Ottawa based think tank, The Conference Board, released a series of reports called “How Canada Performs: A Report Card on Canada,” which assesses Canada’s quality of life in comparison to other countries. Canada receives grades of “B” in the majority of the sections, and received a grade of “A” in the Education and Skills section. However Canada’s performance in Innovation is poor, with the think tank assigning the country a grade of “D.” According to the report, Canada ranks second last in the amount businesses spend on R&D and in venture capital expenditures. However the country does well in terms of the quality of scientific research and the creation of new businesses.
The Canadian government provides a variety of funding to provide financial support for companies to undertake innovation projects. The Scientific Research and Experimental Development (SR&ED) tax credit is the most popular funding source for R&D projects, but there also exist various grants and loan programs such as IRAP, AgriInnovation Program, Innovation Demonstration Fund, and the Southern Ontario Fund for Investment in Innovation (SOFII), to name a few. The Canadian government ranks 8th in terms of R&D spending for business; yet, Canadian business spending on R&D has dropped to 0.89% of GDP in 2011, from 1.29% of GDP in 2001. US businesses spend twice as much on R&D, and Finnish businesses three times as much on R&D compared to Canadian businesses. The onus is on Canadian businesses to ensure that they receive full value from generous government funding initiatives.
