Evidence of meeting #39 for Science and Research in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was companies.
A recording is available from Parliament.
11:25 a.m.
Liberal
The Chair Liberal Lloyd Longfield
Thank you.
I think we've lost your microphone, Mr. Francq, which might be the point of order we're hearing. Can we check the microphone?
11:25 a.m.
Liberal
11:25 a.m.
Liberal
The Chair Liberal Lloyd Longfield
It sounds like you're back. I have the thumbs-up from the translators.
Thank you.
11:25 a.m.
Director, Innovation and Technology, The Conference Board of Canada
Thank you. Let me just start again.
It specifically was around the role the federal government can play in enabling. Perhaps it was number three, which is the review of the IP ownership.
Maybe I'll respond by saying that we've listened to past witnesses, Dr. Karim from UW and Dr. Jeff Taylor from Colleges and Institutes. They commented on the differences between universities and colleges.
Colleges are closer to industry, since their projects tend to be faster and the IP goes to the company, whereas universities are more curiosity-driven. They tend to focus on groundbreaking deep tech or social innovation, on things that maybe companies won't take. They focus on highly qualified personnel and spinoffs. The problem we have, of course, is that these are competing missions. The discovery of new ideas and the dissemination to students is the mission of a university. One is creation and the other is commercialization. One is invention and one is actual innovation.
On the recommendation, if you look at the wide variety of IP rights or commercialization at the universities, on one side of the country we have, for example, UBC, which is entirely institutionally owned, and on the other side, we have the University of Waterloo, which is entirely creator-owned. Somewhere in the middle we have perhaps Toronto, for example, which is jointly owned.
In the economies that are performing best—and they've been cited here in Fraunhofer or perhaps even in the Israeli discussion—you see a centralization and a common standardization of that IP policy. Recommendation number three is to review those rights ownership policies, the technology transfer models and the ownership of those rights and how they get transferred into the economy. Again, we do really well at that side, but we fail at the firm level to transfer those ideas and the HQP, the highly qualified personnel, into the economy.
Let me just say that certainly it needs strong federal coordination, and I think consistent provincial implementation will clarify the best models for research and industrial partners. Again, I would say that tri-council grants must ensure that IP remains in Canada for the benefit of Canadians.
11:30 a.m.
Liberal
Chad Collins Liberal Hamilton East—Stoney Creek, ON
Thanks, Mr. Francq.
I'm going to stick with post-secondary institutions for a minute.
A previous IP study that occurred here in Ottawa and in 2017 highlighted that private firms do not know what research is being performed in post-secondary institutions and that there's a bit of a lack of information about potential partnerships between the private sector and post-secondary institutions.
How can the federal government help in terms of being a matchmaker or providing a road map to funnel those private investments into post-secondary institutions to ensure we're generating as much economic growth as possible?
11:30 a.m.
Director, Innovation and Technology, The Conference Board of Canada
Yes. Thank you very much.
I'll cite, of course, ExploreIP, which is quite an interesting and wonderful resource for companies looking for public R and D. I should check the numbers, but I remember something on the order of 4,000 opportunities sitting there. However, only maybe 400 of them, or 10%, were active, and possibly even only 10% of that was being actively pursued in terms of intellectual properties and business.
By the way, what they do wonderfully is map out the 35 areas of technology focus in the country. If you're in materials or agriculture, or if you're in tech or communications, you can see where those are. It is a helpful navigation tool, but as I just suggested, there is not a lot of engagement or pickup.
For example, if you look at what came out of the expert panel on intellectual property, the expert panel that created IPON, the intellectual property office of Ontario, that's where the rubber really hits the road. You have an organization that is looking at the interface between universities and specific regions—in this case, Ontario—and they are putting in place those things from recommendation 1: IP education, IP intelligence and experts, enabling freedom to operate through collectives and incentivizing patent, trademark and industrial design filings in a very systematic way.
That's actually a good example within Ontario, but this is Canada and the Conference Board of Canada, so we have to take a national approach to this as well and not just lead provincially.
11:30 a.m.
Liberal
Chad Collins Liberal Hamilton East—Stoney Creek, ON
Thanks for those answers.
