INDY Committee Meeting

STANDING COMMITTEE ON INDUSTRY

COMITÉ PERMANENT DE L'INDUSTRIE

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, October 23, 1997

• 0906

[English]

The Chair (Ms. Susan Whelan, Essex, Lib.): Ladies and gentlemen, I'd like to call the meeting to order. We have with us today the Association of Universities and Colleges of Canada, and we would like to welcome them here. Everyone is representing a different association or consortium, and I understand that everyone will begin with a brief statement.

Your report Sustaining Canada As an Innovative Society: An Action Agenda was jointly submitted to the committee by the Association of Universities and Colleges of Canada, Canadian Association of University Teachers, Canadian Consortium for Research, Humanities and Social Sciences Federation of Canada, Canadian Graduate Council and the National Graduate Council. I believe a representative of each of those associations is with us today, although the Canadian Graduate Council representative is not here yet and may not be coming because of an illness.

Without any further adieu, perhaps Dr. Paul Hough could start.

Dr. Paul Hough (Chair, Canadian Consortium for Research): Thank you, Madam Chair.

Members of the committee and ladies and gentlemen, it's an honour to meet with this committee today and we thank you for this opportunity. I would like to take a moment to introduce everyone at this end of the table and provide a sense of the representation that is sitting before you.

My name is Paul Hough and I am here in my capacity as chair of the Canadian Consortium for Research. This consortium brings together 25 organizations, societies and associations that collectively represent approximately 50,000 researchers, mainly in universities but with many in government laboratories and in the private sector. It includes the full spectrum of disciplines, including biomedical, natural sciences, social sciences and humanities. The consortium also includes the Canadian Confederation of Students, which has a membership of around 400,000, and it is from this group of course that our future researchers and leaders will be coming.

I am joined at the table today by representatives of several organizations that are key players in the research scene. Robert Giroux is the president of the Association of Universities and Colleges of Canada. AUCC represents Canadian universities in all provinces and acts as a catalyst for constructive debate on issues of importance to the university community.

Dr. Shirley Mills is a member of the executive of the Canadian Association of University Teachers, CAUT, and is a researcher in the Department of Mathematics and Statistics at Carleton University. CAUT is made up of the many faculty associations across the country, so we have representation here both from the university administration side, through AUCC, and from the faculty.

Dr. Chad Gaffield is the president of the Humanities and Social Sciences Federation of Canada and is a professor of history at the University of Ottawa. It is important to realize that the humanities and social sciences make up about 60% of the total university faculty complement in Canada, so it's imperative that this group be here with us.

We also have Derreck Deans, who represents the National Graduate Council, and we had also hoped to have Rubina Ramji from the Canadian Graduate Council to bring the graduate student organizations to the table. These graduate councils represent the leaders of tomorrow, and it is essential that we engage their energy and enthusiasm as we develop policies that shape the future research enterprise.

Beyond simply representing the broad spectrum of the Canadian research community, these groups have recognized for a long time the need to collectively address the issues that we face and to put forward our assessment of the priority areas and to articulate our proposals for action.

• 0910

At this time in 1996, a year ago, this same coalition had prepared a document entitled Putting Knowledge to Work: Sustaining Canada As an Innovative Society. In that document and in our collective presentations to the standing committees, we underlined three priority areas. These were the pressing requirement to renew university research infrastructure, the importance of sustaining the networks of centres of excellence program, and third, the necessity of having programs that encourage research careers in all sectors. These were the priorities that this broad coalition agreed were the most important, and the government listened and responded through a number of important measures in the 1997 federal budget, as Monsieur Giroux will elaborate on in a few moments.

The research enterprise in Canada is complex and perhaps different in structure from other countries, thus the initiatives announced in the 1997 federal budget and now being implemented address the strengthening of some aspects of this enterprise, leaving other aspects aside. Over the past many weeks the research community, through the organizations represented at this table, have continued their collaborative efforts to define the critical steps that must be taken for Canada to build and reinforce the research capacity that is essential for our future growth and well-being. Those measures are detailed in our joint paper Sustaining Canada as an Innovative Society: An Action Agenda, which we are presenting to you today and which I believe was distributed to the committee previously.

Madam Chair, the research community has come together to an extent not previously seen in this country to define the priority areas and the steps that follow from this assessment. Governments over the years have urged the community to do this and it has happened. This comes at a time when everyone—governments, economists, the private sector and many others—are saying that science, research and development form the base for our future. It is encouraging to us that this committee also views Canadian research and development as critical to the country's development. Thus we hope not only to present the main elements of our joint document but to enter into a discussion as to how we can all work to achieve the objective of a strong Canadian research enterprise.

With that I will turn to Mr. Robert Giroux of AUCC to outline the important elements of our document.

Thank you.

[Translation]

Mr. Robert J. Giroux (President, Association of Universities and Colleges of Canada): Madam Chair, before beginning I would once again like to thank your committee for taking the time to meet representatives of the university community and to listen to our views.

We believe that it is through this kind of sustained and constructive dialogue that, as a community, we will be able to work with you so as to find concrete and realistic solutions to the many challenges facing Canadian society and our country's economy.

University research is central to the future socio-economic prosperity of Canada. To a large extent, innovation is the result of university research. Now that the country's fiscal position is improving and our economy growing, Canada is in a good position to play a significant and high profile role as we enter the 21st century.

However, if the federal government does not increase its support for research and discovery, the Canadian innovative process will slow down, inevitably impacting on our country's growth rate.

[English]

There is little doubt as to the value of publicly funded research. A study conducted on behalf of the National Science Foundation in the United States reveals that 73% of the papers cited in U.S. patents were the result of basic science that was heavily funded by public agencies. The study concludes that publicly supported science is the driving force behind innovation and high technology industries. It further concludes that industrial dependence on public sciences is growing rapidly as innovation becomes increasingly driven by advances in scientific understanding.

In Canada we rely more than the U.S. on university research to meet our knowledge needs. Thus, investment in public science is even more likely to pay off for Canada.

University research is responsible for the production of an estimated $76 billion worth of goods and services, over 10% of Canadian GDP, as well as for sustaining more than 1 million jobs in Canada. The return on the investment in research is very large—in fact, far greater than the returns on investment in standard capital goods or civic infrastructure. Unfortunately, our track record is not good. As the figures provided to you show, there are major differences between the American and Canadian approaches to funding public science. Despite efforts to balance its budget, the American government has recognized a pressing need to feed the innovation process.

• 0915

Since 1992 it has increased its support for the National Institutes of Health by over 50% and the National Science Foundation by about one-third. Meanwhile the Canadian government actually provides about one-third less support in the case of the Natural Sciences and Engineering Research Council, NSERC, and the Social Sciences and Humanities Research Council, SSHRCC, than it did in 1992. A government whose key priorities include knowledge and innovation must correct this trend.

As a group, we were very supportive of the important initiatives taken by the current government in the February 1997 budget. The networks of centres of excellence program was made permanent and funding was extended for programs such as the industrial research assistance program, IRAP, which promotes the transfer of knowledge.

The Canada Foundation for Innovation, one of the biggest initiatives ever of its kind, shows that the government firmly believes that a strong university research infrastructure is an essential underpinning of a successful knowledge-intensive economy.

We now need to build on the government's recent initiatives to sustain and renew Canada's university research. The groups around this table have together developed an action agenda entitled Sustaining Canada as an Innovative Society. Its purpose is to ensure that the university research enterprise has the tools it needs to foster innovation and produce the highly qualified individuals needed in the new economy.

In sustaining Canada as an innovative society we recommend the government make strategic investments through the three federal granting councils, directed at three critical areas—investing in people, enhancing our current efforts in knowledge and technology transfer, and giving a greater international orientation to our research.

[Translation]

We must invest in people. In order to enhance our ability to produce knowledge, we have to focus on human resources, that is researchers and the support they need to conduct high tech research. Increased funding for research excellence is essential to any strategy to support productive research geared to our real needs.

Canadian university researchers need increased support in order to train research staff, but also to produce, transfer and disseminate new knowledge.

Graduate students in particular are facing more and more acute problems. Cuts are increasing the level of student debt. As a result, too often young people turn their backs on scientific careers or even leave Canada so as not to leave the world of science.

Increased support for graduate students and improved research assistantship opportunities through research programs are excellent ways of encouraging more students to pursue research careers.

Furthermore, research offers an opportunity to provide the new generation of graduates with the skills required to succeed in a knowledge-based society.

[English]

Enhancing knowledge and technology transfer: Knowledge transfer and dissemination from university research occur in many ways, with the most important being university graduates who bring their knowledge and expertise to a new environment. Universities have put in place formal institutional mechanisms to improve the transfer and commercialization of technology. We must strengthen such knowledge transfer activities and expand into new areas to include knowledge created in the social sciences and humanities, for nowhere is the gap between knowledge need and availability greater than in the social sciences and humanities.

The pressures arising from an increasingly global and knowledge-based economy have put great strain on Canada's social and economic institutions. As a result, social cohesion and integration are becoming issues of concern to policy-makers.

Of similar concern are the adjustments that individuals, firms and institutions are challenged to make in adapting to the knowledge-based society. The social sciences and humanities research community is extremely well placed to help Canadian policy-makers address these concerns and develop policy solutions to these important issues.

This will require sustained and sufficient support for social science and humanities research as it not only produces the knowledge on which good policy is based but trains the individual to put that knowledge to good use. We believe this is an invaluable opportunity for the government to bring social sciences and humanities to the forefront, giving it the support it deserves in helping Canada's society to prosper.

• 0920

Research in a global economy: We also know that in order to prosper, Canada must compete successfully on the international scene. Increasingly, trade and international relations depend on informed strategies. Canada needs more and more people who are truly knowledgeable about the economies, business structures, history, politics, cultures and languages of the rest of the world. A renewed vigour in support of international research and area studies is necessary if we are to understand our competitors and play an effective role on the international scene.

Research collaboration not only increases our knowledge base but also is a relatively inexpensive means of providing Canadian researchers with leading-edge facilities that might otherwise be uneconomical. Despite the depth and quality of our research, Canada produces only a small fraction of the world's knowledge. In order to have access to new technologies, processes and knowledge developed abroad, we must have partnerships with researchers in other countries. To be included in such international collaborative research initiatives, Canadian researchers must be able to bring something significant to the table in terms of both financial support and expertise.

[Translation]

In conclusion, our plan is realistic and achievable. It focuses on just a few important aspects of university research and the country itself. Our plan sets out clear priorities and proposes specific measures. It is designed specifically to support our innovative capacity as we move fully into the next millennium.

