Science and Research Committee on June 4th, 2026

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

Despite the explanation you gave, I believe it would, obviously, be beneficial for Canadians and for people at large to know if there are concrete definitions to figure out what the criteria are, how the government is going to define “dual use” and which projects are going to be used for national defence.

Anyway, I will move to my next question. How many National Research Council-supported defence technologies have been procured or deployed by the Canadian Armed Forces thus far?

[Mitch Davies]

Madam Chair, I couldn't answer that with a single number without having undertaken some significant work to get a solid answer. We have many projects that support the Canadian Armed Forces and DND over many decades, so I can't answer that—

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

I appreciate that you won't have a list of projects. Can you name five items that have been given so far to the Canadian Armed Forces?

[Mitch Davies]

If it's a question of the council working on a project for the Canadian Armed Forces and having realized the objectives of the project, there are many. I would give you one example, but could give you further examples. I am happy to provide those to the committee.

In fact, one of the projects for which we most recently received an international award was for the autonomous flight of a helicopter in multi-use airspace. We won the top international award for the technology work we did. That's a project that was supported by DRDC.

There are many examples. I could give you a very long list of such projects where we've advanced technology—

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

Has that been deployed by the Canadian Armed Forces as of now?

[Mitch Davies]

Autonomy in that form—a helicopter flying in airspace that's very active—is something that's being deployed and tested in a robust way. At some point, these technologies will be in use, but they have them with us because we have to ensure that they're robust and actually will deliver.

Aerospace technology doesn't arrive in a matter of months. It's something that has to be developed to a very high standard. It needs to be very robust to be deployed in the field. That's what our expertise is.

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

We're running out of time, so let me ask a final question before the bells ring.

If a project receives NRC support but never reaches Department of National Defence procurement or Canadian Armed Forces operational use, does the NRC consider that a success or a failure?

[Mitch Davies]

I think that pursuing very ambitious technology itself brings a reward. It advances the skills and capabilities of our teams. In many cases, we can actually develop potentially patentable technologies in the course of doing that. Whether it's ultimately taken up and put into use is not necessarily the sole way you define success. I actually think there's a lot that's gained in the learning process of attempting things that are very challenging. In fact, most things that are very challenging can have a high failure rate as a consequence of being really complex stuff that we're trying to do. Yes, there's a benefit.

[The Chair, Liberal, Salma Zahid]

The time is up for MP Mahal.

We will now proceed to MP McKelvie for five minutes.

Please go ahead.

[Jennifer McKelvie, Liberal, Ajax, ON]

Thank you, Madam Chair.

That question leads really well into what I wanted to ask.

The committee has talked a lot about modernizing federal research and about a shift towards more mission-driven, mission-oriented research. I'm a big fan of that because I do think sometimes that we should be doing less, better. We should be identifying strengths, and we should certainly be identifying priorities, especially as we're embarking on this new venture around nation building and some of the work we're doing around defence.

What do you see as some of the strengths of the National Research Council that you can really build upon? What should some of these missions be? This is a question I love to ask academics at the dinner table. You get a very wide range of ideas, such as, for example, quantum computing. I ask, “What do you want to use the quantum computer for?” A great example is a secure transmission across the country from one end to the other. Something that Canada has always been known for is communication. That is an example of what we want that computer for.

Another example is that Canada is a leader in biotechnology and can be a leader in the new and emerging field of synthetic biology. A question would be, “What would you want to use those technologies for?” A great example would be mRNA technologies for autoimmune diseases, of which, in some cases, Canadians have some of the highest rates—for example, multiple sclerosis.

What do you think some of these missions are that we should be undertaking? How is the National Research Council at the forefront and ready to lead? How can you work better with the academic community and others to get there?

[Mitch Davies]

Thank you for the question.

The first thing I want to share with the committee is that the NRC established challenge programs somewhere around seven or eight years ago to very much do exactly what you said. The NRC's expertise needs to be combined with the best expertise outside the NRC. We define program areas that are missions for the country, and then pursue them over seven years. It's long-term work, with focus and intention, to get to outcomes. Those programs are approved by our minister in order to give them the sense that we're aiming for things the country needs and that are relevant.

