Evidence of meeting #29 for Industry, Science and Technology in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was atlantic.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

  • Bruce Archibald  President, Federal Economic Development Agency for Southern Ontario
  • Paul LeBlanc  President, Atlantic Canada Opportunities Agency

9:10 a.m.

Conservative

Gary Goodyear Cambridge, ON

I can absolutely do that with your permission, Mr. Chair. The knowledge infrastructure program is actually a science and technology file, whose main estimates we're not talking about, but with your permission, I'd be happy to comment on the knowledge infrastructure.

This was a program where the Prime Minister asked us not only to look after the science and technology strategy for the nation and to make sure that it wasn't derailed, but at the same time to also look at any opportunities to create and protect jobs in the very short term, because science and technology, obviously, is an opportunity for a strong economy—but in many cases in the future, not necessarily today.

So the knowledge infrastructure program, I think, was a brilliant idea where, as a federal government, we put up $2 billion. The parameters were to rebuild the research capacity of our colleges and universities all across the country. It had to be matched by provinces, territories, and the private sector, and sometimes the colleges and universities themselves. We actually ended up spending just over $5 billion on over 500 projects all across Canada. I've had the fortunate opportunity to have seen some of these buildings, and they are astonishing. In some cases, they're brand new buildings with brand new classrooms and teaching facilities. In other cases there are multi-disciplinary labs, where you will see not just statisticians and chemists, but also engineers and people dealing with medical devices, with optics, and stem cell research, all of whom are literally working side by side in a very big laboratory—again pushing the collaborative partnerships.

This, along with some of our other programs, such as the Vanier and Banting postdoctoral fellowships and the Canada excellence research chairs, are all programs that were designed to increase our research capacity as a nation, building up the buildings as it were. We also put money into the CFI to put new equipment in those buildings, and, with these other programs I just mentioned, we are now attracting scientists from around the world and, in some cases, their entire teams.

That does a bunch of things. It puts the inventions and incremental innovations in our country, which means that the patent, should there be any, and the intellectual property and job spinoffs, will very likely be in our country. It also allows for an extremely positive educational opportunity for our next generation of scientists and entrepreneurs as they are trained by these folks.

So we have come up with a nice organization that keeps our brightest minds here and attracts the brightest minds from around the world. In the case of the automotive sector at McMaster, we stole a brilliant mind—probably the best on the planet—from the United States.

Then we also train the next generation, maintaining our capacity that way. Canada now has a brain gain, and I'm absolutely convinced, and I'm sure you are too, that the high quality jobs of the future will come from science and technology and research—and most importantly, the development of that research, the transfer of that knowledge out of the laboratories, out of the minds of our folks and onto the factory floors to be sold to the living rooms and hospitals. I'm so committed to that. I can tell you that we have a responsibility. We have an obligation as a nation to move that knowledge out to the hospitals of the world—if that's the case—helping people all around the world, but also improving prosperity here at home in doing so.

The knowledge infrastructure program was a great leap forward in terms of bricks and mortar, including the equipment through CFI, and then through other programs for people to use that equipment.

9:15 a.m.

Conservative

Phil McColeman Brant, ON

Just very quickly to change gears, you used the example in your opening comments of the water consortium.

I think we have a minute left, so would you just touch on that in a little more depth, if you wouldn't mind?

9:15 a.m.

Conservative

Gary Goodyear Cambridge, ON

In our consultations, which were quite extensive all across southern Ontario, we had the opportunity to meet a bunch of people who had the same idea. We would go to a community and they would tell us that they didn't want to become a one-industry town. They wanted to be the best in the world in water technology. I would go to another community two hundred kilometres away, and I'd hear the same thing.

Quite quickly, I talked to the partners and said that we couldn't fund five people to be the best in the world; it didn't not make sense. I suggested that they get together to come up with a better idea, and we worked with the organization for almost a year. It ended up, as I said, including seven or eight universities, seven or eight municipalities all along the Grand River corridor, running from the northern part of southern Ontario all the way down to the Great Lakes. This organization with, I believe, 68 or 70 private sector companies is going to develop everything from software to manage water, to sensors, flood control, purification, and cultivation. You name it, they're going to design it and invent it, test it here, and then produce it here, and sell it to the world.

This is the largest water consortium. I don't believe there's another project this big or this focused on creating critical mass anywhere in the world.

9:15 a.m.

Conservative

The Chair David Sweet

Thank you, Minister.

Now I'll move on to the Liberal Party. Mr. Hsu, for seven minutes.

May 8th, 2012 / 9:15 a.m.

