Industry Canada

Industry Canada

October 14, 2010 10:40 ET

Harper Government Takes Action to Better Support Business Research and Development

Government promotes innovation as a key driver of Canada's economic recovery

TORONTO, ONTARIO--(Marketwire - Oct. 14, 2010) - Today, the Honourable Gary Goodyear, Minister of State (Science and Technology) in Toronto and the Honourable Jean-Pierre Blackburn, Minister of Veteran Affairs and Minister of State Agriculture (Quebec) in Saguenay launched an independent expert panel to solicite the advice of Canadians and business leaders on how the federal government can cultivate its support of business research and development.

"Through this panel, our government is taking action to improve its support for innovation and to ensure that investments are effective for Canadian businesses and workers," said Minister of State Goodyear. "We are committed to helping Canadian businesses acquire the tools they need to grow and create new jobs; this panel will help achieve that goal."

The government is demonstrating its leadership through Canada's first place position in the G-7 for supporting science and research at our universities and colleges.

"Canadian business spends less per capita on research and development, innovation and commercialization than most other industrialized countries, despite the Government of Canada investing more than $7 billion annually to encourage business R&D," said Minister Blackburn. "This review will help provide recommendations on how the government can bolster Canadian businesses, create jobs and bring new ideas into the market place for the benefit of all Canadians."

The panel will conduct a comprehensive review all existing federal support for business R&D to see how this support could be enhanced to make sure federal investments are effective and delivering maximum results for Canadians.

The Research and Development Review Expert Panel is composed of six eminent Canadians chosen for their experience in business, academia and government as well as their knowledge of R&D and innovation practices and policies.

The panel's chair, Thomas Jenkins, is Executive Chairman and Chief Strategy Officer of Open Text. The other panel members are Dr. Bev Dahlby of the University of Alberta, Dr. Arvind Gupta of the University of British Columbia, Monique Leroux of the Desjardins Group, Dr. David Naylor of the University of Toronto and Nobina Robinson of Polytechnics Canada.

As announced in year two of Canada's Economic Action Plan (Budget 2010), the government is following through on a review of federal support for R&D to improve its contribution to innovation and create greater economic opportunities for business. The review will respond reports published by the Science, Technology and Innovation Council and the Council of Canadian Academies, which provided overwhelming evidence of Canada's productivity and innovation challenges.

The panel will report back to the Minister of State (Science and Technology) in one year with recommendations to enhance Canadian business innovation.

Backgrounder

Expert Review Panel on Research and Development

The Government of Canada has 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 seek submissions from interested parties and conduct focused research to support its work. It will report back in one year to the Minister of State (Science and Technology) with concrete recommendations.

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 2008 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 increasingly 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.

The review will support Advantage Canada, the government's long-term economic plan, and provide a basis for future investments under the government's Science and Technology (S&T) Strategy, Mobilizing Science and Technology to Canada's Advantage.

For more information, please consult the Review of Federal Support to Research and Development website (www.rd-review.ca).

Contact Information

  • Office of the Honourable Gary Goodyear
    Minister of State (Science and Technology)
    Gary Toft - Director of Communications
    613-943-7599
    or
    Industry Canada
    Media Relations
    613-943-2502