Industry Committee on Dec. 4th, 2013

[Glenn Thibeault, NDP, Sudbury, ON]

Excellent. Thank you.

From September 2013 to March 2014, Industry Canada has allocated $8 million for ads related to the government's more choices campaign, while the Department of Public Works has allocated an additional $1 million. I know that we can't necessarily speak to the Public Works piece, but where would that $8 million for ads in the more choices campaign be in relation to this?

[Marta Morgan]

First, I just realized that I didn't give you the complete picture. We also have $1.7 million in that office of consumer affairs in a sort of grant program that provides grants to consumer organizations around the country for their work.

With respect to your second question, David noted earlier that the advertising budget is managed corporately within the Government of Canada. Reports on that are published annually through the annual report on government advertising, which is published by the Department of Public Works and Government Services. That provides a full accounting of all the advertising that's done, including the advertising that would be done on wireless telecommunications.

[Glenn Thibeault, NDP, Sudbury, ON]

Can you clarify that for me again? Are you saying that the $8 million from Industry Canada really isn't coming from Industry Canada?

[Marta Morgan]

Well, every year the Privy Council Office works with departments to develop a Government of Canada advertising plan that supports the priorities identified in the Speech from the Throne and the budget. An overall funding envelope is approved by Treasury Board and redistributed to the particular departments involved that year.

Industry Canada will receive its share of the funding through subsequent estimates and reports on spending through the public accounts. Information, as I just noted, is also provided in Public Works and Government Services Canada's annual report on government advertising.

[Glenn Thibeault, NDP, Sudbury, ON]

I guess what we're seeing here, then, Mr. Chair, is that the office of consumer affairs is getting just over $4 million, but this government is spending $8 million on ads. We don't have enough boots on the ground, so to speak, when it comes to protecting consumers, but we'll spend ads on it.

In relation to some of the campaign's contents, we're seeing that the policy is stating that it's going to increase rural and remote wireless coverage, when in fact I believe the rules in the auction, which is what I'm speaking to here, governing the rural rollout only require successful bidders to build out capacity in pretty much Canada's 10 largest urban centres to meet the rural rollout requirements.

Would that be correct?

[Marta Morgan]

Just as a little background on spectrum, wireless companies require spectrum in order to compete effectively in the market. The government has had a spectrum policy since 2008 to make spectrum available in such a way as to promote competition, investment, and availability of services to Canadians across the country.

In terms of the spectrum auction that's coming up for the 700 spectrum, this spectrum is a particularly valuable spectrum. It goes through buildings, it will go into garages, and it also goes really far. It has properties that make it particularly appealing to companies offering these services, including companies offering services in rural areas.

The rules for this auction, because of its quality, actually include the first rural deployment conditions of their kind in Canada. They include rules that are specifically related to the use of the spectrum in rural areas.

The government has also recently stated, the minister recently made an announcement, that it will only renew spectrum licences when all licence commitments are met so that other companies wanting to invest, for example in rural services, can do so. If a company has spectrum and they haven't been using it in rural areas, that spectrum will be taken back and repurposed to companies who do have a business plan that involves providing services in rural areas.

[The Chair, Conservative, David Sweet]

Thank you very much, Ms. Morgan.

Thank you very much, Mr. Thibeault.

Madam Gallant.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Thank you, Mr. Chairman, and through you to our witnesses.

What are the reasons underlying the changes to the National Research Council of Canada that we announced in the 2013 federal budget?

[Robert Dunlop]

Mr. Chair, yes, the National Research Council was asked to reorient its activities as a research technology organization, working primarily with partners, primarily private sector, but other public sector organizations as well, to focus on research that is directed towards a specific end, and in that respect take on ambitious projects that maybe private companies wouldn't normally do, looking beyond the short term through the involvement of the resources of the National Research Council to do that.

They've announced projects on, for example, the genomics of wheat, working with a variety of partners kind of longer term, involving the private sector, involving other public sector organizations on a very important issue for food security.

Similarly, they've announced that they're working with a variety of partners on printable electronics, which is a new area of research with great potential application, based on an assessment that there is potential for specifically that industry in Canada.

Those are a couple of examples of the kinds of projects that the new NRC is focusing on.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

How far along is the transition to providing support and services, based on market and industry demand?

[Robert Dunlop]

This is exactly the process they're going through now. There has been a very large change in management systems, in the kind of reach out they have to do. They have to develop the relationships with the companies, which calls for new kinds of people. The president of the National Research Council, John McDougall, has been very active on that.

As I say, we see the change with the announcements of these new programs and activities. That's an ongoing activity right now.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Is the NRC engaging the stakeholders or just announcing new programs?

[Robert Dunlop]

The announcement is the last stage. The first stage is using their network, and the IRAP network is one example of that, right across the country, knowing what companies are working on, reaching out, and trying to put together a consortium of similarly interested companies and institutions to define a project and commit resources.