Liberal

Ted Hsu Kingston and the Islands, ON

Thank you, Mr. Chair.

I have a question about how FedDev measures the effects of programs on your desired outcomes. What kind of metrics do you use to measure diversification, competitiveness, self-reliance, growth, and job creation?

We can observe all of these things. We can observe diversification and job creation and so on, but there's always the question, and I'm sure you're very concerned about this, as to what effect the actual program spending has had on these, on top of what would have happened otherwise.

I know that FedDev has not been in existence for a long time. But part of FedDev, and I'm thinking particularly of the eastern Ontario development program, has been around for a long time because it used to be under FedNor. I'm wondering if you are tracking the effects of the program spending in the EODP that occurred many years ago to see if there has been any measurable long-term impact on the desired outcomes of EODP. That goes back to the issues of diversification, competitiveness, the economic self-reliance of communities, growth, and job creation.

9:15 a.m.

Conservative

Gary Goodyear Cambridge, ON

That's a very good question. I'm looking for the numbers on the metrics for EODP.

Ted, that's a great question, and how governments measure the successful outcomes of programs is something we struggle with every day. I can tell you at this initial stage of FedDev, we can count job numbers both as estimated by the applicant and then as the project concludes, when we always go back and have a look at how they have done with respect to their promised outcomes in the application.

In terms of innovation, job numbers are one thing, but creating a job doesn't necessarily mean, as you point out, that a company is more innovative or more globally competitive. Evaluating those requires a more long-term study, as you will well know.

FedDev is working to develop the metrics program. We're doing the same thing on the science and technology file, to develop the metrics that, first of all, relate overall or generally to what we're attempting to do, but also specifically with metrics for each individual program because their outcomes are slightly different.

In terms of becoming a more innovative nation or improving productivity, I read a report that I was quite excited about. It indicates that R and D spending by business is up, and I think the report said it was by 4% this year over the last four years. That's a good sign, but as you would agree, it is not an indicator of future trends. But we're not going to say no to the fact that business expenditure on research and development is up this year over the last four. But we are working on metrics.

On the eastern Ontario development program, since 2004 more than $65 million has been invested in more than 5,500 businesses and community development projects. More than 57,900 people have received work-related training. That's an ongoing advantage that's difficult to measure, but they have the training. What they do with it, as I'm saying, is difficult to measure.

More than 880 youth interns have been placed in not-for-profit and private sector organizations. That's a big step up for eastern Ontario, where we do see unique challenges with respect to the youth migration in some of these communities like Kingston.

An additional $307 million, on top of the $65 million provided by the federal government through EODP, has been leveraged by partners. So this is a good news story where the federal government has put up $65 million, and the private sector and communities—the Government of Ontario—have put up an additional $307 million.

There's a great example of a company, Ted, in your riding. I won't say the name of the company for privacy's sake, but it's owned by a lady engineer who graduated from Queen's, and you'll probably know the company right away. She had the opportunity to go anywhere, but again because of FedDev and some other federal assistance, she stayed in Kingston. She's producing a product that cannot be produced anywhere else and her company is exploding in size, in terms of hiring people from the area and expanding.

9:20 a.m.

Liberal

Ted Hsu Kingston and the Islands, ON

I guess her company is related to my question because you mentioned in your opening remarks a company that I believe you said was saved by FedDev support, and her company, she says, was saved by SR and ED credits.

There are two different ways to save companies and so the question goes back to efficacy. What is the relative efficacy of program spending, where a government program or agency decides how to spend the money, versus a tax credit where you're just letting companies do what they want to do?

I understand that you're developing metrics. Will you be soliciting input from Parliament on the metrics and the methodology? We're going to be using those metrics to formulate policy.

9:20 a.m.

Conservative

Gary Goodyear Cambridge, ON

When we talk about metrics and how we evaluate programs, I will say that the OECD has said that Canada has some of the best metrics in how we measure our programs. But like you I would like to see a more detailed analysis and if there's a direct relationship between this dollar spent and that effect that has occurred. That is a little bit more of a detailed analysis, as you well know. What questions you ask and whom you're asking them of can determine that outcome.

In the beginning of FedDev our struggle was to create jobs in the very immediate term. We would fund a project that said there was a possibility of 60 jobs created. For example, the juvenile research diabetes program suggested that 180 jobs would be created. When we looked back, it was well over 200 jobs.

So those are the metrics we're using at this point. But a good example of what you're talking about—

9:20 a.m.

Liberal

Ted Hsu Kingston and the Islands, ON

Will you let Parliament have some input into the metrics and the methodology you developed?

