Mr. Chair and esteemed committee members, thank you for the opportunity to be here on the occasion of the tabling of the main estimates for the 2018-19 fiscal year.
Our government believes that the best investments we can make are in our people.
We believe a growing economy means investing in curiosity, creativity, and innovation. That's why, as you are no doubt aware, our government recently made the biggest investment in research in Canadian history.
We made this investment because research is the engine that drives an innovative economy.
That's right. Budget 2018 sets aside nearly $4 billion to support current and future scientists and researchers.
In addition to the new funding, $2.8 billion will go toward renewing federal laboratories to ensure federal scientists have the infrastructure they need to inform evidence-based decisions about our environment, our health, our communities, and our economy.
Budget 2018 represents the culmination of so much work with so many partners and stakeholders. We believe these investments will encourage current researchers and inspire the next generation.
We want to continue to position Canada at the leading edge of discovery, discovery that improves not only the health and quality of life of Canadians, but also our environment. We want to supercharge the economy with research, enabling the discoveries that create jobs and even entirely new industries.
Take artificial intelligence, for example. Budget 2017 committed $125 million for the pan-Canadian artificial intelligence strategy. This investment is supporting hubs across the country. Industry is taking notice. Alphabet Inc., the parent company of Google, is setting up shop in Toronto, and now The Economist is talking about “Maple Valley”, not just Silicon Valley. People around the globe are asking, “How did Canada do this?”
We also want to improve the lives of Canadians with new breakthroughs in areas like health care.
These investments in research will help lead to new treatments, new medicines, and better care every day for Canadians across the country. We want to build a dynamic 21st-century workforce, one that is equipped with the science, technology, engineering, and math—and I would add arts and design skills—needed to respond to future challenges and opportunities with creativity, courage, and confidence.
Let me share some details. Of the $4-billion investment I mentioned, $1.7 billion is going to support research funded through the granting councils. This includes the single largest investment in discovery research in Canada's history. This will mean better opportunities and increased support for about 21,000 researchers, students, and highly qualified personnel across Canada. That includes $210 million in new funding for our Canada research chairs program.
Already, through the Canada 150 research chairs, we have recruited 25 internationally renowned chair-holders who are making their way to Canadian universities in the coming year from Austria, Australia, France, the United States, New Zealand, South Africa, and the United Kingdom. I'm happy to say that 42% of them are Canadians, returning home because they now see a future in research here in Canada. Let me add, 58% of them are women. They are leaders in their fields, attracted to Canada by the supportive funding and the advantages that our research ecosystem offers.
Budget 2018 also sets aside over $1.3 billion to provide researchers across the country with access to state-of-the-art tools and facilities. This means that over 44,000 students, post-doctoral fellows, and researchers will have access to the equipment they need to carry out groundbreaking research.
I'd also like to highlight an important investment that budget 2018 makes in our world-class colleges and polytechnics. They are a critical innovation bridge between ideas and the marketplace. Through the college and community innovation program we have set aside $140 million to increase support for collaborative innovation projects involving businesses, colleges, and polytechnics. This is the largest research investment ever.
These institutions are critical to innovation. They partner with small businesses in their communities to solve real-world challenges.
Mr. Chair, I'd like to share a local story that illustrates this.
I recently visited the technology access centre at Niagara College. While there, I chatted with a representative of General Electric. He was happy to share that one of the main reasons the company decided to open a manufacturing facility in Welland was the technology access centre in the college. GE saw first-hand how the capabilities of the college could benefit the company. Everything it needed was there, in Welland: access to faculty and research teams; resources and equipment; and highly skilled and knowledgeable graduates in technology, trades, and business. This is huge. Today, the GE brilliant factory employs approximately 200 people.
We are making investments that strike the appropriate balance between discovery research that supports breakthroughs and the commercialization of ideas.
Mr. Chair, I'm glad to say that budget 2018 was well received by those on whom it will have the greatest impact.
The Universities Canada president said:
“This budget makes important advances on the roadmap developed by the Naylor report.... It's a major investment in research that impacts Canadians' everyday lives, from shortening commute times to lifesaving medical treatments and environmental protection.”
The CICan president and CEO said, “Supporting applied research is one of the most efficient ways to boost Canadian innovation.”
This investment will go a long way toward unleashing the potential of colleges and institutes to drive growth in their communities and to train future innovators.
To that end, I want to emphasize that budget 2018 is about renewing Canada's research ecosystem to train the next generation of researchers. In recognition of this historic opportunity for real change, we want to ensure that Canada's next generation of researchers, including students, trainees, and early-career researchers, is larger, more diverse, and better supported than ever before. We task the granting councils with developing new plans to achieve greater equity and diversity in the sciences, and to support more early-career researchers.
We want to see our support advance the research ambitions of more women, indigenous peoples, minorities, persons with disabilities, and those at early stages in their careers. What's more, over the next year, the government will do further work to determine how to better support our next generation of researchers through scholarships and fellowships.
Mr. Chair, the government is playing the long game here.
