Ontario Budget advances province’s commercialization agenda and creates research council

The Ontario government will establish a Research Council of Ontario (RCO), implementing a key recommendation in the recent review of post-secondary education conducted by former premier Bob Rae (see page 2). The announcement was contained in last week’s Ontario Budget, which introduced or advanced several features of its long-awaited innovation and commercialization strategy.

Massive increases to the funding of health care and education dominated new spending initiatives, but research, science and technology fared reasonable well, with the consolidation of key research organizations under the Ontario Research Fund (ORF) and somewhat higher funding levels.

In addition to the RCO, the Budget announced a consolidation of the province’s cancer research activities into one organization, a refocused biotechnology incubation network and $730 million in funding to flow through the new ORF. Further details on funding allocations will be available in the coming weeks when the government releases its budgetary estimates.

“I’m delighted that, in spite of pressure to cut, we have not backed down on R&D investment,” says Richard Patten, an Ottawa MPP and parliamentary assistant to Joe Cordiano, minister of Economic, Development and Trade (MEDT), with responsibility for innovation and commercialization. “I’m also pleased that the ORF is far more flexible than it used to be which means more opportunities for SMEs (small- and medium-sized enterprises) ... We’ve got to do a better job of retaining young companies or we’ll be seen to be a farm team for the US.”

The Budget marks the first time the government has officially acknowledged the ORF, which has been in the planning stages for several months. It moves the province toward a one-stop-shopping approach by consolidating its support for research operating, capital and overhead spending.

The ORF will feature two main programs. The ORF-Infrastructure Program replaces the Ontario Innovation Trust and is expected to release its first tranche of funding no later than June. The ORF-Operating program replaces the Ontario R&D Challenge Fund and is expected to issue its first call for proposals within weeks.

Other changes pending include the launch of the Research Talent Development Program (RTDP), replacing the Premier’s Research Excellence Awards (PREA) program. Budget 2004 earmarked $7.7 million for the RTDP.

Budget documents also spell out the province’s research priorities, which include automotive, agriculture, advanced manufacturing, information and communications technologies, alternate energy and fuel cells, environmental technologies and nano-technology.

While the Budget reflects a tangible effort to provide greater coordination and alignment of research funding and programs, it remains unclear how the new commercialization initiatives fit into a larger whole. The strategy was originally slated for release last fall but has been delayed. The province has now jettisoned plans to issue a published strategy.

“I’m not sure you’ll ever see a detailed document, but you will see a set of program initiatives along with some refined policy perspectives,” says Dr Tim McTiernan, MEDT’s ADM for research and commercialization. “It’s more coordination than a document.”

NEW RESEARCH COUNCIL

The RCO will report to the premier and is designed to advise on research priorities, coordinate public research funding and raise the provincial profile as a global research centre.

The Rae report was released last February and called for the RCO membership to be composed of individuals “with expertise in primary and applied research and commercialization, business and technology transfer, and from the donor community”. It also cited the allocation of funding for basic research and commercialization in accordance with confirmed priorities.

Perhaps the most important rationale for establishing the RCO is the need for a mechanism to negotiate with the federal government. Many of the biggest federal research programs need matching funds from the province — a requirement that has long irked provincial officials.

“The province was left out of the process. We’re in the middle of talking with the feds about that,” says McTiernan. “The Quebec model represents a more reasonable arrangement.”

RINS

The Budget also announced the formation of a new Commercialization Framework composed of 11 existing regional innovation networks (RINs). Essentially an expanded version of the previous government’s Biotechnology Cluster Innovation Program (BCIP), the province plans to expand the networks beyond their current life sciences focus into areas such as information technology, energy conservation and advanced materials. The centres will also act as conduits to commercialization organizations such as the Ontario Centres of Excellence, Waterloo’s Communitech, the Medical and Related Sciences (MaRS) centre and the Ottawa Centre for Research and Innovation (OCRI).

The BCIP program was announced in 2003, providing $2.2 million for the centres to develop business plans and $27.8 million for the implementation phase. McTiernan says an expansion of their mandates won’t necessarily require additional funding.

CANCER RESEARCH PROGRAM

The Budget announced that the new Cancer Research Program will be merged with the existing Ontario Cancer Research Network, fulfilling a policy thrust for consolidation initiated by the previous government. Funding for the new entity is pegged at $142 million through to FY07-08.

“The intent is to build up critical mass on a variety of research themes. Research will be funded in institutions according to program themes set out by the board of directors of the not-for-profit organization,” says McTiernan. “Immediately, it will build out the existing board of directors and get a new administrative structure in place, including a scientific review board. It’s a one-year process.”

The Budget also announced that the result of a review of Labour Sponsored Investment Funds (LSIFs) is expected this spring.

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