We believe that the granting councils are at present in the best position to meet those urgent needs. We fully realize that everything cannot be done at once. Therefore, our action plan calls initially for only modest expenditures for 1998-1999 and continues on that basis.

Specifically, we recommend that the federal government increase by approximately 50% its total investment in such councils over the next four years. We also recommend that the budget allocated to the Social Sciences and Humanities Research Council be increased by 60% over the same period. This would help to bridge the disparity between the need and the availability of knowledge, which is nowhere as pronounced as in the social sciences and humanities.

Madam Chair, distinguished committee members, we would like to thank you for giving us this opportunity to explain to you our priorities and views on the important role university research can play in the social, economic and cultural development of Canada.

[English]

We look forward to a productive exchange with you. Thank you.

The Chair: Thank you, Mr. Giroux.

Mr. Gaffield.

Dr. Chad Gaffield (President, Humanities and Social Sciences Federation of Canada): Thank you very much.

As you know, I'm here representing researchers in the social sciences and humanities across Canada—54 associations of economists, historians, political science sociologists, English professors and so on. I'd like to share with you one way of thinking about universities as we end the 20th century—that is, universities are in the process of a fundamental transformation.

One of the most familiar images of universities is that they are conservative, traditional and perhaps staid. I'd like to challenge that notion a little bit in reminding us all that universities have been around since the middle ages—the ones we have now. I think they've survived over the centuries because they've changed so much. I think it's breathtaking to see the changes on campuses nowadays. The universities that I attended in the late sixties and early seventies are very different institutions from the ones we have now.

One way of thinking about this is the change that universities are engaged in, as with the arrival of the post-industrial society, the information age, or whatever name you want to capture that within. I'd like to illustrate it in three ways.

My first way has to do with the new importance of interdisciplinarity. It seems to me that one of the hallmarks of universities in the 20th century and as they developed in the 19th century was the development of disciplines—disciplines that really didn't exist before the 19th century. We moved into a university that was, I think, in some sense compartmentalized and maybe fragmented. What we've come to at the end of the 20th century is a new appreciation of the importance of bringing together expertise from across the campus.

• 0925

No problem now and no issue are simply defined as a science issue or a natural science issue or a social science issue or a humanities issue. Increasingly, we're seeing researchers from across the campus bring together a disciplinary expertise, but working together. A good example of this is something like the environment. The environment is a cultural issue, it's a biological issue, and increasingly I think researchers are working together. The fact that we're in front of you here today within a coalition, to my mind, reflects this new sense of oneness.

My second example is the new importance of information technology and computerization. Often we think about the impact of that being perhaps in engineering and the sciences and the biomedical fields. But in fact across campuses now new modes of discovery, reflected in computer-based analysis, are becoming increasingly apparent and are bringing together researchers within networks, the centres of excellence being a good example. The collaboration I was speaking about earlier is evident in the ways in which the new technologies are transforming how we write, how we research and so on. Certainly the way I do my research now is far removed from the ways we did research in the late 1960s or 1970s and obviously in most of the 19th and 20th centuries.

My last example has to do with the fading distinction between what we used to talk about as basic research and applied research, or pure research and applied research. Increasingly, we are seeing the interconnections between different forms of research. Now we're understanding that applied research and pure or basic research are in fact intimately connected and that it's impossible really to think about one without thinking about the other. This is true again across the campus and is reflected in the thrust of our document.

[Translation]

In conclusion, when I say that universities are changing very quickly and reinventing themselves, I would also like to stress that it must be recognized that our universities in Canada are in fact very fragile.

Only very, very recently have Canadian universities granted doctorates. Until the 1960s, the vast majority of researchers were trained outside Canada, in the United States, England or France. Only recently have we established a solid research infrastructure in Canada which has begun to contribute to society. That goes back only 30 or 40 years, to the post-war period, and the fact is that our infrastructure is very fragile. Without significant investment now, I believe that there is a danger of entering into the XXIst century with foundations which are not very solid. That is why we are here, to examine this issue which is very, very important for Canadian society as a whole.

Thank you very much.

[English]

The Chair: Thank you.

Professor Mills.

Professor Shirley Mills (Treasurer, Canadian Association of University Teachers): Thank you, Madam Chairman.

I sit before you today as a representative of the Canadian Association of University Teachers. I myself am a professor of mathematics and statistics at one of the local universities here. I would like to speak to you today about some of the serious problems we're facing within the university community and use some of the examples from my own background to illustrate them.

In particular, we are concerned about the difficulty in maintaining international research collaborations. This is one of the areas that have been most affected by government restraint. I could cite two problems that I have encountered personally with my own research funding, which affects several researchers within Canada and internationally.

One of them pertains to the cut in funding to the program called MELSI, which is the medical, ethical, legal and social issues initiative and is tied to the human genome project. We feel these international collaborations are extremely important, and it's very important to bring to the table an interdisciplinary approach.

I sit at that research project as an applied mathematician and statistician using very technical and very fundamental research in mathematics, which also is not funded very well. I sit at that table along with the dean of the law school of the University of Ottawa. I sit there with medical doctors from across Canada, looking at genetic therapies, gene testing and so forth. That program's funding has been cut and researchers, not only in Canada but internationally, are affected because we have been able to bring in researchers from the United States and Europe to consult with us on molecular genetics and gene therapy and gene testing. So this is a research program that has been cut, and that has serious effects. It is something I think we have to look at in Canada.

• 0930

Another one that has been cut is the tri-council funding, which involves three councils of NSERC: medical research, social science, and humanities. One of the projects I was particularly involved in there, again with more than 50 university researchers plus their graduate students, was looking at the ecosystem health of the St. Lawrence River. This deals with medical, social, and illegal impacts and so forth and has wide-ranging impacts on industry in general.

What we're looking at is a need for the maintenance of funds for international research collaborations. I highlight research collaborations such as what we see in the physics area with CERN. It's absolutely necessary that our researchers in Canada have access to facilities of that nature. I've mentioned the human genome project, but one of the things related to it, the MELSI project, was cancelled. Another area we are looking at is international collaboration with the World Health Organization in such studies as AIDS studies.

In addition to those research collaborations where we are working on not only applied research but actually fundamental research in our own disciplines, the students who would be trained in these areas are not going to get funding. We have serious problems with this type of situation.

In addition to that, as researchers in the university, it's been mentioned that we're seeing a great change in our university, a great transformation in the development of new disciplines. In fact, statistics, the discipline I represent, is actually a discipline that only developed in the middle of this century. It has developed since the second world war. So it's an absolutely new field that is coming into play.

In addition to those new fields, we're finding a need to collaborate internationally, and what we are looking at also is the development of trade and industrial relations. That is going to require researchers, not only from the scientific disciplines but also from the social sciences and humanities disciplines.

In order for us to work with industry and research collaborations abroad, we have to understand the politics, the economies, the cultures, the languages of those countries. If we are to have any hope of making a substantial impact internationally, we have to develop an area of foreign studies, particularly as we look at the Pacific rim, the NAFTA or Latin American countries, or eastern Europe. We have to understand their culture and their language in order to communicate with them, not just in research projects but in the foreign affairs and trade situation.

Those are two particular areas we are concerned about. Certainly we feel the foreign area study should be a strategic area for research and we require the funding for international research collaborations.

I've touched briefly on a problem with our graduate students. The students now are graduating from undergraduate studies with a fairly large debt load, but we are not able to provide sufficient research funding to graduate students to attract them to follow on and take the research studies that are needed to go on to masters and Ph.D. levels. We have a serious brain drain in this country and we really wonder where the next generation of researchers is going to come from.

Thank you.

The Chair: Thank you, Professor Mills.

Mr. Deans.

Mr. Derreck Deans (Coordinator, National Graduate Council): Good morning. On behalf of students, thank you for the interest you're showing in the university research community.

I am here on behalf of the National Graduate Council, which consists of 45,000 graduate students on 23 Canadian campuses. Students would like to urge the government to act on the recommendations contained within Supporting Canada as an Innovative Society. Our focus is largely on the research-granting councils, which are an essential pillar in Canada's research endeavours as a whole while also serving as an indispensable source of support to many graduate students.

To provide a little context, we would like to point out that undergraduate students who borrow are expected to graduate next year with an average debt load of $25,000. Without the scholarships, fellowships, and research funding provided by the research-granting councils, it would be impossible for many of these students to continue on into graduate studies.

It is clear from research done by the Canadian Federation of Students that there are only limited and largely hidden sources of financial support for students wishing to pursue graduate studies. The research-granting councils are the exception to this. They continue to maintain a high profile as a means to offset the costs of graduate students training in research. They do this in both direct and indirect ways. Their scholarships and fellowships provide financial support directly to students.

• 0935

Many of the research funds awarded to professors are indirectly redistributed to students as research assistantships. Not only do these research grants provide much-needed funds to students, but they also directly involve students in a wide range of ongoing research processes. This training is important preparation for students' research careers in Canada's economy.

Despite the cutbacks to the research-granting councils' overall budgets, they have tried to protect the funding for scholarships and fellowships, but rising tuition fees and living costs for students are having a marked negative impact.

Applications for the Social Sciences and Humanities Research Council's scholarships, for example, have continued to rise while the number of awards have shrunk, resulting in a success rate of only 16.4% in 1996-97. Moreover, our research indicates that as tuition fees rise while scholarships and research grants decrease, there are negative effects on enrolment, times to completion and drop-out rates.

Access to education, though, is certainly not the only issue addressed by Sustaining Canada as an Innovative Society. It clearly recognizes that the distribution of knowledge is just as important as production. The proposal for the establishment of community research and information crossroads, or CRICs, on Canadian campuses is an important potential tool in knowledge transfer.

Currently a great deal of the information that students produce on Canadian campuses stays there, particularly in the social sciences. At the same time, though, there are countless groups in the surrounding community that are unaware of the relevant work that students and faculty are doing in the ivory tower. A network of these crossroads would build a vital bridge between people and groups working on campus and in the community.

I'll stop here, though, because I know that you would like to ask specific questions soon. Thank you for giving us this time to elaborate our common conviction that federal support for research and development is essential for a healthy Canadian economy.

The Chair: Thank you, Mr. Deans.

I believe the Canadian Graduate Council has joined us.

Ms. Rubina Ramji (Chair, Canadian Graduate Council): Thank you very much. I have the flu, so I'm going to be very short.

