Science and Research Committee on Nov. 5th, 2025

[Steven Murphy, President and Vice-Chancellor, Ontario Tech University]

Thank you, Madam Chair. I appreciate the invitation to be in front of you today.

My name is Steven Murphy, and I'm the president and vice-chancellor of Ontario Tech University in the great city of Oshawa, Ontario. There are a few points I'd like to make in front of the committee today.

I first want to acknowledge the government for the focus on priorities, more money for research, including basic research, and a focus on STEM to match the moment the nation faces. That's an important acknowledgement.

It's also important to acknowledge that while we have academic freedom, many of our universities are nimble, and we react to government, business and national priorities. I think we all know that we're in a time of historical significance for Canada. We need the academic community to be stepping up with those priorities. I'll be returning to that.

That said, we may historically have been looking at the wrong end of the commercialization continuum. As a university president, I'm probably asked daily, “Why aren't you doing more to get things out of your lab and into your organizations?” I could tell you that we're working really hard on that, and that we know we're not doing enough, but it's becoming a smaller subset of Canadian companies that are doing R and D in Canada. I know you've heard this from many witnesses.

It's really important to acknowledge that given the changes we see in our economy, with efforts in energy, building defence, manufacturing and retooling, and in steel and aluminum, to name a few, this could be an appropriate time to reboot, given the relational challenges with our neighbour to the south. Let's also not forget SMEs in this conversation.

Second, while we often focus exclusively on faculty and top talent—and that's critically important—what we don't hear a lot of is investment in commercialization officers. These officers have been the most successful at my university. These are individuals—professionals—who have spent some time in university life, but also some time in the private sector. They're a bit of a unicorn to try to find, but if you can find the right people, they are able to translate research into the commercialization opportunities that industry speaks, so that we're not speaking different languages. Let's let our researchers be researchers. They weren't trained in commercialization. Let's employ commercialization officers smartly and put money aside for that purpose.

Third, we've heard a lot about R and D tax incentives. Again, I think the budget was a good step here. I think we have to be thinking about the entire ecosystem. With less R and D happening in Canada, we have to try to make it viable. We know, for instance, that SMEs, when they're asked why they aren't using government programs, including what might be a more expansive R and D tax incentive, focus on the bureaucracy and the excessive time it takes to fill out government forms.

We really need to get a hold of how we can do things quicker and more nimbly if we indeed are going to create this new economy. It will lead to better talent retention, both in industry and in the academy. Everybody wants to be working on something meaningful, and I think you'll find that the universities are really meaningful partners.

I want to conclude by talking about the important partnerships—and I think we have some great ones at Ontario Tech—that really show how commercialization can be done. We are a NATO DIANA designated facility for our ACE wind tunnel. We do an awful lot of work with the Department of Defence, but also with the burgeoning defence sector that we have to continue to build in our nation. That means we have folks coming into our wind tunnel and using our professors and our facilities to advance technological innovation, both in government and in the private sector.

We're also a designated International Atomic Energy Agency collaboration centre in nuclear energy. Darlington, of course, is in our backyard, but we work closely with OPG, Bruce Power and AtkinsRéalis, and with the entire Canadian ecosystem, to ask how we can help to get the person power and the technology to improve nuclear, whether it's at the SMR stage or the full-scale grid stage. Our partnerships across the energy sector are also a real highlight in hydrogen fuel cell battery grid and modernization.

Finally, I would be remiss if I didn't touch on AI and the focus on ethics by design that we have at Ontario Tech. This is really pulling in many organizations that think an ethics-by-design approach is not just the right way forward, in comparing what's happening in Europe to what's happening south of the border, but it's also good business. Our clients want to know their data is protected and they want to know that privacy concerns are taken care of, and we're helping to commercialize that as we're developing AI.

In short, to wrap up, Madam Chair, I would say that where I see the connectivity is we need to be more closely aligned around the types of people we need in our universities who bridge this gap to our industry. We also really need to have our eyes wide open to this moment so we seize it in terms of the supply chains that are being built and both the SMEs and the large-scale companies that haven't traditionally been able to scale their commercialization efforts in Canada to the degree we'd like to see. There's a huge opportunity before us.

Thank you for this opportunity.

[The Chair, Liberal, Salma Zahid]

Thank you.

We will now proceed to our third witness.

The Canadian Shield Institute for public policy is being represented by Kaylie Tiessen.

Ms. Tiessen, you will have five minutes for your opening remarks. Please go ahead.

[Kaylie Tiessen, Chief Economist, The Canadian SHIELD Institute for Public Policy]

Thank you very much.

