Federal research funding programs need redesigning so the college-polytechnic-CEGEP (in Quebec) sector receives more funding for its applied research with industry that has real-world impacts, say leaders in the sector.

A new approach to federal research funding also could be used to incentivize more research collaboration between the university sector and the college-polytechnic-CEGEP sector, they said. At present, no formal mechanism exists to encourage or reward this collaboration.

“One of the things we need to look at is how our [research funding] programs are incentivizing more intentionally the collaboration across the [postsecondary] system to deliver the impacts we want,” Pari Johnston (photo at right), president and CEO of Colleges and Institutes Canada, said in an interview with Research Money.

The programs need to ensure they are providing funding that brings colleges and universities to the table around a particular issue, “as opposed to – which right now is the case – many of the programs are framed for university participation,” she said.

In some cases, colleges can be brought in as “junior partners” in university-led research that has federal Tri-council agency funding, Johnston said.

But, for example, colleges are not eligible to submit a proposal, as the driver of the research, for funding under Natural Sciences and Engineering Research Canada’s Alliance grants program, she noted.

If Canada wants real-world impact from its research investments, then the federal government needs to be “incentivizing much more intentionally partnerships that bring everybody’s full capacity to the table,” Johnston said.

If the eligibility rules, peer review process and other aspects of Tri-Council funding programs were “reimagined,” many colleges could compete in those programs, she said.

Johnston said she fully supports the need for curiosity-driven discovery research done by universities. “But Canada has to do better at pulling it [this research] downstream, pulling it into knowledge translation, into de-risking technology uptake by our SMEs.”

In the 2022-23 fiscal year, Canada’s three federal research funding agencies provided a combined total of about $3.7 billion in grants and awards for research and training.

Canadian universities received approximately 97.1 percent of the total Tri-Council research funding, while colleges received only 2.9 percent.

• The Natural Sciences and Engineering Research Council (NSERC) has an average annual budget of approximately $1.38 billion for funding natural sciences and engineering research and training.
• The Canadian Institutes of Health Research invests approximately $1.3 billion each year to support health research and related activities.
• The Social Sciences and Humanities Research Council annual budget is approximately $1.1 billion to support research and training in the social sciences and humanities. 

The total funding amount for the Tri-Council agencies is set to increase with the new investments announced in the federal government’s 2024 Budget, which committed an additional $748.3 million per year in ongoing funding to boost core research grants. 

At the Canadian Foundation for Innovation, only 17 of 553 project awards in 2022-23 were awarded to polytechnics or colleges.

In contrast, the College and Community Innovation Program administered by NSERC – the flagship federal research funding program for colleges for their applied research with industry – received an investment of $108.6 million over three years, starting in 2023-24, shared among 119 eligible institutions.

Colleges and Institutes Canada has looked at how research funding could be more reflective of funding that “drives to impact,” and at the kinds of things colleges could do in leading on research or in partnership with universities, Johnston said.

“We should actually be looking at perhaps a stretch goal of 10 percent of the [federal] research investments going to support college applied R&D and tech uptake,” she said.

“Equitable” research funding framework needed

Polytechnics Canada, in a submission last year to the House of Commons Standing Committee on Science and Research, recommended that the federal government establish an equitable research funding framework that fully captures the capacity of polytechnics and colleges to respond to the needs of Canadian businesses.

Polytechnics Canada also recommended that the government revisit funding models and programs which rely heavily on prior funding success, peer-reviewed publications, and patents as indicators of research excellence. “Productivity gains should be an important driver of government investment.”

Government should also consider mechanisms to more evenly distribute research support funding to ensure all players in the academic research ecosystem have sufficient resources to build and sustain a research infrastructure in service of their mandate, Polytechnics Canada said.

Despite the longstanding suggestion that academic research funding develops an innovation talent pipeline and supports productivity gains, the economic and societal impact of these investments is elusive, the organization noted.

“We believe this can be traced to funding disparities that value investigator-led research at Canada’s largest universities ahead of all other forms of academic research support. What the Tri-Councils invest in pragmatic business-identified research is little more than a rounding error,” Polytechnics Canada said.

What is worrisome for Canada’s college-polytechnic sector is that the top-up funding they received under NSERC’s College and Community Innovation Program is set to run out at the end of government’s fiscal year on March 31.

