[Recorded by Electronic Apparatus]
Tuesday, December 10, 1996
.1525 
[English]
The Chairman: The committee will resume its hearings on science and technology pursuant to Standing Order 108(2), dealing with science and technology and the innovation gap in Canada.
I'm very happy today to welcome one of the most spirited academics I've met in politics through my academic life, Stefan Dupré, who is now president and chief executive officer of the Canadian Institute for Advanced Research, and before that he was a professor for many years at the University of Toronto. At relatively short notice, he has agreed to come down to talk to us about what he sees as some of the problems dealing with science and technology, particularly from his experience as a university researcher and I guess right now what you would call an organizer and supporter of university research.
.1530
We will be joined later by guests from Kelowna, whom Mr. Schmidt has known and very much wanted to have testify.
So we'll spend the first half hour with Mr. Dupré. Then, Stefan, our normal habit is to have you as the witness stay if you can and then have a round table. Responses go back and forth, as you feel you'd like to participate, and it's pretty wide open.
We operate in a pretty informal fashion here for a round table. We follow the order as people feel comfortable doing. We'll start with you, if you wish. But our habit has been that people have declined to go first and jump in later on, and that's quite fine and just has to be recognized by me. I'll let you in whenever you want. Okay.
We have received the statement in English only from Mr. Dupré, so with the permission of the committee it will now be distributed.
I turn it over to you, sir. Mr. Dupré, you may start at your leisure.
Mr. J. Stefan Dupré (President and Chief Executive Officer, Canadian Institute for Advanced Research): Mr. Chairman and honourable members, I am honoured by your chairman's invitation to appear before you today in my capacity as president of the Canadian Institute for Advanced Research. The CIAR is a uniquely innovative instrument, which is the brainchild of my immediate predecessor, Dr. Fraser Mustard. I believe, Mr. Chair, that he will be appearing before you later this week on Thursday.
I have sent the clerk of your committee a brief document, in addition to my statement, which describes both the institute and the work of its nine university-based research programs. I believe she is distributing that document now.
In a nutshell, CIAR has nine research programs that span subjects ranging from theoretical astrophysics to the theory of economic growth. Each program is based on the premise that the best fundamental research will be produced by the interaction of the best curiosity-driven minds, both in Canada and abroad.
Through its programs, which are rigorously reviewed every five years, CIAR funds the research time of its scientists and scholars by making salary payments to their home universities and by financing the cost of their collaboration with their hand-picked colleagues. The CIAR programs currently unite over 180 of the best minds from 21 Canadian universities and 42 foreign institutions in synergistic networks that bridge institutional, disciplinary, cultural and linguistic boundaries.
Of particular interest to this committee quite possibly is CIAR's economic growth program. This program, spearheaded by such outstanding economists as Richard Lipsey of Simon Fraser University and Paul Romer of Stanford University, has elegantly married the techniques of economic history and mathematical economics to pinpoint the key roles played, not so much by labour and capital, but by ideas, knowledge and ingenuity in propelling the economic innovations that are the key to sustained growth.
Such innovations do not fall from heaven. They come from entrepreneurial firms whose ingenuity is driven by the vision of capturing new markets with new goods and processes. Elaborate feats of development, design and testing, often demanding additional research, are involved. Here is where alliances between business firms and universities can play a critically important role. I submit, Mr. Chairman, that such alliances are being well served by the networks of centres of excellence launched by the Government of Canada in 1988.
In this light, I would urge this committee to join me in applauding the report of the House Standing Committee on Finance released last Friday. This report recommends the renewal of the networks of centres of excellence program for a further five years at an expenditure level of $60 million per year.
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Increased investment in research and development at the interface between industry and universities is to be applauded. Arguably, Canada suffered in the 1960s and 1970s from an unbalanced portfolio of R and D activities, in which industry accounted for a disproportionately small share of activity. Such measures as the national centres of excellence, to say nothing of the emergence of industrial R and D giants such as Nortel, signal Canada's graduation from this past.
But like all who graduate in the 1990s, this country is greeted by a fast-moving and demanding world. In this world, long-term considerations are as demanding as those that loom in the short run. University-industry partnerships necessarily emphasize the development, testing and evaluation segments of the broad research and development spectrum. They stress the centrality of short-term pay-offs in the form of deliverables. This is fine, because as Lord Keynes once said, ``We live in the short run.''
Nonetheless, I urge this committee to pay sympathetic heed to what to me is a matter of grave concern. At the very time that Canada's R and D portfolio invests in more activities that stress short-term pay-offs, I submit this portfolio is showing dangerous signs of underinvestment in the curiosity-driven research of university scientists and engineers who create the knowledge base upon which the economic innovations of future decades will depend.
Not least because my current position as president of CIAR gives me a front row seat on the Canadian university research scene, I come to this standing committee with a straightforward message. The future of scientific and engineering research at Canadian universities is in jeopardy. Three reasons underlie my doleful message.
First is the matter of the infrastructure that university research in science and engineering requires. From the late 1960s into the 1980s, our universities snatched major improvements in laboratory and library resources from the jaws of an expansion that was financed not out of public concern for research but in the name of providing accessibility for a baby boom that was passing through young adulthood. By the end of this passage, coupled with the current fiscal climate of public sector contraction, our universities were left with an eroded infrastructure that saps the vitality of our research efforts.
Second, there is the matter of the operating costs of university research. Having read a certain number of the briefs already submitted to this committee, I am sure I need not provide details of the funding cuts absorbed by many federal research agencies that fund university research. In the meantime, universities, absorbing what are often double-digit cuts in their own provincial operating grants, are anything but able to pick up the slack in federal research support. More seriously still, universities are finding that most of the economies they achieve from both normal and early faculty retirements, from putting old geezers like me in retirement, must be applied to balancing their budgets. In the result, with universities applying the economies they realize from retirements to balancing their budgets, there is virtually no room for the appointment of junior faculty members, who constitute the next generation of productive researchers.
.1540
The third reason why I consider the future of scientific and engineering research in Canadian universities is in jeopardy is that there is a currently prevailing attitude towards this kind of fundamental research that gives me grave concern. As president of CIAR, I can speak of this attitude with first-hand knowledge. This is because the fact of the matter, Mr. Chairman, is that my institute is finding it difficult to sell its fundamental scientific research programs to prospective private sector donors.
Our list of donors does yield some notable exceptions, such as Imasco, Inco, Nesbitt Burns, Noranda, Scotiabank and TransCanada PipeLines. In the main, however, CIAR finds it more difficult to sell fundamental science programs in such fields as cosmology, evolutionary biology and superconductivity than to garner support for its economic growth, human development and population health programs.