I think I have just over a minute left.
You gave a bit of a mixed-bag summary of the report card you provided for us. What's the greatest gap to bridge right now in terms of either investments or policies? Can you give us the top priority for improvement in one or more of the categories you highlighted in your opening remarks?
11:30 a.m.
Director, Innovation and Technology, The Conference Board of Canada
Yes. I have the report card in front of me right now. Across nine indicators.... We're increasing it to 25 indicators, by the way, this year, which is going to give a lot more granularity and maybe, to Mr. Greer's point, go beyond patents, which is just a proxy for innovation. We're going to try to go to incremental innovation, social innovation and, frankly, in the words or the book of Danny Breznitz, we're going to look for where innovation is truly happening in the country, because we actually do have great innovation sources.
To answer your question very pointedly, I'm looking at the report card. The one that receives the most D-minuses is business R and D, and the second one beyond that is patents and intellectual property, so that's where we're going to focus.
11:35 a.m.
Liberal
The Chair Liberal Lloyd Longfield
That's great. Thank you very much.
Go ahead, Mr. Blanchette‑Joncas.
11:35 a.m.
Bloc
Maxime Blanchette-Joncas Bloc Rimouski-Neigette—Témiscouata—Les Basques, QC
Thank you, Mr. Chair. First, let me say congratulations on your election as chair.
Initially, I was a bit skeptical about your joining the Standing Committee on Science and Research. Science and research is a very important issue in Canada, and you can't just become a science expert. Similarly, you can't suddenly understand the science ecosystem because you join the science and research committee, which has been working diligently for more than a year and a half. Nevertheless, I'm going to give you the benefit of the doubt, in the hope that, through your dedication, you will familiarize yourself with all the work the committee has done so far. You can certainly count on my co-operation and support to advance science and research in Canada.
I'd also like to take a moment to recognize the Honourable Kirsty Duncan, who did the early work to get this committee off the ground more than a year and a half ago. I want to commend her commitment and all of her hard work. I want to say thank you and I hope to see her soon.
Mr. Francq, your opening remarks were quite eloquent. I think the figures speak volumes. You said that Canada ranked last among OECD countries on per-capita long-term growth, and you had the figures to prove it. The fact that Canada's GDP growth was just 1% between 2007 and 2020 certainly isn't trivial. It means billions of dollars in lost economic potential and fewer resources to deal with social priorities and the decline of our overall ability to influence our citizens' quality of life.
This is my question. Do you think there's a link between the indicator you mentioned, long-term growth per capita, and the current level of science research intensity in Canada?
11:35 a.m.
Director, Innovation and Technology, The Conference Board of Canada
Thank you for the question.
I want to draw attention to the comment about where we can punch above our weight and win globally.
We are an applied research centre, Canada's largest one, when it comes to this issue, so we looked at the problem of patents. We looked at the data and we asked several questions. I'm going to try to give you some insight on where we can punch above our weight.
The first thing we did was look at the technology classes in which Canada has really strong specialization compared to the rest of the world. The policy relevance here is that consistent, strong specialization in this technology means that there's some sort of domestic factor that supports Canadian businesses.
We looked at that, and then we looked at where the technology classes in Canada have comparative advantage. A number of researchers have done this, but we overlapped the two so that we can see where Canada can punch above its weight. We analyzed that, and here are the results from that report.
Our analysis of the latest patent statistics shows an absolute advantage in nine fields, the top five being medical technology, computer technology, measurement, pharmaceuticals and transportation.
It's also important to assess the comparative advantages. Mr. Balsillie mentioned the idea that economy works on the idea of absolute advantage. This is what you get when you get critical mass, but you also have to have strong specializations in emerging areas.
We have three areas where we have the potential to punch above our weight. One of them is microstructural technology and nanotechnology, the basis for semiconductors, quantum and advanced materials like batteries. We are strong in that area, regardless of these low OECD and declining patent numbers. We have strength here.
I'll give you a sense of what strong specialization means: Canada patents three times more frequently in microstructural and nano compared to the world average, and it's almost twice as much in civil and environmental technology.