“Unless that program gets renewed – and we’re in active conversations with Finance about this as they look at which programs they’re sunsetting and which aren’t – we’re going to have about a 45-percent cut to that [College and Community Innovation program],” which would take the funding back to 2018 levels, Johnston said.

That dramatic drop in funding would come at a time when the federal government, in Budget 2025, invested $1 billion for the federal Tri-agency to launch an accelerated research Chairs initiative – aimed at attracting more than 1,000 highly qualified international researchers – starting in 2025-26.

The budget also proposes to provide the Tri-agency with $133.6 million over three years, beginning in 2026-27, to assist international doctoral students and post-doctoral fellows to relocate to Canada, and additional funding to recruit international assistant professors if necessary.  

“If we don’t marry that [talent] up with knowledge translation and application for SMEs who are the backbone of our economy – which is where colleges can help – we’re going to miss out on the [research] translation aspects of those big investments,” Johnston said.

Valérie Levert-Gagnon, media and public affairs officer for NSERC, confirmed in an email to Research Money that Budget 2023’s three-year top-up investment in the College and Community Innovation program ends on March 31, 2026. 

“Continued delivery of the CCI program’s budget will focus on maximizing the impact of available funding,” she said.

Colleges and Institutes Canada, in its pre-budget submission for Budget 2025, recommended that the government make the investment in the College and Community Innovation program permanent, and also establish a new fund for applied research to address Canada’s major challenges. Those recommendations went unanswered in Budget 2025.

Companies lined up waiting to work with college-affiliated technology access centres

One of the college sector’s strengths is technology access centres (TACs) college-affiliated specialized applied research and innovation centres where small and medium-sized businesses that can’t afford to do in-house R&D have affordable access to state-of-the-art equipment, technology and multi-disciplinary expertise.

Even with the current funding for NSERC’s College and Community Innovation program, there’s still a three-month waiting list for innovative companies wanting to work with TACs, said Ken Doyle (photo at right), executive director at Tech-Access Canada, the national network of Canada’s 60 TACs.

If the federal government doesn’t top up the College and Community Innovation program funding, the subsequent 45-percent drop in funding will be devastating for those companies, he said.

“We’ve got a lineup of innovative Canadian companies, especially the ones pivoting for defence, dual-use and AI. They want to work with us because they can’t do it [R&D] in-house themselves,” Doyle said.

Even for specific projects where companies have to ante up 25-percent cash to work with a TAC, the ratio of applications submitted is three-to-one compared with the number of funding awards available, he noted. “And that’s going to go to about 12 to one on April 1 because the funding dries up.”

“So even though they [innovative companies] are willing to put their own skin in the game, cash on the table, there’ll be nothing for them,” he said.

Doyle said he blames his own sector for not doing a good job as advocates in explaining the “unique value proposition” of the colleges’ applied R&D to policymakers.

“The fact that the colleges writ large got shut out of different mechanisms in [federal Budget 2025] is a wake-up call to us and our sector,” he said. “We have to do a better job explaining why what we do is important.”

However, he thinks the government simply designating a percentage of federal research funding to go to the college sector isn’t the solution. “I’m very cognizant of what our sector has the capacity and the capability to deliver on. So I’m more interested in an actual number.”

“I think the right number is $150 million [per year] because the demand for our services far outstrips the supply and the available funding, he added.

For example, Tech-Access Canada’s Interactive Visits program, a partnership with the National Research Council of Canada's Industrial Research Assistance Program (IRAP), offers 20 hours of technical and business advice to help companies with their innovation challenges, for a $250 access fee.

Tech-Access is able to turn around a decision on a company’s application in 72 hours and the company’s project gets done on average in 51 days, Doyle noted.

But because the limited amount of federal funding available typically runs out in about 50 days, “if you’re not a company that does its R&D from April to June, you’re [left] out in the cold,” he said.

With more funding, the Interactive Visits program could accept applications year-round and expand eligibility beyond only IRAP companies, he said.

The college sector’s applied research in working with industry to solve its problems is uniquely Canadian, Doyle pointed out.

Yet government’s approach in research funding historically has been to lump the college sector in with the university sector – “us being a square peg and the [research] granting councils being round holes.”

“If the goal is to provide the enabling conditions for all of us to succeed, and we keep getting lumped in to the academic side of the discussion, I worry about that because frankly what we are is the tool of industrial R&D,” Doyle said.

Problem is partly due to how federal research funding programs were designed

Johnston said the under-representation of colleges and polytechnics in the broader federal research funding levels is partly due to how the funding programs were originally designed and structured.

