Canada hopes industrial policy will fuel science spending

Academic scientists, frustrated by years of lean budgets, again urged to value stimulating corporate innovation

June 29, 2021
Canadian dollar
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Canadian research funding leaders are urging patience from the nation’s frustrated scientists, promising they will benefit from yet another industry-focused governmental drive to fuel innovation.

The government was making “significant boosts in research across the board”, even if scientists have not begun to see the effects, said Ted Hewitt, president of the Social Sciences and Humanities Research Council, one of Canada’s three major research funding agencies.

John Hepburn, chief executive officer of Mitacs, a not-for-profit facilitator of industry-university partnerships, added that he was “cautiously optimistic” that the government’s latest innovation plan would work.

The leaders offered their reassurances at a moment of rising discontent among Canada’s academic scientists. Canada has watched its global ranking in research spending drop for more than a decade, and now is reaching the end of a three-year federal funding boost prompted by the warnings of the Naylor report in 2017.

The Liberal Party government of prime minister Justin Trudeau announced an annual budget in April that was highlighted by C$2.2 billion (£1.3 billion) in mostly new funding for life sciences. But a major share of that increase is going to Covid-related responses rather than new research investments, leading to rising dissatisfaction in recent weeks.

The Trudeau government has fallen short, said Daniel Béland, a professor of political science at McGill University, “in terms of boldly investing in academic science and putting the money where their mouth – and rhetoric – is”.

Canada spends only about 1.5 per cent of its gross domestic product on research and development, well below the 2.5 per cent average of the 38 member nations of the Organisation for Economic Cooperation and Development.

Corporate leaders, however, insist that fixing the country’s low rate of private-sector innovation remains the biggest potential help that the government can give academic scientists.

Canada has long managed to keep its economy strong on the strength of economic spillovers from the US, such as making parts for US carmakers, without having top corporate players in any major industrial sectors, said Trevin Stratton, chief economist at the Canadian Chamber of Commerce.

The country has been trying to encourage the development of its own commercial sectors, he said, but has struggled to do so. Of the two big efforts it has mounted in recent years, the Centres of Excellence for Commercialization and Research has been cancelled and the newer Innovation Superclusters Initiative was found by parliamentary auditors to be running poorly.

Despite such problems, Dr Hepburn said, the government is trying again in this year’s budget, by offering money to stimulate industrial activity in areas that include biomanufacturing, quantum technologies and sustainable industries.

Such money doesn’t go directly to universities, he said, but will help academic science in Canada over the long run if it helps build industries that can create jobs for skilled university graduates and stoke demand for further innovation.

“The government is trying,” he said. “It’s basically the beginnings of an industrial strategy, focusing on key sectors and seeing if they can provide better support for moving from the great research that gets done at the universities – which we have no shortage of – into societal benefit, into more innovative programmes.”

Yet the 2017 report requested by the government from a nine-member advisory panel led by David Naylor, a former University of Toronto president, questioned whether federal budgets were undercutting academic science at the expense of “innovation-facing and priority-driven programmes”.

Key recommendations from the Naylor report, especially concerning the sustained direct funding of academic science, “have yet to be implemented”, said Professor Béland, who also serves as director of the McGill Institute for the Study of Canada.

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