Departmental Performance Report — For the period ending March 31, 2009

Section 2: Analysis of Program Activities by Strategic Outcome

Strategic Outcome: An Innovative Economy

Performance Indicator	Results	Trend
Business Expenditures on Research and Development (BERD) as a percentage of gross domestic product (GDP)	In 2008, BERD accounted for $16.31 billion, or 1.02% of the GDP, down 0.15 percentage points from 2003 BERD / GDP10	Declining
Higher-Education Research and Development Expenditure (HERD) as a percentage of GDP	In 2008, HERD accounted for $4.53 billion, or 0.28% of the GDP, down 0.2 percentage points from 2003 HERD / GDP11	Declining
Number of people in science and technology occupations as a share of total employment	1.2 million in 2008, or 7% of total employment, an increase of 0.41 percentage points from 200412	Improving

 

D

Scientific discoveries and new technologies provide solutions to many of the issues most important to Canadians, giving us the knowledge and the means to preserve the quality of the environment, protect endangered species, improve health, enhance public safety and security, and manage natural and energy resources. Scientific and technological innovations enable modern economies to improve competitiveness and productivity, providing the means to achieve an even higher standard of living and better quality of life.

D D

Meeting Our Commitments:

In an effort to foster a knowledge-based economy, Industry Canada implemented all commitments stated in the Science and Technology Strategy. Significant progress has also been made to create value for Canadians and lay the foundation for benefits from science and technology in the future. The Department also supported the generation and commercialization of knowledge by supporting innovation in aerospace and defence and supplementing access to information and communications technologies.

In January 2009, the Communications Research Centre (CRC) received an Emmy Award for its contribution to the standardization of the Advanced Television Systems Committee (ATSC) digital television (DTV) standard at the Academy of Television Arts & Sciences annual Technology & Engineering Awards. CRC's contributions to the ATSC standard helped define the way high-definition television (HDTV) is broadcast to homes in the United States and Canada. Its Advanced Television Evaluation Laboratory (ATEL) conducted two rounds of extensive subjective tests and produced results that were critical in the adoption of the ATSC standard in North America.

The Department completed Technology Roadmaps, bringing together representatives from industry, its supply chain, academia, research groups and government to identify and prioritize the technologies needed to create new products to meet future market demands.

The Automotive Innovation Fund (AIF) was established to provide automotive firms with access to $250 million over five years in support of strategic, large-scale R&D projects to build innovative, greener, more fuel-efficient vehicles.

Benefits to Canadians:

• Through its commitments to S&T, invested in a stronger economy, future opportunities for jobs and an improved quality of life for Canadians, which will contribute to a sustainable national competitive advantage
• Through CANARIE, which provides a high-speed research network, provided Canadians with the opportunity for international collaboration on projects in areas such as health care, the environment and weather monitoring
• Through SADI, recipient companies contributed to Canada’s knowledge-based economy, increased collaboration with research institutes, universities, colleges and non-profit organizations
• Technology Partnerships Canada (TPC) and Program for Strategic Industrial Projects (PSIP) recipients developed and improved innovative technologies, stimulated private sector involvement, and provided opportunities for economic growth
• The Science, Technology and Innovation Council (STIC) provided advice on the design of the developed Canada Excellence Research Chairs Program and the Vanier Canada Graduate Scholarships Program and drafted STIC’s first State of the Nation Report on Canada’s Science, Technology and Innovation System

Performance Analysis:

Through the following program activities, Industry Canada continued to build an innovative economy.

Science and Innovation Sector — Science and Technology (S&T) and Innovation

Expected Result: Development and coordination of policy frameworks in support of an innovative economy

Performance Indicator	Results	Trend
Policy proposals that are brought forward to reinforce the elements that advance an innovative economy and reflect a coordinated approach based on tools available across the sector	Policy proposals were brought forward aimed at advancing an innovative economy and were championed for inclusion in the budget. Budget 2009, tabled on January 27, 2009, included initiatives that will result in cumulative S&T funding of over $5 billion, of which $3.8 billion will be spent by next fiscal year	Improving

 

Financial Resources ($ millions) 2008–09				Human Resources (Full-Time Equivalents) 2008–09
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
101.1	100.0	99.7		74	70	-4