Good evening, everyone. My name is Kaylie Tiessen. I am the chief economist at The Canadian Shield Institute. We're a new think tank focused on securing economic transformation and sovereignty for the country. It's great to be with you tonight. I'm appearing on behalf of our institute and my colleague Vass Bednar, who is tending to a family demand this evening.

Canada’s research and innovation ecosystem needs a significant overhaul if we are serious about managing global risks and improving long-term economic performance. We don’t lack good ideas. We've heard that already tonight from the university and industry people who've been here. We don't lack good researchers. But our domestic firms invest too little in research and development, and when they do, they often can’t capture or retain the value of what they create.

Data from Statistics Canada shows that foreign-owned firms continue to outspend Canadian-owned firms on R and D across nearly every major industry. In 2023 there were three sectors where Canadian firms came out ahead. They were utilities, health care, and education, largely because those companies are Crown corporations or the broader government sector. Meanwhile, foreign firms in wholesale and retail trade spent up to 25 times more than domestic companies on R and D. Nearly 10% of all R and D spending happened in the retail and wholesale trade alone, much of it in advanced robotics, AI-driven logistics and e-commerce analytics.

When non-Canadian companies take on the bulk of the research, they also own the resulting intellectual property. Even when the initial research is funded by a Canadian institution, perhaps a university, the downstream value creation often flows abroad. This imbalance inhibits our ability to lead in advanced technologies. AI is often used as an example here. The foundational research that powered today’s generative AI models was produced at Canadian universities and supported with Canadian public funds, yet the commercialization of that work and the firms that dominate the market are all headquartered elsewhere today.

Other countries have confronted similar challenges head-on. In Israel, the Israel Innovation Authority has created Yozma Fund 2.0, using public capital to de-risk private investment in technology firms. For every dollar of institutional investment, the government contributes 30¢ and waives its share of returns. It's a clear signal that innovation is a national priority. In Korea, Korea Fund of Funds uses government financing to seed early-stage venture capital, and provides credit guarantees for start-ups built on intangible assets. Sweden’s Saminvest model coinvests alongside private venture funds to ensure that promising companies can scale domestically instead of being acquired prematurely.

All three countries share two things—a coherent innovation mandate and institutional vehicles that mobilize both public and private capital toward a national goal. By contrast, Canada dismantled much of its strategic policy architecture in the 1990s, when it was assumed that the private sector would fill the gap left by, say, the Economic Council of Canada. That never really happened. Our business R and D spending has stagnated for three decades, and our share of global patents continues to fall.

Further, R and D investments are also tools of sovereignty, so we have some recommendations here. We could structure public research funding so that Canada retains IP or equity stakes in resulting technologies. We could encourage institutional investors—pension funds, insurers, foundations—to allocate more capital to domestic innovation funds. Canada also has a gap in late-stage capital. This is often where firms are bought up by foreign companies. Targeting that kind of funding can maintain Canadian ownership. We must rebuild analytical and coordination capacity, such as with a modern economic council, to track where R and D value is actually captured and shape a strategy that sits across sectors.

Finally, others appearing before the committee earlier this week have recommended a sovereign innovation asset bank. We see this as an important and useful tool to help ensure that the value created from R and D is captured in Canada and used by other Canadian firms to innovate further. We can rebuild Canada’s innovation sovereignty so that when Canadians invent something extraordinary, we don’t immediately surrender its value. If we can better align competition, capital and capability across that principle, Canada can stop being the R and D branch plant for the world and start being a place where ideas become enduring national assets.

We will be submitting a formal brief to the committee on all of this later. We look forward to your questions.

Thank you very much.

[The Chair, Liberal, Salma Zahid]

Thank you.

Thanks to all of the witnesses for their opening remarks.

We will now proceed to our first round of questioning.

MP Ho, you have six minutes.

[Vincent Ho, Conservative, Richmond Hill South, ON]

Thank you, Madam Chair.

My set of questions will be directed to Ms. Tiessen.

We speak a lot in this committee about innovation, private sector R and D and job creation. The House of Commons was debating the issue of youth unemployment a couple of days ago. On that topic, do you think we are in a youth unemployment crisis right now, and do you think it has anything to do with a failure of government policy?

[Kaylie Tiessen]

I think we are in a youth unemployment crisis right now. We actually spoke about this at committee yesterday. I've been very busy the last couple of days. The solution has to be exactly what we're talking about here: creating better jobs so that there are jobs available for new graduates to move into them. That would include through innovation, creating the companies and creating the infrastructure, building, scaling companies here in Canada in order to make that happen.