Currently, the bulk of the programs through which the granting agencies deliver funding “are very much playing within a university frame,” she said. “That is leading to this [funding] distribution.”

In contrast, “A lot of what CICan (Colleges and Institutes Canada) has been trying to say is: How are we funding research, both discovery [research] and [research] that translates knowledge, to make sure Canadians’ lives are better?”

Research funding seen through the lens of impact could mean growing the College and Community Innovation (CCIP) program, with colleges sometimes leading the programming, Johnston said. “It’s making sure that CCIP – the flagship – is well-funded, and that it’s funded at scale.”

“The CCIP is very over-subscribed, because we’ve done such a good job in building up the [colleges’ R&D] capacity across the country,” she noted.

“It has become clear that in a context of precarity for Canadians and disruption of our economy, we need to show how research dollars are linked to our future prosperity and Canadians’ well-being,” Johnston said.

Polytechnics Canada said in 2022-23, its 13 members conducted 3,389 research projects and addressed the needs of 2,656 partners. They co-developed 2,678 prototypes.

A study by Polytechnics Canada found that for every dollar invested in applied research, there is a return that ranges from $8.24 to $18.82.

Because polytechnics do not retain intellectual property arising from a partnered project, those best positioned to unlock the economic value – businesses themselves – are empowered to realize the commercial impact of their R&D activity.

Yet Polytechnics Canada noted that polytechnics and colleges are not eligible to receive overhead allocations outside of their grants. In the university sector, the Research Support Fund provides operating funds to sustain the research enterprise. But polytechnics and colleges are required to allocate 20 percent of their grant award to overhead.

Gabriel Miller (photo at right), president and CEO of Universities Canada, pointed out that postsecondary institutions conduct over one-third of the research output in Canada. Yet Canada’s research intensity is the second lowest in the G7 and is below the OECD average, “so we need more research funding across the board,” he said in an email to Research Money.

“We need both colleges and universities in the research ecosystem. They play complementary roles,” he said.

To get there, we must work together to expand the research pie, and not get lost debating how the pie currently gets cut up,” Miller said.

Universities are building on the fundamental research they’ve traditionally been known for, and are playing a critical role in advancing both fundamental and applied research, he noted. “One of the major strengths of universities is that they develop both foundational and applied technologies in high-value industries like AI, quantum and biotech.”

For example, researchers at Ontario Tech University’s ACE lab help industry partners to enhance technology in the automotive and defence sectors through access to the facility’s climactic wind tunnel.

In agrifood, at the University of Manitoba, biological sciences professor Mark Belmonte and his research team developed a fungicide to stop white mold, which is the top killer of Canada’s $30-billion canola crop.

“This type of research is a huge benefit for Canadian industry and would not happen without the mix of fundamental and applied research at universities,” Miller said.

“When it comes to research funding, we should be looking at ways to draw on these existing strengths,” he said. “To this end, Canada needs to expand support for commercialization and industry partnerships across the research ecosystem.”

New initiatives to improve federal research funding coordination

Miller said the level of federal research funding coordination has improved, particularly at the level of the three granting councils, which is helping to maximize the impact of research coming out of universities.

He also pointed to federal funding earlier this year for NSERC’s Lab to Market program, which funded four networks – led by the University of Guelph, Dalhousie University, Simon Fraser University and Red River College – to accelerate research commercialization.

These networks include both universities and colleges that work together to build capacity for industry-postsecondary partnerships and research commercialization, Miller said.

“Lab to Market shows the type of collaboration that is possible and also allows universities to bring their research strengths to these partnerships,” he said.

The higher education sector as a whole performs 35 percent of R&D in Canada, and between 2022 to 2023 universities performed 98 percent of higher education research that was funded by the business sector, according to a 2025 Council of Canadian Academies report.

“This shows that business has remarkable confidence in the university sector to generate collaborations,” Miller said.

Doyle, however, said he’s not aware of any formal mechanisms in Canada to encourage and enable university and college collaborations on research, and especially using research funding to incentivize such collaborations.

Moreover, a more fundamental foundational challenge “is the fact that there’s never been a mechanism to enable college-to-college collaboration,” he said.

Even within provinces, there’s no formal mechanism for colleges to interact and collaborate on R&D because the provinces give autonomy to the institutions, he added. “So if we can’t collaborate within our sector, how are we then supposed to collaborate wider in the postsecondary to achieve the outcomes?”

