Implications of the Recommendations of the Expert Panel on Federal Support to Research and Development

Abstract

Canada lags behind many of its First World counterparts when it comes to business innovation, and urgently needs to improve its performance if it is to remain competitive and attractive to investment. The Expert Panel Report on Federal Support to Research and Development has recommended several policy initiatives that governments need to enact to close the gap. This paper reviews all six major recommendations made by the Expert Panel and provides thorough assessments of each, with ample consideration given to their implications for the private sector. The two most promising are: (1) the consolidation of research and development spending programs at the federal level and (2) the adoption of smart procurement as a means of spurring innovation in the non-government sector. While some of the other recommendations need refinement and raise concerns about their impact on the economy, the message for government and business is clear: the former can and should facilitate Canadian business innovation by removing tax and regulatory burdens and facilitating better public-private cooperation, while the latter must make innovation a major part of corporate culture. This paper explains the consequences of the Panel’s recommendations for both sectors, identifies the deficiencies, and offers clear-eyed guidance for ameliorating them.