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Results: 1 - 15 of 41
View Annie Koutrakis Profile
Lib. (QC)
View Annie Koutrakis Profile
2021-05-20 16:49
I know that in your testimony you were kind of hoping to see $30 billion for the strategic innovation fund. We're starting with $7 billion.
If I misquoted you, I apologize.
View Annie Koutrakis Profile
Lib. (QC)
View Annie Koutrakis Profile
2021-05-20 16:50
Okay. This budget includes a significant commitment of $7 billion to the SIF, which has been an effective program in helping businesses grow and innovate.
How do you see the chemical and plastics industry making use of the $5 billion in funding for decarbonization of industry through the net-zero accelerator?
Bob Masterson
View Bob Masterson Profile
Bob Masterson
2021-05-20 16:50
It does provide some opportunities, and certainly we have had three major investments in Canada that have participated in the strategic innovation fund to date, totalling, I believe, a proposed $9 billion. One of those investments was put on hold due to COVID. We'll see if it comes back. Therefore, the industry has experience with that.
The $30 billion number that I mentioned is how much investment, total investment, we should have seen come into our sector. Again, we don't expect the government to fund all the capital investments for our sector, but we expect it to create the conditions where that will come.
What I was providing was a historical example. We should have seen $30 billion. We've only seen $7 billion. It tells you that we're falling behind, so there's an urgent need for measures again.
The money in SIF, especially the net-zero accelerator, is very welcome. We have companies that will definitely take advantage of that—my point being, though, it's a minority of the facilities in Canada. We have to create a business environment where we can recapitalize. Getting to net-zero, we have to recapitalize not only our sector, but the mining sector and every other sector in the economy, and that means attracting domestic and foreign investment.
It's a big job, and SIF expenditures alone will not achieve that, as important as they are and as welcome as they are.
Jim Balsillie
View Jim Balsillie Profile
Jim Balsillie
2021-05-20 12:40
Thank you, Mr. Chair.
I'm Jim Balsillie, presenting on behalf of the Council of Canadian Innovators. I'll make two observations about the structure of the modern economy in relation to the budget and conclude with one recommendation.
The accelerated pace of innovation and the digital transformation over the past 30 years has created a new kind of economy in which the basis of wealth and power is derived from the ownership of valuable IP and control of data. Concurrently, the new technologies of this era, centred on the nexus of automated decision-making and machine learning, are reshaping our social and political spaces. Intangible assets comprise 91% of the S&P 500's $28-trillion total value.
This shift is unprecedented in its degree and rapidity, particularly with the emergence of high-profit firms with monopoly positions based on IP rights and control of data assets. Wage growth is now concentrated on the small workforces of firms rich in IP and data, which drives inequality. These firms have a low propensity to invest because they generally don't produce tangible goods. Rather, the marginal production costs of their intangible goods is near zero. Additionally, the nature of the taxation system on the profits of intangible assets allows firms to deploy effective tax-minimization strategies, resulting in tax base erosion for Canada.
Countries around the world, starting with the U.S. in the 1980s, have retooled and recalibrated their prosperity strategies to fit with the shift from the traditional economy to the economy of intangible assets. Canada's prevailing policy orthodoxy, still visible in this most recent budget, is to stick with the traditional production economy strategies for growth, even though such an approach continues to result in weak productivity, lower rankings in innovation indices and, most acutely in the last decade, a decline in our GDP per capita compared with the U.S. As the chart in my appendix shows, Canada's deficit on IP payments and receipts is widening at an alarming rate. This deficit would be much larger if the value of net flows of data was included.
