Report details no-cost innovation action plan

A blue-ribbon panel of leaders from industry and academia have released a highly proscriptive action plan for improving Canadian innovation without requiring new public spending or tax cuts. Recognizing there is little appetite among deficit-ridden governments for new spending, the Coalition for Action on Innovation in Canada (CAIC) lists a series of steps that can be taken over the next 12 months to realign existing resources and remove obstacles to innovation.

Co-chaired by John Manley, president of the Canadian Council of Chief Executives and Paul Lucas, president and CEO of Glaxo-SmithKline Canada, the CAIC suggests Canada's innovation challenges are well known and that it's time to move "from discussion and study to action."

Many of the recommendations are not new. For example, the 11-page report takes aim at the Scientific Research and Experimental Development (SR&ED) tax credit's lack of refundability, which "makes the credits useless to unprofitable, publicly traded companies". It also criticizes the administration of the program by the Canada Revenue Agency as "often adversarial and unpredictable". It says changes are needed to make the credits more broadly applied, consistent and accessible.

Like other reports, the CAIC also stresses the need to strengthen Canada's intellectual property regime, and for post-secondary institutions to adopt disclosure and licensing policies that facilitate collaborative research and encourage innovation.

Other recommendations include:

* Establish government-sponsored co-investment funds with private sector;

* tap private sector experience in developing new R&D and innovation initiatives;

* leverage government procurement to spur adoption of innovative products and services;

* launch a national learning and innovation initiative that aims for a 90% high school graduate rate and tracked programs to age 21 for the remaining 10%;

* expand opportunities for foreign students to obtain permanent immigration status after graduation;

* align federal and provincial policies and spending to support development of regional and local clusters; and,

* establish an independent advocacy body with a mandate of encouraging innovation by Canadian business.

Once governments are in a better fiscal position, the report calls for tax relief for investors to improve flow of capital, tax relief for individuals to increase supply of talent, and a near doubling of support for the indirect costs of research to support industry liaison and technology transfer offices.

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