Modest progress on innovation in 2010 budget

This year's federal budget didn't throw the doors of Canada's telecommunications industry wide open to foreign investment as some had hoped it would. Nor did it say much about how the government will "launch a digital economy strategy" and build the jobs and industries of the future it promised.

Forestry, particle physics and satellites are this year's winners

The 2010 federal budget unveiled Thursday didn't throw the doors of Canada's telecommunications industry wide open to foreign investment, despite the anticipation created by the throne speech the day before.

Nor did the budget provide much detail about how the government will "launch a digital economy strategy" and build the jobs and industries of the future it promised.

Instead, it limited the modest increase in green jobs and clean energy spending to the forestry industry and directed the bulk of new technology spending to a particle accelerator and a group of next-generation satellites.

While the budget does propose easing foreign ownership rules in the telecommunications industry, that applies only to one specific area – satellites. That will allow greater foreign ownership of private satellites licensed in Canada that provide services such as satellite television.

However, it won't impact the wireless industry, where ownership restrictions have caused the most controversy over the past year. In December, the government overturned a Canadian Radio-television and Telecommunications Commission decision that originally found new wireless entrant Wind Mobile did not meet Canadian ownership rules and could not launch its service.

While the 2010 federal budget promises to help create the "economy of tomorrow," new innovation funding will be largely focused on two projects:

  • $222 million over five years for Vancouver-based TRIUMF, a nuclear and particle physics research facility.
  • $397 million over five years for the Canadian Space Agency's RADARSAT Constellation Mission, a group of next-generation satellites to support surveillance, defence and environmental monitoring. The project will get another $100 million through the agency's own budget.

Forestry gets clean energy funds

The forestry industry is the main beneficiary of new green jobs and renewable energy spending, through the Next Generation Renewable Power Initiative. The program will provide $100 million of the next four years for clean energy technologies and production in the forestry sector. Details aren't expected until later in the year, but the program could entail support for biomass energy or the use of alternative energy sources to fuel forestry processing plants.

Forestry will also benefit from $75 million in new funding for Genome Canada for genetics research targeted at forestry and the environment as well as regional genomics innovation centres.

While the throne speech mentioned that the government aimed to "expand opportunities" for "top graduates" to pursue post-doctoral studies and commercialize their ideas, the budget provides for a maximum of just 140 post-doctoral fellowships a year. Each new two-year fellowship will be worth $70,000 annually.

Government to test new prototypes

Other nods to technology, innovation and the environment in this year's budget include:

  • $40 million to help federal departments and agencies adopt prototype products and technologies developed by small and medium-sized businesses, through a two-year pilot project involving 20 initiatives.
  • $15 million for the College and Community Innovation Program, which funds research collaborations between colleges and businesses focused on the company's specific needs.
  • $32 million for Canada's three granting agencies, including $16 million for health research, $8 million for science and engineering research, $5 million for science and engineering research collaborations between academic institutions and private companies and $3 million for the social sciences and humanities.
  • $18 million over five years for the pre-construction design phase of the proposed High Arctic Research Station.
  • $80 million in additional incentives for homeowners to make their home more energy-efficient, through the ecoENERGY home-retrofit program.

The budget doesn't allot any funding for the "digital economy strategy" that the throne speech said would "drive the adoption of new technology across the economy." Nor does it say when such a strategy might be expected.

Tim Weis, director of renewable energy policy for the Pembina Institute, said based on their respective budgets for 2010-11, the U.S. will outspend Canada 14 to 1 per capita on renewable energy and 2 to 1 on energy efficiency. Canada has improved its energy efficiency somewhat by expanding the ecoENERGY retrofit program but continues to subsidize the fossil fuel industry by funding carbon capture initiatives.