Meeting Our Commitments:

To foster innovation, Industry Canada supported granting councils by providing funding for research in priority areas and by enhancing their accountability and responsiveness. The Department bolstered the Canada Graduate Scholarships Program to offer an additional 1,000 scholarships, as announced in Budget 2007. These awards provided incremental federal support for top Canadian graduate students pursuing advanced training and research at Canadian universities. Opened to students from all disciplines, the Industrial R&D Internship Program (IRDI), coordinated through NSERC, provided interns with the opportunity to apply their research skills to real-world challenges while connecting firms with intellectual capital and potential future employees. The program placed 468 graduate student and post-doctoral interns in firms across Canada last year.

In support of an innovative economy, Industry Canada, with its partners, the Business Development Bank of Canada (BDC), National Research Council Canada (NRC), and the Natural Sciences and Engineering Research Council (NSERC), took immediate actions aligned with the federal S&T strategy to collaborate more closely and to share resources and expertise with the intent of accelerating the commercialization of publicly funded research that capitalizes on the individual strengths of these organizations. A steering committee was established to track the project’s progress, accelerate critical initiatives and identify fresh opportunities to work together effectively.

Industry Canada monitored progress in five priority areas and ensured that it was reported to ministers at the North American Leaders’ Summit in Montebello, Quebec, in August 2007. The five areas are Enhancing the Global Competitiveness of North America, Safe Food and Products, Sustainable Energy and Environment, Smart and Secure Borders, and Emergency Management and Preparedness.

Industry Sector — S&T and Innovation

Expected Result: Innovative Canadian Industries

Performance Indicator	Results	Trend
Increase year-over-year in industrial R&D13 expenditures	2007P: $16.2 billion 2008P: $16.3 billion14 Change: 0.97% P: Preliminary estimate	No change

 

Financial Resources ($ millions) 2008–09				Human Resources (Full-Time Equivalents) 2008–09
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
9.5	101.0	90.4*		83	79	-4

^* The variance is a result of additional authorities approved in 2008–09.

Meeting Our Commitments:

To support innovation in targeted Canadian industries, Industry Canada announced two funding programs: the Automotive Innovation Fund AIF and the CSeries Program. Under the AIF, Industry Canada signed one contribution agreement for up to $80 million to support strategic, large-scale R&D projects for the development of innovative, greener and more fuel-efficient vehicles. In addition, through the CSeries Program, the Department announced its intention to make a repayable investment of up to $350 million for the research and development of new aerospace technologies that will lead to more fuel-efficient and safer commercial aircraft.

Furthermore, Industry Canada facilitated the completion of 10 industry-led Technology Roadmaps (TRM) enabling industries — from hydrogen fuel cells to textiles to health management — to focus more effectively on R&D investments. Industry Canada also supported the creation of the Green Aviation Research and Development Network (GARDN), a business-led centre of excellence for the aerospace industry.

Spectrum, Information Technologies and Telecommunications Sector — S&T and Innovation

Expected Result: Improved science and research capacity and commercialization of information and communications technologies

Performance Indicator	Results	Trend
Percentage of the top 50 Canadian R&D universities that utilize CANARIE’s Advanced Network	98% of the top 50 Canadian R&D universities are now connected to the CANARIE Network	New indicator
Number of new technologies and applications developed in the areas of intelligent systems and advanced robotics through Precarn’s collaborative model	Precarn developed 30 new technologies and applications	New indicator

 

Financial Resources ($ millions) 2008–09				Human Resources (Full-Time Equivalents) 2008–09
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
18.4	30.2	29.5*		4	4	0

^* This includes the $28-million payment is the third instalment of the $120-million conditional grant for CANARIE’s Advanced Network. The amount paid is based on CANARIE’s cash flow requirements, reported annually to the Minister before an instalment is issued.

Meeting Our Commitments:

Network operations continue to be extended and optimized to deliver high-quality service to Canada’s research and education community. As a result, more than 50 organizations now have access to, and use of, the CANARIE Network through the Infrastructure Extension Program. Additionally, and in support of an innovative economy, CANARIE encouraged the definition and implementation of collaborative projects that will accelerate the development of, and participation in, national and international cyber-infrastructure and e-research platforms.

