Innovation, funding, tax credits

Here's a link to good overview of some issues with the current Scientific Research & Experimental Development (SRED) tax credit regime. As I've noted earlier, there are some issues with how SRED works that are not in keeping with how R&D is conducted nor measured. As the Globe article posits, the Jenkins Panel has also recommended changes to the SRED program. While the SRED program has done a lot of companies a lot of good, it is skewed against the kind of market driven applied R&D that helps get new products introduced into markets. Overhauling SRED would be daunting to be sure, but anything that helps firms engage in R&D more directly should be welcome news.

Science, Technology, Students

In picking up the thread of research and development in Canada, there have been a few good articles of late that help frame the fall conversation. This will be particularly important as the federal government readies the release of its anticipated update to the S&T Strategy.

The Globe has a piece by economist Todd Hirsch on the lack of S&T investment by industry. This is not new news. Hirsch does do a good job of articulation what this may mean down the road for Canada's economy, especially when, as he notes, Canadian companies are "flush with cash." Partnering with a post-secondary institution such as a college, polytechnic or university can help industry to de-risk the R&D enterprise. This has been a staple of government support for R&D of late.

Of course there are those that decry this approach to R&D funding, saying that requiring industry partners will debase the pursuit of science. A recent Ottawa Citizen op-ed claims that governments are "starving" fundamental science research with the focus on industry engagement. Without wading too far into this, I wonder if a more nuanced approach is required? Certainly declining grant success rates is frustrating for anyone applying for funds. But fostering a greater national approach to partnering in research generally, and in this I include with industry, and among universities, colleges and polytechnics, both fosters greater academic and industry R&D productivity, while giving students better experience. I've made the point many times that engaging students in applied R&D with industry fosters innovation literacy. The point here is that, as CCA reports have outlined, we are excellent at many areas of basic research. I just think we don't have the GDP to support unfettered research into everything and so have to make choices. And health is likely a good one.

With the economic recovery perhaps not as good as we might hope, there is a couple of voices coalescing on the value of Canadian education. Both Mark Kingwell and Minister Jason Kenney have not dissimilar views. While the former lauds the value of Canadian universities such as the University of Toronto, Kenney goes a step further in seeking to leverage immigration specifically to attract and retain talent. Both underscore the value of our educational systems as being components of the larger productivity strategy that involves talent and R&D.

And this is a good segue into the Strategic Mandate Agreements that the Ontario government has recently required of all PSE institutions in the province. I've not yet had a chance to review these in detail and to compare and contrast them, but it will be interesting to see how our colleges, polytechnics and universities can work together to meet the needs of the labour market generally, for the economy of today and that of tomorrow.