Funding for higher education sector declines for the first time since 1998

The era of dramatic funding increases in higher education R&D appear to be over. Statistics Canada reports that the total investment in the sector increased just 1.1% in 2006-07 to $9.6 billion. Of the six sectors contributing to higher education R&D, all posted moderate increases over the previous year except for the federal government.

Federal support declined 2.2% in 2006-07 to $2.487 billion — a drop that is even more pronounced (-4.4%) when measured in 2002 constant dollars. This isn't the first time federal support has declined. During the early years of the Chrétien administration, program review-related cuts ate into federal contributions which declined every year from 1993-94 to 1997-98 before rebounding (see chart).

The new data show that the federal government made massive funding hikes to higher education between 1998 and 2006, pushing Canada to the top of the G-7 in terms of public R&D performance.

The most recent decrease calls into question the S&T Strategy's commitment to "maintain Canada's G-7 leadership in public R&D performance". Funding increases to the granting councils and the Indirect Cost of Research program have been less than requested and the $510-million commitment to the Canada Foundation for Innovation in Budget 2007 allows that organization to hold one major competition with no indication that future funding is forthcoming.

In 2006-07, the natural sciences and engineering accounted for $3.9 billion or 40.8% of the total. Health sciences were close behind with $3.8 billion (39.3%) while the social sciences and humanities received $1.9 billion (19.8%).

The higher education sector itself was the largest funder of higher education R&D at $4.4 billion or 46% of the total, although the rate of growth (2.1%) has slowed to a trickle. It should be noted that the federal government is the primary source of funding attributed to the higher education sector.

Foreign sources of funding achieved the highest rate of growth at 8.01% with $125.7 million in funding support.

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