Investing in innovation: getting to three per cent of GDP

In a global knowledge economy, Canada’s competitiveness depends more than ever on increasing our capacity for research and innovation. Despite having some of the best universities, most talented researchers, and innovative companies, many Canadians would be surprised to learn just how far behind we are internationally when it comes to our support for research. A key measure used by economists in comparing investments across countries is gross domestic expenditures on research and development—known as “GERD”— as a percentage of GDP. GERD measures total public and private investments in research and, when divided by GDP, gives us an estimate of the strength of a country’s knowledge economy. Report after report has found that Canada continues to lag on this important measure. The latest data from Canada's Science, Technology and Innovation Council confirmed that our global competitiveness continues to fall: “Canada’s GERD intensity declined from 1.96 per cent in 2006 to 1.62 per cent in 2013, and its global ranking fell from 16th to 24th out of 41 countries.” Since then, we’ve dropped even further to 1.61 per cent, and are now woefully behind the OECD average of 2.38 per cent and leading countries like Korea (4.29 per cent), Israel (4.11 per cent), and Japan (3.59 per cent). After nine years of Conservative government, this is hardly to be expected. As part of their War on Science, the Conservatives slashed over $1 billion in real terms from the federal science and technology budget over the course of their majority mandate, according to figures from Statistics Canada. Although Budget 2016 was a step in the right direction, and included important investments for the granting councils, post-secondary institutions, and life sciences research, we have a long way to go to rebuild Canada’s reputation as a knowledge leader. And of the promises the Liberals made in the budget, however, many of the details remain to be seen. The government spent the summer consulting on their new and flashy "Innovation Agenda." When they launched this process, the office of Innovation Minister Navdeep Bains stated that: “Clear outcomes and targets will be used to measure progress toward the vision of positioning Canada as a global leader in promoting research, accelerating business growth, and propelling entrepreneurs from the commercialization and start-up stages to international success.” While this rhetoric is welcome, let’s hope the Liberals match their words with real action. Other countries have set firm targets to drive investments in research and development. Shortly after being elected, President Barack Obama set an ambitious goal for the U.S. to increase its research spending to three per cent of GDP. The European Union has since followed suit and is now aiming to hit three per cent by the year 2020. In fact, the idea for a national R&D target in Canada is hardly new. Following the 2001 Speech from the Throne, Jean Chrétien announced his government would aim to “ensure that our research and development effort per capita is amongst the top five countries in the world.” At the NDP’s 2013 policy convention, party members made science and technology a focus, and debated a resolution calling for Canada to match the percentage of GDP invested in R&D by global leading countries. It went on to be passed unanimously. Make no mistake: Getting to three per cent won’t be easy. Boosting Canada’s research investments will require unprecedented collaboration across different levels of government and from all sectors of the economy—higher education, private, and not-for-profit. And we’ll have to rethink and retool existing government programs and incentives for innovation. Most importantly, new legislation will be needed to drive action, track our progress, and ensure accountability. When Parliament returns this month, and the government puts forward their agenda for the fall session, we’ll see just how serious the Liberals are about building Canada’s knowledge economy. Kennedy Stewart, PhD, is the Member of Parliament for Burnaby South, B.C., the NDP science critic, and an associate professor on leave from Simon Fraser University. The Hill Times

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Investing in innovation: getting to three per cent of GDP

Boosting Canada’s research investments will require unprecedented collaboration across different levels of government and from all sectors of the economy.

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