Tech-Access Canada ran a pilot program for eCampusOntario that included six projects with collaboration by La Cité college and Carleton University.

“Even between two institutions within the same city within the same province there were gigantic obstacles that we found out afterwards had to be addressed before this cool idea could be rolled out to all 24 colleges and 20 universities in Ontario,” Doyle said.

Doyle said the universities do “disruptive” R&D innovation because they have to, due to the “publish or perish” dictum. However, colleges do more incremental innovation that directly helps industry solve its problems.

“We have a valid role to play here in supporting industry. It’s just the incremental innovation piece isn’t sexy and hasn’t been enabled,” he said.

The technology access centres work with 6,000 companies a year every year. They also work with an additional 980 clients and partners, including universities, government labs and other organizations.

“With the universities, the TAC collaborations are happening at the grassroots level. It’s under the radar, but it’s very strong,” Doyle said. “We gladly welcome university undergrads and graduate students to be part of our [TAC] team for an experiential learning opportunity, just like we also involve college students.”

Greater role for industry to play in supporting coordination and collaboration

Miller said there’s always more room to expand research collaborations, which could happen in the defence area.

The federal government made massive investments in defence in Budget 2025, and the talent and expertise from postsecondary institutions will help to strengthen these investments as they unfold through initiatives like the new BOREALIS (Bureau of Research, Engineering and Advanced Leadership in Innovation and Science) agency, he said.

There is a widening gulf in business R&D funding between Canada and other Organisation for Economic Co-operation and Development (OECD) countries. In Canada, business R&D intensity fell from 77 percent of the OECD average in 2000 to 57 percent in 2023.

“There is definitely a greater role for industry to play in supporting coordination and collaboration across the ecosystem, and universities welcome industry partnerships,” Miller said.

Canada’s postsecondary system needs stable and consistent public support to generate discoveries in fields like health, AI, quantum and energy efficiency, he said. “In essence, we need both business and higher education R&D funding to maintain a strong and collaborative innovation ecosystem.”

Engaging Canadian universities early in the design of new programs is especially important because it greatly increases the possibility that new funding will be delivered in a way that supports real-world partnerships, Miller said.

Budget 2025 reaffirmed the federal government’s intent to work to implement the capstone research organisation as announced in Budget 2024, Hans Palmer, a spokesperson for Innovation, Science and Economic Development, said in an email to Research Money.

“The capstone organization will provide better coordination across the federally funded research ecosystem and help to advance internationally collaborative, multi-disciplinary, and mission-driven research,” Palmer said.

Miller said that if the new capstone organization is designed correctly, it could improve coordination in Canada’s research ecosystem.

Universities Canada, which participated in the government’s consultations on the capstone organization, provided these recommendations:

• Retain the structure of the Tri-Councils and their budgets under the umbrella of capstone [organization] and clarify the relationship between capstone and the Tri-agencies.
• Ensure that there is strong academic representation in the governance structure of capstone and that the board reflects regional and linguistic differences.
• Maintain a commitment to fundamental research and research excellence and invest across all fields of knowledge, including STEM and social sciences/humanities.
• Avoid administrative burden and duplication in capstone.

Polytechnics Canada called for a complete review of federal funding streams and programs, saying: “Simply put, the research funding playing field has been designed to unfairly advantage research-intensive universities. In today’s environment, this is untenable.”

Doyle said it remains to be seen if the new capstone organization will be able to better coordinate and integrate the federal research funding ecosystem.

He said he was disappointed not to see the proposed Canada Innovation Corporation (CIC) not mentioned in Budget 2025. CIC, which would have been industry-facing and managing mission-driven research, would have been aligned with colleges’ applied research work with industry, Doyle said. “But it still hasn’t seen the light of day.”

Johnston said Colleges and Institutes Canada has been having ongoing conversations with the three federal granting councils about the new capstone organization. “We’re actually quite bullish on the capstone if it’s done right.”

“We do not have the luxury anymore of only doing the same old thing,” Johnston said. “We’re at a very critical point for our country and we have to be willing to try some new things.”

[Editor’s note: U15 Canada, which represents Canada’s largest research-intensive universities, received approximately 80 percent of total Tri-Council funding, even though they represent 52 percent of Canadian researchers, according to a 2024 House of Commons report. Research Money reached out several times to U15 Canada for comment, but the organization did not respond to our questions].