Liberals emphasize commercialization and venture capital in election platform

NRC would get major new funding

The Liberal Party has laid down its clearest vision yet of what it believes Canada must accomplish to become a truly 21st Century economy. As expected, commercialization is the centrepiece of the Party’s election platform for science and technology, stemming directly from the government’s ongoing policy of building upon its $13 billion in research investments over the past eight years.

As illustrated in the last federal Budget (R$, April 6/04), initiatives in support of commercialization involve several players, the most prominent being the National Research Council (NRC) and the Business Development Bank of Canada (BDC). The cost devoted to its key innovation commitments is relatively small. Commercialization is estimated to cost $300 million, presumably the amount it will take to underwrite NRC’s planned network of commercialization centres — known within the NRC as Canada Innovation Centres. The next largest commitment is $270 million for BDC, emphasizing early stage companies. The commitment is in addition to the $250-million equity injection announced in the last Budget.

In the area of environmental technologies, however, the Liberal commitment is much larger. As stated in the Budget, $1 billion from the proposed sale of the government’s stake in PetroCanada will be pumped into this area, although there are no details.

In its main campaign document — Moving Canada Forward: The Paul Martin Plan for Getting Things Done — the Liberals devote 10 pages to its overall economic plan. The document estimates the Liberal platform commitments will cost $26.3-28.3 billion over the next five years. It also estimates that revenue will exceed expenditures (before platform commitments) by $40 billion in the same timeframe, leaving at least $12 billion for further initiatives.

The more detailed Bulletins companion document provides insight on plans for various industrial sectors, as well as skills development, small- and medium-sized businesses and energy. The latter emphasizes wind energy and sketches out a three-part plan to encourage investment, develop a market and promote R&D.

Economic commitments also include initiatives in the areas of regional and industrial development, estimated to cost $2 billion over five years. Unlike the Conservative Party, a Liberal government will maintain Technology Partnerships Canada, which is described as having played “an important role in supporting many innovative aerospace projects”.

The Liberal platform also has the advantage of building upon a stellar economic track record — seven straight Budget surpluses, significant debt repayment and tax reductions bringing the tax burden for Canadian businesses in line with its major competitors.

Where it may run into trouble is its handling of the regional agencies. The platform says a Liberal government will use the Atlantic Innovation Fund (AIF) — administered by the Atlantic Canada Opportunities Agency — as a template for economic development in other regions. It’s far from certain that the AIF has been effective in economic growth and job creation, and stands in stark contrast to the Conservative’s pledge to revamp the regional agencies and eliminate business subsidies.

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