In the contemporary economy, the objective is to generate and control IP and data stock assets for their economic and non-economic benefits amidst rivalrous international economies. Canada's prosperity strategies are not only inadequate but often also counterproductive. The first is creating foreign direct investment agencies and programs that have no contemporary analytical framework, unlike our peer countries globally. The second is a 15-year spree of signing free trade agreements despite economists writing, as early as 2003, that international trade treaties have shifted to dealing with strengthening protections for IP owners rather than traditional tariff reductions. The third is making enormous investments in scientific research without adequate IP policies and strategies. Fourth is the underfunded and outdated mandates for critical regulators in the modern-day economy, such as foreign investment, privacy and competition.
The federal budget reflects an outdated approach to a contemporary economy. It also fails to recognize the real limitations of our institutions. It is irresponsible to pack 270 measures into a 700-page document and expect that they will be implemented. It's futile to invest enormous public funds without updated frameworks and clear strategies that would yield desired outcomes for Canada. While the risk remains high for turning a dollar of taxpayer investment into 10¢, there is also the risk of continued counterproductive measures where taxpayer funds generate negative returns for Canada.
Finally, the redistribution of a fixed economic pie or the prudent fiscal anchors many are advocating for are insufficient without a strategy to generate new wealth. Canada urgently needs growth strategies attuned to contemporary realities and budgets to reflect them.
I offer one recommendation that can foundationally help improve Canada's budget planning and implementation—namely, rebuild the Economic Council of Canada to create in-house capacity for the analysis of the contemporary economy. The nature of today's global economy requires an unprecedented amount of horizontal integration, analytical depth and rapid response to deal with the accelerated pace of innovation and the powerful feedbacks and spillovers that emerge in our networked society. A properly built economic council would lead in the very necessary revival of our policy community and help the government rebuild critical capacity that favours national interest, including post-COVID economic recovery.
In closing, I reiterate that misunderstanding our changed economic realities comes with real consequences to our prosperity, security and ultimately our sovereignty. Helicoptering money does not work like it used to, because the volume of credit needed to produce one unit of GDP growth tripled between 2007 and 2015. Simply chasing jobs with an assumption of relatively homogeneous firms is a race-to-the-bottom strategy that will worsen inequality.
Canada has the potential to build back better, but it begins with knowing what we need to build and how we need to build it.
Thank you.
View Sean Fraser Profile
Lib. (NS)
View Sean Fraser Profile
2021-05-20 13:39
On a similar vein to the question I put to Ms. Tiessen on how we set ourselves up for success, there are a couple of envelopes included in the budget around the strategic innovation fund, including about $5 billion for the net-zero accelerator fund.
You're speaking to a group of parliamentarians here. In your mind, what would you have us do when this meeting ends, if we're going to help inform the next step to make sure that the money that's being budgeted for is actually deployed in the most effective way?
Jim Balsillie
View Jim Balsillie Profile
Jim Balsillie
2021-05-20 13:40
We have a problem in that we view firms as homogeneous while they're strikingly heterogeneous in the evolution of the last 20 years, and we view jobs as relatively homogeneous when in fact they have entirely different characteristics for the benefit of the individuals and the country. My number one recommendation is that we do not have the capacity to analyze and create programs and implement and monitor programs to get the outcomes we're looking for in the quality of jobs, the quality of firms, the quality of productivity and the quality of security, which is in this 91% of the economy called intangibles. We talk the game, but we have to understand that Canada adopted an orthodoxy of extreme neo-liberalism 30 years ago.
The economist who wrote for the Macdonald commission, said that if you're going to liberalize labour, capital and markets, that's fine, but you have to pair it with an industrial innovation strategy or we'll go to a low-productivity, low-growth equilibrium. That was Richard Harris. He was the economist for it, and they ignored.... It was a two-book treatise and they only took one of the books. The first thing we have to do is to have capacity, or we're just going to keep, which is the definition of insanity, doing the same thing over and over again and expecting a different outcome.
View Gabriel Ste-Marie Profile
BQ (QC)
Thank you, Mr. Chair.
