Conservative Sci-Tech and R&D funding claims don't hold up

Ted Hsu
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The Conservative government often claims to have spent $11 billion in new investments in science and technology since taking office in 2006. This is the standard answer when the government is pressured about muzzling scientists, closing important research facilities or cutting budgets for science research.

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“…we have invested more than $11 billion in new resources since 2006 to support science, technology, and innovative companies that are opening new frontiers for Canada.” – Finance Minister Jim Flaherty, February 2014

“Since 2006, the government has provided more than $11 billion in new resources to support basic and applied research, talent development, research infrastructure and innovative activities in the private sector, including more effectively aligning federal support for research with business needs.” – Finance Minister Joe Oliver, May 2014

I asked the government to account for this so-called new money, and they provided me with a table of program expenditures covering the years 2006/07 to 2013/14 .  I checked these numbers against StatsCan’s table of federal expenditures on science and technology, research and development and related scientific activities. The government’s assertion just doesn’t hold up.

First of all, total federal spending on science and technology, research and development and related scientific activities is on the decline. Adjusted for inflation, total federal spending was $10.02 billion in 2005-2006, before the Conservatives took over. In 2013-2014,  it was down to $9.80 billion.

While the government claims to have invested a cumulative $11 billion in new money for science and technology, the StatsCan table shows that cumulative expenditure increases for science and technology are actually closer to $3 billion. That is mostly because, along the way, they spent some money on one-time economic stimulus. While they have made “$11 billion in new investments” in science and tech, they have also cut about $8 billion at the same time. Not surprisingly, the Conservatives never share the latter number in debate.

For example, the government’s “new money” table shows $110 million a year starting in 2012 for the NRC Industrial Research Assistance Program, and a one-time $400 million Venture Capital Action Plan funding in 2012-13. This is indeed new money for those programs, but when they were announced, the funding was taken from cutting the Scientific Research and Experimental Development (SR&ED) tax credit – a rebate for Canadian companies doing research and development. This support for R&D is expected to decrease by $315 million in 2014-15, by $480 million in 2015-16 and every year thereafter (read what I said about SR&ED in 2012). So these cuts are happening alongside what the government is choosing to call “new” investments which are really redirected money.

UPDATE: The “new money” table lists (line 3) $1,504 million spent on the Strategic Aerospace and Defense Initiative (SADI). But this was a replacement for the Technology Partnerships Canada (TPC) program. In fact the TPC program was abut 50% larger ($300 million a year vs. $200 million a year), and included funding for R&D at Environmental Technology, Bio-technology, and Communications companies. It is completely misleading to claim that funding for SADI is “new resources” as the Conservatives have.

So don’t believe that $11 billion figure. It’s misleading spin. The government’s own data from StatsCan proves it.

UPDATE: The government has updated talking points which add on spending from the 2014-15 fiscal year. Here is Conservative Minister of State Ed Holder speaking during a debate on muzzling of scientists, May 26, 2015: “Since 2006, the government has invested more than $13 billion in new funding in all facets of the innovation ecosystem, including advanced research, research infrastructure, talent development, and business innovation“. And here is Conservative Minister of State Michelle Rempel: “Since 2006, our government has invested over $13 billion in all aspects of the innovation ecosystem, from basic research through to commercialization”. When we bring up muzzling of scientists and the gutting of federal science capacity, they like to mislead Canadians about “new” funding.