Federal R&D outlays to jump nearly 10% due to major granting council funding hikes

Ottawa’s focus on university research is the driving force behind a healthy 9.4% increase in projected federal R&D expenditures this year. Statistics Canada’s latest data show R&D expenditures of $4.65 billion in 2001, up from $4.21 billion in 2000 and $3.89 billion in 1999 — increases attributed primarily to the Canada Foundation for Innovation (CFI). In contrast, the R&D expenditures of federal departments are virtually stagnant, with few if any showing a year-over-year increase of more than 1%.

Although it was formed in 1997, it wasn’t until FY99-00 that the CFI started to disburse large amounts of research infrastructure funding. That year it awarded $118 million, jumping to $187 million in FY00-01 and $306 million in FY01-02. The program is expected to level off in future years.

The granting councils have also been the recipients of federal largesse. They are projected to enjoy double digit increases this year, with the largest percentage growth experienced by the Social Sciences and Humanities Research Council (SSHRC). Although it continues to receive by far the lowest level of federal support, SSHRC jumped 20.9% from $110 million in 2000 to $133 million in 2001.

The Canadian Institutes of Health Research is projected to climb 13.6% to $458 million, while the Natural Sciences and Engineering Research Council (NSERC) weighs in with an 8.9% increase to $539 million. The increases are even greater if the recent Budget announcements are factored in (see page 3).

Greater R&D expenditures also drove increases in federal S&T spending — R&D plus related scientific activity (RSA) —, which rose 8.0% in 2001 to $7.39 billion. The S&T ratio now accounts for 4.5% of the total federal budget, up from 4.4% in FY00-01 and 4.1% in FY99-00.

After the CFI, the department or agency experiencing the largest jump in S&T spending is Industry Canada, which rose 18.0% to $485 million. The largest dollar increase (after the CFI) was enjoyed by Statistics Canada, which increased $92 million or 15.6% to $683 million. FY01-02 is a census year.

Of the $7.39 billion in S&T expenditures, $5.71 billion or 77.2% was devoted to activity classified as natural sciences. The remainder — $1.68 billion or 22.8% is classified as social sciences.

When broken down by performing sector, 55.6% of federal S&T expenditures are classified as intramural. Higher education is the next largest recipient, receiving $1.6 billion for a 21.6% share. The private sector received $1.16 billion for 15.7% of the total, followed by non-profit institutions which received $232 million or 3.1%. Other Canadian S&T performers received $81 million while foreign performers received $214 million.

The StatsCan report also provides a revealed 10-year window on federal S&T expenditures, breaking down data for R&D and RSA. Between FY92-93 and FY01-02, S&T outlays increased 27.9% from $5.78 billion to $7.29 billion, with the bulk of the increase coming in the last three years. In fact, the lowest year was FY97-98, when federal S&T spending dropped to $5.51 billion.

For R&D, the 10-year increase was slightly more pronounced, growing 29.5% from $3.59 billion to $4.6 billion.The low point was also FY97-98 when spending dipped to $3.58 billion.

RSA expenditures increased 25.2% over the same 10-year period, from $2.19 billion to $2.74 billion, with the low point in FY97-98 when just $2.13 billion was spent.

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