Cuts to R&D reduce federal S&T spending for the first time in five years

Federal spending on S&T will decline this year for the first time since FY02-03 despite a significant increase in overall government spending. The Statistics Canada report is based on data compiled well before the current financial crisis. It underlines the growing sense that the Harper administration's public pronouncements of support for S&T are beginning to ring hollow.

S&T expenditures are set to fall 3.0% in current dollars for FY08-09 to $9.863 billion from $10.164 billion last year, while overall spending derived from the government's main spending estimates is estimated to increase 4.6% to $241.3 billion.

The bulk of the decrease is accounted for with a decline in R&D spending of 4.0% to $6.222 billion, while financial support for related scientific activities (RSA) is down a marginal 1.1% to $3.641 billion. S&T accounts for 4.1% of all federal spending, down from 4.6% two years ago. R&D has also dropped from 2.9% of the spending total in FY06-07 to 2.6% in FY08-09.

Among the 16 science-based departments and agencies, the S&T budgets of 10 are slated to decline. Atomic Energy of Canada Ltd takes a especially large hit, dropping 48% from $329 million in FY07-08 to $171 million in FY08-09. The drop is curious, given the latest federal Budget's allocated of $300 million in new funding to AECL which was booked for FY08-09 (R$, March 11/08).

Other departments or agencies with large projected decreases include Agriculture and Agri-Food Canada (down 15.1% to $355 million), the Canadian Institutes of Health Research (down 6.4% to $902 million), and Industry Canada (down 26.7% to $400 million). The latter decrease is more pronounced as Industry Canada received additional funding for several Centres of Excellence in Commercialization and Research (CECR) booked for FY07-08.

NSERC #1

The Natural Sciences and Engineering Research Council (NSERC) receives the largest single amount of funding, breaking $1 billion for the second year running.

The largest single amount of funding is being allocated to higher education, with an estimated $2.761 billion in FY08-09, up 1.6% from FY07-08. The second largest performer is the federal government itself, with Intramural spending in FY08-09 estimated at $2.467 billion, down a modest $68 million or 2.7% from the previous year.

Canadian businesses account for $612 million in federal funding down 4.1% from the previous year and 22.6% down from FY05-06 6— the year the Conservative government took office. Funding for Canadian non-profit institutions plummets 44.8% from $310 million to $171 million.

The bulk of the R&D funding decrease came at the expense of the natural sciences and engineering (NSE). While social sciences R&D is holding steady at $805 million, R&D for NSE drops $257 million or 4.5% to $5.417 billion.

StatsCan data are based on the government's main estimates and do not include supplemental estimates or changes at the departmental level. The agency projected a decline in federal R&D and S&T spending two years ago for FY05-06, only to have the data revised to show a 5.8% increase.

For related scientific activities (RSA) spending, Statistics Canada is the single largest recipient at $584 million, followed by Environment Canada ($409 million), Canadian International Development Agency ($371 million), Natural Resources Canada ($340 million) and Health Canada ($327 million). The vast majority of RSA is spent internally —$2.7 billion or 73.9% of the $3.64 billion total for FY08-09.

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