I represent the Canadian Graduate Council, which represents about 20,000 graduate students in Canada. I myself am a graduate student, so I know a bit more at first hand about what it's like not to be able to find funding to get my degree done.

The Canadian Graduate Council wants to maintain socio-economic progress, and as my colleague has said, the only way this can be done at the graduate level is by increasing funding to the tri-councils. Funding is reduced so much that even at the SSHRCC level they cannot fund masters students any more; it's only for Ph.D. students to be able to find funding.

If we are able to fund graduate students, we'll create new researchers for tomorrow, and these new researchers basically will put Canada back onto the market and also create global investment back into Canada.

Thank you very much.

The Chair: Thank you.

Are there any other comments, Dr. Hough?

Dr. Paul Hough: I don't believe so. We'd be delighted to get into questions, answers and discussion.

The Chair: I'm sure we have many questions for you. We'll begin with Mr. Pankiw.

Mr. Jim Pankiw (Saskatoon—Humboldt, Ref.): Thank you.

This is my first question. It seems to me that you present yourselves as a very cohesive group with a common front. But when you arrived at what you're recommending for increases to funding, how was that arrived at? Was there disagreement amongst you?

Witnesses: Oh, oh.

Mr. Robert Giroux: Yes, and I think the disagreement was that we were too contained, maybe too modest, in terms of what we were asking. The demand...and it's been illustrated to you this morning with respect to the Social Sciences and Humanities Research Council situation. There is a similar situation with respect to the Medical Research Council, which has documented that the demand is about twice what they're handling right now, and also with respect to the NSERC.

We felt, however, that the government is slowly moving out of a deficit situation. Of course the news that Minister Martin announced last week is extremely good, but there will be a lot of competing demands on where government should concentrate its activities and so forth.

• 0940

We felt that by starting modestly in 1998-99 but, as I indicated in my remarks, moving from that point on to about a 50% increase over four years was a reasonable way of approaching it. We came down to this consensus.

Mr. Jim Pankiw: In your opening statements you said that the gap between knowledge, need and availability was greatest in the social sciences. On what basis do you say that?

Mr. Robert Giroux: I'd like to ask my colleague Chad, and it's also been mentioned by the representatives of the graduate students. It's basically because of the very small proportion of projects that are actually funded in terms of the demand for those projects.

Chad, do you wish to add to this?

Dr. Chad Gaffield: Sure. I think one of the things we're increasingly coming to grips with is the idea that the challenges Canada faces right now are, in many ways, social and cultural.

I'll give you two examples from my own discipline as an historian. It is very disturbing to continually read that our children and many of the adults in our society have no idea about Canadian history, for example. And here we are at the end of the 20th century attempting to save this country, at some level, and we're very unclear about what it is, and where it's been. I think it's wonderful to think about the 21st century, where we're going and so on, but I think it's very important to understand how we got here as a starting point for that. So in terms of history, I think knowing ourselves is very important.

A second kind of example is related to families. Nowadays it has become commonplace to say that families are dramatically changing. The kinds of family structures and household compositions, marriage patterns, and so on are undergoing fundamental change. I would argue that one way of getting a sense of this, and a better understanding, is to actually come to grips with that and to study it.

Across the fields it's clear that we really don't have good research upon which to base our understandings. Generally, and even in our own document, you see that, and it makes me feel bad.

We end up citing American statistics. We end up sort of saying, well, elsewhere there's this pattern, so we must sort of be like that. And we know that's not the case. We can't import policies from elsewhere and say, well, it seemed to work there, so it should work here. We know that public policy has to be related to the context. We have to understand Canadian society as a starting point for saying, okay, what kind of policies would be good for us? And the reality of the matter is that across our society we really don't have those sorts of understandings that we need in order to take us forward into the 21st century.

The Chair: Thank you, Mr. Gaffield. Thank you, Mr. Pankiw.

Mr. Ianno.

Mr. Tony Ianno (Trinity—Spadina, Lib.): Thank you very much.

First, in the last four years this committee has been very supportive of science and research. The government has been reacting to a lot of our stuff and has actually been as proactive as possible considering the restraints we've had to deal with.

I guess that having the University of Toronto in my area and having University Avenue in my own riding, with the medical buildings and lots of the spin-offs that occur from research there, I come with a perspective.

In a sense, you receive a lot of money—even though it's not enough—and a lot of worthwhile works, but I find that in terms of the institutions that receive the moneys, from an entrepreneurial perspective, often what happens with a lot of your basic research is that there are commercial applications available. Only in the last year and a half have I been starting to see at least some mindset about trying to get royalties from some of that. But I'm still not seeing enough.

I know that every time I was called by many of my constituents who work in the science field I had to say, what are you doing once something is developed? You give it away to the commercial entities, and we get nothing back to replenish the much-needed moneys. What is happening with all of your organizations to ensure that once something is successful, there is a return to the Canadian taxpayer so that in effect we can put it back into your system?

• 0945

Mr. Robert Giroux: I can tackle that.

You're raising a very significant point. You're recognizing that the universities have been able.... But I get your point: in recent years the universities have been able to commercialize and organize themselves in such a way that they can get returns on the investments they've made.

The whole issue of intellectual property is one of the issues that are foremost in the minds of the universities right now. In fact, in terms of our own membership priorities, they've asked us to spend considerably more time on trying to find ways and means by which the universities themselves can capitalize on the projects they have put in place and the discoveries that have been made.

So more and more is being done. I don't have too much detail to give you here today, but certainly we could provide you with some good examples of what is actually happening.

Mr. Tony Ianno: Thank you, I don't need the examples. What I want is more results.

I think that if you feel the pressure in trying to achieve that.... I'm not saying that when we provide moneys for basic research...I understand that. But sometimes during that basic research something worth while comes forward. As long as you feel the pressure, so that in effect you're translating that into return moneys for the Canadian taxpayer and your institutions, then I think the system will start to sustain itself.

But I feel that you just think you can go to the governments, and basically they will just supply you the money. Unfortunately that's what I found sitting here four years ago with many from NSERC, MRC and all the rest, to the point where it was as if they were coming back with cap in hand as compared to their trying to be self-sustaining.

I think that's where you have to get a clear message: we support you, but we want you to do more work and not just be dependent solely on government.

From another perspective, I was involved somewhat with the innovation fund. What I suggested at the time seems to be the biggest windfall that the universities have had for...I want to say almost decades. This was unexpected moneys.

Instead of putting it in a general discussion, I think we need positive reinforcement for governments at large, regardless of the level, so that they get the benefit of understanding that you are pleased with additional funds, so that they will also contribute additional funds to the science and research community.

Sometimes we just deal with the need versus the positive. I don't think that's going to work well for you in the long run.

The other question I have is—

The Chair: Briefly, Mr. Ianno.

Mr. Tony Ianno: Yes, thank you.

Ms. Mills and you, sir, you were talking about international projects, learning other cultures, languages, politics and economics. Well, Canada happens to be a country that offers a great resource that allows us to be placed in the forefront internationally.

What are your institutions doing to utilize Canadians of other origins across this land with great skills, who often find difficulty in your institutions? With your great need, why aren't we utilizing those opportunities? Thank you.

The Chair: Professor Mills, or someone else. Dr. Hough?

Prof. Shirley Mills: I'm not sure I can actually answer that, because I personally am not involved with the hiring of university faculty.

Certainly with respect to graduate students, we welcome the graduate students who are coming from elsewhere. We do capitalize on them as much as possible, but in many instances we don't have the funding to encourage them to develop their research careers.

Mr. Tony Ianno: What do you mean by “elsewhere”, “coming from elsewhere”?

Prof. Shirley Mills: We have international students who wish to study in Canada and further their studies.

Mr. Tony Ianno: No, I'm referring to our own bodies here in Canada, who happen to be Canadians of other origins. They have the skills required to allow the knowledge base that is required—which you state is required—to be utilized in your research projects.

Prof. Shirley Mills: Well, I could certainly speak from my own perspective in the area. I'm directly in mathematics, and actually in applied mathematics. We do have the foreign students. We have programs at our university and several others that will capitalize on giving them training in international business, so we are trying to address that.

They certainly bring great skills to us. We would like to be able to keep them and develop them even further. They're a wonderful resource.

Mr. Tony Ianno: But you're discussing foreign students versus Canadian students.

• 0950

Prof. Shirley Mills: No, I am talking about Canadian students who have a background—

Mr. Tony Ianno: Who are foreign.

Prof. Shirley Mills: They have recently immigrated. They have other language skills, or they have interests like this. We are trying to give them a multidisciplinary-type background. We are certainly encouraging their development in the direction of international business relations and so forth, but we do have difficulty with funding these students, too.

The Chair: Thank you, Professor Mills.

Madame Alarie.

[Translation]

Ms. Hélène Alarie (Louis-Hébert, BQ): I read your action plan with a great deal of interest. Obviously, it raises more questions than we will be able to discuss with you this morning. You recommend an increase in the funding to granting councils. As we see, they are frozen at the 1985 level. The reason therefore speaks for itself.

My question concerns the 60 per cent increase that you recommend for the Social Sciences and Humanities Research Council. You are saying that is needed to address problems such as health reform, violence and others. I agree with you, but I wonder how you are going to sell that to the government.

You referred to changes taking place in universities. As we realize, we now have to work in a multi-discipline environment, but the government is more inclined to fund projects producing short or medium term results, or agencies where research is directly linked to people's expectations. In the report, this part would be developed a little further since, in my view, it is extremely important but difficult to sell.

Mr. Chad Gaffield: If I may, I would like to come back to the example I gave earlier, concerning families, and emphasize the importance of the links between research and policies.

At the present time, we don't know exactly what to do with this entity we refer to as a family. All our institutions and our social organization in Canada are based on the model of a family which, generally speaking, no longer exists. We have designed the tax system, schools, etc., on the basis of a family model which no longer exists at the end of the XXth century.

The question is how to refocus our social organization and institutions so as to relate them closely to the contemporary family. In my view, that is an excellent example. We need new policies, in the tax system and elsewhere.

I could give you another example, that of problems arising when conducting a census. People are asked who is the head of the family, and other such questions. All of this causes problems nowadays. Therefore, we have to see how we can reinvent our whole system so as to deal with issues of social diversity, the scope of which goes beyond our level of knowledge.

I think that the link between research and policy in social and cultural areas is a very close one. To date, the bridge has not been built as it should be.

Mr. Robert Giroux: Could I add something Madam Chair?

The Chair: Yes.

Mr. Robert Giroux: I just want to say that you have certainly identified a major problem. it is far more difficult to find arguments in favour of research in the social sciences and humanities than it is for medical research, for example.