The attraction of a lot of programs, of course, lies in their discernible links to easily perceived immediate problems, such as unsatisfactory rates of economic growth, the spreading prevalence of child poverty and the spectre of rising health costs.
In a nutshell, what prevails is a climate of opinion more concerned with the short run than the long run and more concerned with immediately useful research than with the curiosity-oriented research that nurtures a knowledge base, without which future applications will not be possible. If I may be so bold as to say so, this climate has been reflected in Ottawa's own research funding policies during this decade.
What are my prescriptions? I would urge this committee to consider the following practical measures. First, in the domain of infrastructure, consider giving your warm endorsement to the recommendation of the Association of Universities and Colleges of Canada, tabled here on November 26, that the federal government should enter into a partnership program to update the laboratories and facilities required to conduct advanced university research. Mr. Chairman, I would suggest vesting responsibility in the research councils of the appropriate lead agencies for such a program because of their familiarity with the infrastructure needs of this country's research universities. A department of public works, if I may say so with respect, does not have that kind of familiarity.
Second, in respect of the operating costs of university research, consider the merits of the following two-pronged approach. In the near term, encourage the research councils to accelerate any and all aborning initiatives designed to make it possible to appoint at this time junior faculty members whose salaries universities will be able to finance toward the end of this decade, once their fiscal situations have stabilized. For the longer run is the second prong with respect to operating expenditure problems. Consider, Mr. Chairman, advocating a fundamental change, whereby Ottawa would greet the dawn of the 21st century by funding the full cost, indirect as well as direct, of university research financed by the Medical Research Council of Canada, the Natural Sciences and Engineering Research Council of Canada, and the Social Sciences and Humanities Research Council.
I will confess, Mr. Chairman, I have long been party to various recommendations that Ottawa should fund the indirect costs of university research that it supports. The reason given by successive federal governments for not accepting such recommendations was that Ottawa in fact recognized the indirect costs of university research through the post-secondary education component of the federal-provincial fiscal transfer arrangements. I submit, Mr. Chairman, that this reason has now gone with the wind of the block funding generated by the new Canada health and social transfer.
.1545
I put it to you and to your colleagues that the time for funding the indirect costs of federally sponsored university research brooks no delay beyond the end of this decade, when hopefully Ottawa should be reaping the dividends of its current fiscal policy.
Finally, Mr. Chairman, I come to the existing climate of opinion, what I perceive is currently more focused upon immediately useful research than upon the curiosity-oriented research of university-based scientists and engineers.
The good news is that the opinions of our public and private sector decision-makers are always open to change by rational persuasion. What is more, I consider that the reports of parliamentary committees such as yours, Mr. Chairman, have a longstanding proven track record as agents of change in the climate of opinion.
In this light, Mr. Chairman, I would exhort the Standing Committee on Industry to write a report whose text will highlight the importance of a balanced Canadian investment portfolio in the realm of research and development. To be balanced, such a portfolio must include shorter-term research and development that involves development testing evaluations and deliverables. But again, to be balanced, such a portfolio must feature ample investment in fundamental university-based research in science and engineering.
To be honest with yourselves, you will have to face the fact and then ask your own readers to face that fact. That fact is that such investment in fundamental university-based research in science and engineering is fraught with uncertainty. In practical terms, we cannot know what today's fundamental research is for.
From hindsight we of course know that the research of late 19th century physics spawned the discipline of electrical engineering, which in turn with physics spawned Canada's electrification in the wake of World War I and later spawned our nuclear generation plants in the wake of World War II. In the more recent timeframe, we know that what now makes possible the diagnosis and treatment of such inherited human defects as cystic fibrosis would not have been possible without the curiosity-driven research of geneticists a quarter century ago. These are facile examples, and such facile examples of course, Mr. Chairman, can be multiplied a thousandfold. They are all the products of hindsight.
What we lack, as did our 19th century ancestors, is the foresight that would tell us what curiosity-oriented research in what disciplines will provide the facile examples of how ideas provide the basis of the major innovations that the ten decades of the coming century will spawn. The highly gifted seer might perhaps take a reasonable crack at guessing about the first decade. But I wonder about a decade as near as 2040, when today's young adult born in 1975 will have just reached a retirement age that may itself be obsolete.
This, Mr. Chairman and honourable members, is the core argument that R and D investment must feature a balanced portfolio that accommodates ample investment in the unpredictable and uncertain relevance of fundamental concepts and ideas to downstream innovation and long-term economic growth and wellbeing.
.1550
I urge this committee to espouse this argument. I urge you further to observe that this is not simply the classic argument for public support of university research; it is also a classic argument for private sector support. Call this brilliant philanthropy on the scale that the Carnegie Foundation launched more than a century ago and that embraced such Canadian universities as Dalhousie and McGill. Call it altruism as enlightened self-interest. Call it high-risk investment, because that's what it is, high-risk investment in the most exciting human activity of all, the work of creative minds operating at the frontiers of knowledge. Call it any or all of these, and I put it to you that you should rest assured that hindsight, but only hindsight, will prove your arguments correct.
I shall close by saying, in my capacity as president of the Canadian Institute for Advanced Research, that CIAR, which receives important contributions from Industry Canada that match its private sector support with one government dollar for every two private dollars it raises, operates on the premise that its raison d'être rests on its own capacity to persuade through the arguments I have outlined. I have already taken to the bully pulpit in a number of places on behalf of the importance of long-range high-risk investment - because that's what it is - in university-based science and engineering and research. I welcome my opportunity, Mr. Chairman, to have taken my bully pulpit into your midst. And may I say that as CIAR continues to preach the message I have given you we will welcome all the help that committees such as this one can give us.
The Chairman: Thank you very much, Mr. Dupré. I think everybody recognizes that you have thrown the gauntlet to us. You've challenged us very directly after us hearing from others in the last couple of months, and I think the committee members will probably welcome the opportunity to discuss this further.
I'd like to have a special welcome to John Godfrey, the former chair of this committee, to join us to hear this particular witness and other witnesses this week. I very much appreciate his ongoing interest in this issue.
Mr. McLelland will start the questioning.
Mr. McLelland (Edmonton Southwest): Thank you very much.
First of all, I'd like to thank you, Doctor, very much for your testimony. I used to be on this committee as well, and I really treasure it; I think this is probably one of the most effective and best committees in Parliament.
