Canada is becoming a laggard in technology, innovation and research and development investment, according to a biennial Science, Technology and Innovation Council (STIC) report.
It continues to do well academically, but Canadian businesses are investing far less in R&D and new technology than business in other economies, placing it 25th among 41 nations, STIC’s “State of the Nation 2012” concludes.
While a recent reorganization of the National Research Council (NRC) that focuses resources more on applied science could help bridge the gap, it should not be at the expense of pure science, said Simon Pimstone, CEO of Vancouver’s Xenon Pharmaceuticals and co-chairman of the STIC report.
“Government investment in basic research is critical,” Pimstone said. “Basic research is the beginning of the pipeline. It’s a requirement to enable the higher education system and industries to be successful in Canada. I think it’s absolutely critical that Canada continues to invest in basic research. There are different ways in which they can do that.”
STIC, an 18-member council of Canadian scientists and business leaders, was created in 2007 to advise the Stephen Harper government on science and technology policies. The “State of the Nation 2012” is its third report.
The good news is that Canada continues to punch above its weight academically. With just 0.5% of the world’s population, it publishes 4.5% of the world’s peer-reviewed articles, and 51% of the population has a university degree. However, it lags behind other jurisdictions in the number of PhDs it produces.
It is investment by Canadian business in new technology, innovation and R&D where Canada lags the most, however.
“We’re declining in our investment in information and communications technology, we’re declining in machinery and equipment on the business side,” Pimstone said, “and we definitely are lagging quite significantly on the venture capital side.”
The biggest declines have been in the pharmaceutical and medicine manufacturing sector, which dropped by about 2% since the 2010 STIC report.
Investment in information and communications technology, manufacturing, motor vehicle and parts manufacturing, and finance, insurance and real estate are all down about 1%.
Surprisingly, there has even been a drop in investment by the oil and gas drilling and extraction sectors, an especially important driver for the clean-tech sector.
The NRC’s work and how it will change
For nearly a century, NRC has funded science and technology research in Canada. Until its recent reorganization, it had 21 institutes across Canada doing research in areas from materials science to astronomy – including two in B.C.
The B.C. institutes are the Herzberg Institute of Astrophysics in Victoria (including the Dominion Radio Astrophysical Observatory in Penticton) and the Institute for Fuel Cell Innovation in Vancouver.
The fuel cell institute has been regrouped under the NRC’s new Energy, Mining and Environment portfolio, along with the Chemical Process and Environmental Technology institute in Ottawa, which does battery research.
The 150 NRC scientists and researchers in Vancouver will remain here, but they will be working more with universities and industry, said NRC spokesman Charles Drouin.
“Instead of just having NRC trying to do this, now we’re going to engage universities to work with us and engage industry to work with us on the other side,” he said.
“The changed mandate certainly seems to be, in part, to address what has been a relative weakness in R&D investment by business and in the commercialization continuum,” Pimstone said. “But it in no way should be a substitute for business investing in R&D.”
Neil Simmonds, CTO for Corvus Energy, an innovator in large-scale lithium batteries, said that in some cases, the NRC institutes have been doing the same research as companies like his.
“If they’ve got 150 scientists there, they’re burning through a lot of cash, and it would be far better if they gave it to some of the private industry groups,” Simmonds said. “We’re doing the same thing. Basically, they’re coming out to compete against us.”
The NRC does fund private- sector research through the Industrial Research Assistance Program (IRAP).
NRC’s total budget for 2013 is $900 million, a $200 million increase over 2011. IRAP represents about 25% of NRC’s budget (about $200 million to $250 million), which is double that of 2011.
