Review of Federal Support to Research and Development

December 21, 2010 09:30 ET

Expert Panel Launches Consultation on Business R&D

Federal review of R&D spending seeks views from Canadians on maximizing impact

OTTAWA, ONTARIO--(Marketwire - Dec. 21, 2010) - Today, the independent expert panel reviewing federal support to research and development (R&D) launched a national consultation process with the release of its consultation paper. The panel has been asked by the Government of Canada to provide recommendations on how it can maximize the impact of the $7 billion dollars it spends annually in support of business and commercially-oriented R&D.

"With the release of our paper, we are seeking a dialogue with Canadians on the state of federal programs supporting business R&D and innovation," said panel chair Thomas Jenkins, Executive Chairman and Chief Strategy Officer of Open Text. "We want to hear from Canadians about what's working and what's not, and, most importantly, about the opportunities they see for Canada to do better in the future."

The panel has released a consultation paper that provides background information and a series of questions to guide its consultation process. It builds on other recent work about Canada's innovation performance undertaken by the Council of Canadian Academies and the Science, Technology and Innovation Council. These reports point to a serious issue facing Canada in terms of our country's lagging ability to capitalize on the knowledge we produce to create economic value.

Recognizing that innovation by business is vital to maintaining the enviable standard of living Canadians enjoy, the panel will examine the ways federal spending on R&D can be optimized to stimulate innovation and create economic opportunity for Canada.

As part of its dialogue with Canadians, the panel will be accepting written submissions in response to questions posed in its consultation paper. The panel's discussion paper and guidelines for submissions can be found on its Website: www.rdreview-examenrd.ca. Interested parties are invited to provide a submission before February 18, 2011. The panel is expected to release a report by October 2011.

In addition to Thomas Jenkins, the other eminent Canadians serving as panel members are Dr. Bev Dahlby of the University of Alberta, Dr. Arvind Gupta of the University of British Columbia, Mrs. Monique F. Leroux of the Dejardins Group, Dr. David Naylor of the University of Toronto, and Mrs. Nobina Robinson of Polytechnics Canada.

Backgrounder

Expert Panel on Federal Research and Development Spending Launches Consultation

On October 14, 2010 the Government of Canada launched a comprehensive review of federal programs that support business innovation. As announced in Budget 2010, a six-member expert panel will provide recommendations on maximizing the effect of federal programs that contribute to innovation and create economic opportunities for business.

The panel has been asked to review three types of federal research and development (R&D) initiatives:

  1. Tax incentive programs such as the Scientific Research and Experimental Development (SR&ED) program
  1. Programs that support business R&D through:
    1. general support (e.g., Industrial Research Assistance Program)
    2. sector-specific support (e.g., Strategic Aerospace and Defence Initiative)
  1. Programs that support business-focused R&D through federal granting councils and other departments and agencies, including research at universities and colleges (e.g., Centres of Excellence for Commercialization and Research)

The panel will provide recommendations to the Government of Canada by October 2011 related to the following questions:

  • What federal initiatives are most effective in increasing business R&D and facilitating commercially relevant R&D partnerships?
  • Is the current mix and design of tax incentives and direct support for business R&D and business-focussed R&D appropriate?
  • What, if any, gaps are evident in the current suite of programming, and what might be done to fill the gaps?

The Government has asked that the panel's recommendations would not result in an increase or decrease in the overall level of funding required for federal R&D initiatives.

The panel intends to undertake the following activities in support of its mandate:

  • a review of previous reports related to its mandate;
  • focussed research, where appropriate;
  • an assessment of specific federal initiatives that support business and commercially oriented R&D; and,
  • consultations with stakeholders.

To guide its consultation with stakeholders, the panel has developed a consultation paper that outlines the panel's mandate and approach, the public policy context for business innovation in Canada, and an illustrative list of federal programs that support business and commercially-oriented R&D, for consideration. The paper also presents a series of questions intended to spur a dialogue with Canadians on these topics. The panel will be accepting written submissions until February 18th, 2011; guidelines are available on the panel's Website: www.rdreview-examenrd.ca.

The review will build on the evidence presented in Innovation and Business Strategy: Why Canada Falls Short, a 2009 report by the Council of Canadian Academies that examined why the business strategies of Canadian companies are less reliant on innovation than their counterparts in other countries. The review will also respond to State of the Nation, a 2009 report by the Science, Technology and Innovation Council that drew attention to Canada's comparatively poor performance in transforming new knowledge into innovation. Both reports underscored the challenges facing the Canadian economy in terms of productivity growth and drew a link to low business expenditures on R&D and low rates of commercialization of new products and services.

Business innovation is vital to maintaining both Canada's global competitive advantage and high standard of living. The Government of Canada plays an important role in fostering an economic climate that encourages business innovation. It provides substantial funding through tax incentives and direct program support. Despite the high level of federal support for R&D, Canada continues to lag behind other countries in a number of areas: business R&D spending, rates of commercialization of new products and services, and productivity growth.

In 2008, Canada ranked second among Organisation for Economic Co-operation and Development (OECD) countries in the total value of tax incentives and direct (provincial and federal) support for business R&D as a percentage of gross domestic product (GDP). Nevertheless, Canada currently ranks 16th among OECD countries for business expenditures on R&D as a percentage of GDP.

For more information, please consult the Review of Federal Support to Research and Development Website: www.rdreview-examenrd.ca.

Contact Information

  • R&D Review Panel Secretariat
    Samuel Millar
    Executive Director
    613-960-9375