Tech sector applauds spending on innovation
TORONTO — Technology leaders are applauding measures in Wednesday’s federal budget aimed at supporting an innovation economy, even though a large portion of the spending amounts to a followthrough on promises made in 2016.
Budget 2017, for example, proposes an investment of $950 million over five years to be parcelled out to a small number of innovation “super clusters” with the greatest potential to accelerate economic growth.
These “super clusters” will be established across Canada encompassing consortiums that include universities and other partners along with business interests.
That spending amplifies the 2016 budget’s proposal for $800 million to fund the clusters — and still leaves many details to be hammered out.
The government will also commit $125 million to fund a Pan-Canadian Artificial Intelligence Strategy designed to attract and retain top academic talent, increase the number of researchers studying artificial intelligence, and promote collaboration between Canada’s main centres of expertise in Montreal, Toronto-Waterloo and Edmonton.
The budget announced the renewal and enhancement of funding for the Toronto-based Canadian Institute for Advanced Research, which has been tapped to administer the artificial intelligence (AI) program.
Alan Bernstein, the institute’s CEO, said the strategy will “expand the pipeline” of graduate students being trained in AI, whose wide-ranging applications include the self-driving cars that are a focus of companies including Google, Waterloo’s BlackBerry and Canadian auto parts maker Magna, which is researching auto seats that can monitor a driver’s heart rate. He said something in the order of $40 million to $60 million will be dedicated to each of the main centres of expertise, with funding possible for an organization called the Vector Institute at the University of Toronto and equivalent groups in other communities.
Bernstein said smaller affiliates in Guelph and Winnipeg, for example, could also receive cash after adjudication of proposals by an international group of scientists. He said exact amounts will be determined “over the next 12 months or so.”
“This is new and this is real,” said Chris Plunkett, external affairs vice-president of Communitech, the association that advocates for Waterloo Region’s tech sector. He said while the budget offers “no silver bullet” it represents an important step as Canada stakes out leadership in emerging economic sectors.
The government said it will consolidate corporate support programs into one fund and contribute $400 million in additional venture-capital funding through the country’s development bank.
The budget aims to pick six industrial sectors to promote innovation and jobs.
It proposes more than $2.2 billion, to support clean technology research, development, demonstration and adoption as well as to accelerate the growth of clean technology companies. The amount includes nearly $1.4 billion in new financing on a cash basis over three years, starting in 2017-18, through the Business Development Bank and Export Development Canada.
“We need to focus on our strengths — areas where we can lead globally and create good jobs for Canadians,” Finance Minister Bill Morneau said in his budget speech.
Abdullah Snobar, executive director of the DMZ business incubator for tech startups at Ryerson University, said the budget promotes a “daring innovation agenda” that seeks to reward the best.
Benjamin Bergen, executive director of the Council of Canadian Innovators, said tech CEOs and business leaders who are commercializing ideas welcome budget measures focused on helping high-growth Canadian companies scale-up.
Innovation, along with infrastructure, is at the centre of Prime Minister Justin Trudeau’s efforts to develop a growth agenda that could help bolster support for a deficit-spending plan that will see the country’s debt rise by $143 billion over six years.
The budget plan, which includes a skills and jobs training component, will set targets to gauge its success. That includes a target to boost exports 30 per cent by 2025 and doubling the number of “high-growth” companies in Canada over that time.
In addition to the narrowing industrial focus, the government will also consolidate three corporate support programs — for technology, aerospace and automakers — into one $1.3-billion, five-year plan.
The government will also create a $50-million program for government procurement from Canadian innovators and put funding toward speeding up visa processing for high-tech workers, both of which the startup community had been asking for.