Communications Research Centre Canada

Expected Result: Communications sector clients receive the required technical input to develop telecommunications policies, regulations, programs and standards

Performance Indicator	Results	Trend
Extent of client satisfaction (related to content, timeliness and usefulness) with Communications Research Centre technical inputs and assessments used to develop telecommunications policies, regulations, programs and standards	No formal client satisfaction survey was undertaken during the year. However, client feedback indicated that CRC contributes positively to policy, regulations and standards initiatives	Not applicable

Expected Result: Canadian companies use CRC-developed technology to enhance their product lines and competitiveness

Performance Indicator	Results	Trend
Sales revenue of Canadian communications companies with a technology link to Communications Research Centre	A study of CRC’s economic impact is undertaken every 5 years, with the next study due in 2010. The last study (2005–06) by an external consultant pointed to $1.6 billion in annual sales revenues from CRC spinoff companies, and cumulative industry sales resulting from CRC IP licences to the year 2005 of $520 million	Not applicable

 

Financial Resources ($ millions) 2008–09				Human Resources (Full-Time Equivalents) 2008–09
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
43.1	60.3	57.4*		400	374	-26

^* The variance is a result of increased salary costs from collective agreements, recapitalization of scientific equipment, increased respendable revenues from collaborative research agreements and campus operation activities, and spectrum monitoring support for the Vancouver 2010 Winter Games.

Meeting Our Commitments:

Industry Canada, through the CRC, provided technical input and expertise to its various partners and clients on multiple occasions. The CRC is participating in a multi-partner CANARIE project called Health Services Virtual Organization (HSVO) to create a sustainable platform for the experimental development of shared information and communications technology (ICT)-based health services. As its contribution, the CRC provided infrastructure support as well as specialized software. The CRC also provided support to the Department’s telecommunications policy-making and spectrum regulation through a number of projects and studies, including interference studies from new technologies, such as white space and unlicensed devices on DTV reception; review of orbital licence allocation proposals; cognitive radio simulations and analysis to support technical inputs to IEEE 802.16 standards; and development of new techniques for detecting and identifying malicious attacks on networks, as part of a Canadian and global effort to improve security for business and other transactions.

The Department also contributed to the International Telecommunications Union (ITV) in the areas of HDTV and 3D-TV quality assessment, audio loudness measurement and Software Defined Radio (SDR).

Industrial Technologies Office — Special Operating Agency

Expected Result: Leading-edge research and development in Canadian firms

Performance Indicator	Results	Trend
Dollar of private sector investment leveraged per dollar of Agency investment in ITO projects	$2	New indicator

 

Financial Resources ($ millions) 2008–09				Human Resources (Full-Time Equivalents) 2008–09
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
311.8	333.5	294.6		96	85	-11*

^* The variance is due to a high staff turnover.

Meeting Our Commitments:

Industry Canada successfully wound down the h2 Early Adopters (h2EA) Program for the March 31, 2008, closing date. The 2008 h2EA final evaluation indicated that government and industry representatives saw the program as being in line with industry needs when established in 2003. The approved projects represented over 50 companies, including technology providers, funding partners and suppliers. Most companies experienced technical learning and general improvements in their capabilities in hydrogen technology.

The Department also invested in nine new SADI projects valued at $395.4 million, which leveraged upwards of $723 million in additional R&D investment commitments, thereby enhancing competitiveness in the aerospace and defence industry.

In addition, the Department disbursed $238 million to the legacy Technology Partnerships Canada (TPC) and Program for Strategic Industrial Projects (PSIP) programs.

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¹⁰ Business Expenditures on R&D Compared to GERD and GDP. Table 3. Statistics Canada, 2009

¹¹ GERD - By Performing Sector and Funding Sector. Table 1-2. Statistics Canada, 2009

¹² Employment by Industry. Statistics Canada, 2009

¹³ Intramural expenditures: expenditures for R&D work performed within the reporting company, including work financed by others

¹⁴ Total Intramural Research and Development Expenditures - By Industry. Table 1-1. Statistics Canada, 2009