I have two related questions; I'd like to present them both and then I'd appreciate your response. The first is, as you are aware, we had early on in this Parliament an infrastructure program that was essentially bricks-and-mortar-driven. As we go into the next century and the next millennium, with the changing nature of work, could you postulate on the value of a second infrastructure program, but this one into the next generation, that would be based on education and building these infrastructures? Have you done any thinking about what the impact would be in the future had we put a $2 billion investment into the knowledge-based industries, or into universities and into the future, rather than into bricks and mortar?
I wonder as well if you could postulate a bit. You mentioned in your testimony the relationship in Stanford University, and it brought to mind the book written by Bill Hewlett, The Company that Bill and I Built, about Hewlett-Packard and the relationship between industry in the United States and research-driven universities such as Stanford and MIT. I wonder, because we don't have any such universities in Canada, to my knowledge, that have this close relationship between industry and the university and research, and because at the base of our manufacturing and our economy we don't have this head office to support it, would it be possible to convert the National Research Council into such a university, particularly because we have the critical mass of high-tech industry in this area, we're very close to the major densely populated areas of the country, the seat of government is here, and we have that great nucleus of people already there and that could be the eureka scientific research, the curiosity-driven research, and the application that results in new jobs and builds the economy?
It's a big question, but I appreciate the opportunity to put it to you.
.1555
Mr. Dupré: I very much appreciate those two questions. Let me try to parse them in turn.
The last infrastructure program, as I understand it, was indeed about bricks and mortar. Depending on the province, as I understand it, some universities did benefit from this program in terms of exactly that, bricks and mortar.
This is rather different by and large from what universities have to be concerned about when they contemplate their research infrastructure. What you are looking at here is not so much a matter of bricks and mortar as it is a matter of depreciated, and for that matter outdated, equipment, which becomes a direct roadblock for any kind of university research, including university research that is more applied, that is not curiosity-driven so much as it is the result of alliances with industry.
This is why in my own mind, if there were to be such an infrastructure program, precisely to ensure that it would target research - education and accessibility for students is something else again, certainly a provincial matter - it should be a program in which NSERC and MRC in particular are asked to play lead roles because they have a better knowledge, I would submit, of the university research needs for equipment that is on the ground than any of our Ottawa agencies.
Let me go to your second excellent question. Stanford, and certainly also MIT, give you some marvellous examples of universities that have very well developed their interface with industry. This is not to say that they don't do fundamental research - they are the cutting edge, respectively, of scientific research in both science and engineering - but it is certainly worth while to examine, for example, a Stanford spin-off that is called SRI, the Stanford Research Institute, and essentially finances much of its activity out of contracts, agreements and other alliance mechanisms with industry.
As far as the Canadian scene is concerned, I think there has been the normal lag between Canada and the United States, but I would argue that in the course of the last ten years there have been some very interesting developments. If I was going to name a particular university, I would name the University of Waterloo as probably coming closer to the Stanford model than any other Canadian university.
.1600
One thing that could well be worth your while, since you asked what was in part an Ottawa-centred question, is to see what potential the University of Ottawa and Carleton already have vis-à-vis the high-tech industry in this region. I'd certainly take a look at what is developing on the ground there. I don't have first-hand knowledge of it myself, but I have been given impressions that there's a fair amount on activity on the engineering front.
Your question about whether the NRC might have a future here is an interesting one. For my sins I served eight years on the National Research Council back at the time, by the way, when it had both the university granting function and the federal government's intramural labs. I should point out that when I was appointed to the council I had just been party to a recommendation that the NRC be split. When my Order-in-Council appointment came through, and I went to my first NRC meeting, I was probably the smelliest onion that ever walked into the petunia patch. Nonetheless, I tried to serve both of NRC's functions to the very best of my ability. Let's face it, at the time NRC's laboratories were so good in fundamentals as well as more applied science work - but of course it provided the home in which Dr. Herzberg won his Nobel Prize.
NRC's in-house laboratories certainly make it quite a logical place from which to spin off research alliances with industries. I don't think universities should have a monopoly on university-industry relationships. NRC might well be a logical candidate well worth this committee's attention.
I would point out, though, in this regard that there are aspects of NRC that have actually a very long standing relationship with local industry, and in this regard I think the committee might certainly find it instructive to look at the history of the prairie regional labs of NRC in relationship to western agriculture. That, I would submit, is actually quite a major and successful case study in the relationship between an in-house government lab and industrial development.
The Chairman: Now I'd like to turn to another former chair - we're full of former chairs here today - Mr. Leblanc.
[Translation]
I will give you five minutes only for questions because we have two more witnesses to hear from by teleconferencing.
Mr. Leblanc (Longueuil): Okay. I will ask my first two questions then. First of all, you talked about the difficulties you have selling the results of your research. Would you care to elaborate on this? This is something I have been interested in for a long time.
Secondly, we know that our budgets are very tight. What are the choices you would make if you had the same amount of money to spend? Should we be investing more in basic research in university or keeping up the investment in other research centres that are not necessarily at the university level? What would your choices and priorities be?
Mr. Dupré: To answer your first question, I can tell you that my problem is getting support for basic research and not selling the results of research.
.1605
This is simply because the practical results of basic research will be known only 20, 25, or30 years down the road. That is why I like to compare research to -
[English]
an investment portfolio. And a balanced portfolio makes room for lower-risk research.
[Translation]
It is easier to predict the results of short-term applied research than it is to predict those of fundamental research, when the only thing you know is some biochemist is involved in research on ultramicroscopic microorganisms.
[English]
They're doing that kind of research because their curiosity that drives them to do it. That is very high-risk research. This therefore takes me back to my argument for a balanced portfolio, which should very much be what this government, any government, does.
[Translation]
If we want to increase our investments in short-term research, it would be very wise to increase resources for the more uncertain long-term research.
Mr. Leblanc: I would like to go back to the earlier question of whether you believe the research results sell for a good enough price. Do we get a reasonable price for the results of research? If we managed to get reasonable proceeds from the results of short-term research, could we invest more in basic research?
Mr. Dupré: Short-term research gives financial results we can pretty well assess simply by looking at companies which are very successful in that area. Results on the markets can give you a fair idea of profits generated by short-term research.
As far as long-term basic research goes,
[English]
it's the rear-view mirror.
[Translation]
It is easy to see that electrification in North America has been made possible by the 19th century physics and the discipline of electrical engineering based on physics. It is easy to say that in retrospect. But years and years of work were needed to bring about electrification, including the use of nuclear reactors.
[English]
The Chairman: Thank you. I know we have about five more members who have expressed an interest.