In the case of medical research, there are companies established, people can see the product and recognize that it is very important and the cures for specific diseases must be found. This is also true of research in the natural sciences and engineering. People want to have better highways, better road surfaces, etc. They can see the product immediately. Furthermore, the private sector is far more ready to enter into partnership for such research projects.

The government has a role to play in social sciences and humanities. The government must have long-term vision and acknowledge that we have social problems, that the economy is important, but that it results in all kinds of social problems. The private sector is not perhaps as prepared to acknowledge that, because it wants to see a product. So it is important for the government to accept its responsibility in that respect.

• 0955

The fact also remains that the vast majority of researchers in universities are in social sciences and humanities, and that SSHRC has the smallest budget of the three. It represents roughly 12 per cent of the granting councils' budgets combined.

So we are making a special effort to try to make people aware of that.

Ms. Hélène Alarie: Thank you.

The Chair: Thank you, Ms. Alarie.

Mr. Bellemare.

Mr. Eugène Bellemare (Carleton—Gloucester, Lib.): I would like to thank the experts here this morning for their excellent presentation. I would also like to thank them for having pointed out that the government is on the right track. In its 1997 budget, it created

[English]

the networks of centres of excellence program, and we are in the right direction. We're putting in nearly $1 billion, $800 million plus, but you want more and more and more. Of course we say, whoa, whoa, we need two peddles in this car, one that slows us down—I nearly said brakes—but lets us continue at a pace that is manageable.

We need to create jobs. That's an important fact in this country for

[Translation]

ensuring Canada has a higher quality of life. It is the ideal place to immigrate, and we are proud of our country. We want a better world, but in a better world, people must be able to live and jobs must be created.

[English]

I have two areas in particular on which I would like to ask questions. There will be two questions. One is on private industry involvement.

I have a feeling that most of the headquarters are located either in Switzerland or in France,

[Translation]

in England, or in the United States,

[English]

that we are branch offices and that most of the research money is given to the area in which the headquarters of various companies are located. If their company is in Reston, United States, or in Berne, Switzerland, the inner circle is a mix of business and the universities and so on, so the money rotates in that area. What can the government do to incite, even to force, companies, for any research money they give, to establish research sections in Canada? Do you have any specifics on that?

Should I also give my second question? Someone else can take it, and I'll be through with my questioning.

I guess, for the lack of a better expression, someone could think of it in terms of industrial espionage. Because we can commercialize a great deal of research, I have a feeling many foreign countries may be researching your research and using it for commercial advantages in their own countries. How much picking—not wanting to use the terms “industrial espionage” or “intellectual espionage”—of our university research is being done by foreign countries for commercial use? Have you done research on that? Can people just walk into a university, send a kid there to study, take out something and walk away, saying, hey, look what we found au Canada—seulement au Canada, you say.

Thank you.

The Chairman: Dr. Hough.

Dr. Paul Hough: Thank you very much, Madam Chair.

I think there are a couple of areas to underline here. First I would like to clarify that the $800 million for the Canada Foundation for Innovation is very substantial, it's very welcome, and it has been recognized by the community as a whole as being extremely important. It also relates to the renewal of the research infrastructure within the university, hospital and institute sectors. It's not related directly to the networks of centres of excellence.

• 1000

The networks of centres of excellence have been renewed on a permanent basis, but I believe the annual level of funding is something in the order of $47 million.

Those two are comparable in the sense that they occupy different parts of the spectrum.

That's another point I wanted to make, and it relates to your questions. The universities, the institutes and the hospitals all conduct a variety of activities in research, from absolutely fundamental studies of whatever right through to the applied and the commercial areas. There is no qualm on this side of the table that there are important contributions to be made in all those areas. But the private sector, for instance, has also undergone a substantial change in the last decade or so with respect to focusing its activities in research, when it does do research, on its core business activities, whatever its business might be. To an increasing extent, the private sector is looking elsewhere for niche expertise, for the expertise it needs on an occasional basis if you wish, and it is not developing it in-house.

So there is an enormous number of linkages, of alliances, of contracts that have been developed and are commonplace between Canadian universities, Canadian researchers and the private sector. This means that over the last five, six, seven years or so the private sector component of the research that is conducted in Canada has actually taken a very significant increase.

If you want to use gross numbers, for instance, the international comparison is the gross expenditure on research and development as a function of GDP of a country. Canada is about 1.6% at the moment, 1.57%, and 1% of it is from the private sector. That's an increase over the last decade. I'm not exactly sure how much, but it's a very substantial increase. At the same time the component from the government sector is coming down.

In direct response to your questions, sir, there is more that can be done. I think we all want to see the private sector get involved and do more of its own research, but we have to realize that they themselves have changed their modus operandi and are focused on their own particular area of concern.

How much cherry-picking goes on? That's an interesting question, because in the university sector we try to bring in or accept graduate students of high quality, of high calibre, without a lot of attention being paid necessarily as to where they are coming from.

In many cases this is an advantage, because it exposes many people from other countries to the Canadian experience, to our particular abilities in the research world, and it develops linkages that people follow up on over the years. There are innumerable examples of ties between people who obtained their graduate education or training here in Canada, who are now implementing in their countries what they learned in Canada. They come back to Canada for supplies, for connections, for collaborations.

I'm less worried about people coming in—and I don't know of any instances of anybody coming in and saying that something is a really neat application or a neat idea and taking it out and commercializing it elsewhere. There is no doubt that the commercialization aspect is very important. There's no doubt, as an earlier question indicated, that we have to spend a bit more time on it.

But the main message I would like to leave with you is that the private sector is looking to the university sector for real expertise. When and if the universities do have things that can be commercialized, only a small portion of any work on basic research is ultimately going to be available for commercialization. It may contribute to knowledge and understanding, etc., but only a small fraction is actually going to be commercialized.

I think there's a lot more awareness these days of trying to do that. Certainly there is a lot more venture capital, which has come forward only in the last five years or so, to do that sort of thing. So there is a mindset change within the research community in general.

• 1005

The Chair: Thank you, Dr. Hough. Thank you, Mr. Bellemare.

Mr. Lowther.

Mr. Eric Lowther (Calgary Centre, Ref.): Thank you, Madam Chair.

I want to thank my colleagues on this side of the table for allowing me to change the order a bit, because of some constraints that I have. I mention that so that it will be on the record. If I ever have to return the favour they can point it out to me.

I appreciate the board so much. I know that it must be difficult to answer some of these questions, especially with your background. On some of these questions you could write volumes, but we're asking you to boil it down into a very tight timeframe. Time is our enemy here.

I'm going to ask a question that you could probably write volumes on, but I'm going to ask you be as succinct as you can be. Some of my colleagues have greater in-depth knowledge of the R and D situation in Canada than I do, so this is more of an educational question for me.

As I listened to the presentation, two questions came to me. First, is there any constraint in your minds as to what should be researched? What are the parameters that say let's go do this or let's not? Or is it just whatever occurs in the mind of a researcher, undergraduate, graduate student or person who says this seems like an interesting field, and off they go and they're looking for funding? Are there any parameters that determine what will be worked on?

Second, and in a somewhat related mode—and many of my peers here have already pressed in on this—we are in a new fiscal reality in Canada. Your reality is that the purse is more and more difficult to open to fund you. Have you started thinking about radical new ways of funding R and D, or are we still on the same track as before? Have there been any breakthrough ideas in how you might continue on with the work you do?

I'll leave it at that. Thank you.

The Chair: Professor Giroux.

Mr. Robert Giroux: Your first question is a tough one to answer. We have lots of experience with research where we've allowed the researcher to do something or a researcher has said here's a project and it will take 10 to 15 years before you see the output.

We now produce certain strains of wheat in Canada. The canola industry is growing tremendously. That's the result of research that was done 15 or 20 years ago by a researcher who had an idea. Maybe people were asking the same questions that you're asking right now. How does this fit? Is there a priority there somewhere? But you have to allow our best and brightest to go out there and do something and test it.

Many times it will lead to very little, but it will also lead to some other major areas. So the government has tended to identify certain sectors in which it wishes to put more priority. The whole information technology area, the bio-energy area, the biodynamics area, the biotechnology and all—we have those kinds of sectors in place. However, it's also important to allow our bright people to pursue an idea and give them the environment to do so.

Your second question was about different means or other means of funding. I think we see a lot of examples of those. The Canada Foundation for Innovation has been strongly supported as a way of nurturing and bringing forth partnerships. We think partnerships are the way to go. We do not exclude partnerships in terms of what we're asking for the granting council. In fact, the granting councils, particularly NSERC, are very strong on the area of partnerships and getting leverage from the outside on how best to fund this.

What's been happening in the United States and Japan? I understand the Japanese government has decided to put billions and billions of dollars to basic research. They recognize that governments have a responsibility here. Governments have a responsibility to fund basic research, not by themselves but to provide leadership. That is where we're coming from.

• 1010

I think you would like to add something.

Mr. Derreck Deans: In the document we talk about the research granting councils, and there is the peer review system within the research granting councils where each proposal for funding goes through evaluation by the peers—professors and people like that. We can all find examples of research that's been conducted that we think is way out in left field and shouldn't be funded. Maybe the examples I give will be trite, but in any research endeavour you have to go down a certain number of blind alleys to discover that they're blind.

Before the discovery—and I use this term very loosely—of America there was a prevalent believe that the world was flat. That was commonly accepted knowledge. It took some weird idea in someone's head to get in a ship and go west to prove that it's not flat. So we will get some research projects that look ridiculous, but we don't know where they're going to lead in advance. We can't predict that. We're sitting here and saying it is partly the responsibility of government to fund those so that we can move our society forward.

The Chair: Thank you. Thank you, Mr. Lowther.

Professor Mills, did you you want to add to that?

Prof. Shirley Mills: There are a couple of comments I'd like to make.

With respect to the first question about who decides what to research, it's a rather circular situation. Certainly a student's professor will have a major hand in determining whether that student will be doing a particular research project, but the student's professor also needs the research funding to hire the student and provide the graduate funding for several years of study. It goes back to the granting councils providing the research funding, or through industrial contracts that are in place in many universities and actually expanding. It goes back to the funding of that research, and if there are no funds the students won't be going down in that particular path either. We can't gaze in a crystal ball. We'd love to be able to pick the winners and say this particular route will give us a fantastic result, but there's no way we can do that.