I'll give you an example very much related to what you said.

A new program we're launching, which is under way now, is quantum internetworking. It's a new challenge program. It's been supported as a consequence of the defence industrial strategy. It's to do exactly what was mentioned: design the technology layer needed to move a quantum state across long distances and to essentially build quantum networks for the future.

Canada has everything from an ingredients point of view. We need to realize this, but we also need to tie it all together. That's what the program's intention is. That's why it's seven years. That's why it's not just us. It's us with academics and companies, all working together. This has been built into the NRC's tool box over the last decade of change and reform at the NRC, and it puts us in the exact right role. We can now deliver this sort of thing for Canada in a unique way.

[Jennifer McKelvie, Liberal, Ajax, ON]

Thank you.

Something being undertaken right now is the defence industrial strategy and BOREALIS to better look at connecting defence with the academic community, other government departments and, I believe, the NRC.

How are you engaged in BOREALIS? In particular, what role are you playing in the new DISHs—the defence innovation secure hubs?

[Mitch Davies]

We put staff in the joint project office to support the development of BOREALIS right at the beginning, at the conceptual stage of how BOREALIS will achieve its objectives. We've made ourselves part of that. We need to do this because we're the largest federal research and development organization, and we want to make sure everything we have available can support the goals that are part of the government's plan for BOREALIS.

As investments and choices are made as to the DISH portfolio, you will see the NRC working very closely with whoever is chosen, particularly if they are ecosystem or academic organizations. In fact, I hope we have prior existing relationships that are very strong. The challenge programming I talked about has brought us a lot closer to one another, so we're well positioned to deliver. The important distinction is that we are a capability of talented people. We also have a connection to small and medium-sized businesses that's very robust. It's almost not something you can replicate. We're offering those capabilities and assets to what the government is trying to achieve with BOREALIS.

I think we're there. There will obviously be further decisions made on how it will be structured and how it will work. We'll play a part in that, to the extent that we can be useful.

[Jennifer McKelvie, Liberal, Ajax, ON]

My last question is—

Oh, there's no time.

[The Chair, Liberal, Salma Zahid]

The time is up.

We will now start our third round with MP Holman for five minutes.

Please go ahead.

[Kurt Holman, Conservative, London—Fanshawe, ON]

Thank you, Madam Chair.

Thank you to the witness here today.

Mr. Davies, it has been reported that Canada has entered a recession. This is quite a concern for me because the London region, including London—Fanshawe, the riding I represent, has a 9.2% unemployment rate, the highest in Canada. Along with that, economists have repeatedly warned us about Canada's long-standing productivity challenges.

Given that the NRC's mandate includes supporting innovation and commercialization, how do you measure whether NRC investments are actually improving Canada's economic competitiveness and productivity?

[Mitch Davies]

If we're talking about the economy, the most important role over at the NRC that's very direct and that we can measure is the support we provide to small and medium-sized businesses. I mentioned that in my opening comments—the 10,000 companies we help every year. The question is this: What happens to them when they receive their help? How do they follow up?

We have strong KPIs to track what goes on. We have a 33% growth rate of the companies we work with. Over the last year, there was 13% growth of employment. That is an area that has recently trended down. I think that reflects some of the uncertainties and economic questions that you've raised. Essentially, companies are working on internal work, but they are not necessarily expanding their workforce. It's an area where we want to see opportunity at the growth and employment levels in the companies we work with. We track it very closely. In fact, you can look at it over a long period of time and see what it is that IRAP achieves.

The other statistic that's important is that the companies that IRAP supports are, more or less, 80% of the companies that raise the greatest equity, subsequent even to working with us. The question is whether we are choosing wisely whom to work with. I believe we have pretty strong evidence that we are. Those companies scale, become more significant, add more employment and become real exporters for Canada. We have to build from small businesses to get there. Those are the companies that will move the needle on the productivity that we're looking for in the long run.

