Evidence of meeting #31 for Industry, Science and Technology in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was investments.
A video is available from Parliament.
10 a.m.
NDP
Raymond Côté NDP Beauport—Limoilou, QC
Thank you, Mr. Chair.
My thanks to all our witnesses for being here to answer our questions.
My second question was about the major resources support program. I must admit that I can't see why the minister did not understand that the program is with the Natural Sciences and Engineering Research Council, which is still the responsibility of Industry Canada. I want to go back to that.
When we look at the supplementary estimates (B), the Natural Sciences and Engineering Research Council is requesting $14 million in grants and $845,000 in operating expenditures to increase the support for advanced research in natural sciences and engineering.
Will those amounts make it possible to reactivate the program I was referring to, the major resources support program?
10 a.m.
Lisa Setlakwe Executive Director, Industrial Technologies Office, Department of Industry
The major resources support program will not be reactivated. The Canada Foundation for Innovation has set up a component, with other programs, to support smaller organizations. Approximately $25 million will go to that component, but the announcements have not been made yet.
10 a.m.
NDP
Raymond Côté NDP Beauport—Limoilou, QC
Very well.
Let's get back to the magnet of the National Ultrahigh-field NMR Facility for Solids that I mentioned. We are still talking about state-of-the-art equipment, and the centre is under threat of closure. Based on my understanding of the articles in La Presse, it could be closed in a few days or in a few months. Will the centre be supported by the funding you were talking about? I suspect not.
10 a.m.
Executive Director, Industrial Technologies Office, Department of Industry
I am not able to tell you right now what the decision about the funding will be. The National Research Council of Canada also supports the centre. My understanding is that the NRC has signed an agreement with the organization. It will support it for some time and make sure that the centre is still in place in the short term to make it possible to determine the next steps.
10 a.m.
NDP
Raymond Côté NDP Beauport—Limoilou, QC
Okay.
I could have referred to another salt water study proposal, which was cancelled in 2013, and Dalhousie University's Aquatron Laboratory whose survival is threatened.
Could you tell us what impact the major resources support program moratorium will have on basic research? What is the loss for Canada?
10:10 a.m.
Executive Director, Industrial Technologies Office, Department of Industry
I cannot comment on the other examples that you gave, but I can say that support for research and development in Canada is very important. We have recently announced a new investment in research to the tune of $1.5 billion. Compared to the other G7 countries, Canada is doing very well. The results are visible too.
Our publishing numbers are ranked very highly internationally.
The investments that we make give great results.
10:10 a.m.
NDP
10:10 a.m.
Conservative
Mike Lake Conservative Edmonton—Mill Woods—Beaumont, AB
I wouldn't mind if you could take the opportunity to elaborate a bit more.
You talked about the support for R and D being very healthy. I have written a note here for you to touch a bit on the Canada first research excellence fund program. Could you give some explanation of that? That was in the most recent budget. I know there's work being done on that right now. Could you elaborate a little bit on what that is and how it impacts research, or will impact research, in Canada?
10:10 a.m.
John Knubley Deputy Minister, Department of Industry
The Canada first research excellence fund, which is a $1.5 billion program over 10 years, was announced in the last budget. As indicated in that budget, it is to focus on excellence in university research. There is to be an announcement very shortly on this issue and how the process of taking applications from universities will happen.
10:10 a.m.
Conservative
Mike Lake Conservative Edmonton—Mill Woods—Beaumont, AB
When you talk about support for R and D being very healthy, who is it that measures that? On a global scale, as we take a look at the research expenditures that are made in developed countries or countries around the world, what is the organization that looks at that? What are the metrics we're looking at? When you make that assertion that R and D is very healthy in Canada, what's it based on?
10:10 a.m.
Executive Director, Industrial Technologies Office, Department of Industry
The OECD is the organization that provides standardized measurements. I made reference to the G-7, so we're compared against that grouping of countries.
When we're adjusting for the size of our economy, Canada ranks first in the G-7 for its higher education expenditures. We also know through the Council of Canadian Academies, which has undertaken some studies itself, that Canada is also producing a disproportionately higher number of frequently cited articles than other countries. We also have in Canada the highest percentage of college or university educated adults among developed countries. Recently the CCA did another piece of work that showed that Canada ranks first on a science literacy index among countries with similar available data, just to name a few examples.
10:10 a.m.
Conservative
Mike Lake Conservative Edmonton—Mill Woods—Beaumont, AB
For someone who might be watching this—I'm sure there are hundreds of thousands of Canadians watching this live at this very moment—who is not familiar with research funding and how research funding is delivered in Canada, could you walk us through the larger programs, the research envelopes, and what the sources of funding are that the Canadian government funds?