Minister, as you know, the greater Montreal area and other parts of Quebec are home to thousands of tech start-ups. At the beginning of the pandemic, they told us that the wage subsidy program was inadequate in terms of coverage. A start-up is, by definition, a business where someone puts up their own money while working towards a technological development, which, once ready, they can sell and reap the benefits of. The government turned to the innovation assistance program, administered by the National Research Council of Canada.
Now, some start-ups are asking why the program was not extended until September 25, like other income support programs. As we know, the innovation assistance program provides more than $250 million in funding, largely to start-ups. Some have even warned that, if the program ends, they could go bankrupt by the end of the pandemic.
Why end the innovation assistance program when we are this close to the goal line?
View Chrystia Freeland Profile
Lib. (ON)
Thank you for your question.
I must say, I certainly recognize how important Montreal's innovation ecosystem is. Toronto, where I'm from, has a similar ecosystem. Mr. Julian is here, and Vancouver, in his riding, has an ecosystem as well. The same is true of many other Canadian cities and municipalities.
Start-ups are a very important part of our growth plan. Canadian innovators will find quite a few measures in the budget that are meant to help them, especially small and medium-sized businesses wanting to make growth-oriented investments.
The budget truly focuses on growth and the future, with numerous programs that will be particularly helpful to these types of businesses. If you like, I can put together a list and send it to you.
Sherry Cooper
View Sherry Cooper Profile
Sherry Cooper
2020-06-18 16:59
I just want to touch on something we haven't mentioned yet, which is the sectors that government can definitely help to grease the skids of economic development. Sectors that will be very important in the growth of the next wave of technology innovation are telemedicine, which we're all engaged in right now; big data; artificial intelligence; cloud services; cybersecurity, a big government issue; and 5G. Compound that with enhanced broadband and computers for everybody and inexpensive tablets for kids. All of that is very important.
Roger Scott-Douglas
View Roger Scott-Douglas Profile
Roger Scott-Douglas
2020-06-04 15:54
Thanks very much, Mr. Chair, committee members and other witnesses. It's a pleasure indeed to be here.
I'm Roger Scott-Douglas, secretary general of the National Research Council. I'm very happy to be joined today by David Lisk, vice-president, industrial research assistance program; Jean-François Houle, the vice-president responsible for our COVID pandemic challenge response program; and Lakshmi Krishnan, director general, human health therapeutics branch.
Like others, I will begin by briefly explaining a little bit about the National Research Council.
We are the largest federal science organization, with close to $1.2 billion in expenditures. Over the course of the last 104 years that we've been existence, we've served as an instrument of the federal government in trying to find scientific and technological solutions to significant challenges, which is very much the call of the moment. We do that in two principal ways. We have a research and development side where over 2,000 scientists, engineers and technicians work in 14 research centres across 22 sites. On the IRAP side, the industrial research assistance program side, we also have about 400 people of whom 255 are industrial technology advisers working with close to 8,000 firms annually—high-potential, early-stage innovative firms that are so important to the innovation economy of the country.
In the context of COVID, the National Research Council, as part of the Prime Minister's announcement of the $1 billion that's been given over to COVID, received funding and support for, effectively, seven measures, which I would like to briefly outline. Then my colleagues and I would be most interested in answering any questions that members might have. I'll walk through each of them at a very high level, explaining a little bit of what lies behind them. I might, before getting into those details, talk about the important work the National Research Council, along with other science organizations across the country, has tried to provide to the community.
We've had over 350 requests for technical advice, for short-term support for companies, to provide such things as the quality assurance on N95 masks that the Public Health Agency has asked of us, and for other measures that support the community, individuals, the provision of personal protective equipment, and so on and so forth. This I say only to show how connected we are with both the larger federal group as well as communities across the country.
In terms of specific measures, I'll run through the seven key things.