As far as radical new ways of funding R and D, I mentioned that industrial collaborations are expanding and I would expect that to go along those lines for the next few years. Certainly that has to happen, but there is fundamental basic research that is conducted at universities and we know industry will not be able to attack those types of issues. They're looking at their core business. That fundamental research has to be funded by granting councils for the main part.

I will throw out a couple of results that people around the table will be aware of. It came from pure basic research many years back that no one thought would lead to anything—the development of lasers; the fax technology that all of you probably have in your offices is fundamental, basic research that nobody would of funded initially. The technology that we now see in lasers and fax—we had no idea it was going to develop out of that research.

The World Wide Web was developed by physics researchers with CERN. Would we want to put intellectual property rights on the World Wide Web and look at things like that? From my own area in mathematics, people ask what you can do with pure mathematics, but the derivatives field is based upon pure mathematics.

Mr. Walt Lastewka (St. Catharines, Lib.): You're the problem.

Prof. Shirley Mills: There's a real problem, but mathematicians had no idea that would get picked up and used by economists in that field. We can't crystal-ball gaze.

The Chair: Thank you.

Ms. Ramji, would you like to add to that as well?

Ms. Rubina Ramji: Yes, I would. Actually, it comes down to a lower level. More times than not a graduate student won't even think of doing something innovative because it will not get past the professor or the department. You will not get accepted into a program if it's not already solid and structured, and you won't even apply for funding because you know you probably won't get it. A lot of the times we actually squash the innovation before the funding is even asked for.

The Chair: Thank you. Thank you, Mr. Lowther.

Mr. Lastewka.

• 1015

Mr. Walt Lastewka: Thank you, Madam Chair.

I want to thank you for your presentation and your collaboration together in this proposal. I appreciate the fact that you've made those three recommendations. Recommendation two on technology transfer and international orientation is very clear. It's with the investment in people that we get into a more global situation.

My question is going to be in two parts. The first part is to Dr. Mills. Professor Mills, concerning your international project, you received your funding from whom?

Prof. Shirley Mills: Of the two I referred to specifically with respect to mine with the tri-council, an NSERC-SSHRCC-Medical Research Council was one of them. That was on ecosystem health in the St. Lawrence River. The second was the MELSI; it's medical, ethical, legal, and social. It's a multidisciplinary approach to looking at testing for gene therapy and testing individuals to see if they have problems with genes.

Mr. Walt Lastewka: Were these the same people who cut your international project?

Prof. Shirley Mills: No, this is funding that has been cut, so it cannot continue now. One project just ran out this year. There is no funding available.

Mr. Walt Lastewka: Don't they have other funding and they decided—

Prof. Shirley Mills: No, there is no replacement funding for it, for either case.

Mr. Walt Lastewka: Oh, I didn't understand that from your original presentation.

I'm sure we all find ourselves in a dilemma; we had a great discussion in the last Parliament concerning research and development being focused and prioritized because of the situation the government finds itself in on funding. We're in a situation in which we still have to struggle. I appreciate your earlier comments that we have to go at this gradually until we get ourselves a clear path not only out of the deficit but out of the debt. As we get more out of debt, there will be more funds available.

We're in a situation today where we have 1.4 million people unemployed on one hand and on the other hand we have a starvation for graduates for employment, whether it be in the computer system—42,000 or 44,000 has been mentioned—or on the engineering side in plastics, which I'm personally involved in. I used to manage the largest plastics plant in Canada. They're starving for engineers at this time.

My question to the group is have you taken a look at prioritizing to help us to get this mismatch straightened out so we can be more flexible on funding in the future?

Mr. Robert Giroux: Speaking from the universities' perspective, they're very much concerned about producing the workers or the graduates that are necessary to feed the industries that are developing in Canada. A number of them would come before you and would say that would be extremely important in terms of increasing support from their provincial governments to allow them to develop more and more graduates, because they are being funded on a formula that is not necessarily that sensitive to those kinds of questions. That is an important priority.

On the other hand, what we say when we come before you today is we would like you also to take a futures approach. Of course we agree when Minister Martin says tough choices have to be made, but we have to nurture innovation. We recognize the problems that are taking place today, but it's also a fact that by nurturing and fostering innovation, you're going to be producing the kinds of industries and products in the future that will create more employment and will help to alleviate the gap we find ourselves in right now.

We say make an investment in innovation. Continue to make that investment and realize that the university sector, which is about 25% of the research activity taking place and by far the major part of the basic research that is taking place, is much more of the applied and commercially driven research, as was indicated in terms of the corporate sector and industry. Make the investment in that group of people. That does not, however, take away from the fact that universities also have to be conscious and work very hard at producing the kinds of graduates that are necessary.

In this town, of course, both the University of Ottawa and Carleton University are extremely active in cooperation with the high-tech sector in particular in developing programs that will enable this growth industry to get the graduates it needs.

• 1020

Dr. Chad Gaffield: I think what we see is that our graduates by and large tend to find jobs and to establish their own businesses and so on. I was just counting up the other day, and I've had the pleasure of directing 63 graduate students since the 1970s. All of them are employed or have their own companies now and are succeeding.

I think one of the dimensions of everything we're seeing is that in fact the more experience you get in research environments, the more it suits the opportunities of the new information age. People who can write, who can criticize, who can analyse data, who can use computers and so on seem to be finding spots in our new society. Experience in research projects, at least from what we can see, tends to lead to successful and profitable lives from which I think Canadian society benefits.

The Chair: Thank you, Professor Gaffield.

Professor Mills.

Prof. Shirley Mills: I just want to address two issues here, one with respect to changing focus at universities. I can speak directly from experience at Carleton University, where we have definitely moved towards a high-tech focus.

I have a calculus class of 440 students in first year. That's not fun, and that is a situation that exists at many institutions. While we try to take more students in, we're faced with a situation of having to teach them. How do we do this? We don't have the classroom space for this. We have one classroom that can hold all of these students. We have very few classrooms that have the technology we need. Certainly the $800 million for innovation is most welcome. I can't indicate how very welcome it is; we all need this.

We have a situation where if we're going to take more students in, we need the people to teach them. That means we need to have students go on to do research and graduate work to develop in that field.

I particularly am involved with the high-tech sector in collaborative research with my graduate students. I can say that my graduate students are in demand. They get the jobs. In fact, I can't turn out enough of them for the work we're doing in applied statistics. But I can't encourage them to go on without the research funding to support them at the masters level.

Particularly we need masters level to handle the type of statistical analysis we're talking about in the information age. The funding for the graduate students becomes extremely important there and for the researchers, and also for the renewal of the university faculty.

The Chair: Thank you, Mr. Lastewka.

Dr. Hough, do you want to add briefly to that?

Dr. Paul Hough: I have one additional comment. It is a problem. Historically the university sector, the post-secondary sector, has been a little bit out of phase with what's happening in society in one area or another. But I don't really think there are any places in engineering schools, in the computer science areas, for instance, that are going begging within the institutions. They're all putting out just as many of these people as possible and they are as highly trained as possible.

While there are gaps, if you wish, or greater demand in certain areas today, I wonder sometimes what we're going to be saying in ten years. What are going to be the future gaps in a sense? We say today, for instance, that we have more than enough teachers. In ten years, will that be the case? I don't know. Will geriatric medicine or oncology be an absolute necessity, for instance? You can guess at these sorts of things and you can take some educated guesses at it, but I think we're going to be in that kind of a situation for a long time.

The Chair: Thank you.

Mr. Axworthy.

Mr. Chris Axworthy (Saskatoon—Rosetown—Biggar, NDP): Thank you for your presentation and for your very helpful answers. I've met Dr. Hough many times, as well as others as colleagues on these questions.

Dr. Hough just mentioned what we'll be saying in ten years' time. I was on the board of the CAUT in the late 1970s and early 1980s and we were saying exactly the same things as you're saying today. I was a professor for 16 years and directed an interdisciplinary research centre before I became involved in politics. The questions you're raising are questions I raised, too. That centre was funded jointly by business, government, and the university. Back then, in the 1980s, that was unusual, but it's not so unusual today.

• 1025

I wanted to make a couple of comments and then ask a question.

At present I represent a part of Saskatoon, where we have a very good example of how you develop a world-class research facility that is contributing to the economic development of the country in a major way. The agricultural biotechnology centre there, one of the top five in the country, was developed in the way you indicated: people played around with things and discovered products that became very important in our mix of agricultural development. That group of companies was developed in partnership with government, universities, and the private sector in an extremely successful way. So there are very many examples of how we've done well, in spite of very many obstacles.

Also, at that university, we have the problem of the synchrotron, if anybody knows anything about that. Here is a project we cannot do without, and yet we're waiting years and years and losing huge potential, both commercial and otherwise, in that activity, for only about $60 million or $70 million of federal government money. It's quite remarkable that we would not have that in place already. If anybody knows anything about why that's so difficult, perhaps they could respond.

My main point, though, in referring back to the late 1970s is not just to show how old I am, but to indicate that back then there was a distinct lack of national coordination and national vision on these kinds of questions, and that lack of vision continues today. There is no university education system in our country, and no research system. We just have all these institutions all over the place, and nobody really knows whether or not we're acting in the best interests of the country at all.

If you're going to make the point that we need to do more in order for Canada to be innovative, you presumably have to point out that Canada is not all that innovative by international standards. How innovative is Canada by comparison to other countries, in particular Southeast Asian countries? Somebody mentioned Japan, but there are many others who are investing enormously in the things you're saying we should invest in.

In spite of all you've said today and in spite of all we've been saying for 10, 15, or 20 years, how do you make government understand the difference between investment and just spending money? It seems to me we can't not invest in the things you say we should invest in, and yet we've not been doing it effectively for about 20 years, or at least the 20 years that I've been involved.

Mr. Robert Giroux: Maybe I could answer that.

Every year the OECD makes a report comparing the economies in the OECD network, and although they give Canada high marks for the quality of life and a number of other indicators of that type, they always mention that Canada has an innovation gap with respect to other countries.

We've distributed to you, and I think you have a copy of this particular slide in the information.... Did we provide this information? Oh, I'm sorry. We'll give you a copy of it. In fact, we did not invent this; it comes from a presentation that the Deputy Minister of Industry Canada gave recently to the Corporate Higher Education Forum.

The top part is the value-added share of high-technology industries in total manufacturing value-added, and this shows that, for example, in the U.S., value-added share is up there. Canada is way out at the end by comparison.

The other one of course is our expenditures, and this is what OECD looks at to come to their conclusions. The expenditures in Canada as a percentage of gross domestic product....