10:10 a.m.
Executive Director, Industrial Technologies Office, Department of Industry
Much of the federal research expenditures are through our granting councils. There's the Natural Sciences and Engineering Research Council of Canada as well as the Social Sciences and Humanities Research Council. To give you approximate figures, the NSERC budget is about $1 billion and SSHRC's budget is nearly $700 million. That's straight research.
In there, there's a combination of pure research and you will see investments in internships as well. If you look to other mechanisms that support that ecosystem, there's the Canada Foundation for Innovation that supports infrastructure that's needed to undertake research.
A third area that I would highlight is in terms of support to business. There would be a number of different programs, direct and indirect, available to support business. There was mention earlier of the automotive innovation fund. There's the strategic aerospace and defence initiative and the NRC industrial research assistance program, just to name a few examples.
It really is an ecosystem that spans from basic research to applied research and commercialization.
10:15 a.m.
Deputy Minister, Department of Industry
Mr. Chair, it's very important to recognize in this area as well that there was a study and a report by Tom Jenkins called “Review of Federal Support to Research and Development”. This was tabled in 2011.
Since that time, there has been a series of budget announcements in 2012-13 that have really implemented the plan. That included a number of steps related to the scientific research and experimental development tax credit program, and the doubling of what's called IRAP, the industrial research assistance program.
We've also moved ahead to leverage our procurement processes and to change them to favour industrial benefits. We've launched the venture capital action plan of $400 million. As part of this, of course, the National Research Council has undergone a transformation in terms of its focus and in terms of research and development.
10:15 a.m.
NDP
Peggy Nash NDP Parkdale—High Park, ON
The aim of the strategic aerospace and defence initiative is to encourage innovation and product development, and increase competitiveness in Canadian businesses, but I note that both last year and this year, the program only spent 80% of its planned budget.
I'm wondering what the department is doing to improve the program to ensure that businesses are getting the support they need, because aerospace is especially very competitive internationally.
Can you tell me what actions the department is taking on this?
10:15 a.m.
Deputy Minister, Department of Industry
There are lots of actions and Lisa can tell you all about them.
10:15 a.m.
Executive Director, Industrial Technologies Office, Department of Industry
I fortunately manage that program so I can speak to it a little bit more closely.
You are correct in what you are saying. There are certain things that have been done. You will recall the Emerson report on aerospace that was recently released. One of the recommendations was in fact to improve some aspects of the program. We did do that. There were things like reducing the administrative burden. We've also made changes. For example, we've simplified the formula; we've increased the percentage of the federal sharing portion. We used to support 30% of eligible costs and now we are able to support 40%.
Also, one of the things we heard was that typically an R and D project will span over a five-year period, and we used to require that companies begin repaying the contribution one year after they were done completing their research and development. Companies were telling us that this doesn't give them enough time to turn around and commercialize that research and development or the results of it. We've extended the grace period before repayments begin for an additional year so that companies get two years before they are required to begin making repayments.
On a more practical level, we've also increased our outreach to companies. We've established close relationships with not only the aerospace and defence industry associations and stakeholders across the country but we also work closely with our federal partners to make sure that we are cross-referencing referrals. We'll work with the regional development agencies and their staff to ensure that we're in touch with the companies within their regions. Similarly, we'll do the same thing with the NRC industrial research assistance program officers.
We are working on a number of different fronts to make sure that our program is known and is responding to the needs and opportunities that businesses face.
10:20 a.m.
NDP
Peggy Nash NDP Parkdale—High Park, ON
I have a follow-up question on that. One of the issues you talked about was the outreach to industry. One of the comments we had heard, and I think it came out of an evaluation a couple of years ago, was that there was low awareness of the program. How effective do you think the outreach has been? Do you have any sense of a dollar figure and how much money has been spent on outreach?
10:20 a.m.
Executive Director, Industrial Technologies Office, Department of Industry
I'd have to get back to you on the second question. We can certainly determine how much has been spent.
How good are the responses? After every outreach that we undertake—some of them are more formal than others; some of them are actually attending trade shows and such, and others are travelling and meeting with specific companies—we are seeing an increase in uptake in applications over the last few years. We have seen very tangible results, not with every single one, but we are seeing some increased uptake.
10:20 a.m.
Deputy Minister, Department of Industry
Maybe I would just add that I think in the broader context it has been the Emerson report, which involved a series of consultations for really a year-long period.... Obviously SADI is one part of the aerospace sector, but certainly Mr. Emerson and his fellow colleagues spent a lot of time looking at all of these issues and this would have given more profile to the SADI projects.
