Special Feature: Focus on BC British Columbia strives to capitalize on strengths in R&D and high-tech sector

British Columbia's high-technology industry is on a roll. The number of large and medium-sized companies has never been greater, and many contend that the province is achieving a critical mass in S&T that will allow the sector to accelerate its rapid rate of growth. Biotechnology, new media, information technology and microelectronics are all well represented in the economy, while more traditional sectors such as forestry and aquaculture are beginning to take on a decidedly high-tech hue.

What's more impressive is that the success of BC's science and technology (S&T) intensive firms has been achieved within an economic and fiscal environment that's perceived as the nation's most inhospitable to business, with a government seemingly unable to develop a workable S&T strategy that complements and capitalizes on the province's strengths.

The success of the BC S&T economy is due in no small part to its research foundation, largely centred in its universities and technical colleges. Simon Fraser Univ, the Univ of Victoria and particularly the Univ of British Columbia are powerful engines of discovery and commercialization, producing many successful firms that have become high-tech stars. Recent federal initiatives aimed at increasing the output of university research are strengthening the research base even further.

To analyze the forces driving BC's S&T sector is to delve into a sea of contrasting and often frustrating attitudes and positions on exactly what needs to be done to stimulate the high-tech industry and encourage innovation throughout the economy. Many of the public players complain of inadequate funding, while the high-tech sector - represented by the BC Technology Industries Association (BC TIA) - continues to hammer away for lower marginal tax rates and changes to labour legislation.

A recently completed random poll of British Columbians shows that the current NDP government is not considered to be a strong supporter of S&T. Sponsored by the BC TIA, the poll indicates that 55% of respondents believe the provincial Liberals would provide the strongest support, compared to the 17% for the BC Reform Party and just 13% for the governing NDP.

For its part, the government has belatedly introduced several S&T funding programs and changes to taxation that have lessened the contrast with other provincial jurisdictions. But the initiatives have often been made to take advantage of federal programs such as the Canada Foundation for Innovation, or to level the playing field with other provinces. Other initiatives have been in collaboration with federal partners, such as the New Media Innovation Centre located in downtown Vancouver, and the recently announced funding for fuel cells demonstration projects (see page 3). Many contend, however, that any successful S&T strategy must also acknowledge the unique characteristics of the BC economy.

"Canada is not really one economy but three or four economies separated by large expanses of space. What goes on in BC has some similarity (to the rest of Canada), but it also has a lot of differences," says Adam Holbrook, associate director of Simon Fraser Univ's Centre for Policy Research on Science and Technology (CPROST). "For example, there isn't a large manufacturing sector out here, it's more resource and services based. And BC, of course, is a Pacific Rim economy and it always runs counter cyclical to the rest of Canada."

NEED FOR REALISTIC S&T POLICY

Holbrook says BC governments have often run into difficulty developing industrial policies that reflect regional realities and also succeed in branding BC as a place where both start-ups and established firms can thrive.

"If the province is going to get into an S&T policy, it has to go in with both feet the way the Quebec government has done, whether its supplemental R&D tax credits or assistance to universities, tax holidays or even something like providing subsidies for lower income people to buy computers," he says. "The Alberta approach is also fine as long as a province has a large capital fund to work with, and Alberta has the heritage funds (Alberta Heritage Foundation for Medical Research and Alberta Heritage Foundation for Science and Engineering Research)."

GOVERNMENT CAN DO BETTER

For its part, the BC government argues that it has been responsive to the high-tech business community and provincial research institutions. Changes have been made to labour legislation that recognize the "unique characteristics" of the sector, says Calvin Shantz, executive director of the Information, Science and Technology Agency's science, technology and telecommunications division.

Shantz asserts that business is now receiving strategic financial support from government in the form of the $17-million Science and Technology Fund and the $100-million Knowledge Development Fund. He also points to efforts by the government to work with universities and colleges to ensure that the appropriate skills pipelines are developed to serve the New Economy.

But he concedes that when it comes to creating an overall strategy for the province, the current plan - 1999's A Strategy for Growth - doesn't provide the visionary leadership that's required.He also laments the under-utiliziation of the Premier's Advisory Council on S&T which hasn't been used effectively since the days of premier Mike Harcourt.

(The government recently appointed Gail Gabel, president and CEO of Victoria-based Environmental Sensors Inc as the Advisory Council's new chair. Several new member appointments have also been made.)

Shantz says the federal government's decision to pour money into S&T and reduce taxation levels have been positively received in BC, but he feels there should be more consultation with the provinces.

"The way they get announced and developed leaves the province in the position of responding. There's not enough advance notice and it puts the government in a reactive stance," he contends. "We don't disagree with the direction but there should be advance discussions."

SCIENCE COUNCIL OF BC

Regardless of varying opinion on how the BC government is treating S&T and the high-tech sector, its support for the Science Council of BC (SCBC) has been consistent, albeit at significantly lower levels in recent years. As the province's premier S&T support agency, SCBC fills a multi-faceted role as both a funder and promoter of provincial S&T, and has recently been taking an increasingly entrepreneurial approach to its activities.

Armed with a base budget of just $2.3 million in FY99-00, the Council has been extremely successful in leveraging funds from other sources to run a wide variety of programs ranging from Technology BC to the research component of Forest Renewal BC. The additional flow-through funding pumped last year's expenditures up to $29.1 million, down significantly from $39.9 million in FY98-99 due to a drop in Forest Renewal funding.

SCBC has also become increasingly involved in generating reports, taking the lead in new studies on forestry, aquaculture and performance measurement. More than a year in the making, the Council hopes the performance measures study will provide clear and quantitative inter-jurisdictional data that will give the province a much better picture of how its strategies are working. The report is being prepared by a coalition of stakeholders including SCBC and Innovate BC, a new group headed by the Vancouver Board of Trade and dedicated to promoting the province's S&T assets.

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