.1610
The other witnesses have come at this issue from a completely different perspective, and they've been waiting for about 10 or 15 minutes. They are from Sphere Research Corporation of Kelowna, B.C. They've been involved with two or three ventures. I think they have a criticism from a different perspective.
My suggestion is that we take a quick break while the technicians set up the videoconference screen. Later, obviously, you can direct your questions back to Mr. Dupré, who's staying for the duration of this meeting.
The meeting is suspended.
.1611
.1619
The Chairman: Good afternoon. We're resuming our hearings on the review of science and technology and the innovation gap in Canada.
We are joined by two witnesses, Walter Shawlee and Robert Sibson, both from Sphere Research Corporation.
Mr. Sibson, you're with the Meridian Applied Science company. Is that with Sphere Research?
Mr. Robert Sibson (Vice-President, Marketing, Meridian Applied Science Inc.): Yes, it is. That's the marketing...and we also have some retail and manufacturing capability in that company.
.1620
The Chairman: We have at the table as well Mr. Stefan Dupré, who has provided us with some background as to why the federal government should be putting more research effort into the university system in Canada, particularly for fundamental research. We'd like to hear your perspective.
To give you an idea of our timetable, we have about an hour and five minutes. We have a vote at 5:30 p.m. our time. I'd like you to make your presentation in the context of five or ten minutes so that we have lots of chance for the committee members to involve you in a discussion and to bringMr. Dupré back into the discussion.
Mr. Shawlee, would you begin your comments.
Mr. Walter Shawlee (President, Sphere Research Corporation): Sure. I did fax ahead a paper I did in 1994. I don't know if everyone got a copy of it.
The Chairman: Yes. We have it here. It's being distributed with the agreement of the committee.
Mr. Shawlee: The issues that were there in 1994 I see as largely unchanged. This had to do with the essential problems of program delivery, that there are many things the government does for reasons that make sense politically but don't always make a good business case.
For example, if you're going to fund research and development on a project but are going to deliberately exclude capital assets, you probably have precluded the project from taking place, particularly if a key item in the research undertaking happens to be to buy some piece of physical equipment. For example, a project we're working on right now required an optical spectrometer, but it was impossible for us to fund that particular item as part of a research and development project through, for example, Technology B.C., in this case; it could have been IRAP or anyone else.
So there's always been this huge problem of misalignment that the program becomes more important than the eventual outcome, that everyone is looking for program compliance rather than whether there is benefit attached at the end and whether in fact any useful work will be done. As well, I think there's been a historical problem of trying to use research and development funding as a vehicle for employment, the idea being that somehow, by stimulating these industries, we're creating these new high-tech jobs.
The reality largely is that people want to do this work with the people they have. They're not looking to create new positions or anything of that nature. So a tremendous amount of fooling around takes place on everyone's part trying to make the real work fit the program.
My first issue there, certainly the one that's the most important, is to try to bring these two areas back into alignment. We we should be looking for the good business case, not necessarily for what is maybe politically most attractive. I know that may not seem very appealing from your perspective, but if we're looking for results, I think we have to be more focused on that.
As well, there are some much larger background social issues. When we're going to accept in the educational system that 50% is a pass, we should pretty well give up as a nation that research and development or scientific accomplishment is a primary focus. We're not going to do any science with 50% students. If your position is that somehow that's possible, we should be finished now. Really, there is no way to get to the goal line with students who simply are ill-equipped. It doesn't matter whether it's at the elementary level, the high school level or the college level; this totally unrealistic standard of 50% has to go.
There are some other issues that directly tie in with that, certainly not the least of which is that we're entering an era where a lot of education is time-expiring. People are requiring skills that only became common knowledge perhaps twelve months ago, or six months ago. There is no infrastructure in place to deliver that knowledge either to new students or to university faculty or high school educators. That single issue is going to be crippling in the future, because we're going to have trouble solving the problem of delivering education in a timely way when the skill itself still has value. We don't need to be teaching people skills that were in vogue ten years ago, but we certainly need to improve our ability to deliver skills that are in demand today.
The Chairman: Mr. Sibson.
Mr. Sibson: I would concur, in a similar context, that in my side of the company, the division of Meridian, we're heavily involved in the computer area from both a retail and a technology integration issue with corporate clients. We seem to be finding an extreme pace of accelerated learning and issues outstanding in our own segment of the industry.
.1625
Just as an example of what Walter was saying, to reinforce that point and maybe bring it closer to home for some people, in Windows 95 we have a window of opportunity of about 6 to 18 months to learn the current issues. We're just now solving the issues that have been learned since its first release date, and there are already three new versions.
So whether you have Windows 95, 95A, or 95B with the inherent problems between those, what's going to come up in the next six months that we haven't learned and nobody has learned yet, but that will no longer apply whatsoever two years from now? How do you deliver that? How do you accomplish that learning and how do you deliver that back through the university system?
We have a technician just finishing his degree in our local college here and his big concern is how long this certificate will really be good for. The answer is probably 18 months.
The Chairman: This is a good start. There are issues very dear to the heart of the previous witness.
I'm going to continue on the list I had before, with Mr. Bodnar. Mr. Bodnar, perhaps you can start your questions. Just indicate which witness you're starting with and then we'll go from there.
Mr. Bodnar (Saskatoon - Dundurn): I'll start with Mr. Dupré because I found a few of his comments rather interesting. What I had heard from him in his paper and his position was that the financing aspect of all of this should be coming from the federal government. Obviously working in the Department of Industry, or at least being associated with the minister's office, I have quite an interest in that, especially when the whole question of provincial funding was not mentioned.
It appears that over the years and decades, whenever universities wanted funding they always went to the government with one hand out rather than trying to source moneys from other sources. In particular I think of alumni members, etc. Other universities in the United States have funds and trusts that have been set up with huge amounts of money that can be utilized by universities. It seems that Canadians have been averse to that door; it's been too easy coming from government. I don't know which it is.
For one thing, in these difficult times we can talk about funding and more funding and research and I don't believe anyone really disagrees with the paper Mr. Dupré has presented today. One question I have is the question of funds and where they are to come from in extremely difficult times. I notice that with the funding from the organization he represents, there is matching funding of a sort. I wonder whether that is proposed.
I guess one of the questions I have, since education has been generally under provincial jurisdiction, is whether he recommends that Ottawa just deal directly with universities and bypass the provincial governments altogether in these areas in funding, when the federal government is involved in funding universities.
I have one last point. If you had a word for the Minister of Finance for his next budget, whenever it's coming down, what would you tell Paul Martin?
