Superclusters report a wakeup call for Liberals' withered innovation policy

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Michael Geist holds the Canada Research Chair in Internet and E-commerce Law at the University of Ottawa, Faculty of Law.

It was just five years ago that the Liberal party, then mired in third place nationally, made innovation a centerpiece of its electoral strategy. The 2015 Liberal platform referenced “innovation” 10 times with promises to establish a national innovation agenda that would touch on everything from agriculture to the everyday work of government. Within weeks of the election, the role of industry minister was recast as the innovation, science and economic development minister, armed with a mandate letter peppered with instructions to pursue an innovation agenda.

Fast forward to 2020 and innovation has largely disappeared from the government’s radar screen with the word banished from the 2019 election platform. The response to COVID-19 has understandably emerged as job one, but the disappearance of innovation as a government policy priority raises serious concerns about how Canada will foster the economic growth needed to help recover from the devastating effects of the global pandemic.

The results of the government’s innovation strategy have, to date, been underwhelming at best. This week, the Parliamentary Budget Office released a report on the government’s billion-dollar supercluster strategy that found significant delays in spending and notably expressed doubt about the prospect that the program would meet its objective of increasing GDP by $50-billion over 10 years. The government has responded by indicating that spending has accelerated in recent months, but the report throws cold water on the promise that it can spark innovation simply by writing big cheques.

Further, Navdeep Bains, the Innovation, Science and Industry Minister (the position was renamed yet again in 2019), has seemingly ceded much of the innovation file to cabinet colleagues and provincial governments. At the federal level, the government has puzzlingly turned digital and innovation policy into a cultural issue, with Canadian Heritage Minister Steven Guilbeault leading the way by making “getting money from web giants” the top legislative priority. Rather than positioning Canada as an innovation leader, Mr. Guilbeault’s vision of regulation, licensing and tax requirements to counter what he has described as “immoral” activities is likely to lead to reduced foreign technology investment and innovators looking elsewhere for supportive markets.

Provincial governments have also become increasingly engaged in innovation policy with plans to encroach on the federal government’s jurisdiction over intellectual property. For example, the Ontario government launched an intellectual property action plan that is convinced that universities could become better at commercialization if only there were clearer roles for technology transfer offices and better governance frameworks.

The experience elsewhere suggests this is unlikely, but the plan nevertheless equates patents as a proxy for innovation and bets on governance frameworks and centralized resources as the mechanism to create and commercialize intellectual property. The benefits of open innovation that eschews the restrictive patent model – particularly for the millions of dollars of publicly funded research – is surprisingly absent from the provincial plan.

While innovation policy may have fallen out of favour, the global pandemic has highlighted how governments can help foster private-sector innovation without the emphasis on commercialization and patenting. Years of publicly funded research has been essential in supporting the race to find an effective COVID-19 vaccine, serving as the foundation for the Astra-Zeneca/Oxford vaccine candidate. Further, the World Health Organization has focused on innovation models that support wide access to research outcome and publications.

The need to prioritize alternative innovative policies has not been totally lost in Canada. Soon after the pandemic took hold, the government passed legislation to override patents in an effort to remove potential barriers to the distribution of vaccines or other pharmaceuticals. More recently, National Science Adviser Mona Nemer released a report that touted making “scientific data, research and results freely available to all, with minimal restrictions.”

There is still much more to be done. Canada should be considering tax incentives that encourage private-sector research and development, supporting fast-growing companies to keep Canadian innovation at home, encouraging technology investment by rethinking some of its Internet regulatory plans, and adopting a broader vision of innovation that incorporates both open and patent-based models.

The rapid response to the global pandemic highlighted that government can move quickly when pressured to do so. That urgency has thus far been absent from the innovation file and the PBO report serves as a wake-up call that the Canadian innovation agenda emphasis on superclusters is unlikely to provide the promised economic gains or position the country as an innovation leader.

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