What's really important to note, as was mentioned by a previous witness, Pina D'Agostino, is that different approaches are required for each—
11:35 a.m.
Bloc
Maxime Blanchette-Joncas Bloc Rimouski-Neigette—Témiscouata—Les Basques, QC
Sorry to cut you off, Mr. Francq, but I see you're reading from the report. Thank you for sharing your analysis, but I have another question.
I'm going to list three facts. First, Canada is considered the only G7 country to have seen a decline in the number of researchers per 100,000 inhabitants in recent years. Second, Canada is the only G7 country whose R and D spending as a share of GDP has dropped in the past 20 years. Third, Canada hasn't increased or even indexed federal graduate scholarships for two decades now.
My sense is that there are reasons to explain that position of disadvantage when it comes to long-term growth. Even in the last federal budget, there was nothing set aside for research. It's tough to stand out when we don't invest in R and D, while our neighbour and competitor does. The U.S. actually doubled its investment in its main research funding program.
When you take all of those facts into account, how do rate Canada's prospects?
11:40 a.m.
Director, Innovation and Technology, The Conference Board of Canada
Let me just qualify. Do you mean that in terms of potential innovation policy compared to, for example, the U.S., China or other leading nations?
11:40 a.m.
Bloc
Maxime Blanchette-Joncas Bloc Rimouski-Neigette—Témiscouata—Les Basques, QC
I'm talking about productivity and economic growth. How can we be productive and innovative, when we don't invest and our biggest competitor and neighbour, the U.S., is doubling its spending?
11:40 a.m.
Director, Innovation and Technology, The Conference Board of Canada
Indeed, that is a problem.
Where we seem to have lost the ability to translate this incredible ability in public R and D, essentially the generation and creation of new ideas—
11:40 a.m.
Liberal
11:40 a.m.
Bloc
11:40 a.m.
Liberal
The Chair Liberal Lloyd Longfield
If we could have that answer in writing, it would be beneficial to the committee.
11:40 a.m.
Bloc
Maxime Blanchette-Joncas Bloc Rimouski-Neigette—Témiscouata—Les Basques, QC
Yes, I wanted to ask for a written response. Thank you.
11:40 a.m.
Liberal
The Chair Liberal Lloyd Longfield
Thank you.
Mr. Cannings, could you take the floor, please, for six minutes?
11:40 a.m.
NDP
Richard Cannings NDP South Okanagan—West Kootenay, BC
Thank you.
Thank you to the witnesses here before us today. It's been very interesting.
I'm going to start with Mr. Greer.
It's always good to talk to a fellow Okanagan resident. I know you have a background in Accelerate Okanagan, and some years ago I had the opportunity to tour the facilities. It was great that you expanded this conversation beyond patents into other more, in many ways, important circles.
Mr. Williams asked most of the questions I had marked down, but I wonder if you could give some concrete examples of where governments have stepped up and helped these social purpose organizations. How can we do more of that, or where do we really need the federal government specifically to step in? What are some concrete examples of how we could help?
11:40 a.m.
Managing Director, Purppl
Thank you. It's nice to see you, Richard. Welcome to another Okanaganite.
Those are great questions. A couple of examples....
How have governments stepped up to help? The federal government has a social innovation and social finance strategy. There's a $900-million strategy supporting this. The government recently rolled out a program called the investment readiness program, which has specific support for social purpose organizations to improve and increase their investment readiness.
There are some great examples. We work here with a charitable day care with multiple sites—about seven or eight sites—here in Kelowna. Through some coaching through the first round of the investment readiness program, they slowly got their confidence to take on investment and they purchased the farm where they were operating a day care. Now they've secured their economic future. They took out a big loan, secured a place to operate for as long as they want, and kids are accessing day care on a farm. It's pretty cool. There's a good example of a positive story.
On the other side of the coin, social purpose organizations, most being non-profits, are left out of organizations like BDC. BDC serves businesses, so all the innovation financing that's going into the Canadian economy is basically leaving SPOs out of the equation.
That would be a place or an example, but the examples continue. The SR and ED program is not applicable. The small business financing program is not applicable for SPOs. There are major gaps in policy for supporting social innovation.