The last stage is the announcement. An awful lot of work goes in before, because you want to have clear objectives. You want to have milestones. One of the objectives here is that if a project isn't reaching its milestones, it would be terminated. It is very much a private sector approach in that regard, but it's only the last stages. The progress we've seen is the fact that there have been a number of announcements of projects that have gone through all of that already.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

I keep hearing about this government concierge service and how it's supposed to help small businesses navigate through the suite of programs available.

When is this going to be up and running? How is it going to help small business achieve better access to the programs and the services they need?

[Robert Dunlop]

Actually, Minister Rickford announced the launch of the service formally on December 2.

The NRC has the service now in place and it will be ramping up. The intent is that by reaching into the national network of the National Research Council, no matter where a small business is, they will be able to access information about what's available and how they can best navigate government.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Does the Natural Sciences and Engineering Research Council of Canada have performance indicators to measure the impact of grants to support the partnerships between the educational institutions and local companies in relation to innovation?

[Robert Dunlop]

Yes, Mr. Chair. All of the activities of NSERC are subject to an evaluation framework of one sort or another, specifically on the partnerships program, which has released a progress report on the activities. It demonstrates the growing number of companies that have taken part in these programs over the last couple of years, and then, of course, to be followed up with a more formal evaluation when a bit more time has elapsed.

As I said, we've released an interim progress report to demonstrate the impact to date.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Dunlop and Madam Gallant

Now on to Mr. Stewart for five minutes.

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

Thank you, Mr. Chair.

Thank you to the witnesses for coming today.

I'd like to continue with Ms. Gallant's questions about the National Research Council.

I was looking at the Treasury Board Secretariat figures, which say that in 2008 the NRC had 4,590 employees. In 2013, the Treasury Board reports that the NRC now has 3,525 employees, which is about 1,000 fewer employees. I'd say that's a fairly massive cut over that period of time.

I'm wondering what kind of employees have been let go.

[Robert Dunlop]

I wouldn't be able to answer that right now. We'd have to get back to the committee, Mr. Chair.

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

Great. So we could have some kind of accounting of that.

Treasury Board does break down the types of employees who work at the NRC, and I'm wondering whether this is a cut across the board or whether it is a particular segment of the NRC that's being laid off. I've also heard that there have been more employees laid off, but different types of people hired on. When we had Mr. McDougall here earlier in the spring, we asked questions about this, and we were told we'd get a full report. We haven't seen much on that.

Mr. Chair, I'm just wondering if that is something that could be tabled, in terms of looking at the employee distribution within the NRC.

I'll continue on this line of questioning because it's quite puzzling to me. There has been an increase in some of the budgets at the NRC. It's been highlighted. There's an increase in funding for the NRC in some areas, but it's also letting 1,000 employees go.

I'm wondering where this money is being spent if it's not being spent on labour. Is it being spent on advertising? Where would the extra funding be spent? For example, is it being spent on contractors? Are they letting full-time staff go and bringing in contractors?

Is there anything you can help me with in terms of allocation of budget?

[Robert Dunlop]

Mr. Chair, a lot of the variability in the budget at the National Research Council is the budget of the industrial research and assistance program, IRAP. That was doubled by the government several years ago. The major increase you've seen in the overall budget is not on the internal operations of the National Research Council but the program to help industry. The internal operations are much more stable.

All government institutions have had some reductions, and as I was saying in the answer earlier, with the reorientation of the organization, they've also had to change the kinds of activities their employees are engaged in.

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

Thanks. I have one more question.

Ms. Gallant mentioned the 1-800 concierge service. I'm wondering if you could give us a ballpark figure on how much is being spent to launch and continue this. Could you maybe give us some detail of what it entails, other than a website and a phone number?

[Robert Dunlop]

I might need the “this just in” service on that. I'm trying to go on memory and numbers have never been my strongest part of memory.

The service is really meant to be value-added. The great strength of the National Research Council and IRAP is that the people who are there are people who are experienced in business. They're experienced researchers; they're not just providing the kind of information that's available on a website.

What this service is meant to do is make sure that the small business gets plugged into the right people, that they know the system. They're also working with other organizations that provide similar types of services, so to the extent possible, they don't get the runaround. Putting it at IRAP, the real objective here was to get them in touch with experienced people who've been through developing a small business, who've developed a technology, and allowing that value-added, which oftentimes is more important than the money, to be brought to bear.

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

Mr. Chair, I'm aware we have very low BERD investments and I understand we need to get small and medium-sized businesses investing in R and D, but I'm just wondering, if there have been such massive layoffs, and there has been no increase in the administrative budget, how is this shifting happening internally? That's why my direct question about the costs on this service is important to me.