We have to focus on the day-to-day in dealing with those companies and doing our job well in deploying the funds we have. Whether that all adds up at the global level to high productivity.... I think we're contributing, but there are a lot of other things that have to go well.

[Kurt Holman, Conservative, London—Fanshawe, ON]

Can you point to specific examples where NRC-supported research has translated to measurable economic growth, private sector investment or job creation here in Canada?

[Mitch Davies]

Once again, I think the key data are some of the things I've said to this point. I would also say that IRAP's economic analysis—which they've done—validates that we get about a five-dollar return on every dollar that's invested through the program and that it supports 13,000 jobs.

I don't want to quote specific companies, but I think pretty much any company that 10 years ago you didn't know who they were and now you know who they are, likely, in most cases, worked with IRAP in the very early stage when the support they received was pivotal to whether they could proceed or not. In some cases, if they couldn't have turned to us at a stage where it's the highest risk, where people stepping in to invest is very risky.... I think it's a program that does a lot to set us up to have opportunity to grow.

There's a whole question about what you need to sustain capital, to sustain the growth process and to have the right support for that and the right system. These are questions that you could ask other folks who come before the committee. I think the question is on how IRAP is very much focused on doing its job well, as part of this overall system, to create opportunities for very small firms to grow and then make real gains in the time they work with us.

[Kurt Holman, Conservative, London—Fanshawe, ON]

Canada is often recognized for world-class research, yet we frequently struggle to turn that research into Canadian companies, Canadian intellectual property and Canadian jobs.

How much NRC-supported research ultimately remains in Canada as economic activity, rather than being commercialized or acquired elsewhere?

[Mitch Davies]

Other KPIs that the council tracks relate to our contribution to intellectual property. The work we do that we contribute to and create in our labs adds to Canada's overall tool box. We put around 200 new patents in place every year. We have 1,800 patents in our portfolio, over 500 of which are actively licensed.

Our trend of who we're licensing with is reflecting more Canadian institutions and Canadian licensing. Pretty much 80% of it will be placed in a Canadian business that can take the work we do and actually make something of it in our country.

We, as a research performer, in actually holding and developing IP for Canada, contribute to the kinds of issues that have been raised in the question.

[The Chair, Liberal, Salma Zahid]

Thank you.

Time is up for MP Holman. We will now proceed to MP Rana for five minutes.

Please go ahead, MP Rana.

[Aslam Rana, Liberal, Hamilton Centre, ON]

Thank you, Madam Chair.

Thank you to all the witnesses for their valuable time.

Being a Hamiltonian, I'm really interested and would love to know about the role the National Research Council is playing with McMaster University to establish a southern Ontario innovation hub in Hamilton, which is the home of Canada's largest steel industry.

[Mitch Davies]

The opportunity to support the change under way in manufacturing technologies for the automotive sector is significant for Canada. It means shifting towards electrification as the main energy source, and that's actually a change to the entire vehicle.

We recognize the very significant strength of McMaster in this area. They have great, very deep research and connectivity with large automotive companies and a lot of very solid research performance that we can measure. We decided we would create a collaboration centre with McMaster to take our strengths and their strengths and combine them. We fit well with them in that our goal is to support the tiers 1, 2 and 3 suppliers in the supply chain that also need to pivot and see their technologies advance as part of this change in electrification for transportation.

Working side by side with McMaster, I think we can accomplish more. We can also optimize. We can bring our equipment into their facility. They have their equipment there, and we can use what the CFI has supported over the years and what the NRC has and make them work together. We owe it to the country that these things are connected so that we can have a bigger impact, so we're quite excited about the opportunity to work with McMaster very closely. They're a very strong player in the field.

[Aslam Rana, Liberal, Hamilton Centre, ON]

I'm pretty sure my colleague from southern Ontario, Mr. Baldinelli, will be interested, too, in knowing how the NRC is playing a role in shifting our traditional heavy steel industry towards advanced manufacturing and automation.