9:20 a.m.

Conservative

Gary Goodyear Cambridge, ON

I have worked very hard to open my doors to anybody who has an opinion. I've been to more than a hundred round tables at this point in my life. If you want to write me an email, if Parliament wants to make suggestions to me, if scientists and engineers around the world have great ideas on how to measure some of these outcomes, -or great ideas for products that we can produce more jobs with and improve our prosperity, I am all ears. This is not up to me personally, but a collaborative measure where, especially in the case of metrics, it will require some very intelligent people to determine what those questions are.

9:25 a.m.

Liberal

Ted Hsu Kingston and the Islands, ON

Do you think that you might table some preliminaries to this committee?

9:25 a.m.

Conservative

Gary Goodyear Cambridge, ON

That's a little bit into the future. To answer your question, we're looking at internal...like the Science, Technology and Innovation Council, which has 18 of the smartest people in Canada. Plus others are working with us.

But I'd be more than happy to hear what you have to say, Ted. Thanks.

9:25 a.m.

Conservative

The Chair David Sweet

Thank you very much, Mr. Minister, and Mr. Hsu.

Now on to the second round of five minutes.

Madam Gallant, for five minutes.

9:25 a.m.

Conservative

Cheryl Gallant Renfrew—Nipissing—Pembroke, ON

Thank you, Mr. Chairman.

Through you, to the minister, first of all, I'd like to comment on the direction the government has taken in the area of science, technology, and innovation. I'm very supportive of this, as are many of the businesses in my riding that are in science, research, development, and manufacturing.

Most recently, we had an announcement about Tyne Engineering. It's an engineering company that takes hydrogen and has experimented, using the facilities at Chalk River Laboratories, to build a passive autocatalytic recombiner and actually get it to the manufacturing stage. So the scientists at Chalk River wanted to find a way to take hydrogen out of the atmosphere because they wanted to minimize the risks of explosions. The scientists worked on that, and a manufacturing business from the outside saw that they were doing this and has actually spun that business out into a new business. So we do have the holy grail of science to manufacturing and the creation of jobs occurring right up there.

Another example of how the different policies implemented are working is the situation we had a number of years ago when the NRU was shut down for repairs. As a consequence of that, the scientists had to develop the tools necessary from scratch, to even take a look at the inside of the reactor, let alone how to fix it. Because of the tools they developed, they've been able to sell those on a larger scale to other countries whose reactors are now going through the exact same thing. Again, we have another example there of how we've been able to facilitate science from the bench all the way to the manufacturing stage.

Another example is the tracking of nuclear materials. I'm very pleased to say that a team of scientists developed a way to track nuclear material around the world in real time. That team of scientists has been recognized internationally for that work, a very practical use of that development.

Another example is muon tomography. Muons are subatomic particles. They can literally provide the ability to see through steel and concrete—X-ray vision, if you will, but not X-ray as a substance. That's another example of where we're at a stage where we're looking for a company that can take this to the next phase and market it throughout the world. We're almost there. We do have a company we're looking at.

There are also non-medical isotopes. Before 9/11 we were known for providing 95% of the world's medical isotopes, but we are also capable of producing non-medical isotopes. That's quite a revenue generator for the laboratory site. I know that we are looking at funding science that can generate its own revenues as well.

With regard to materials analysis, we had our Nobel prize winner there, Bertram Brockhouse. He developed neutron spectroscopy. That has developed into a business onsite where they can look at materials, like the blades from airline turbines, in a non-invasive way, and they can see the molecular structure and where there might be a fault in the blade.

There's the non-proliferation aspect as well. Back when the SALT Treaty was being implemented, we had Russia and the United States taking down their warheads. They put the fuel, the radioactive part, into an inert form, brought it to Chalk River and we made the warheads into fuel. It was more valuable to Russia as a fuel as opposed to a weapon. In terms of non-proliferation, they're doing very well, as well as exploring and manufacturing new ways of generating electricity.

What I wanted to tell you is that the investment in the business innovation program is alive and well. If you'd like to speak to that, I'd like to hear what you have to say.

9:30 a.m.

Conservative

Gary Goodyear Cambridge, ON

I can tell, Cheryl, that you have the same passion about science and technology and its ability to improve the quality of life of people all around the world as I do.

On a very high level we are number one in the G-7 in terms of our expenditures on post-secondary education as a percentage of our GDP. Where we're nowhere close to being number is in business expenditures on research, and the development of that research. We've spoken to that. The federal government has clearly....

Am I out of time?