Ottawa unveils shortlist for ‘supercluster’ program.

‘Supercluster’ program

OTTAWA • Ottawa began rolling out Tuesday the shortlist of companies to receive funding under its $950-million “supercluster” program, part of a spending push by the Trudeau Liberals to spur Canadian innovation.

The government has whittled down the number of finalists from more than 50 proposals to nine, according to a list supplied to the Financial Post by the ministry of Innovation, Science and Economic Development. It opened up its bidding process last May, and received proposals from over 1,000 private companies, business associations and research institutions.

Ottawa plans to spend the funds in a bid to develop several so-called “superclusters” aimed at creating a hive of innovation, similar to that of Silicon Valley — a dense population of private companies, university researchers, investors and other stakeholders who collaborate and share ideas in an effort to hasten technological developments.

Innovation minister Navdeep Bains unveiled a few shortlisted companies in both Halifax and Montreal.

In Halifax, the so-called Ocean Supercluster proposal — an applicant from the Atlantic region — got the nod. The industry consortium aims to expand digital technologies in aquaculture, fisheries, offshore oil and gas, and clean energy.

Another proposal on the short list based in Quebec is designed to bolster Canadian leadership in artificial intelligence and data science. It is led by the Optel Group and includes proponents such as Alimentation Couche-Tard Inc., Bell Canada, CGI Group Inc., AgroPur, Aldo, Cascades Inc. and the University of Montreal’s Polytechnique. Montreal-based flight training and simulator company CAE Inc. leads the mobility systems and technologies supercluster proposal, which includes more than 170 firms.

Bains will reveal more finalists later this week in Toronto, Calgary and Vancouver.

They include a proposed clean, low-energy supercluster in Ontario led by the Canada Mining Innovation Council that wants to position Canada as a leader in clean resources, clean technology and responsible sourcing of metals.

An advanced manufacturing supercluster involving the MaRs Discovery District, Linamar Corp., Maple Leaf Foods Inc. and the University of Waterloo wants to drive collaboration between the technology and manufacturing sectors, is also on the short list.

A protein innovations Canada supercluster in the Prairies would position Canada as the global supplier of plant-based proteins and related products. Led by AgWest Bio Inc. and including the University of Saskatchewan, it would focus on new technologies and value-added supply-chain infrastructure.

A smart agri-food supercluster led by Agrium Inc. would work on building information technologies in the crop, livestock and agri-food processing sectors.

Stantec Inc. leads a proposed infrastructure supercluster that aims to use advanced digital communications and interconnected applications to improve design and construction.

A proposed digital technology supercluster led by Telus Corp. and including Microsoft Canada Development Centre and six post-secondary institutions in B.C. wants to focus on inventing, developing and applying digital technologies.

The announcements come amid a heavy emphasis by the Liberals to invest in innovation. Ottawa raised the cap on its supercluster fund to $950 million in March 2017, from $800 million. It has also announced a range of other programs, including plans to introduce $1.4 billion in clean tech funding and $400 million for venture capitalist firms that invest in innovation.

“This really reflects the recognition that we’re in a global innovation race,” Minister Bains said Tuesday.

The ministry expects to choose around five final superclusters for the program, which will be announced in early 2018. The money will be rolled out over five years.

Bains said the ultimate decision on which superclusters are chosen will be on jobs and the economy, as well as boosting revenues for private companies. “It’s all about where are the growth areas, where are the jobs,” he said.

Critics of government innovation programs say they often come with tight controls over how the capital is invested, or the too-slow “matching” of funds that slows the speed of investment.

Some programs have historically focused too heavily on job creation and contribution to GDP, according to Margaret Dalziel, an associate professor at the University of Waterloo — a metric that tends not to provide much insight into the innovative value of an investment.

Still, Dalziel says intensifying competition outside of Canada, and a fast-changing and global marketplace where only a few top companies dominate, compels government to play a larger role in creating an atmosphere of innovation. That reality is a sharp shift from when legacy companies were less at-risk of being disrupted.

“It’s more of a winner-takeall,” she said. “You’re kind of a global leader or in many respects you’re off the table.”

Proponents of the nine remaining superclusters have to submit more detailed proposals to the government by Nov. 24 before the winners are announced in 2018.