[Vincent Ho, Conservative, Richmond Hill South, ON]

With the youth unemployment crisis, do you think it has any spillover effects? Perhaps financial struggles are caused by this youth unemployment because there are no jobs, which means there are no paycheques. Do you think it has spillover effects that perhaps would cause mental health issues for youth and exacerbate the mental health challenges that are faced by young Canadians today?

[Kaylie Tiessen]

I am not a mental health expert, but I will say that young Canadians are struggling right now. We know that they have fewer jobs. There are fewer jobs, and there's a higher unemployment rate for young workers than there was a year ago and two years ago. They are working fewer hours. There are fewer jobs, but if they are working, they're working fewer hours. They're also, after adjusting for inflation, making less per hour than they were last year.

This is a significant challenge for young workers who are trying to launch their life. They may have just graduated from university. They want to rent an apartment. They want to move out of the home where they grew up and buy a car. I don't know, there are all sorts of things they might want to do. Actually making that happen is definitely a challenge in this environment.

[Vincent Ho, Conservative, Richmond Hill South, ON]

The environment is the result of government failure.

Conservatives are fighting for an affordable budget for an affordable life. We hardly see any elements of that in the budget that was tabled yesterday.

Do you think that Canadians are facing an affordability crisis right now or in recent years?

[Kaylie Tiessen]

There's definitely an affordability crisis in this country. That's not going to surprise anyone. Everyone around your committee table knows that the crisis exists.

I think that a number of things could be done. I have written extensively about this. Unfortunately, I don't have that information with me. I prepared for a different set of questions, but I'd be happy to prepare a brief for you and to talk about some of the things that we could do, particularly in the digital economy. I'm thinking about algorithmic pricing, how that's affecting people across the income spectrum and what needs to be done to make sure that this is not eating away at the amount of money they're making. A company could be using algorithms to lower your pay, as well as using algorithms to hike up your prices. That's one of many issues we could discuss, and I'd be happy to prepare a brief for you on that.

[Vincent Ho, Conservative, Richmond Hill South, ON]

A lot of people are talking about the costly Liberal budget, which was released yesterday. Do you think there's anything missing in the 2025 budget, or are there any missed opportunities in the budget in your view in terms of innovation, anything about affordability or the youth unemployment crisis?

[Kaylie Tiessen]

What I wrote about yesterday was the need to make sure we are directing...that we have the systems in place for when investments are made in the multitude of things we saw yesterday. We saw that there will be investments in defence. There's a buy Canadian policy. There are investments in artificial intelligence, quantum technology and sovereign cloud. We need to make sure there's no sovereignty washing in how that money is directed, that it's directed to Canadian firms and that when the value is created from all the government spending that is going to happen—which is much needed at this time to fight the trade war and fill in the hole left by the drop in demand from the U.S. and from China—as much as possible is going directly into Canada's economy. That includes—

[Vincent Ho, Conservative, Richmond Hill South, ON]

Thanks, Ms. Tiessen.

I have one minute left. I'd like to give my time to MP Mahal.

[Jagsharan Singh Mahal, Conservative, Edmonton Southeast, AB]

I will continue where my friend left off.

You said that you definitely agree there is an affordability crisis in this country right now. Would you agree with me, Ms. Tiessen, that given the affordability crisis and given the uncertainty of the budget, getting access to private funding, with added bureaucracy and other red tape, would pose further difficulties when it comes to youth employment and the crisis we are in right now?

[Kaylie Tiessen]

I don't know if I would make that direct of a connection.

I do think there are opportunities not to remove regulation but to speed it up. We heard from some other witnesses already this evening the challenges that small and medium-sized enterprises face in filling out all of the documents that are required in order to access the innovation funding. I think it was in reference to the SR and ED tax credit.

We don't necessarily want to change the rules so much as we want to change the process of how that funding is accessed. I don't have a specific recommendation on exactly how we would do that, except to say I know there is technology that could be used and other processes that could speed it up.

Even just having different—

[The Chair, Liberal, Salma Zahid]

Thank you. I'm sorry, but the time is up.

We will now proceed to MP McKelvie. I think she's sharing her time with MP Rana.

You have six minutes between both of you.

[Jennifer McKelvie, Liberal, Ajax, ON]

Thank you, Madam Chair.

I want to start by saying that it is a good day for science. I started this morning with the Stem Cell Network's celebration of research excellence, which celebrated their awardees.

Then, over the lunch hour, we honoured Canada's top NSERC scientists, and we recognized in Parliament, Dr. Wishart, who's the winner of the Herzberg medal, as well as the other recipients.

