Montreal – To improve Canada’s lamentably poor innovation performance we must move beyond our traditional focus on research and development (R&D) and take steps to reinforce competition rather than hinder it, says a new report from the Institute for Research on Public Policy.

“As the global market place becomes increasingly competitive, Canada’s innovation performance is clearly lagging behind — this despite generous R&D tax credits,” says author Andrei Sulzenko, a former senior assistant deputy minister of policy at Industry Canada.

His report, released in the wake of the government’s commitment to make Canada an innovation powerhouse, assesses the policy impact of the 2011 Jenkins Report on innovation, and recommends a way forward for the new Liberal government.

Sulzenko argues that despite recent steps in the right direction, Canada’s policy approach has been too timid and is failing to stimulate widespread innovation-driven business strategies. The reason is, he says, we have been dealing with the symptoms (i.e., Canada’s weak R&D performance), rather than tackling the root of the problem. “The lack of serious, sustained competitive pressures in key sectors of the Canadian economy has made it rational for businesses to underinvest in a range of riskier innovation activities, including R&D,” he says.

According to Sulzenko, Canada’s new innovation agenda will require a smart combination of microeconomic carrots and sticks to create a more comprehensive, pro-innovation business climate. Key elements of this approach should include:

• promoting competition in Canada;
• emphasizing demand-side instruments (such as smart regulation and government procurement);
• investing in highly skilled people;
• increasing the supply of financing for high-growth firms; and
• fostering an innovation ecosystem, including sectoral and regional clusters of activity.

It will be crucial to seize the opportunity to get the policy approach right, because innovation-driven productivity improvements are the best sustainable source of future growth for Canada.

Canada’s Innovation Conundrum: Five Years after the Jenkins Report by Andrei Sulzenko can be downloaded from the IRPP’s website (irpp.org).

Media are welcome to attend a working lunch with the author and commentators Hon. John Manley (president and CEO, Business Council of Canada), Ilse Treurnicht (CEO, MaRS Discovery District), and Iain Klugman (CEO, Communitech).

What: Canada’s Innovation Conundrum: Five Years After the Jenkins Report
When: June 13, 2016, 11:45 a.m. – 2:00 p.m. Panel discussion will begin at 12:30 p.m.
Where: Rideau Club, 99 Bank St, Ottawa

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The Institute for Research on Public Policy is an independent, national, bilingual, not-for-profit organization based in Montreal. To receive updates from the IRPP, please subscribe to our e-mail list.

Media Contact:    Shirley Cardenas    tel. 514-594-6877    scardenas@nullirpp.org