A RE$EARCH MONEY Q&A with Adam Holbrook

The Context: Innovation has risen up the government’s priority ranking and will be a major thrust of the federal Budget when it is tabled March 22. Over the past year, several expert panels and councils have been preparing policy papers on fundamental science, innovation and economic competitiveness. On the other hand, the government is running annual deficits and plans to continue for several years to come. We asked Adam Holbrook, adjunct professor and associate director of the Centre for Policy Research on Science and Technology, Simon Fraser University, for his perspective on what needs to be done to make Canada more innovative and its use of research more effective.

R$: What actions should the federal government be considering to improve Canada’s innovation performance?

AH: The first question that has to be answered by the government is “Why should the the government get involved in innovation at all?” Innovation is an inherently entrepreneurial activity (whether economic or social). Most of the fed’s problems seem to come from not knowing why they are involved. The answer is, of course, economic growth and jobs. Most jobs are created in the private sector, and in small enterprises. That should at least shape the policies.

R$: How much influence can federal science, research and innovation policies and programs have on improving Canadian innovation performance?

AH: In theory very little. Government programs are supposed to be in support of “peace, order, and good government”.  Thus regulatory and exploratory programs are OK, but many federal internal programs have little commercial influence. But there are two areas where it can make a huge difference: a policy-driven major technology project, and an incentive program for small Canadian firms to supply the project (as per the Jenkins report). Telesat and the Canadarm are good examples of this, even if dated.

R$: There is speculation that the Innovation Agenda could be accompanied by a major shake-up and reduction in federal STI programs aimed at business and academia. Is this an area where action is necessary?

AH: This, intuitively, seems to me to run counter to any innovation policy. Does this mean that the feds are going to put more money into intramural activities? I don’t see how that would contribute to innovation in Canada.

R$: The fundamental science review led by David Naylor is now complete and the appointment of a Chief Science Advser is only months away. What actions can be taken to improve the way the government funds academic science and improve outcomes?

AH: I have not seen this review. But academic science could be improved by better management of the funds allocation process to universities. At this point, it is not worth the effort to apply for an NSERC/SSHRC/CIHR grant.  The paperwork is too onerous (and bulky) and success rates far too low. Are the feds trying to get out of this altogether? There must be some specificity to the academic granting programs, similar, perhaps to the early days of the Networks of Centres of Excellence program. On the other hand, the Canada Chairs program has possibly run its course – Canada no longer suffers from a dearth of talent in academia (thanks to Mr. Trump).

The federal government can help in areas of fundamental science, but at arm’s length. TRIUMF is a good example – a 30 or 40 year bet that has paid off with small synchrotrons for medical isotopes. Arctic warming, arctic archeology (which has serious sovereignty implications), are areas for support. Internet connectivity is also a major issue – maybe we need new technology (back to a Telesat-like project?) or maybe we need a new regulatory framework for the service providers.

R$: The federal government is emphasizing company scale up and global competitiveness as the central tenants of its strategy for making business more innovative. What kinds of measures would you favour for assisting companies in becoming larger, more innovative and globally relevant?

AH: To start with, there has to be an exit strategy when they get big. Bombardier, the auto companies, Nortel and Blackberry were/are at the top of the feeding chain and consume/consumed most of the resources. But the govt can never seem to cut them adrift to sink or swim in global markets.

At the other end of the scale, the Industrial Research Assistance Program is still the best hope for any small firm. It blends the right touch of money and gentle but firm mentorship. Expanding IRAP should be an element of the program. It is significant that it is the only federal STI program that has survived since the 1950s.

The real problem is how to help firms make the jump from regional or national markets to global markets. Global includes the US – we can no longer regard it as a special case for our trade. Many services, such as software, are automatically global. As soon as an app or game is produced, it either sinks or swims in the global market. This argues that there should be (perhaps) two policies – one for goods and another for services.

We should also be looking at the German experience with mid-sized companies (the Mittelstand).

R$: Canada currently lacks a strong, market-drive intellectual property (IP) policy. Do we need one and how important is such a policy in making Canada more innovative?

AH: Definitely. And it has to be somehow different from the US system, which is now overwhelmed by defensive patents, patent trolls, etc. It has to be made clear that US practices do not extend to Canada. Our IP protection system has to favour the SME.  Right now they can’t afford to take on any giant who wants their IP – the best they can do is negotiate a deal. Large pharma in particular basically smothers any attempts by small firms to get a foothold in the market. And again, there likely have to be two sets of rules, one for goods and the other for services. Our high-tech future is in services, but our IP policies as far as services are concerned are medieval.

All of this is wrapped up in free trade agreements. We have to ensure that our firms can access IP from a free trade partner as easily as they can access ours. We also have to recognize that Canada is no longer (if it ever was) a major player in the production of manufactured goods (arguably the idea that we could be a global manufacturer of anything was an offshoot of our rapid industrialization during the Second World War). We are very good in resource-based products — agriculture, forestry, mining and energy — and are also very good in certain niche services. Services obviously have a big IP component, but these days so too do resource industries. These are what we have to focus on.

Adam Holbrook is a long-standing science policy practitioner, adjunct professor and associate director at Simon Fraser Univ’s Centre for Policy Research on Science and Technology.

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