Mr. Dupré: Well, that's quite a menu, Mr. Chairman. Let me see if I can do it at least partial credit, in the following order.
For Mr. Martin, of course, I don't think I'd have to start with something that I'm sure his finance officials have educated him on.
How did we get into this mess? It's very simple. For 20 years, from 1974-75 until 1995, the real rate of interest in this country ran two or three percentage points a year ahead of the real rate of growth.
Let me tell you what it was like between 1945 and 1974. We came out of World War II with a federal debt that was equal to 105% of gross domestic product. By 1974-75, debt as a percentage of gross domestic product was less than 16%. We didn't get there by running a string of budgetary surpluses. As a matter of fact, there were only two budgetary surpluses between 1958 and 1975. We got there through a 30-year period in which, year in and year out, a real percentage rate of growth in the gross domestic product exceeded the real rate of interest.
.1630
So at this stage of the game, to me the Minister of Finance - for that matter, his provincial counterparts, whatever the persuasion of their governing parties - is trying to bring the debt under control. Not only that, but he is trying to do so through a combination of low inflation, which is going to mean low interest rates, and a higher real rate of growth.
After two decades of a wrong relationship between the rate of interest and the rate of growth, I don't see why things cannot be turned around to go back to what they were in the previous two or three decades that spanned 1945 to 1975. That should mean that by the turn of the century there will be some fiscal dividends that come out of current policy. This will create some room for government expenditure that is simply not there now.
That's why, when I advocate that the federal government should finally get around to paying the full costs of research in universities, including the indirect costs, I have a timetable. It says if you can get into that by the start of the next century, it would be great. The intervening four or five years are what we need to get us there.
In response to the point about public sector spending, I'd just like to emphasize what I covered in the last couple of pages of my testimony. That is, my great concern that the private sector be encouraged to invest not only in short-term research and development, and testing and evaluation, but in longer-run fundamental science.
That is what I, Steve Dupré, am doing when I visit the corporate headquarters of this country. It's a hard sell at the moment, but we have had a good reception from certain major firms. Certainly I am finding senior corporate executives responding to one thing very well, and this ties in with some of the testimony you're getting from Kelowna. That is a very strong need for young faculty members, who are at the cutting edge of their disciplines, and for whom universities do not have room right now, given public sector constraint. I think that private sector donors can be talked into giving us a fair amount of help on the way to the next four or five years.
The Chairman: Does Mr. Shawlee agree that what the private sector needs is encouragement for long-term research, or do you think that's not the proper way of looking at it from your point of view?
Mr. Shawlee: Well, there are actually a whole bunch of issues that tie directly into this. Repeatedly, when you look at a summary of what people spend in terms of R and D, you always see that Canada shows very low comparative numbers.
Part of the reason for that is the way Canadian tax law is written. For this we clearly need to drag someone in from Revenue Canada. A tremendous number of things that are R and D everywhere else on the planet, except Canada, are excluded. For example, you cannot do development after you begin production. As a matter of fact, the report I already filed with you lists all the things that are excluded.
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I can't begin to describe how foolish this posture is. Essentially we exclude all the things that are an essential part of the feedback loop in ISO 9000, that are a logical part of development in literally every other industrial nation in the world. The only things we permit as eligible R and D expenses are those things when we honestly have no idea, and almost no assurance, of success. That's literally the definition of research from Revenue Canada.
Now you want to know why people in industry aren't very motivated to get involved in funding. It's that all of it is excluded from being eligible.
I don't think companies would have any difficulty providing additional support. We routinely - almost continuously - have work-term students in our building. We are already doing a joint project with our local college. As a matter of fact, for virtually my whole history in business we've always had some direct relationship with colleges or universities in B.C. We see that as an inevitable part of business.
You have to understand, however, that bad policy breeds bad outcomes. You cannot continue to have an extremely prejudicial tax policy that basically penalizes people in Canada for doing research and development - compared to other countries - and then expect to have some kind of happy outcome.
We're getting exactly the future we deserve. We've done badly, we've planned badly, we have bad results.
The Chairman: Thank you. I'm going to turn to Walt Lastewka. Mr. Lastewka is a vice-chair of the committee, and on behalf of the government has been working on a project on commercialization in this area.
Perhaps, Mr. Lastewka, you can pursue your questions now.
Mr. Lastewka (St. Catharines): Thank you very much, Mr. Chairman. I thank the witnesses for being with us today.
I'd like to expand a little on the networks of centres of excellence. We heard many times from witnesses that there had to be more contact with business, industry, government, and universities. We also heard that these should be able to focus on research as partners up front, and to focus the research so that there could be more winners.
I'd like to hear your comments. I know, Mr. Dupré, that you supported networks of centres of excellence, but what items are making it a success, and why aren't we starting more networks of centres of excellence, if it is the right thing?
Mr. Dupré: I'll give you a very short answer to that. What I like about the national centres of excellence as a program is that they are reviewed very searchingly at each phase. In the last phase...
Remember, it goes back to 1988. The second phase began in 1992 or 1993. A number of the centres - one or two - that started out in the first phase were dropped. Some new centres were added.
As I understand the networks of centres of excellence situation, I fully anticipate that if the government accepts the recommendation of the Standing Committee on Finance to go ahead with a third chapter, it's going to be a matter not of spending more on more centres, but of searchingly reviewing what each centre has been doing, dropping some, and adding centres in other areas of research that make good sense.
The Chairman: Are there any comments? I'll just ask you after these other interventions, or you can stick up your hand if you want to say something. If not, Mr. Lastewka has another question.
Mr. Shawlee: I just have one comment with regard to centres of excellence or any other institutionalized, innovative concept. I think this is an old model. As a matter of fact, most of our educational schemes are old models. The only problem is that you're now trying to deal in an age that is so dramatically different that when you have projects, or even concepts, that take a year to get off the drawing board, they're essentially obsolete.
What's really called for in Canada, in a general way, is the understanding that there are many methods of educating people that do not require a big facility. I mean, I routinely do most of my work by e-mail. I write a column every month, I file, and I do all of my editing, all electronically; I never even see the people I work with. We already have people who work for us whom we never see, who telecommute to our office.
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I don't quite understand this insistence on old models constantly being put forward as the only models that are unsatisfactory, produce bad results, have high capital costs, and lag behind the actual requirements for education. If we're not going to accept the fact that we're entering into an area where new models are required, we're simply not going to be competitive.
The Chairman: Thank you. I return to Mr. Lastewka.