This is our chance to harness the power of research to change the lives of Canadians for the better.
This is our chance to create a research ecosystem capable of sustaining brilliant minds and groundbreaking work.
We do all this because we want to be a global research leader and be at the forefront of discoveries that positively impact the lives of Canadians, the environment, our communities, and our economy. We are doing our part to train and support this generation of Canadian researchers so that they can help make that happen.
Thank you. I'd be pleased to answer any questions the committee members have.
Thank you very much, Chair.
It's great to be back. It's great to see a lot of familiar faces, some new faces as well.
Thank you very much for this opportunity.
I appreciate the opportunity to meet with you on the occasion of the tabling of the 2018-19 main estimates.
It is my intention to share with this committee the details of the continued implementation of our government's innovation and skills plan, which we've discussed in several of our budgets.
Chair, my comments will be brief to allow maximum time for questions. I know you said up to 10 minutes, but I will do my best to take less than that so we have a fulsome discussion.
However, before I do that, I'd like to thank this committee once again for its report on intellectual property and technology transfer. As you saw last week, when I announced our government's first national IP strategy, which is a huge point of pride, it reflected the recommendations, and you were instrumental in driving those initiatives home. I thank you for your leadership.
I would be happy to discuss our strategy in more detail during the Q&A session.
As for our innovation and skills plan, it is already providing a better life for middle-class Canadians from coast to coast to coast. We are well on our way to accomplishing our goals. Our economy has been growing at a rate of more than 3%, so GDP is doing really well relative to previous decades.
Our economy is the fastest growing economy in the G7.
But we can't be complacent. We must continue to make investments. We need to be strategic, we need to be smart, and we need to be thoughtful. From day one, jobs have been a priority for me and for our government.
Since we formed the government, in 2015, the Canadian economy has seen more than 600,000 jobs created. Our unemployment rate right now is at 5.8%, so clearly we're headed in the right direction.
Naturally, we want to continue to build on that momentum. That's why I'm here today to discuss the proposed budget allocation of $7.8 billion in the 2018-19 time period across the ISED portfolio and to answer any questions you may have. In doing so, I am seeking approval for spending to continue advancing our government's innovation and skills plan—again, it's a multi-year plan—including the priorities announced in budget 2017.
One of the centrepieces of our innovation and skills plan that received funding, or that was allocated in the 2017 budget, was the supercluster initiative. In February we revealed the five successful proposals that link together business, academia, and non-profit society to come together to supercharge our economy. The framework for partnership is there. Now it's up to innovators to bring those partners together and put their plans into action, and I look forward to seeing what each supercluster does in the coming months and years.
The strategic innovation fund, which was also announced in budget 2017, is another tool intended to stimulate innovation.
This fund will help Canadian innovators build in areas of economic strength, expand the role of Canadian firms and regional and global supply chains, attract investments, and create new, good-quality middle-class jobs.
Since its launch in 2017, Canada's innovative industries have responded positively to the strategic innovation fund. For example, hundreds of applications have been received through this new single-window program. We will put departmental resources to good use to allow SIF, the strategic innovation fund, to accelerate technology transfer and commercialization in sectors ranging from aerospace, defence, and automotive to agri-food and clean tech. Really, again, it's to diversify our economy and to look at the areas of high growth.
I'd like to highlight a couple of other important measures that are ensuring Canada's place in the digital economy.
I'm referring to the CanCode and connect to innovate initiatives. Through CanCode, we're teaching coding and other digital skills, and this is really a point of pride for me as a father of two young girls. One million kids from kindergarten to grade 12 will learn how to code in the next two years, and we will also help train more than 60,000 teachers on how to incorporate new technology in the classroom.
Of course, none of this is possible without access to high-speed Internet service. That's why we are funding the connect to innovate program, which helps bridge the digital divide in rural and remote communities across Canada. This is a matter of fairness and a matter of equality. This is a really essential part in the new digital economy.
Canada's success in the digital economy also depends on leveraging our diverse talent and providing opportunities for all to participate in investing in digital skills, and infrastructure, we believe, will help achieve this.
Finally, among the many 2017 measures I'm talking about here today, let me draw your attention to the innovative solutions Canada program. Under this program, 20 federal departments and agencies will challenge small and medium-sized Canadian companies to solve real departmental problems. These are challenges the government is facing. They're going to go out and put them out in a very open and transparent way. This program will support the scale-up and growth of Canada's innovators and entrepreneurs by having the federal government act as a first customer, to be that marquee customer.
In return, the government will have access to the latest and most innovative products and services. This is aimed squarely at innovators, and we are confident it will help smaller companies become successful global players as well.
Our government's investments under the innovation and skills plan ensure that Canada will sustain its leadership position as one of the world's best places to live and to do business.
They will help sustain a world-class workforce in cutting-edge infrastructure, and they will attract investment and opportunities from around the world.
Once again, I thank this esteemed committee for this opportunity to speak and share some of my thoughts, and I look forward to any questions you may have.
Thank you very much.
