Editorial - 22-4

The federal Budget signals the Harper government's intent to maintain a targeted approach to the S&T file — an approach that includes both the type of science it wishes to support and the type of activity it considers the best use of public money. This time around, the focus is on highly qualified personnel with the introduction of new research chairs and scholarships aimed at Canadian and foreign talent.

These are laudable measures that should serve to position Canada as an ideal place to conduct cutting-edge research. With billions in new S&T infrastructure, the scholarships and chairs are a powerful complement.

But the government needs to refine its systems approach to S&T or it may undermine its efforts to attract and retain highly qualified personnel. The indirect costs of research remain a glaring weakness at the research end of the innovation spectrum. Financial pressures faced by major science facilities are being addressed in an ad hoc manner.

At the market end of the innovation system, inaction is once again the order of the day. Despite stubbornly low levels of industrial R&D, the government has ignored the urgings of the business community to expand the scope of tax credits for R&D and make them fully refundable.

The Harper administration has also forged ahead with a further reduction on the GST, despite overwhelming evidence that such a move will not help to increase competitiveness and productivity. With limited fiscal room, it has squandered an opportunity to be a more effective player in reshaping Canada as a knowledge-based economy.