Mr. Lastewka: There seems to be a difference of opinion there, Mr. Chairman, involving previous witnesses. We've had discussions on networks of centres of excellence, and I hope we're talking about the same centres that previous witnesses mentioned.
My second question goes back to your comments concerning research and development, tax laws, and so forth. Previous witnesses have said that our tax laws are some of the most generous in the world. If they are not at the top, they are the second or third most beneficial tax laws.
But there have been problems with getting multinationals to spend research dollars in Canada. This has to do with their desire to have their research done near headquarters, and we in Canada somehow need to get over that. Do you have any comment on that?
Mr. Shawlee: You bet. I don't know where this most generous issue came from, but I will tell you something, and you're welcome to go check into our own personal records. Since 1980 we have been audited every single year, because we claim the research tax credit. That's every year. As a matter of fact, every company in Canada that claims it is automatically scheduled for an audit.
Now, you may see this as benevolent tax policy. I have to tell you that in the administration of this policy, you have a lot of very unhappy campers at the receiving end.
I also think that there is a fundamental flaw here in terms of what is acceptable as R and D activity. I don't know how many of you actually have run a business that does research and development. I hope at least some of you have, so that when we're talking about this issue we're talking from a common background. But if you have never been put through an audit every year for 16 years, you probably can't appreciate how fabulously irritating and what a huge waste of resources it is.
In addition to that, it is now routine policy at Revenue Canada to come back to whoever has claimed the tax credit and say, well, we've already taken six months to do your audit; if you're prepared to accept a 10% discount in your claim, we'll forward the thing for approval. Now, I don't know who dreamt up this particularly ingenious method for increasing tax revenue, but I have to tell you that if you're at the receiving end, it sounds and feels... Well, the only comparable effort I can come up with is that it reminds me a lot of being blackmailed.
And this is how your policy is being implemented. It doesn't mean that the policy necessarily was bad, but there's a big difference between concept and delivery, and in Canada the delivery is extremely poor.
The Chairman: Thank you for that insight.
Thank you, Mr. Lastewka. I'm going to turn to Mr. McClelland for a question.
Mr. McClelland: Well, thank you very much. I'm here on this committee at the invitation of Werner Schmidt, who extends his greetings to you.
I'd like to pose a very short question. We grapple with the problem. It's very difficult for persons who have been elected all of a sudden to become venture capitalists. When we're using other people's money, the taxpayers' money, how do we go about picking winners and losers? How do we go about deciding what particular company should get a development grant, or particular credits?
I'm looking at your submission, and your key point that small amounts of fast money for difficult-to-fund internal... Would that necessarily be better as a...? Well, it already could be a business expense, but when you transfer it to a credit, it changes everything.
I represent a riding in Alberta, and in Alberta we have been burnt dramatically by throwing money indiscriminately at anything that even sniffed like research. How do you square that circle?
Mr. Shawlee: Well, that's an extremely difficult problem. I think the first and most pivotal issue you have to understand is that going into the ring, no one is good at picking winners and losers. Werner von Braun's comment that research is what I'm doing when I don't know what I'm doing, really sums it up extremely well.
Particularly if you're doing pure research, as Mr. Dupré would be doing, we do not know what the outcome is going to be. That's the reason you explore. You also discover that you may get halfway into a project and you then decide to scrap it, because it has a fundamental flaw, or it's not competitive, or it's not as competitive as another project started by someone else.
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I don't think the megaproject concept is particularly successful, or is really a good model. You can get far more ignition out of those direct investment dollars by funding smaller projects, which are much more likely to maximize the likelihood of return.
In other words, if you feed 100 good ideas, it's likely that some of those will in turn be able to attract their own venture capital once they get to the proof-of-concept stage. You can show it, and people can see it. Now you can bring in investment capital to complete that circle.
But to throw tens or hundreds of millions of dollars at something, whether it's oil sands, battery plants, or whatever... I'm not singling these people out for abuse, but I think there is a tendency in Canada to go for the politically attractive - look what we did - as opposed to look at the500 companies we were able to stimulate.
All statistics show that the bulk of these new job creations are coming from smaller companies. Yet our policy is always directed at the big, mega, giant, huge, well-politicized, well-publicized event. I think that's incorrect.
Most of the innovation is occurring in fast-track companies that are intrinsically small in nature. They are not battling this huge infrastructure to try to push the idea out into the market. They're far more likely to give you good results.
In my view, small amounts of money, delivered quickly, produce better results, and maximize your likelihood of success. But going in, you have to understand that science is not a certainty, and research is not a certainty. You cannot say here that absolutely every project you fund is going to produce measurable economic benefit. If that were the case, we would do no pure research.
Now, there are areas that desperately require research dollars. One of the things that was in your mandate is when you asked what are critical industries. Well, the ones I would pick would probably surprise you, even though I'm in the electronics business. The ones that seem desperately important to me are, among other things, virology. I feel that if there isn't an enormous push into immediate, deep and penetrating research into viral diseases, we're probably all going to be dead in 20 years. I see that as infinitely more important than whether or not we fund another diskette plant, or help another start-up computer company.
There are some issues that are so important: securing food resources. I mean, we're sitting here talking about high tech as if somehow it's the only issue that's important. But research into, for example, diminishing cod stocks, diminishing salmon stocks... We'd better come up with some answers here. The country is depending on its scientists, its technicians and other research personnel to solve these problems. These are real problems affecting, among other things, whether we get to eat or not.
I'd like to see some emphasis put back in areas that have broader appeal, things like the delivery of education. Our educational system is a shambles. We are teaching things that are not in demand. We are passing students who are woefully inadequate. I mean, a student who's graduating with 50% competence - what skill is he going to hold? What conceivable job could he have? Yet we're accepting that as a logical outcome of our system.
Really we should be focusing our efforts towards true, total competence in all our citizens. They should be well educated. They should be competent. They should be able to deal with everyday life issues. But apparently that's not a priority. And if it doesn't become a priority, imagine what's going to happen when a generation of people who were educated at that level suddenly move into positions of authority. What are we going to do with them?
The Chairman: Mr. Sibson, that's a thesis we've had repeated to us several times, and it's one the committee is going to have to deal with in its final report.
I wonder if I could just ask Mr. Dupré to intervene for a second, because he comes at this issue of picking winners and losers from a much different background. But essentially that's the life of university and a research institution in the public sector. So I'm asking you to comment briefly, and then we'll turn to Mr. Shepherd, who has some questions.