I mentioned Japan. This is where Japan is right now; the United States is there; and this is where Canada is. We're slightly ahead of Italy, but we're way behind a lot of OECD countries, and when you add countries such as Norway, Denmark, and Sweden, which are emerging economies in Europe, they're all at around 2%. And Korea is at 2.8% right now; it is investing a lot of money.

You may say it's not just money, but money is an indicator. The amount, the share, is an indicator of how much innovation takes place in an economy, and that's why we say we have this innovation gap. We are a G-7 country. We are an OECD country. We value a high standard of living, but it is a race out there in terms of the future, and if we're not ready for that race, and if we don't move as fast as the others.... It's not a question of moving. We are moving, but if we don't move as fast as the others, we're going to lose that race and we're going to slowly go down in standard of living.

• 1030

The Chair: Thank you.

Dr. Hough, did you wish to reply to that as well?

Dr. Paul Hough: Yes, I had a short comment, but I'll come back to it in a minute.

The Chair: Mr. Peric.

Mr. Janko Peric (Cambridge, Lib.): Thank you, Madam Chair. I ask short questions, so maybe I can have an opportunity to ask more than one.

I fully support research, and I believe we have to financially support the research side of the universities, but are you aware of how many foreign students are studying in Canada right now?

Mr. Robert Giroux: Yes, if you talk about the post-secondary network, we're at about 30,000.

Mr. Janko Peric: In what fields—high-tech, social studies, geography, history?

Mr. Robert Giroux: A large number are studying in our graduate schools, and in fact they are extremely important to some of our graduate schools. They are studying in engineering, high-tech, the humanities, and the social sciences. It's pretty well spread out. Many of them are studying in our community colleges also.

Mr. Janko Peric: Yes. I'm coming from the area where Canada's technology triangle is formed, and that's Cambridge, Kitchener-Waterloo, and Guelph. In that area high-tech industry is prospering, as you know, or should know, and the high-tech industry is closely working with the two universities and a college.

There's a shortage of qualified high-tech people. For instance, Gandalf is opening a new plant with Newbridge right across the river, and the reason is there's a shortage of high-tech people.

At the same time, I've been seeing graduates from history, geography, social studies, even nursing. Do you believe there is a lack of communication between the universities' research departments, the private sector, and government?

Mr. Robert Giroux: I think you're referring to the fact that at any point in time, you may find that the demand for a particular kind of graduate is not being fulfilled by the universities. I think this is what you're getting at.

Mr. Janko Peric: Yes.

Mr. Robert Giroux: There's no doubt that this is happening. It's of course very acute—

Mr. Janko Peric: Why is it happening?

Mr. Robert Giroux: Well, who could have foreseen four years ago that this would be on the increase? Universities now are very much trying to....

I'm going to backtrack a bit here, and my colleagues know this better than me, so they should jump in. It's not necessarily when someone joins a university that is the time to orient him in the best kinds of faculties or courses he should be oriented to. My feeling is that it has to be done starting almost at the end of elementary school, and of course at secondary school.

What you're looking at is a gap of seven or eight years after you start saying to young children that they should go into the high-tech field, the medical field, social sciences, and so forth. What we're now seeing of course is the result of decisions that were made seven or eight years ago.

But more and more the universities are encouraging and developing the programs that will meet the needs of the organizations you're dealing with.

Mr. Janko Peric: Sir, my questions is, in your opinion, is there a lack of communication? I believe we are falling behind the times. Every 10 years there's a need for nurses and everybody goes into that sector, and 10 years after there's a surplus, so we have to educate them for Americans, unfortunately. Is there a lack of communication between government, the private sector, and universities to be able to work together and foresee that? Otherwise this is poor planning.

Mr. Robert Giroux: I think my colleague wants to jump in, so I'll let him tackle this one.

Dr. Chad Gaffield: I'll have a try at this.

Obviously the hard thing about the future is it's always ahead of us and we can't predict it. But the implication of your question, it seems to me, is that graduates now, let's say in the social sciences and humanities, are not being used properly, or they're not as useful as they might be if they were in high-tech. What I find happening is that our graduates are the content providers.

• 1035

I think it's one thing to build a whole information highway and so on, but the question is what's going to be on it? The big need I hear about across all those involved in the high-tech industry is the question of content. What I see in my graduates is that many of them are involved now in the high-tech sector, not developing the hardware and software in any kind of direct way but, rather, worrying about the content side of it.

I think the employment statistics bear me out. It's not as if there are thousands of people over here unemployed. In fact, I think there is lot of interaction. There is need, there's no doubt about it. There's a “gap.” But I would say the gap is great on the content side. Most teachers in the world out there ask what's on the information highway, what's in the actual content. And increasingly it's being provided, I think, by our graduates.

The Chair: Thank you. Dr. Hough.

Dr. Paul Hough: I think it's an interesting question and an example of an area where greater research efforts would be most appropriate, because I'm not certain any groups really have a good handle on how to determine what might be happening, what are the emerging areas and how to respond to it, either on the technical side or on the social side.

I think a more basic look at universities.... I'm a little bit...not distressed, but I certainly don't look upon the university sector as a “training school” in the sense of turning out people who can twiddle the right knobs and produce the right kind of technology instantly. I think most of us look at universities as places to prepare people, not only to think and give them experience in certain areas but also to adapt to changing circumstances. Anybody coming out with a Ph.D. in organic chemistry or in physics or any of the social sciences is going to be out of date in about four or five years, if not sooner, from the straight technical point of view. So these people have to have the skills, the abilities and the aptitude in order to change and move with their particular area of expertise.

The university is not the same and shouldn't be looked upon in the same way as a community college, for instance. It has its own functions. But I think the actual communications component of your question is intriguing and I think the whole social sciences area could contribute to this.

The Chair: Thank you. Mr. Power.

Mr. Charlie Power (St. John's West, PC): I would like to congratulate you on an excellent presentation. It's a pleasure to be here to listen to what you're trying to do in this country and I wish you all the best in doing it.

I think one of the problems you're going to have is selling to government, at this time in our history, the idea of getting more money for research. I think you have to tie it in with.... If there is any great shame in this wonderful country, it has to be the fact that we keep one and a half million people unemployed, somewhat deliberately, to fit in with our fiscal and other policies.

I've never been able to find out—and I wish somebody would do the research—what it actually costs to keep one person unemployed for one year, or one day. Somebody in the humanities section might want to do that somewhere down the road and find out the real cost to a government.

I also find that governments can be very counter-productive. We get on a bandwagon for a short period of time. If it doesn't give us our immediate goals we immediately get off the bandwagon and find five years later we should have stayed on it because that's where the world was going.

I'll give you an example of how in Newfoundland's case something can be very counter-productive. We have a tremendous fish crisis. The TAGS program that everybody hears about and everybody basically hates—it's $1.9 billion—as soon as we realized we had more people requiring income support, guess what we cut back on? Science. Is the Government of Canada sensible to give income support on one hand and cut back on science programs and research on the other hand in the Department of Fisheries and Oceans? Obviously all we're doing is making sure the problem lasts longer and doesn't find a solution, which means more cost and more deficit.

Can your group in any way prove to the Government of Canada that if we, as a people, decide to put more money into research, there is a direct relationship with unemployment, that numbers of dollars put in can actually prove to the government that we will therefore have fewer unemployed people and fewer problems with our deficit? I suspect there might be a relationship. If you are telling us to put more money into research and therefore we're going to have more real jobs—and I mean real private sector jobs because of research, not just jobs at university—if you could do that, I think you would have a great selling point to give to the Government of Canada or anyone else.

• 1040

Does anyone have any statistics to prove more research means more jobs and less research means a higher deficit because of unemployment?

Mr. Robert Giroux: I don't think we have statistics that make this direct comparison, although we have pointed out in our brief that the research in Canadian universities is responsible for the production of $76 billion worth of goods and services, over 10% of GDP. However, a couple of years ago the Canadian Institute for Advanced Research did a study that tried to project what a 1% increase in GDP would do over time. Of course this is over a longer period, because that is all we have.

We also point this out in our brief. If you add 1% to the GDP—and remember, we're at 1.5%, 1.7% of GDP at the moment now.... If we add 1% to the GDP over time—I'm not saying you do it in one year, but over a period of five to ten years—you get yourself around 2.5%, which is about where the other countries are. This would engender or result in an increase in our future GDP by as much as 18%—an 18:1 ratio. These are of course projections made on models that have been put in place.

I think that kind of result is what is stimulating, because this was based on data and approaches that are happening in other countries, because Canada was compared with other countries in that study. It results in the kinds of things.... For example, I heard yesterday that a bipartisan bill is being seriously considered in the U.S. Congress by both a Democratic senator and a Republican senator to double the public investment in research in the United States in ten years. It's exactly that kind of thing that is important.

As for the direct relationship, we have tried to do some tests. We have developed a model and done some research in AUCC by using a model developed by a professor at the University of Montreal, which shows that if you add to a research enterprise the spillovers on the economy.... It's very difficult to take that model and transmit it nationally, but it could be made available if the committee so wishes, and we would be pleased to provide it. It does show what we call the acceleration effect or the spillover effects of an investment in a research dollar.

The Chair: Dr. Hough, you had a comment.

Dr. Paul Hough: The focus on things in the high-tech sector, in the biotechnology sector, and in other areas these days...there isn't necessarily a direct relation that can be shown—not that I'm aware of, but I stand to be corrected—between investment and unemployment, but certainly the investment in research will result in a number of new innovations, a number of new companies, a number of new activities in this country, that are going to require people. The concern I have about all this is that the focus on these areas is going to demand a pretty high level of person in all these new ventures, new companies, etc., simply by the very nature of the programs and the activities. While some of the activities are going to need people who have fewer skills or lower skills, for instance, there will be a drag effect on it.

I think it's a structural problem that is really in fundamental need of a lot of attention. Even if we had the money to pour billions of dollars into research, yes, the unemployment rate would probably go down, but to what extent you would really have to try to find out.

The Chair: Mr. Deans.

Mr. Derreck Deans: I know your questions envision more of the economy as a whole, but part of the thrust of sustaining Canada as an innovative society is funding going to the research granting councils, and there is a direct relationship there between money going in for research and jobs. Much of the funding that goes to professors for their research projects is spent on students who are hired to do the research. They're not full-time jobs, they're not permanent jobs, but they are being paid for the work that they're doing.

• 1045

On top of that, for the training that students receive there, they can take it out of the economy. If I didn't have the training that I got in my program, I wouldn't have got my term position working for the Immigration and Refugee Board. It was because of the skills that I learned in graduate school that I was able to go and do that.