The first—and this is Jean-François Houle's responsibility—is the pandemic response challenge program. We were fortunate enough to receive $15 million in the medical countermeasures announcement by the Prime Minister. There are essentially four themes or pillars to that work. All of these are collaborative programs where the National Research Council scientists pair up their expertise with individuals in academia and the private sector to come up with technological and scientific solutions to these challenges. These are short-term applied scientific efforts. The first theme is around rapid detection and diagnosis. The second theme is around therapeutics and vaccines. The third theme is monitoring and surveillance, data analysis, tracking for testing and that kind of thing. The fourth is around enabling adaptive responses, including innovative solutions for the delivery of health care. We have in the organization both the human health therapeutics branch, of which Lakshmi is the director general, and also the medical devices lab, which Jean-François will be able to speak about.
The second big thrust is the announcement of, in total, about $44 million that will be used by the National Research Council to upgrade and enhance the capacity of our Royalmount biomanufacturing facility.
It's currently a research lab. We're going to be upgrading it such that it obtains levels of good manufacturing practices and enables us to provide testing for promising vaccine candidates. Ultimately, once a candidate has been found, we hope it provides the successful industrial production for first responders and so forth.
We have three vaccine collaborations as well, with VBI Vaccines , an Ottawa-based company with an attachment to Massachusetts; VIDO-InterVac from the University of Saskatchewan; and CanSino Biologics in China, which is one of the leading international vaccine researchers.
In addition to that, on the IRAP side, which I mentioned Dave Lisk was responsible for, we're working with Innovation Canada under the innovation solutions Canada program. We have been given $15 million to set up challenges for which innovative SMEs and others will provide technological solutions. We've launched three challenges so far, surveying and assessing quite a few proposals for low-cost sensors, for diagnostic kits and for made-in-Canada filtration material. We'll be launching a couple more in the days ahead.
In addition to that, IRAP has kind of red-circled, if I can put it that way, and reallocated $12.5 million of its budget to help innovative SMEs develop proposals for the kinds of products necessary for the COVID response, such as PPE, testing diagnostics, and tracking and detection products, and that kind of work. We've also organized subject matter expert teams around those broad themes to provide expert analysis when we can.
The next area, the wage subsidy, is a very significant support. Several of the witnesses have spoken about it. Some groups fell between the gaps, particularly early-stage pre-revenue innovative firms, high-potential firms. The government has provided $250 million to IRAP for the innovation assistance program, which effectively provides highly qualified personnel with a wage subsidy—it's about $10,000 per employee, retroactive to April 1—with the idea of delivering the program as quickly as possible. Unlike others, it is not an entitlement program; it's a discretionary program. We're evaluating firms with the highest potential to go forward. We're happy to say that as of May 28, we have already established 1,939 contribution agreements for close to $200 million.
The final thrust of work, which is a critically important part of our future, is youth, particularly those highly qualified future STEM innovators. In that regard, we have a couple of very important programs under way. The government has a long-standing youth employment program. It was topped up to the extent of about $153 million—IRAP will have a portion of that—and will be targeting SMEs, meeting their needs to keep graduates. Within the National Research Council, we have a need to bring on STEM grad students and post-docs, and we've allocated $7.5 million to do that.
Thank you very much.
Ghislain Gervais
View Ghislain Gervais Profile
Ghislain Gervais
2020-05-26 18:01
Since February 2016, I have been president of Sollio Cooperative Group, formerly known as La Coop fédérée.
Supply chains and food self-sufficiency are issues of great concern to us. In operation for nearly 100 years, Sollio Cooperative Group is the only Canada-wide agricultural supply cooperative. We represent more than 122,000 members, agricultural producers and consumers in 50 traditional agricultural and consumer cooperatives.
We have more than 15,000 employees in our three divisions: Sollio Agriculture supplies farms; Olymel specializes in pork and poultry farming and processing; and BMR is one of Quebec's leading retailers of construction materials and hardware.
Last year, our cooperative surpassed $7 billion in consolidated sales, and this year we will surpass $8 billion.