Minister, it is so wonderful to have you here to talk to us about the investments being made in innovation, as part of the estimates process.
I want to talk about the innovation superclusters initiative. There's a particular one that's a bit close to me. That's the advanced manufacturing supercluster. That bid was done out of the area I represent, and it included a lot of partners. It included the City of Markham, the Regional Municipality of York, ventureLAB, York University, Seneca College, and many industry partners such as Celestica, Magna, Canvass Analytics, Peytec, SterileCare, and ChipCare. I'm really pleased that their bid was successful and they will receive funding through the advanced manufacturing supercluster.
It really does represent a wonderful economic opportunity because of the concentration of companies that are here, from start-ups to scale-ups to SMEs to multinationals. They work and operate in a place that really is an ecosystem.
With that, could you talk to us about the superclusters? I've just highlighted the one, but can you talk to us about the five superclusters, how they were chosen, and the government investment in the superclusters initiative?
Thank you very much for your question and your leadership in this area. I know Markham is really a hub of innovation. There are a lot of great companies there, and many of them are participating in this particular initiative, as you mentioned, in the supercluster initiative, the advanced manufacturing one, more specifically.
Now, just to take a step back, we decided as a government that we wanted to unlock more money for research and development. We wanted better quality jobs. We wanted to see more economic growth. We decided that, rather than being prescriptive, we would create an open and transparent process led by businesses. The idea was that they would put forward competitive bids and proposals and ideas of how they'd work with smaller companies, large companies, academic institutions, and not-for-profits, to get us those desired outcomes.
Again, if someone asks me what a supercluster is, I'll say it's a job magnet. It's really about good-quality jobs. It's creating an ecosystem. Also as you mentioned, this was a very competitive process, and ultimately, we selected five. We avoided what we call the “peanut butter” approach. We wanted to be very strategic, we wanted to be very deliberate, and we wanted to have impact.
By selecting up to five—we determined five ultimately based on the criteria—we felt this would allow them to really compete, not only within Canada but globally as well. We have the digital supercluster out of British Columbia, one out of the Prairie provinces around protein and adding value to protein products, obviously the advanced manufacturing initiative that you talked about in Ontario, the artificial intelligence supply chain initiative, and then, of course, the oceans supercluster in the Atlantic Canada region.
This represents the fact that innovation takes place across the country, but fundamentally, the key metrics and take-aways are that this, at minimum, would generate billions of dollars of economic activity and tens of thousands of jobs over the coming years. This has been validated by third party experts. We also engaged government experts. We also had an expert panel, so we're very confident that this is an economic policy that will give us those desired outcomes.
Specifically in advanced manufacturing, it's about platforms. How can additive manufacturing—3-D printing, for example—and robotics help so many different aspects of our economy? It's not focused on aero or auto exclusively. These platforms like artificial intelligence or digital platforms, for instance, have a profound impact across the entire economy. I would say we have to be careful that this isn't a regional strategy. This is really about platforms that are going to be deployed and benefit the entire Canadian economy from coast to coast to coast.
First of all, thank you.
As I mentioned, on the intellectual property report, your feedback and guidance were extremely helpful as we articulated the government's first national IP strategy. In the new knowledge economy, it was long overdue.
With respect to investments in high-speed Internet connectivity in rural and remote communities, that's still a priority for our government. That's why we introduced—and it's in the estimates as well—the connect to innovate program. This is a $500-million program to provide that fibre backbone infrastructure.
The neat attribute about this program is that it actually leverages private sector funding. Overall investment will be over a billion dollars. It will help over 700 communities, including really remote and rural communities, but we're looking to build upon that. We announced for example, LEOs, low Earth orbit satellite technologies, that can help, again, those rural and remote communities to deal with the latency issue.
We're looking at technology. We're looking at traditional funding in fibre. We're looking at partnerships with the private sector. We've also been working very closely with the provinces and territories to make sure that we have better program alignment to maximize those opportunities as well. It continues to be an important issue that our caucus raises. We'll continue to make those investments.
You're right. This is the first national IP strategy that the federal government has deployed. In a new knowledge economy, it was long overdue, and I want to thank you again for your work.
As you know, there is $85.3 million associated with this strategy as well, so it has substantial resources deployed. There are three components to it. One, of course, is around IP literacy, which is really important, particularly, small businesses and IP. Only 9% actually have an IP strategy, and only 10% actually own IP, so this is a real challenge for us. Even if you look at the context in the U.S. for the S&P 500, 84% of their assets are attributed to IP, while for the TSX top 30, it's only 40%. We're really behind in the IP game relative to our U.S. peers.
We brought different provisions. We looked at trolls and bad behaviour. We brought a patent collective forward as well, to deal with issues and to provide better resources to deal with—again—those bad actors.
The IP marketplace is a great initiative that this committee highlighted. It really is a one-stop shop for businesses, to be able to determine the different patents that exist in a more clear and concise way and to see how they can better leverage it in their own business. Also, those patent holders are in a position to then get better licensing, revenue, and fees out of their patents as well.