So we don't have the numbers to say, yes, there is a direct link and this amount of money will produce that number of jobs. But for the research granting councils it is very clear that the money going in there is used, to a large extent, for employment.

Mr. Walt Lastewka: I just wanted to say to the group that I go back almost three years now, when groups like yours were coming here separately and trying to make pitches. It's nice to have a group that's together so we don't have to sort it out. The fact that you have done some prioritizing....

I'm really pleased that your second recommendation on technology transfer is at a higher priority now than it was before, because as I travelled on research and development in our last session, when we studied the innovation gap, there was a big gap between one university and another that was trying to get that knowledge and technology transfer out, from one university that has 30 or 40 people working specifically to do that to other universities having one or two, and technology and knowledge on the shelf waiting for somebody to come around to get that out, where we could benefit from our tax dollar. I'm greatly appreciative of the fact that you've moved that up to such a high level. I think that will answer Mr. Power's question in some way as we see more of that.

I want to come back to the area that Mr. Peric mentioned. I think more work has to be done amongst our universities and colleges on understanding what the future is going to be and where the future jobs are going to be.

I appreciate my colleague from Saskatchewan, who's mentioned we're repeating every 10 or 20 years. I think it's time to stop that repeating. I think it's time that we as colleges, universities, government, and the private sector do something on that. I don't want to come back and continue to hear, well, it's not my job to understand the future, where future jobs are going to be and what we're going to do. I'd like to see some work done in that area. It would make it easier for us.

Dr. Chad Gaffield: One little note of caution here, as an historian. A great book comes to mind that's called The History of the Future. What it does is go back and look at predictions, back to actually the early Middle Ages.

Predicting the future is, in some sense, a fool's game.

One of the things we want to do is develop a multiplicity of scenarios and put ourselves in a position where we're flexible, ready to change, ready to adapt and so on. But to tie ourselves to the future....

I'll give you one quick example having to do with demographics that we hear a lot about these days. We know the demographics, that something is going to happen and so on, and the age of the population and so on. There are a whole bunch of assumptions in there. By now, if you believed what was going on in the 1960s, for example, we'd have very different family formations than we actually have today. Nobody in the 1960s was predicting the kinds of family structures we now have.

It's very difficult to predict teacher shortages or enrolment rates. By now, for example, most universities were supposed not to have very many students, because the baby boom would have been moving through and we were all supposed to be declining rapidly. Now we have lifelong learning.

I would caution us that, yes, we have to give it our best shot and so on, but one thing that would be disastrous in terms of this great new society that's emerging would be to say we can predict where the jobs are going to be, what's happening.

I would argue that even the word “job” is up for grabs now. What do we mean by a job? What will a job look like in the years to come? What does a job look like now? I would say even fundamental concepts like that are up for grabs, and I think we're going to have to be very cautious about assuming the future is an extension of the present.

• 1050

Mr. Robert Giroux: I would just like to add to this, because you were mentioning a point that your colleague Mr. Peric, I think, made about communications. You should know that the universities are very much in constant contact and dialogue with the employers of this country. There is what we call a Corporate Higher Education Forum, which brings corporate people and post-secondary institutions and other institutions together. Virtually all universities have advisory committees that give them advice on their programs and their curricula and so forth, and they do include a lot of representatives from the corporate sector.

So the communications are there, and the universities are much more sensitive to keeping in touch with the future employers of their graduates. In my view it is happening much more than it has ever happened before.

The Chair: Madame Lalonde.

[Translation]

Ms. Francine Lalonde (Mercier, BQ): Thank you for your interesting presentation, as the former human resources development critic and the current NDP critic, I think it is even more important to hear you before the Industry Committee that it was to hear you before the Human Resources Development Committee. Human Resources Development is somewhat natural, but here we have to work to understand the very important link between maintaining and developing research, and developing the economy and social harmony.

Unfortunately, the government sent the wrong message by cutting grants to post-secondary education. Now it has to revisit that decision. I hope it finds the spin it needs to explain the importance of support. It seems to me that industry should not talk about grants, but investment in research, because it is an investment—let's take a very trivial example—just like mining. Money is invested to find a deposit. No one says that they will not invest a penny unless they are sure of finding a deposit. That is true with oil, and it is true elsewhere. It is an investment.

You said earlier that your request was modest. That is what surprises me. I would be inclined to ask you, as Mr. Brassard has suggested, if you think this request is likely to ensure that the brightest researchers or the most promising students will remain in Quebec or in Canada rather than being attracted to the United States because of the scholarship and research conditions that exist there.

We have to put this in context. I brought the most recent OECD publication on the globalization of industry, not education, but industry. It is clear that research and development are the driving force and that a country's relative position depends to a large extent on the importance it places on research and development, especially in small and medium-size countries. Large countries attract research and are capable of generating it themselves more easily. If small and medium-size countries do not generate their own, they could quickly find themselves in a difficult situation.

I would like my colleagues opposite to ask themselves where Canada will end up if we do not invest in research with a view to supporting innovation. Innovation is not like research; they are two different processes. Universities are not responsible for innovation. That may be the focus of schools affiliated with universities, but universities must concentrate on basic science.

• 1055

In some ways, all of society is responsible for innovation, because innovation is the ability to transform something old into something new. That is more or less what it is. That is how the idea is applied in management. Universities are not solely responsible for innovation. We have research to do on that point, because small and medium-sized businesses in particular need innovation. They must be put in contact with research.

I am going to go back to my main point. I got carried away, but I have to ask a question. You know that this is an important topic for me.

Some hon. members: Oh, oh!

Ms. Francine Lalonde: I was going to say that Canada and Quebec will have to chose between a society that invests in research and a society where wages are low. I prefer having a society where wages are high as opposed to a society where wages are low. This has to be examined carefully.

So, is your request not too modest?

Some hon. members: Oh, oh!

Mr. Robert Giroux: Ms. Lalonde, I am very disappointed that you asked that question. I was listening to you and I agreed with you fully. It was very good.

We made our request in the context of the fiscal reality we were facing. We are all aware that the government has considerably cut the granting councils' budgets, and we must bear in mind that the granting councils' budgets face another cut which is scheduled for 1998-99. More cuts are coming.

When we made our request, Mr. Martin had not yet made his statement. On paper, the deficit was $16 billion. They realized that last year...

Ms. Francine Lalonde: The Opposition knew.

Mr. Robert Giroux: Yes, I know, but we learned last week that the deficit for 1996-97 would be $8.9 billion whereas it was expected to be between $22 or 23 billion. Yes, perhaps in the present context... We feel that it is a minimum, and we said that clearly in our presentation. What is very important for research is that during the first year money cannot be spent... Confidence must be rebuilt and researchers must be given a vision for the future, and hope. That is why we built our request around that type of curve. Let's start with a modest amount. We do, however, feel that this is absolutely necessary. Let's try to forget about the cuts and build on a four-year period.

Now, if someone told us that they wanted to give us more, rest assured that the university will accept it. I talked to the chairman of the Medical Research Council yesterday. Requirements are probably twice as much as what we requested, but we wanted to be realistic and responsible in terms of the government's funding ability.

Ms. Francine Lalonde: But you have to take care of the universities.

Mr. Robert Giroux: That is right.

The Chair: Thank you.

Mr. Robert Giroux: Thank you.

[English]

The Chair: Thank you, Madame Lalonde.

I know it's close to the time we had originally scheduled to end, 11 o'clock, but we have a few final questions if your time would permit you to stay with us for a little bit longer. I'll ask my colleagues to ask their questions with a little bit of brevity now that we're toward the end.

Mr. Ianno, initially.

Mr. Tony Ianno: Ms. Lalonde, it's interesting to see that you were referring to not just the universities. I don't know if you're familiar with the Canada Foundation for Innovation, but it includes the private sector and other levels of government also. So it takes in the whole breadth of society to ensure that innovation is not just adaptation but leading the way.

We look forward, with our many higher-learning institutions, to being able to give a lot to society. That's why we have invested heavily and will continue to invest heavily.

This is aside from the fact that, as you know, I'm very much in favour of education being national. I want it changed from the provincial governments doing it, because education is so important for employment and opportunity.

This is the question I have, Mr. Giroux. In terms of the universities and colleges, you said there is a group that basically adapts to the needs of the private sector, etc.

• 1100

In terms of the difficulty of predicting the future, we all are aware that it's sometimes difficult to be right on. Nevertheless, there is a great need in terms of scientists and engineers, etc.

What are your universities doing to adapt, considering that there are probably many requests to enter, but there probably aren't enough spots in engineering, which is where the greatest need is today as compared to 10 years down the line? What are doing to adapt to that to allow us, as Mr. Lastewka stated in terms of the private sector having great needs, to do even more research in the private sector along with universities, as compared with solely funnelling it into universities?

Dr. Chad Gaffield: A quick example comes to mind. At the University of Ottawa, we have just established a school of information technology and engineering. It's a totally new program, and it was built in collaboration with the high-tech industry in the Ottawa Valley. You're absolutely right that the demand is greater than we can absorb right now, but we're doubling the enrolment capacity every year for the next five years.

Is it going to be enough? Probably not. Is it a move in the right direction? I think so, but your question is absolutely right, and we're having to run very fast in order to maintain that pace.

Mr. Tony Ianno: How are the provincial governments dealing with you on this, considering that they have the same goals as ours in many ways in terms of ensuring that there are more engineers, etc., so that we can attract investment into Canada?

Dr. Chad Gaffield: I think the word that my colleague Bob used earlier is the key word. I think now at the provincial level as well we're doing the minimum conceivable—helping us build a school of information technology and engineering, for example. But again, it's not enough; it's just a move. But clearly there's an enormous need that goes beyond what is happening right now.

Mr. Tony Ianno: You're talking from a funding side, right? What about internally, so that you give your resources to where they may need to go?

Dr. Chad Gaffield: I think there are internal reallocations. There's no doubt about it. I think more and more universities now are trying to focus on specific areas rather than trying to do everything. Universities are connecting themselves much more closely to their host regions, for example. I think there is substantial movement. Is it enough? Perhaps not, but I think there is substantial movement.

The Chair: Thank you, Mr. Ianno. Mr. Pankiw.

Mr. Jim Pankiw: It's fine and dandy, as Mr. Deans said, that we can do research in areas in which they don't necessarily know where they're going, so we shouldn't put limitations on what kind of research is done. However, there is a fiscal reality. I'd like to read a list of four grants and their amounts that the Social Sciences and Humanities Research Council of Canada gave in the past few years: idolatry and religious practice in colonial Peru, $97,000; the social origins of the medieval Latin lyric song, $42,000; cultural and identity politics in festival construction and performance, $60,000; and social influences on the growth of video games, $100,760.