Having said that, I think it is important to bear in mind that our supply chains were under strain even before the pandemic, because of the strike at Canadian National, or CN, and the rail blockades, to say nothing of access to the Chinese market.
Agricultural producers and food processors are feeling the repercussions of the pandemic, which must be limited to protect the supply chain.
At Olymel alone, costs to date amount to more than $20 million, not counting lost market margins. While unforeseen costs mount—costs we assume in their entirety—American processing plants are receiving direct government assistance to stay open.
Recently, we urged governments to create a specific assistance program to ensure the agri-food sector's viability and the food security of Canadians. Measures announced since then by the Canadian government are a step in the right direction, but still clearly not enough. The government must above all not presume that we will be able to withstand a second wave of the pandemic if the dire needs that became obvious during the first wave are ignored.
We have already learned some lessons, and I'd like to take this opportunity to share our thoughts with you. We have defined areas for action that correspond to our vision of the economic recovery to be undertaken. Our aim is to help the agri-food chain face current and future challenges.
First, there is the increase in productivity, which goes hand in hand with infrastructure automation and robotization.
Second, greater food self-sufficiency is necessary, but agri-food exporters must also be supported through investments in food processing.
Developing the vitality of the regions is also an important aspect of the recovery, in particular by stepping up the deployment of adequate telecommunications infrastructure.
Our fourth area for action is support for a more sustainable economy which we believe involves significant support for the digitization and performance of agriculture.
Another avenue to consider is the promotion and support of the cooperative model, which has proven its worth and makes it possible to develop large-scale companies. The cooperative business model also reflects Canadian values.
Promoting the frontline trades represents the last, but not least, area for action. There are still labour shortages despite our current unemployment rates. The last few months remind us how essential the frontline trades are to our businesses and that they need to be supported.
These are the avenues we are proposing to ensure your support is well targeted and our supply chains are protected. They are necessary in order for Canada to increase its food self-sufficiency, but also to protect its capacity and its reputation as a world-class exporter, which have recently suffered.
I thank you again for your invitation. I would be pleased to answer your questions.
Ghislain Gervais
View Ghislain Gervais Profile
Ghislain Gervais
2020-05-26 18:23
Attaining food self-sufficiency will require investment in innovation.
It is important to know that operating margins are very slim in the agri-food industry. When something like COVID-19 happens, it is almost a perfect storm because the margins disappear.
We need innovation. To innovate, with robotics and modernized infrastructure, will need significant investments. However, when there is already no leeway, investments like that are more difficult because people cannot afford them. Whatever the situation, it will require innovation.
An agri-food innovation zone could be created. The potential for Canadian agri-food is immense. Canada has 37 million acres under cultivation. The Netherlands, with 2 million acres under cultivation, produces 11.2 times more agri-food value than Canada. An investment in this sector could increase that value and benefit the entire chain.
The potential is huge, and we could be part of the whole agri-food chain. It would have a major impact in all regions of Canada, build confidence in everyone involved and encourage them to invest more. It would have a snowball effect.
It could help to improve Canada's reputation as a supplier of safe and reliable food for its people, and help us continue to expand our reach into export markets.
Darren Dalgleish
View Darren Dalgleish Profile
Darren Dalgleish
2020-05-07 17:26
Thank you, Mr. Chair.
Good afternoon, everybody. I'd like to thank the committee for the opportunity to speak to you today.
I'm joining you from Edmonton, Alberta, home of the Oilers, the Eskimos and Canada's largest living history museum, Fort Edmonton Park.
The overall tourism industry in Canada is worth $90 billion of economic activity and 1.7 million jobs. It's an enormous industry, with tentacles in every community.
My experience in the cultural tourism sector includes Ontario and Alberta, so my comments will apply to both provinces, but the challenges are generally uniform across the country.
