Mr. Speaker, it is a great pleasure for me to respond to the comments made by my hon. colleagues on the other side of the House.
First let me thank my colleague for his reference to me as a brilliant lawyer. I believe it is undue flattery as will be revealed in the coming minutes. Anyway, I thank him for that.
It is an honour for me to be able to respond to the motion by the hon. member for Rimouski-Témiscouata. If I understand the motion, the hon. member wants to condemn the Government of Canada for "its regressive research and development policies in regard to Quebec". She then goes on to criticize a decision to cut the federal contribution to the Canadian Centre for Magnetic Fusion in Varennes.
I submit that the hon. member does not want, will not look and does not want to look at the federal S and T strategy in the broader context of what it means for all Canadians. This is obviously the hon. member's prerogative.
Evidently she is not interested in science and technology policy beyond the borders of her home province. Nor does she want to put the Government of Canada's spending on science and technology in the context of the overall strategy to reduce the deficit. She ignores the federal deficit in the same week that her former leader, the premier of Quebec, has gone to the investment community of New York to tell American investors that his number one preoccupation is to cut Quebec's deficit.
Perhaps she will take the advice of her former leader, the now premier of Quebec, if she will not listen to what we have to say on this side of the House. I am certain that the premier of Quebec will tell her that deficit reduction requires tough choices. He will tell her that she has to assess her priorities. Not every program can continue to receive funding if we want to bring the deficit under control.
I will argue that the federal government cannot provide funding for fusion R and D at this time because fusion research does not meet our current criteria for funding. There is every indication that it will take at least another 30 years of research before energy supplies from fusion technology can be realized on a commercial basis.
We have had to make tough choices. We know we have had to cut funding for some programs that we would otherwise want to maintain. Above all, we have to make strategic decisions on how best to invest the $5.5 billion that the Government of Canada spends on science and technology.
Out of that S and T budget, the Government of Canada spent $3.1 billion on research and development initiatives in 1992-93. Did Quebec get a fair share of that investment? Did the federal government, as the hon. member accuses, implement a regressive R and D policy for Quebec? Members will find that Quebec received $692 million in federal R and D spending in that year. Another $13 million was spent on the Quebec side of the border in the national capital region.
Taking the national capital region out of the formula, as many industrialized countries do in calculating regional distribution of R and D spending, we find that the $692 million spent in Quebec represents 28 per cent of all spending outside the national capital region. I would suggest that is more than fair. More to the point, I do not see how the hon. member opposite can complain that the federal government has regressive R and D policies with regard to Quebec.
The amount of $692 million is a very sizeable investment in Quebec R and D. It comes from a tax base into which all Canadians pay. An independent Quebec would have to come up with a similar amount, in addition to its current provincial spending, if it wanted to maintain the current level of R and D in the province of Quebec.
In addition, members across and all Quebecers should carefully consider the investment that the Government of Canada has made into new research facilities over the past number of years.
Let me cite only a few examples. In 1987 Quebec got the Food Research and Development Centre and the Maurice Lamontagne Institute. In 1989, it got the space agency, a research agency, I believe it is fair to say, of which all Canadians are immensely proud. All Canadians were proud to see Canadian astronaut Marc Garneau on his second shuttle mission two weeks ago.
The true measure of federal investment in R and D is not measured even by such major investments as these. It is also measured by R and D grants and contracts to industry and universities. Quebec receives 30 per cent of that type of funding. In addition, Quebec gets a higher than average share of R and D tax credits because of the concentration of R and D in that province. According to a recent report from Simon Fraser Institute, Quebec based firms claimed 41 per cent of all R and D tax credits claimed in Canada in 1992.
Since 1981 the investment of the federal government in fusion research at the Tokamak de Varennes alone has amounted to $90 million. This investment has helped to develop scientific and industrial research in Quebec.
The federal government is continuing to fund research and development of energy technology in the province. It will be primarily, and I have said this in the House before, in areas of energy efficiency and renewable energy systems at Varennes
laboratories, which opened four years ago. This program has an annual budget of $6 million and employs approximately 50 people.
In nuclear energy, the mandate of Atomic Energy of Canada Limited is to seek to maintain a viable, competitive business in supplying and servicing Candu reactors at a reduced cost to the federal government.
Electricity generation from Candu nuclear energy technology is an economic reality today. Candu is already a success and has a good chance of achieving even greater success internationally. High technology industries in Quebec will continue to benefit from the nuclear industry through contracts developed from Candu sales to Korea and through the good performance of the Gentilly-2 Candu reactor. Consultants' studies show that a typical Candu 6 sale overseas could bring over $100 million in contracts to Quebec and generate about 4,000 person years of employment.
I would ask the hon. member opposite again; how in light of these numbers, in light of these benefits to Quebec, can she make the case that the federal government has regressive R and D policies for Quebec?
