from planning and implementing challenges.

An individual project is a good approach to tackle a specific objective, take advantage of a new opportunity not envisaged at the outset of a program’s design, or as a gateway to test the challenge approach prior to undertaking a program stream.

Where there is merit in pursuing an individual project to address a pressing problem or test the challenge approach before developing a program stream, Impact Canada uses an Expression of Interest process to allow federal organizations to submit high quality ideas that are then assessed on their potential and applicability for an Impact Canada individual project.

Examples of Impact Canada Individual Projects

  • G7 Ocean Plastics
    Challenge Led by Global Affairs Canada, this challenge aims to implement an international commitment for Canada to work with its G7 partners to support innovations in developing countries to help reduce the impact of plastic waste on people living in poverty.
  • Drug Checking Technology Challenge
    Led by Health Canada, this challenge aims to develop new and more cost-effective technologies to better detect the presence of harmful substances in drugs and help improve outcomes for people affected by the opioid crisis.
  • Hull Design Efficiency Challenge
    Led by the Atlantic Canada Opportunities Agency, this challenge aims to test new hull designs for fishing vessels to reduce emissions and improve climate outcomes.
  • Indigenous Homes Innovation Initiative
    Led by Indigenous Services Canada, this initiative aims to build new partnerships with Indigenous communities while testing new approaches to housing, and improving community well-being.