New S&T funds swamped in sea of stimulus spending, corporate and personal tax breaks

Provincial Budgets

Faced with the unappealing choice of confronting recession-induced pain and investing in the future, the Ontario government appears to have opted for the former, delivering a Budget that's heavy on fiscal stimulus and light on new S&T or innovation-related investments. Of the $715 million in research and innovation spending announced by Finance minister Dwight Duncan, $550 million was either previously announced or serves to match federal research investments made through the Canada Foundation for Innovation (CFI).

The S&T component of the March 26th Budget pales in comparison to its massive stimulus package — $32.5 billion in infrastructure spending over the next two years. Loaded with corporate and personal tax breaks, the Budget pushes the province back into the red for the first time in several years with little chance of balancing the books until FY15-16. A $3.6-billion deficit is now projected for FY08-09, rising to $14.1 billion in FY09-10.

Before the downturn, Ontario was investing heavily in S&T, with a $3-billion, multi-year funding strategy. New funding is now slowing to a trickle, although several of the Budget's initiatives earmark money for key elements of the province's innovation system.

The biggest ticket S&T item is $300 million over five years for the Research Infrastructure arm of the Ontario Research Fund (ORF). The funds will be used to match successful Ontario-based applicants to the current CFI competition. Now in the field, it was increased by $150 million in the recent federal Budget (R$, February 9/09). Results will be announced in June or early July.

The next largest initiative is the $250-million Emerging Technologies Fund which was announced March 19th (see page 3).

genomics wins big

The province's genomics and biomedical research community fared the best of all sectors with $105 million in new funds as well as a substantial share of the $300 million in matching CFI funds from the ORF.

Biomedical research will receive $100 million, administered by the ORF with an emphasis on gene-related research.

The OGI receives $5 million for operations to manage and administer research funds, support outreach activities and for business development purposes in the commercialization of genomics research.

Ontario's Innovation Demonstration Fund is being replenished by $50 million (following another $6 million in the 2008 Budget). The fund has been highly successful to date and its original $30-million allocation and the 2008 top-up have been depleted. Per project funding ranges from $100,000 to $4 million.

For digital media, the Budget provides $10 million to launch a pilot program for intellectual property development by companies in screen-based industries. The program will refund a portion of the costs incurred.

Development of a smart grid provincial electricity system received $50 million over five years. A smart grid increases efficiency through the use of software, two-way communication and automation.

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