Federal spending on S&T declines in FY17-18 with share of intramural spending hitting 34-year low

The share of federal spending on S&T conducted in-house by government departments and agencies declined to its lowest level in 34 years as federal spending intentions for 2017-18 are projected to decline 1.2% to $11.3 billion, according to the latest data from Statistics Canada. The drop to 44% of the total federal S&T spend is largely attributable to a sharp (6.7%) decline in related scientific activities (RSA) spurred by the absence of StatsCan Census Program survey which was last conducted in 2016 and occurs every five years.

Intramural spending dropped 6.6% to $5 billion, which included declines in R&D (-4.7%) and RSA (-8%). Not surprisingly, externally performed S&T surged upward, capturing a record 56% of the total with a 3.4% increase to $6.3 billion.

Of the $11.3-billion total, natural sciences and engineering accounted for $8.8 billion, up 1.7% while the social sciences and humanities (which encompasses the StatsCan census survey) was down 10.5% to $2.5 billion.

The latest data stand in sharp contrast to the Liberal administration’s rhetoric on the importance of research, science and innovation. Even when R&D is singled out, a 2.1% year-over-year increase to $7.275 billion for FY17-18 is 4.3% lower than the most recent high of $7.6 billion in FY10-11.

The Liberal administration started out well in its first year in FY16-17, with S&T spending posting a 10.4% increase to $11.4 billion. R&D rose a respectable 7.6% while RSA jumped 15.3% (including the census survey expenditure).

Full-time equivalent personnel also increased 2.7% to 34,854 in FY16-17 before dropping off 0.7% to 34,594 in the current FY.

FY15-16 – the most recent year for which final data are available — marked a major shift towards extramural S&T spending, due in large part to the transfer of Atomic Energy of Canada Ltd to a privately operated entity. In 2015, AECL spun off a wholly owned subsidiary — Canadian Nuclear Laboratories — under a government-owned, contractor-operated (Go-Co) model, along with approximately 3,300 employees.

To mark Canada’s 150^th birthday, StatsCan has released S&T spending data going back to the country’s 100^th birthday (1967). It shows a steady progression in S&T outlays from 1967 ($853 million) until 2009 when the first decline was registered.  Spending continued a gradual decline for the next several years until FY16-17 when the Liberals assumed power.

Source:  Statistics Canada. Table 358-0142

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