Mr. Dupré: Mr. Chairman, I was just going to say that in the last analysis, when it comes to applied research, development, testing and evaluation, the market is going to be what sorts out the winners from the losers. I would say that not only MPs, but for that matter public servants, are well advised to shy away from picking winners and losers.
I tremble when I look at the second question under your sixth term of reference: how can Parliament organize itself to ensure full governmental accountability for science and technology? If in my mind that conjures up the spectre of some poor assistant deputy minister, or a president of the National Research Council, being raked over for not having picked winners, I really despair.
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I certainly have a great deal of sympathy for the point that there should be a government approach - call it a program - that does try to ensure that bets be spread out, especially on industrial research, when it comes to the smaller firms. This is the natural way to try to hedge risk in these situations.
I was just wondering, though, Mr. Chairman, about the extent to which your committee or the other witnesses would have any comments at this stage of the game on how IRAP, the Industrial Research Assistance Program, has been developing. Maybe this is an example the Kelowna witness has in mind when he makes the point, with which I'm familiar as an old professor of public administration, that very often it becomes the program that drives, rather than what the program is supposed to serve. But I put it to you that IRAP at least is intended to fulfil some of the criteria that would spread bets among small firms. Is this not so?
The Chairman: Thank you. Maybe we can return to this point, but I'd like to give Mr. Shepherd a chance. He has been waiting to ask questions.
Mr. Shepherd (Durham): I guess the main theme among our witnesses today has been the difference between fundamental and commercial or short-term research. My question would be in the area of fundamental research.
For instance, when I first came to this town I went over to the NRC, and I discovered that 75% of the inventions they had come up with still sat out there. In other words, they never became commercial. Now, you might say that's a success story. Maybe that is a measure of success, I don't know. But how do we manage fundamental research so that...?
It seems to me that all research ultimately is commercial, in the sense that it's something people value, whether it's health, or whatever the case may be. How do we manage it to ensure that there's greater productivity in fundamental research?
The Chairman: Are you going to direct it to Mr. Dupré?
Mr. Shepherd: Mr. Dupré.
The Chairman: Mr. Dupré will start, and then I'll turn to the other witnesses.
Mr. Dupré: As far as your NRC question is concerned, there we need to bear in mind that NRC has had a history of covering a spectrum that involves not only fundamental research, but applied research and early development. Sometimes that yields what you call inventions, but from there they are left for the private sector, either to pick up or not to pick up.
If a particular percentage of NRC inventions over time has not been picked up, you should bear in mind a few things. First, you should expect that a percentage would not have been picked up, because that's part of a risk. Beyond that, it would be perhaps worth while for a committee like this one to hear NRC's side of the story, and then perhaps to get opinions out of American operations, such as the Stanford Research Institute.
Now, where fundamental science is concerned, I regret I have to assert rather categorically that the kinds of ideas and knowledge generated there are so far removed from their eventual commercial application that you cannot, in any particular timeframe in which you could do a cost-benefit analysis, evaluate the commercial impact of this kind of stuff. You can do it by doing a history of science or history of technology.
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Mr. Chairman, I can think of examples of applied research that was undertaken for certain purposes, but the main application turned out be totally different from what motivated it. I have in mind, of course, all of the new non-intrusive surgical techniques that make it possible for surgeons to penetrate the guts of old geezers like me in search of items that don't require any kind of an incision to speak of.
What made these surgical techniques possible was some applied research and development work undertaken by the U.S. military and space agencies in quest of miniature cameras that could be mounted on satellites. It is precisely the engineering advances in this kind of micro-miniaturization that now enables a surgeon to penetrate unspeakable parts of my body, and project them on a screen. And of course because I haven't been opened up, he can send me home within 24 hours.
The original purpose of this research, some of which was very applied, had absolutely nothing to do with medicine. It had everything to do with satellite, space and defence technology.
Since you run into examples of this kind at the level of development itself, if you are into fundamental science it's virtually impossible, save once you do the history of science, once you trace the fact that it was the work geneticists did 25 years ago that now gives us a means of diagnosing cystic fibrosis.
The Chairman: Thank you.
Are there any comments on the witnesses...?
Mr. Shawlee: I think his comment is correct that there are often unanticipated results. Everything from plexiglas to post-it notes really came from something else.
The Chairman: I want to make sure Mr. Godfrey has an opportunity to ask his questions, and then we'll have a chance for anybody else who has a second question.
Mr. Godfrey.
Mr. Godfrey (Don Valley West): I guess my question relates to how purposeful a society can be in organizing itself for innovation. The question the committee faces assumes a system. It assumes there has to be gap in the system. That's the basic metaphor. Indeed, Dr. Dupré comes from a particularly privileged position. I have to declare a conflict because I used to be a vice-president at the institute he now presides over.
First of all, one of the programs he administers in economic growth and policy attempts precisely to understand the nature of innovation and how that feeds into economic growth, and what it is that not only individual firms but societies have to do to increase the success rate - or lower the risk, if you like.
Furthermore, he actually presides over an institution that itself was created to innovate. That is an innovation in itself. It is a network institution that attempts to pick the best of a group of players in any given field. It uses modern technologies to bring them together and to set certain tasks for itself. So both in the specific program of economic growth and in the nature of the institute itself, I think there's an implicit notion that we can actually behave in a systemic fashion.
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That leads me to the question that both Dr. Dupré and the witnesses in Kelowna may wish to comment on, which is whether the right image is a kind of national system of innovation that assumes there are all sort of assets out there - private sector, public sector, provincial, national, university and otherwise - that can be configured in a purposeful manner rather than in a haphazard or simply market-driven manner. It would be a purposeful manner that increases the chance of the kind of serendipity Dr. Dupré just talked about. It would not pick winners as such, but say these are important fields in which someone is going to have some winners.
Is that a useful way of conceptualizing the national system, Dr. Dupré?
Mr. Dupré: Mr. Chairman, that is a vast question that I would expect from someone who has been a vice-president at the Canadian Institute for Advanced Research, and like any vast question I think it seeks a vast answer.
I think we have to start by bearing in mind that all kinds of advances in science and technology are absolutely blind to national boundaries. At this stage of the game what any country needs is not to be involved in every conceivable kind of research, curiousity-driven or otherwise, but in what in the trade is called a receptor capacity - that is to say, enough of the nucleus of highly trained scientists, engineers and technicians to weed out knowledge that can come from any country in the world. This of course does speak for the importance of first-class scientific and technological manpower.