Let me broaden the scope of my argument for the benefit of all members of the House and put the decision regarding federal funding for fusion R and D in the context of overall federal priorities and the priorities for federal participation in science and technology activities.
As all members know, the Government of Canada faces the challenge of reducing the deficit in order to manage the debt and maintain a stable foundation for new jobs and growth across the nation. We are determined to meet our objectives, and as we all know, we are making progress toward our objectives.
In addition, at this time we are living up to our commitment to all Canadians to be fair and compassionate in our decision making by putting in place new building blocks for security and prosperity.
The criteria that my department is using to determine its priorities for research and development activities mirror the overall emphasis on jobs and growth in the near term that the federal government is focusing on as a whole. Specifically, the energy R and D priorities at Natural Resources Canada are sustainable development, energy efficiency, renewable energy sources, the science of climate change and non-conventional hydrocarbon resources.
Every thoughtful Canadian who is concerned about the vast range of services provided by the federal government and the equally vast cost of providing these services knows that the government must set priorities and must make difficult decisions. That is why this government was elected, to make these decisions, to allocate our limited funding accordingly and to take action. The federal government must concentrate its resources on its highest priorities and strive for their success.
The focus of the federal government is on activities that will bring results in the near to medium term. As I noted earlier, commercial generation of electricity from fusion is uncertain. Assuming that an economically viable technology could be developed, it is at least 30 years away.
Last March, following extensive consultations with Canadians the Government of Canada introduced a science and technology strategy that lays the foundation for the decisions we must make in prioritizing S and T in Canada.
The strategy demonstrates concretely how the federal government is getting its house in order so that it will be a better partner to the other players in Canada's innovation system, the private sector, academic institutions and other orders of government. The strategy sets out the Government of Canada's priorities in four key areas.
First, it defines national goals for science and technology. These goals are sustainable job creation and economic growth, improved quality of life and advancement of knowledge.
Second, it describes the federal government's core S and T activities.
Third, it outlines a new system of governance within federal departments that bring science and technology to the centre of the decision making process in cabinet.
Finally, the S and T strategy provides operating principles to guide federal departments and agencies.
Keeping in mind these over-arching principles, let us return to the question of energy R and D. Canada is amply endowed with a variety of resources for the generation of electricity, including hydro, fossil, nuclear and renewable energy sources. We have assigned a high priority to research into efficiency gains in the current production and use of energy.
The national fusion program is a good program but it does not rank as a high priority in the federal government's overall science and technology objectives. Cuts are planned for federal funding for fusion research in both Ontario and Quebec. There will also be cuts to the basic science program of Atomic Energy Canada Ltd., mostly in Ontario.
For a number of years the federal government has co-funded research and development of fusion, the national fusion program, in partnership with Hydro Quebec and Ontario Hydro. Recently the annual cost has been $7.2 million for the Quebec part of the program and $4.4 million for the Ontario portion.
More than 70 Canadian high technology companies and 6 universities have benefited and will continue to benefit well into the future from the fusion research program. As I mentioned, in drawing up the 1996-97 budget the government decided not to provide funds for research and development of fusion beyond March 1997.
The agreements among the partners stipulate one year's notice for ending contributions to the program. We have exercised that right. This provides for an orderly transition. The other partners have a year in which to make adjustments.
Hydro Quebec and Ontario Hydro have the option of continuing with the program independent of federal funding. Most of the industrial and commercial benefits of such work would be in Ontario and Quebec. If these provincial utilities consider fusion to be a priority it is reasonable to expect that they devote more resources to this priority.
As I mentioned in committee last week, I have asked my officials to facilitate discussions to help the utilities and other interested parties during the transition to seek alternative sources of funding. I make it clear again this afternoon that there will be no more funding from the Government of Canada.
Taxpayers would like the government to participate in many of the outstanding projects which merit public support, but informed and concerned taxpayers also know as never before that government resources are limited. They elected this government to make tough decisions. Our decision to terminate funding for fusion R and D is one of those decisions.
I believe I have established a solid argument that justifies the Government of Canada's decision to terminate federal funding for fusion R and D. The government is doing all it can to meet its overall priorities of addressing the deficit and improving the climate for jobs and growth. Meeting these objectives will provide substantial benefits for present and future generations of all Canadians.
We are determined to meet our objectives and we are making progress toward our objectives. We have identified clear and consistent criteria on near term goals to priorize our spending and we are making the tough and necessary decisions keeping us on track to meet our deficit reduction targets and, as important, to meet our objectives in terms of encouraging jobs and growth.
The Government of Canada is making a substantial contribution to R and D in Quebec. I do not think anything could be clearer in light of the numbers I discussed earlier. Simply put, however, fusion does not meet our criteria but we are working on many other programs in the province of Quebec and all over the country that do meet our S and T criteria.
This is not a regressive policy for R and D in Quebec. This is a policy with a clear vision to encourage jobs and growth for present and future generations of Canadians.