Now we're talking to the greatest minds in Canada. Today just can't get any better from a science perspective.

With that, I know we have Dr. Murphy here from Ontario Tech.

While you did say that you're in Oshawa, what I actually heard you say was Durham Region, which I'm a part of. My question is for you, Dr. Murphy.

You mentioned commercialization officers. Do you have them at Ontario Tech? How do you fund them, and how beneficial have they been?

[Steven Murphy]

Through you, Madam Chair, we do have them at Ontario Tech. They are funded out of our operating budget because there isn't currently a funding mechanism for them.

To go into a little bit of detail about them, as I said, these are individuals who have worked in the private sector. For instance, it won't surprise anybody that, coming from Oshawa, we have an automotive engineering program, so we certainly have employed one who worked heavily with GM and also spent time in the academic sector. They have an incredible ability to identify what's happening in the lab and translate that into what's happening in industry.

The challenge we face is that these individuals are desired globally, and I've lost a couple of them to big universities in the U.S. For us to keep them, we need to keep them high on the innovation agenda.

There are all sorts of opportunities. I never lose an opportunity if somebody is about to retire and they're thinking they'd still like to be involved, they can also be a great commercialization officer. There are all sorts of ways as we look at our demographic crunch that I think we could position ourselves with people who understand both how university labs and businesses work and how they need to get things out and commercialized more quickly.

It is by creating that bond that I think we can begin to crack this nut. They're certainly a component of that very difficult puzzle.

[Jennifer McKelvie, Liberal, Ajax, ON]

I have one more thing, super quickly, and then I'll pass it off to Dr. Rana.

You gave me a tour of your AI work, and I'm looking forward to doing a tour of your nuclear work.

In terms of nuclear, you mentioned that you partner with IAEA, but I'm wondering how you work with the Pickering and Darlington power plants. They are major employers in our area.

[Steven Murphy]

Partnerships always go down to the depth and magnitude of that partnership. People have correctly stated that partners in the private sector typically come to universities first for talent. Second, they need to be pulled in to understand what you're doing there.

While all of those folks in the nuclear industry, with their expansion, are pulling on us for more nuclear engineers or engineers we re-skilled from other areas into a nuclear program, they're also looking to us for really important advancements in technology. For instance, nuclear waste can now be dealt with so much more quickly and effectively than it has been in the past, and there's so much less waste produced. That is all due to technological advancements that have happened in Canadian universities which have gotten out into them.

Without that depth and breadth of partnership, you would never get to that level of commercialization. I really credit that depth and breadth with our ability to get these things out and into important industries like nuclear.

[Aslam Rana, Liberal, Hamilton Centre, ON]

Thank you, MP McKelvie, for sharing your time.

Thank you, Madam Chair.

I welcome you, Dr. Michael May, as you are from my riding of Hamilton Centre. You're doing a great job with wonderful opportunities for Hamiltonians, along with Canada's biotech sector.

I would ask you about the commercialization challenges you are facing, especially when you convert your idea from the lab to the private sector.

[Michael H. May]

There's a lot of talent in Canada. That's not an issue. The access to capital to scale ideas and get companies off the ground is important.

We also need a focus on ecosystem building. That doesn't mean focusing just on IP. IP is always related to people. People come up with the ideas. What we need to do in this country is create receptor capacity for the IP and the people, which creates viable companies that are well-funded and provide high-paying jobs for these innovative individuals. OmniaBio is a great example of that, because it's hard to move manufacturing. You can move IP and you can move people, but you can't really move manufacturing. In Hamilton, using AI and robotics, we will make that facility five times more productive than it was originally designed to be with just manual operations and people.

The challenge is thinking about it from an ecosystem perspective and making sure that we're thinking of receptor capacity in Canada for the talent and the IP.

[Aslam Rana, Liberal, Hamilton Centre, ON]

You're—

[The Chair, Liberal, Salma Zahid]

Thank you, MP Rana. Your time is up.

We will end this panel with MP Blanchette-Joncas for six minutes.

[Maxime Blanchette-Joncas, Bloc, Rimouski—La Matapédia, QC]

Thank you, Madam Chair.

I'd like to welcome the witnesses, and thank them for their understanding regarding the first hour of the meeting.

Ms. Tiessen, you're right to raise the challenges that AI presents in Canada. Numerous witnesses have recently explained to the committee that innovations and data hosted on American servers are subject to American laws, even if the servers themselves are in Quebec or Canada. That means an important part of our knowledge and intellectual property is no longer under our control.

What are the real risks of this lack of intellectual sovereignty for public research and science policy in Canada?