Thank you, Mr. Chair and members of the committee. We're pleased to be here today from Industry Canada to provide information on innovative transportation technologies to the transport committee and to answer your questions.
At the outset I will provide a bit of background in terms of science and technology innovation policy and the Government of Canada's work in this regard. I refer you to the federal science and technology strategy launched in 2007, which provides a multi-year framework of support for science and technology and innovation in Canada.
This strategy reinforces business research and development. Of course commercialization and innovation are vital to maintaining Canada's global competitive advantage and our high standards of living going forward, and we stress the importance of this.
As you know, the Government of Canada and federal policy play an important role in fostering an economic climate that encourages business innovation. Significant programs provide direct and indirect funding incentives to business to support research and development and commercialization.
The conundrum, which has been pointed out by many commentators, most recently was referenced in the budget of 2010. It is that notwithstanding a high level of overall federal support for business innovation as a percentage of our economy, we continue to have an overall flat level of research and development investment on the part of the private sector in the country. This will pose a long-term challenge to our competitiveness if this trend does not change and we don't see improvement.
This led the government to put in place a review panel, chaired by Tom Jenkins, which released its report, “Innovation Canada: A Call to Action”, last fall. I have copies here. It provides a series of general recommendations in the area of innovation on how federal programming instruments, policies, and organizations could be reformed to enhance their support for increased business innovation in the country.
That's it overall, in terms of background. At the moment the government is considering the recommendations of the Jenkins panel in view of future policy development.
In the material we received from the committee, you asked a number of specific questions. We'll try to address them up front and then take questions on them.
You first asked what federal horizontal initiatives exist to facilitate research and development and commercialization of transportation technologies.
On the part of the Industry Canada portfolio, I would point you to three initiatives that provide research and development support to the transportation industry in a direct fashion.
The first is the strategic aerospace and defence initiative. It supports private sector industrial research in pre-competitive development projects in aerospace, defence, and space industries through a repayable contribution. Since the program was launched, over $750 million has been invested in aerospace technology development.
The second is Automotive Partnership Canada, which is a five-year, $145 million initiative. It supports collaborative research and development activities that benefit the Canadian automotive industry through partnerships among industry and academia and the National Research Council. The guiding principle of the program is that projects are to be funded and driven by industry needs and that there be active industrial participation, collaboration, financing, and support for these projects.
The third is the automotive innovation fund, which supports the development and implementation of innovative, fuel-efficient technologies and processes through large-scale research and development projects in the automotive sector. This program was provided with $250 million over five years through to the next fiscal year.
You also received testimony from the National Research Council, I believe, in terms of its own specific programming. I won't repeat that here, but through institutes that they operate and through the industrial research assistance program for small and medium-sized enterprises, there's support that definitely is relevant in terms of innovation in the transportation industry.
I'd also reference the support through granting councils, particularly the Natural Sciences and Engineering Research Council, which provides support in many ways to direct researchers and also, importantly, to research networks.
In this connection, you may have heard of AUTO21, which is a network of centres of excellence. It has been in place for some time. It supports large-scale academically led research in the automotive sector and involves 200 researchers and 200 industry, government, and institutional partners across the country. It's also a program that was launched after the S and T strategy was put in place, the business-led network of centres of excellence.
Through a competitive process, a network was established called the Green Aviation Research and Development Network, GARDN, which received $12.9 million to promote aerospace technologies that have a specific role in reducing emissions, reducing noise, and increasing the efficiency of aerospace technologies.
Over a five-year period the industry portfolio, through a variety of instruments, has invested close to a billion dollars in research and development in support of transportation industry innovation.
I've also referenced a number of other initiatives of a general nature that are important in respect of transportation industry innovation. The first is the collaborative research and development program, which is a program delivered through the Natural Sciences and Engineering Research Council. It provides support for academics to work with industries on specific projects, supplying a 50% grant to the academic to work with the industry partner, with a requirement that it be leveraged with private sector funds to increase collaboration with the academic sector.
The second initiative, a responsibility of the Department of Finance and delivered through Canada Revenue Agency, is the scientific research and experimental development tax credit, which is generally available to all industries. The program provides overall support for innovation. In the last year for which we have information, there was $3.5 billion in support to innovation across all industries.
The last is SADI, delivered by the National Research Council.
You had asked how we measure results, how we determine whether we're making progress. I would point you to policies on evaluation of the Treasury Board, which we follow. These require that all of our programs be evaluated over a five-year period. The three that I mentioned as specific to our department in our portfolio will undergo such evaluations.
For SADI, there's an evaluation that has just recently concluded, and that information will be made public within the month. That will be available to members, if they're interested to see what its findings were.
The Automotive Partnership Canada program is more or less midway through its funding cycle. Many projects are coming together and being launched. Once there's sufficient activity that you can actually undertake an evaluation and have some substance to look at, there will be an evaluation undertaken as to whether the program is fulfilling its objectives.
There will be an evaluation of the automotive innovation fund of Industry Canada undertaken in the near future to determine how it's achieving its objectives.
Lastly, there was a question about how intellectual property is managed through these programs. In general, the orientation of the programs working with commercial partners is to vest the intellectual property with the commercial proponent, so that the party that's going to undertake the commercialization activity has the ownership over the intellectual property that's developed, often with the support of public funds.
As to the granting council initiatives, depending on which program the support is provided for, often it's a question of university policies that would apply to the researchers in particular. Those policies may have provisions that vest intellectual property with the researchers themselves or with the university. Whether IP is vested with the proponent or the researcher depends on which institution you look at.
There are more commercially oriented programs out of NSERC that vest IP ownership with the proponent directly, such as their small-sized grants called “Engage” and “Interaction”, which try to start the interaction between researchers and private sector parties.
I will turn to my colleague Gerard Peets, who will give you a description of the intellectual property framework that protects innovation in the country. Then I'll turn to my colleagues from Transport Canada.