Report by Standing Committee on Industry, Science &Technology includes wide range of recommendations and promises more in fall

A report on Canadian innovation by the Standing Committee on Industry, Science and Technology (S&T) calls for unspecified increases to several key federal S&T support programs and agencies, revives the call for a minister of science and levels criticism at the Canada Foundation for Innovation (CFI). Virtually every major S&T proposal currently seeking federal funding has been supported by the House of Commons Committee, headed by MP Susan Whelan, which released the document containing 18 recommendations that touch on all aspects of the innovation system.

Yet many of the issues raised by the Whelan Committee are being held for further study when the group resumes its hearings in the fall. Some of those deferred are the Canada Research Chairs program, indirect costs of university research, funding levels for the Networks of Centres of Excellence and most science-based departments and agencies.

The report comes at a time when the government is preparing a White Paper on Innovation and Whelan says she hopes her Committee’s work will inform the process and point to areas where its members contend new investment is appropriate (see page 4).

“The government has committed to doubling its R&D spending by 2010, so I hope it looks at our recommendations,” she says. “The Committee looks forward to being part of the White Paper process and this report is a good example of how we are part of it.”

How much credence government will give the Whelan report is questionable, however, as many consider the focus of the Committee to be scattershot, and its recommendations made without sufficient under- standing of how they will be implemented.

The report begins by weighing in on the importance of S&T in a knowledge-based economy, ranking Canada’s innovation against other nations and assessing the policy framework under which it operates. Recommendations stemming from these sections call for a new composite indicator for knowledge investment, a new public policy instrument to encourage more foreign investment and the benchmarking of scientific publications and patent applications (see box).

The report wades into choppier waters when it considers “strategic S&T investment opportunities”, calling for additional funding in programs and agencies geared towards business assistance. Its an approach that has drawn criticism from Committee members representing the Canadian Alliance (CA) Party and the Progressive Conservative (PC) Party. Both parties filed dissenting opinions at the back of the report, calling for a number of additional measures, most prominently further corporate and personal tax cuts.

The CA takes exception to the Committee’s main report observation that Canadian firms “have historically been laggards in conducting R&D”, blaming instead public policies of the last 30 years “that have failed to cultivate a culture of innovation and competitiveness”. The PCs contend that a new agenda is required and predicts that the White Paper will be yet another example of government intervention when “reforms to Canada’s tax and regulatory burden” are urgently required.

While many of the issues raised in the report remain unresolved pending further study and testimony from expert witnesses, the Committee did finish work on several files. Under the heading of “Value for Money”, it recommends a doubling of the budget for the Industrial Research Assistance Program (IRAP) to help raise the productivity level of smaller firms and increase technology diffusion.

For Technology Partnerships Canada, it recommends government “substantially increase its appropriations” while doing away with the two-third, one-third split between aerospace and defence industries and other sectors eligible under the program.

The Committee deferred examining federal R&D labs until the fall, but it did find time to examine the three granting councils and the CFI. While the former were generally given a nod of approval, the CFI came in for criticism in several areas.

The Committee cited the Auditor General’s observation that the CFI appears to lack adequate measures to protect the public interest, and there is insufficient industry involvement in the projects it supports. It also questioned the allocation of funds which appear to favour larger universities, noting that the Univ of Toronto receives more CFI money than Saskatchewan, Manitoba and Atlantic Canada combined. The report says the Committee will further review the CFI’s legislation including its arm’s length relationship with government.

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