Recommendations for Innovation Nation and Economic Stimulus: Sir Terence Matthews, CATA National Spokesperson
"One of CATA's Innovation Nation objectives is creating 10 domestic companies in the ICT sector with annual revenues exceeding $5B/by the year 2020. Similarly, we are striving to provide Public Sector reference accounts to 10 thousand SMEs in the same time frame. Let's start today to create the mindset and necessary conditions to achieve this bold objective."
Support documents and videos:
State of the Innovation Nation: CATAnet TV inteview
White Paper (pdf)
Innovation Nation Core Planks
Calling on all Governments to Formulate and Issue Compressive Innovation Plans
that:
· effectively fosters the creation, retention and growth of IP such that Canadians obtain the full benefits of the country's investment;
· addresses the dearth of funding available for early stage businesses and the financing of growth opportunities in established businesses;
· promotes a regulatory climate that does not put a drag on innovation; one that encourages Canadians to lead as creators, innovators and adapters of next generation technologies; and
· promotes trade relations that permit Canadian firms to compete, and to effectively seek success and growth in global markets.
Six Areas for Immediate Action -- Recommendations:
1.) Immediate support for tech intensive companies requiring commercial financial & insurance services, by;
a) Authorizing BDC to extend loan and insurance risk guarantees to the financial institutions now demanding same from Canadian tech sector companies,
b) Authorizing / encouraging EDC to provide guarantees for financing and insurance in favour of financial institutions requiring these, in support of Canadian exporters,
c) Creation of a facility to provide temporary injections of direct equity or loans to tech companies now required to provide direct collateral or letters of credit to close sales contracts.
2.) Increased support for corporate R&D in Canada through modernization & reform of the SR&ED program, by;
a) Immediately allowing technology intensive companies holding R&D Investment Tax Credits to convert up to 50% of unused ITCs into refundable ITCs over the next two years,
b) or alternatively, allow companies not qualifying for refundable tax credits to sell unused R&D ITCs to other entities, similar to previous oil & gas exploration incentives,
c) Within a year -- Eliminating the distinction between Cdn private corporations and others so that they are placed on an equal footing for access to the SR&ED ITC system,
d) Within a year -- Eliminating the old "associated companies" rule of the SR&ED system, which interferes with modern 'ecosystem development models' in the high-tech sectors.
e) Fix the current legislative and administrative problems identified in the 2007 Finance Canada-CRA consultations so that the needed structural changes can be effective
3.) Increasing the availability of Venture Capital funding for new & growing companies, by;
a) As quickly as possible -- Introducing a shared fed/prov "Venture Capital Investment Tax Credit" system based on the very successful model currently operating in B.C.
b) Urgently completing the work promised in the 2007 and 2008 Budget Plans to remove the "Section 116 Certificate" and 'Limited Liability Companies' impediments to US investors, (Done)
4.) Improved government investment in, and support for, technology commercialization, by;
a) Immediately amending what types of companies and projects can qualify for the SADI program to broaden the range of sectors and technologies eligible,
b) Or alternatively, developing a similar program to SADI for other high-tech sectors, (though more efficient than the former TPC),
c) Expanding the NRC-IRAP mandate to include technology adaption and commercialization, giving companies the option of IRAP staff support or direct funding,
d) Immediately expanding the funding available to IRAP a further $100M, and increasing annual max contribution agreements from $500K to $2 Million,
e) Streamlining IRAP administration, including considering whether IRAP should remain part of the NRC or be associated with another agency or the department directly,
f) Encouraging and funding IRAP and EDC to better support foreign sales and R&D partnerships by collocation of appropriate staff with Trade Commissioners at our major embassies,
g) Supporting and funding the DFAIT Trade Commissioner Service proposed "Global Innovation Strategy",
5.) Improving government procurement practices, at all levels of government, by;
a) Making officials at all levels aware of the importance of Canadian Tech companies, and focusing on procuring from SMEs where practical,
b) Requiring departments and agencies to focus more on their future tech based needs, and contract with Cdn firms for the necessary R&D work,
c) Re-examining how Canada has interpreted "Defence & Security" under the trade agreements with a view to taking a broader view similar to the U.S. to permit targeted tech spending.
6.) Stimulus for development of environmentally efficient technologies ( GreenTech ) in Canada, by;
a) Including in any economic stimulus package aimed at infrastructure investment components aimed at increasing R&D & commercialization of "Green Technologies",
b) Including under 'GreenTech' energy management & energy efficiency solutions, such as digital networks, teleworker support, remote medicine tools, and advanced home-care & monitoring.
In addition to these recommendations, immediate action is called for by:
a) Encouraging the adoption of the three pillars of importance to corporate social responsibility, namely social, economic and environmental sustainability
b) Developing the IT capacity of women and encouraging women to join the technology market and enroll in technology-related studies
c) Including Aboriginal and minority businesses in supply chain opportunities
d) Creating Technology Test Beds, as a vehicle and incubator to conceive, develop and sustain new solutions for government productivity and to help create reference accounts for Canadian technology companies pursing international markets.
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