Spike in funding inquiries follows cuts

Since the Alberta government cut support for innovation and tech companies late last year, the federal regional development agency for Western Canada has seen a spike in inquiries from firms in the province looking for financial backing, The Logic has learned.

In its first budget five months ago, Alberta’s newly elected United Conservative government cancelled five tax credits, including the provincial rebates for scientific research and experimental development ( SR& ED) and developing interactive digital media, as well as one for investors in companies that are inventing or commercializing new technology or in the gaming and animation sectors, among others.

The government also reduced the operating budget for Alberta Innovates — which offers funding, research support and advice — by $129.7 million over the next two fiscal years. The province instead plans to lower the corporate tax rate from 12 per cent to eight per cent by 2022.

An analysis of the Alberta budget prepared by officials at Western Economic Diversification Canada ( WD) said the provincial government would “reduce or eliminate several economic development programs and services, placing increased pressure on from stakeholders to supplement this short fall.” The Logic obtained the briefing note via access- to- information request.

The agency has indeed seen that uptick in demand. “Through WD’S program outreach and engagement activities, clients and stakeholders have demonstrated an increased interest in accessing WD funding due to reductions in provincial economic development funding and programs,” spokesperson Mark Feldbauer told The Logic.

He also cited the economic downturn in Alberta as a contributing factor. The agency does not record the volume of inquiries it receives, since many of its talks with potential applicants are informal.

The office of Economic Development Minister Mélanie Joly did not answer The Logic’s questions about whether Ottawa plans to increase WD’S funding or launch any additional measures to support businesses in Alberta in response to the provincial government’s reductions. The agency has spent more than $ 309 million in the province since the federal Liberals were elected in 2015, said spokesperson Jérémy Ghio, adding that WD received an additional $ 224.2 million for programming across the last two budgets.

The Alberta government is “realigning investment,” said Justin Brattinga, press secretary to Alberta Economic Development Minister Tanya Fir.