The committee studied private sector investment in research and development in Canada, hearing from Michael McDonald of Colleges and Institutes Canada, Dugan O'Neil of Simon Fraser University, Luc Sirois of the Conseil de l'innovation du Québec, and Benjamin Bergen of the Council of Canadian Innovators.
Michael McDonald said colleges receive less than 4% of federal research funding despite supporting nearly 9,000 partners on over 8,500 projects annually, with 99% of work done with Canadian firms. He recommended the government reinvest $485 million over five years in the college and community innovation program and establish baseline annual funding of $215 million by 2030, and also ensure full eligibility for colleges in all impact-oriented research funding programs. He noted that the college system attracts $1 of private sector contribution for nearly every dollar of federal funding in applied research.
Dugan O'Neil said Simon Fraser University's innovation strategy bridges discovery and commercialization through programs like the invention to innovation network and VentureLabs accelerator, which has supported over 1,400 technology companies. He recommended establishing national innovation priorities across government, implementing federal procurement targets for emerging technologies, and better supporting the research-to-innovation continuum as outlined in the Bouchard report. He argued that creating a Canadian customer for innovative companies is a key missing piece, and that current trade rules can disadvantage Canadian SMEs in procurement.
Luc Sirois said Canada has seen a 32% decline in R&D spending as a share of GDP since 2000, while OECD countries saw 32% growth, and that tax assistance levels in Canada are already very competitive. He recommended redirecting tax incentives from basic research toward applied research and commercialization, strengthening skills in innovation management, consolidating support organizations, and simplifying access to programs. He noted that Quebec has created a new tax credit for research, innovation and commercialization, and that there are more than 200 financial support programs for innovation in Quebec, making navigation impossible for entrepreneurs.
Benjamin Bergen said the root problem is that Canadian companies decide it is not worth investing in R&D because they cannot own and commercialize the ideas generated, and that 90% of S&P 500 value now comes from intangible assets. He recommended establishing an innovation asset bank to generate, assert and defend Canadian intellectual property, and argued that 60% of strategic innovation fund dollars have gone to foreign multinational firms. He disagreed with the current approach to EV battery plant investments, calling it a job strategy rather than an innovation strategy, and said that subsidizing foreign firms like Mastercard and Ericsson deprives domestic technology companies of talent.
The committee debated a motion to extend the current study by two meetings to accommodate additional witnesses. The Bloc Québécois member opposed the motion, arguing that two consecutive Liberal-proposed studies had already been conducted and that other parties should have the opportunity to propose study topics. The motion's proponent noted he would table a motion for an AI study at the next meeting and was open to amendments from the Bloc. The Bloc member did not consent to debate or vote on the motion, stating it was not on the agenda and not related to the day's study.
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