The truth is that taxpayers become a little incensed when they hear about grants of those amounts going to that which is perceived by many to have no value. I'd like you to comment.

You're proposing a 60% increase in the budget for this council. I submit that we would be better, if we're going to spend more money on research and development, to go through NSERC. I'd like you to comment on that.

This is my second question. Earlier, Mr. Gaffield, you mentioned some things such as Canadian history. I'm not saying that no social sciences or humanities research is valuable. Do you have any plans to try to scrutinize and prevent the types of grants that I listed, which are perceived by taxpayers to have no value?

Dr. Chad Gaffield: Sure, it would be a pleasure. Thanks for asking that question.

First of all, on the constraint side, remember that about one-sixth of the projects submitted get approved, so five-sixths of them do not get approved.

• 1105

Let me go back to the four you mentioned. I'd love to talk individually about them, but I'll just stick to the video games one. I would argue that one of the most prevalent, perhaps misunderstood, and sometimes threatening phenomena is to watch our teenagers in video arcades across this country. What is happening there? How can we understand this? What's the need? Why are they there? What's that whole dynamic?

I would say, in many cases, the children and the teenagers involved in those environments.... I've looked in there; I've wondered what it's about. I would say research on a topic like that is exceedingly necessary. Are we supposed to ignore that sort of phenomenon and say, well, there are these video games and those kids are in there and they're very attracted? What's on them? What's the content of them? A number of them, it turns out, are quite pornographic, for example. How is that relating to our society?

You look at the titles of these projects and you say, oh, this is ridiculous; why do we need to know about this? But in fact, when you actually look at what the project is about, you understand why it made it through a peer review process that meant at the end of the day it was one out of six that got approved, in competition with all sorts of other projects.

So I'm happy to take any of those projects you name, and I'd be happy to talk with you about them. My guess is those projects are attacking an issue that is of central importance to our society today. The video games one is the one that jumps to my mind, and instantly I can conceive a project that would be exceedingly relative and important and one I'd like to know the answer to.

The Chair: Thank you. Thank you, Mr. Pankiw.

Mr. Deans, you had a brief comment.

Mr. Derreck Deans: If I understood correctly, he mentioned that the money should be going towards NSERC rather than SSHRCC. Again, on the video example, many taxpayers—I'm uncomfortable with that word. Many parents would be more concerned about why they can't involve their children in family discussions and family activities, because their children are glued in front of the TV or playing video games.

I don't think they'd be as concerned to see how scientists could make those video games go faster and how they could add on options, etc., which would be more appropriately the NSERC funding. I think they would be much more concerned with how do we talk to our children and what influences are coming to bear on our children that make them turn towards video games rather than family discussions?

The Chair: Thank you.

Mr. Jim Pankiw: I'd like to clarify my question. You're saying you really don't think there's a need for scrutiny beyond what there's been?

Dr. Chad Gaffield: Five out of six projects now, which I find is unacceptable, are being eliminated. Could we get it down to one out of nine, or would that help? My argument is that right now the competition is so stiff that I would find it unthinkable that the projects you mentioned aren't in fact exceedingly important.

The Chair: Thank you. Thank you, Mr. Pankiw.

Mr. Bellemare, you had one brief question?

Mr. Eugène Bellemare: Yes, I was going to comment about the fun that Reform pokes at social studies and the fact that the Bloc Québécois all of a sudden wants us to get more involved in research, education, and so on. I will leave that alone for another day.

In a practical sense, if you want more money, it would seem it would go to the head office, the university dean and so on, and your group. Let's think of the students. You mentioned that the students are in debt, and because they are in debt, they don't go into research in graduate work. Could the solution be that if a student had a student debt, the government would give a grant to pay off that debt, or a tax credit, and it would go directly to the student rather than to the institution, which in turn finds their pet projects and their pet students and gives to that?

Mr. Robert Giroux: Mr. Bellemare, we are pursuing very aggressively and very strongly the whole issue of student debt, and you're quite right. In fact, what you're suggesting is exactly what we're saying to the government: you have to tackle the student debt.

But you have to take a look at this from two perspectives. As we make investments—and we call them investments, as Madame Lalonde has indicated—as we make investments towards the future, we must make them on two fronts. We must innovate. We must produce wealth through research and development, and at the same time, we must do it by encouraging people, the knowledge workers, to go through university and graduate. A number of them go into research and others go directly into the economy and become value-added people and so forth.

• 1110

So we have to work on both fronts. That is what the universities are essentially doing right now. And if you were to say let's talk about student debt, you'd see the same organizations around the table, because we do have a round table of organizations that are dealing with the student debt issue. In fact, we will be appearing before the finance committee on this very issue.

However, I'm saying it's not one versus the other. It's not a trade-off between the two. The two are extremely important and the two are areas where the government has to make more investments.

The Chairman: Thank you. Thank you, Mr. Bellemare.

Mr. Axworthy.

Mr. Chris Axworthy: I don't really have a point. I just want to thank Dr. Gaffield for pointing out—and I know it's frustrating to keep having to point it out—that these things are not as simple as we all like to think. If they were simple we probably would have solved them already, and if you could predict the future we would be talking about where that future was going and we would have some past record of being right on the future.

It is a process. You can't just identify where you're going. It takes maybe 15 years to produce a chemical engineer. You might decide today you need one. Well, in 15 years when you have them, you may not need them any more. But we have to be prepared to make those mistakes, and part of being innovative is encouraging people to make mistakes so that they can get to the right answers.

I think it's very important to remember that it is not very simple and that we should leave it to those who have some expertise in that area to decide how we might go forward, and that we wouldn't go forward on a point but we would go forward in some kind of phalanx and hope that we get it right more often than we get it wrong.

I also wanted to thank you for pointing out, in response to Mr. Pankiw's question, that the speed with which life is changing requires us to respond to the way we actually act in that situation. We all have experiences with kids and we don't understand kids in this world that is changing so fast, and perhaps we don't even understand each other very well. To undermine the research—maybe it's because I'm a social scientist, a lawyer...I don't know whether that's a social scientist or not—to undermine our investigation of how we function, which is what social science does to some extent, is quite remarkable, I think. I just wanted to thank you for pointing out the futility of that kind of approach.

The Chairman: Thank you, Mr. Axworthy.

Mr. Pankiw, you had a brief, last question.

Mr. Jim Pankiw: I have a brief question.

In your statement you said that university research is responsible for the production of $76 billion. How did you get to that figure?

Mr. Robert Giroux: These are estimates that were made. Can I get back to you with the answer? I don't have it in the back of my mind. I know we did some research to do it, but we'll send you the details on how we arrived at that number.

Mr. Jim Pankiw: Through research, was it?

Mr. Robert Giroux: Through research, yes. It includes the research being spent in universities and the spillover industries. A good example was what was happening at the University of Saskatchewan. So it's on that basis that this number was arrived at, but we can give you more details.

The Chairman: Thank you.

Madame Alarie has one last question.

[Translation]

Ms. Hélène Alarie: Madam Chair, I have a short comment and a short question.

We are all very concerned about the future of universities. I got quite the shock last year. I went to award scholarships to students in my faculty where 30 years ago I was the only woman in a class of 50. I was in a class of 250 people, and 54% of them were women. But that is not what surprised me the most. What did surprise me was that 60% of the scholarships I awarded were for topics that had not even been discovered ten years ago. That would have been difficult to predict, as they were all innovations.

My question is along the same lines as Mr. Bellemare's question. In your funding plan, you talk about 20% support for students. I did a little bit of research at Laval University, where undergraduates end up with roughly $16,000 in debts. Many do not even go on to the masters level because they are too indebted.

• 1115

Among all the measures you will be taking, are you thinking of providing a link for those who will go on to get a masters or a PhD so that they will remain attached not necessarily to their faculty, but to the university system in general? Otherwise, there will be a brain drain and the whole investment will disappear.

Mr. Robert Giroux: We have recently carried out studies showing that, generally speaking, universities lose a lot of scientists in the middle of their career, when they are essentially the most productive. We believe, and this is simply a suggestion, that by allocating 20% of the increases to research careers, you will be encouraging people in graduate and post-graduate studies to do research, to remain at the university and to join another researcher. This will incite them to remain at the university, to teach and to continue their research.

Without this assistance, since they already have an enormous debt by the time they finish their undergraduate studies, they wonder if it is really worth it to go on and increase their debt. If there were some assistance, they would carry on, do research and remain at the university level.

I believe that we are starting to see a major exodus in this sector.

[English]

The Chair: Thank you. Thank you, Madame Alarie.

I want to thank our witnesses for being with us today. It's not often that we have the luxury of the time we had this morning. We thank you for your patience.

I know all members could ask questions for probably a much longer time if time would allow. When your report came out in September, we felt it was very important that we get you to meet with us as quickly as possible. This committee did do its study on innovation last year, and we wanted to follow up on it, find out where we were on research and look at what the future holds for this committee in that area.

Your comments today have been very helpful. As you undertake your study of level of debt of students in Canada, I would ask that you do a comparison with the United States as well on whether or not the government's dollars in the United States compare to the level of student debt...or vice versa in Canada. I know from my own interest that would be welcome information. The statistics you revealed today are very important as we talk about where we are internationally and where we're going in the G-7.

Again, I want to thank you for joining us.

Do you have a closing comment for us, Dr. Hough?

Dr. Paul Hough: I would like to briefly say thank you very much for the opportunity. We very much appreciate the time here.

There are two messages I would like to leave. We very much hope this committee will take the document forward and the messages therein. The community at large has really done a lot of thinking, a lot of background work, in order to define the priorities that we feel are very important.

I think one other area worth mentioning is that Mr. Axworthy indicated that coordination has been lacking for a long time. I really wonder whether perhaps future actions on the part of this committee could alleviate that to some extent in the sense that this is a focal point for outside groups, government groups, etc., to explain what is happening. It would provide you with an opportunity to basically do an inventory of what is happening in the university, in the government sector, and even in the private sector to make sure the resources that are allocated to research from whatever source are going to the areas that need it, that the communications are being made among the different sectors, and that we do have a sense of where we're going. I think there is a real role for this committee, and if we can do anything to help you in that regard we would be most happy to do so.

Thank you.

The Chair: Thank you.

The meeting is adjourned.