Cultural tourism organizations such as museums have been fighting a steady decline in visitation over the years. Declining interest, the state of the economy and reduced government funding for cultural institutions have all of us on the edge of sustainability. Tourism attractions are under a strain as well, due to declining discretionary spending, and because the market can only absorb so many tourism offerings where the industry has filled the void from lost industrial and manufacturing activity.
I tell you this just to illustrate how fragile this sector was before this public health crisis. Some organizations, including the Fort Edmonton Management Company, started to focus on expanding their product mix to a more market-aligned portfolio. Why is this? Well, it supports the sustainability of the core product, and it helps preserve the social value that these organizations were created for.
Now, with this health crisis, tourism and cultural organizations find themselves in dire circumstances, because the very nature of tourism relies on visitation and volume. The disruption of travel has impeded our industry as well, and this issue will affect us well beyond the pandemic, because consumer behaviours are likely to linger.
Think about this for a moment. Cultural tourism is one of the only industries where there is no shipping cost or supply chain for your product. Rather, your customers come to you to get it. This was once a strong tailwind for our industry, and it has now become a crippling headwind.
Further, when people travel to our locations, they create an economic impact and multiplier that generates demands for many other businesses. This entire model is now drowning, and it needs to be reimagined so that maximum social and commercial values can be realized.
I remember SARS. Toronto was just a few hours away from our home in Kingston, Ontario. SARS devastated the tourism industry in Toronto, but something remarkable came of it. Prior to SARS, the idea that you would see competitors in hospitality, tourism, theatre, music and culture, etc., collaborating to attract people to their city was not well rooted in the industry. After SARS, the constraints in capacity utilization among these sectors demanded collaboration, and ultimately this collaboration and innovation became the epitome of what we now call destination tourism.
We learned from that, and we need the same approach today—a harmonious response and a clear focus on what's next, not when we can get back to normal.
How does the government's response support this? Wage subsidies and student emergency funding are important and help provide some interim relief, but that doesn't fully address the structural problem here.
Yes, of course, we need to take care of people. We need to support students so they can return to university or college and industry workers so they can support their families, but we should reserve some of this allocated funding to incentivize innovation, growth with new products and infrastructure that supports it, and productivity improvements.
We need to be holistic about what the government provides incentives for with these funds. Subsidies, grants and loans that provide a return to my typical business practice will not force innovation in this evolving market. We need more ROI-driven and market-driven initiatives incentivized.
I'm not sure how that looks, but it needs to drive innovation and growth. Constraints in business drive innovation. When constraints are removed, you go back to yesterday, so I would ask the government to be careful to not fully remove all of these boundaries. As with SARS in 2003 or the collapse of the automotive industry in 2008, business models changed out of necessity because they were constrained.
My question for my friends and colleagues is this: How do we look at this as a generational shift—for a segment of funding anyway—in how we support this industry? What does next-generation destination tourism look like?
We need to redefine our product and service offerings to address the new social and economic environment, because I fully expect these new consumer behaviours and expectations to remain well after the pandemic. We need to take care of employees, we need to take care of our guests and we need to take care of our bottom line. If any of these three legs fail, sustainability is simply dissolved. In short, we have to innovate.
The existing government programs to respond to this crisis in our sector are a great start. They will help position organizations to hit the ground running when we emerge from this crisis. But if I'm being completely honest, I'm less worried about when we'll hit the ground running than I am about how we'll hit the ground running. It's possible that we won't be running at all.
I very much appreciate the opportunity to speak with you today. I definitely acknowledge the immense challenge of supporting this very diverse industry. I thank you for that.
View Gabriel Ste-Marie Profile
BQ (QC)
Thank you.
I'm not happy to hear your answer because it paints a bleak picture for start-ups, which really seem to be falling through the cracks of all the programming announced thus far, even though they're an extremely important part of the economy. It's often said that the greater Montreal area alone is home to 5,000 start-ups. Hopefully, the government will come through.
You mentioned the IAP. I'd like to know about your personal experience with granting agencies like the National Research Council of Canada.
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