The only other observation I would make is one that takes me right back to what I call a balanced portfolio of investment in research and development. One should have a variety of instruments, both public and private, that take you into very high-risk investment in fundamental science, where you really won't know what it's about for decades, all the way through to programs in applied research that may be targeted at a particular industry.
Let's not forget that in terms of an international perspective, this country has done very well in the realm of agricultural research. We're not new at this game. We're new at certain parts of this game, but we have that background. Beyond this, if one wants to look at the public sector, one needs programs. Maybe the current IRAP is not the right one, but one needs programs that try to spread applied research and development bets over a wide number of horses, many of which will be your smallest business firms.
The Chairman: Maybe I could turn to Mr. Shawlee. Do you see yourself as part of whatMr. Godfrey described as a national system -
Mr. Godfrey: Or international for that matter.
The Chairman: - or international system, or do you see yourself in a different context that we should understand?
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Mr. Shawlee: That was such a bizarre, fluffy interlude there. I have to think for a minute.
The key statement I would have to make in regard to his original question is that really I feel the government should enable where possible but should do no harm. The idea of having institutionalized innovation is ludicrous; I hope that isn't really your intent here today. It's not as if you could mandate that by saying now we're going to have nation-wide innovation. That just isn't how business works.
I think there is a huge shortfall here between what's possible in a business case and what may seem desirable politically. There are some big gaps here. Unquestionably there are things that need to be done that only the government can control. This probably revolves around area tax law. In real life you cannot force these kids to go through school and do well, you cannot force people to be innovative in the workplace, and frankly, you can't even force companies to stay in Canada if they're unhappy with their situation. All you can hope to do is enable or encourage.
What is typically the case is that something may happen which actually does harm to the activity you want. I think the goal here would be to do as little harm as possible and to be as encouraging as you possibly can. I don't think it's possible, on a legislative basis, to do more than that. Frankly, people are going to do R and D whether you provide funding or not. You could have the worst tax law in history but there are business reasons that people will continue to do research, whether you give them funding or not.
I see a lot of this as being completely beside the point. There are industrial issues which will resolve themselves. There are political mandates or desires on the part of Canada over which you have a very small amount of influence. You can actually do far more harm than you can do good.
I think you have to accept the fact that there is comparatively little you can do directly in this area, but there are things you can do indirectly which are vastly important. If we're going to abdicate responsibility for education to the provinces, then I guess in real life you can do nothing. But if you're going to get involved, then certainly you can have some impact.
The Chairman: Thank you.
I'm going to leave the last round to Mr. Leblanc.
[Translation]
Mr. Leblanc: My question is for Mr. Dupré. I would like to know what he thinks of the federal decision to withdraw from the energy project on nuclear fusion with the small Tokamak reactor. We know that this project involved annual costs of $7 million, but the federal tax revenues flowing from this project added up to more than $7 million. The federal government nevertheless made a decision to withdraw from this project which is fundamental for our future. How is it possible to rationalize this federal decision?
Mr. Dupré: I am sorry, but I do not know the circumstances of the federal withdrawal from this nuclear fusion program. I would have to get more information on this.
[English]
The Chairman: It's not your knowledge that's at stake, it's whether you give the right answer.
Mr. Dupré: Every now and then, Mr. Chairman, I honestly admit that a question has stumped me. I'm not familiar with this retreat.
[Translation]
Mr. Leblanc: Our friends from Western Canada are certainly glad that it was decided to drop the Tokamak project, but I happen to think this is really unfortunate because this research project dealt with nuclear fusion.
This is an international project. The United States, Europe and Japan are involved. Canada's contribution was 1 per cent, but it got a 100 per cent of the spin-offs.
I really cannot imagine why the federal government would pull out of a project that was so promising for Canada as a whole and for the world. Nuclear fusion is a truly clean source of energy. It is the energy of the future. The Tokamak reactor is already working. All that was needed was to improve it.
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You may think this is a political issue, but I think it is more a basic issue for our future. Nuclear fusion is the energy of the future. That withdrawal is really beyond me, and that is why I keep asking this same question to all scientists who appear before this committee. Why did the government withdraw from this project? The only answer we got from the government is that this is not a priority. Honestly, this is kind of difficult to swallow.
[English]
The Chairman: Thank you very much.
The members of the committee have a vote in fifteen minutes and the bells will start ringing in two or three minutes. I was wondering if there are any final comments or issues that Mr. Shawlee or Mr. Sibson would like to leave with us that we haven't discussed. Similarly, for Mr. Dupré, if you have any final one-minute summaries, we'd like to hear from you.
Mr. Sibson: In fairness, with all the warts that exist on certain policies, etc., there are some good things happening. Fortunately, we have been successful enough with the IRAP grants to be able to afford quite a bit of development and innovation. Certainly we would like it to go a little bit easier for some of the paperwork and politics and audits, etc.; that goes without saying. But that is a successful program and we'd like to see that continue and we'd like to see it accelerate and we'd like more money.
That's just my quick comment.
Mr. Shawlee: A quick comment I would like to make would be to start thinking a little more long-term about policies and programs that are going to have a 20-year or 50-year impact rather than programs that are only one or two years in length. Particularly education falls into that category, but also long-term industrial strategy. I think it's very jarring for the economy as a whole to go through a whole bunch of very short policy shifts in the space of two or three years. I know it's hard on a political level, but it would be enormously valuable for the country.
Mr. Dupré: Mr. Chairman, I would just like to record how very much I concur with the Kelowna speaker who emphasized the fact that if you're going to get into picking winners and losers governmentally, you're headed in absolutely the wrong direction.
I also very much appreciated his point that yes, people who are driven by the search for new knowledge or by the desire to apply knowledge are going to do it anyway. I think there's a lot of truth to that statement. I think the speaker who said those words might also want to agree with me that when one is looking at people who are talented in research and development, one is looking at individuals who are free agents. Certainly one way to observe whether you have the right climate for research and development is to look at the extent to which a country like Canada is losing some of its best players to free agency elsewhere.
The Chairman: Thank you.
On that note I'd like to thank the three witnesses, particularly the people of Kelowna, for joining us through teleconferencing. I hope you found it a satisfactory medium. The committee is just getting familiar with the technology and we've found it a very useful way of communicating and saving the government a lot of money and travel and time and so forth. Thank you for your indulgence and for breaking up your schedule to join us. To Mr. Dupré, who came in from Toronto, thank you so much for your time also.
For the committee members, I think it's been another good round table, a good discussion, which contributes to our report coming out in February. We'll make sure the witnesses have a copy of that report and we'll get further feedback for you.
We are now adjourned until Thursday, December 12, at 10 a.m.