Implementing Canadas Innovation Strategy: Engaging Stakeholders in Policy Learning Process Implementing Canadas Innovation Strategy: Engaging Stakeholders

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Implementing Canadas Innovation Strategy: Engaging Stakeholders in Policy Learning Process Implementing Canadas Innovation Strategy: Engaging Stakeholders in Policy Learning Process A. Duff Mitchell Manufacturing Competitiveness Directorate Industry Canada Six Countries Programme, Stockholm, Sweden May 23, 2006 Slide 2 2 Canada: Who we are & public policy challenges Slide 3 3 Canada is a prosperous & successful country large, resource rich country relatively small, high income, bilingual & multicultural population federal political system & situated next to U.S. Canada ranks high as place to live & do business: United Nations Human Development Index 5 th among 177 countries in 2005 World Economic Forums international competitiveness ranking 13 th in 2005 OECDs measure of living standards real GDP per capita was 2 nd highest in G7, 9 th in the OECD in 2004 Slide 4 4 Focused on three policy challenges & innovation 1.Increasing productivity growth on sustained basis (objective: closing productivity gap vis--vis U.S.) 2.Improving human capital through education & training (objective: one of best educated society/economy in world) 3.Enhancing global economic reach (objective: more global FDI, deeper trade links in key markets, creating stronger Canada brand) Canadas Innovation Goal: To be recognized as one of the most innovative countries in the world Slide 5 5 Maintaining comparative advantage in competitive & rapidly changing global marketplace requires: quality of policies & institutions (& quality of human resources & national endowments) flexibility, adaptability & speed in policy formation & delivery continued alignment of government policies & business strategies Through policy learning success factors identified Source: Canadas Success is No Accident, Kevin Lynch, Policy Options, April-May 2006 Slide 6 6 Why an Innovation Strategy? Slide 7 7 Canadian economy performance is mixed GDP* per Person ($US) for the G7 Countries Source: OECD Economic Outlook* Real GDP, 2000 constant PPP 2 nd in G7 re GDP 2 nd re GDP growth from 1991 to 2003 But productivity growth has lagged U.S. & created income gap Slide 8 8 and productivity challenges are mounting Private sector R&D investment performance low M&E investment as % of GDP lowest in G7 Productivity growth also lags main trading competitors Source: Canadas Success is No Accident, Kevin Lynch, Policy Options, April-May 2006 Slide 9 9 Higher Energy Prices price of oil & natural gas rose by 200% & 455%, respectively from 2001 to 2005 Appreciated Canadian Dollar Canadian $ increased by more than 30% against US $ since 2003 Canadian industries also facing increasing pressures Emerging Countries China is now Canadas 3 rd largest trading partner (total trade increased 555% between 1992 & 2004) Increased competitiveness for value-added products Canadas Merchandise Trade With China ($Cdn billion) Source: Trade Data Online. Slide 10 10 Canada needs to rank near top to compete successfully But Canadas innovation performance ranks near bottom in G7 e.g., R&D, continuing education, regulatory environment & FDI Benchmarks/Performance Canadas Rank (Out of 11*) Investment in Research and Development (R&D) Gross Domestic Expenditure on R&D (GERD) 7 th Business Enterprise Expenditure on R&D (BERD) 8 th Publication of Scientific Papers 5 th Commercialization University/Industry Collaboration in R&D 2 nd Technology Balance of Payments 5 th Skills, Education and Training University and College Graduates 1 st Adult Participation in Continuing Education 6 th Regulations and Reform Economy-Wide Regulatory Environment 6 th Public and Business Confidence / International Recognition World Competitiveness Rankings 4 th FDI Confidence Index 7 th *These 11 countries are Australia, Canada, Finland, France, Germany, Italy, Japan, Spain, Sweden, United Kingdom, and United States Source: Conference Board, Exploring Canadas Innovation Character, June 2004 Our traditional competitors rank higher than Canada in many areas Slide 11 11 Key innovation challenge areas: knowledge performance challenge (R&D) promote creation, adoption, & commercialization of knowledge (productivity growth) skills challenge ensure an adequate supply of people who create & use knowledge (human capital) innovation environment challenge ensure that Canadas stewardship regimes & marketplace framework policies are world- class (global economic reach) Canada recognizes innovation challenge Slide 12 12 The Federal Government Innovation Strategy Initiative Slide 13 13 National Innovation Strategy involved multi-pronged engagement process National Engagement Process launched 2002: February: released Innovation Strategy Papers set directions for 2010 May October: asked Canadians for views on targets, priority actions, recommendations November National Innovation Summit Two overarching objectives: mobilize Canadians to make commitments and turn them into action so that Canada becomes one of most innovative countries in world examine Governments Strategy to accomplish this goal then tell us if weve got it right Slide 14 14 Engagement process resulted in extensive outreach Source: Public Policy Forum, Engaging Leaders: Lessons from the Innovation and Learning Strategy Slide 15 15 Innovation Secretariat established 10,000+ Canadians participated in: 33 regional events 80 sectoral group meetings 40 expert, best-practice, and interest group roundtables multiple streams, e.g. sectors, regions, youth, provinces 600+ online responses from individuals & SMEs 250+ formal submissions received from organizations representing hundreds of thousands of Canadians (posted on line) key federal government departments involved Knowledge Matters: Skills & Learning for Canadians Achieving Excellence: Investing in People, Knowledge & Opportunities Innovation initiative heard from all Canadians Slide 16 16 and Canadians had a lot to say Confirmed major directions set out in Innovation Strategy papers Suggested modifications to certain targets & milestones Move faster in key areas (e.g. regulatory reform) Modify performance measures in key cases (e.g. R&D intensity) Provide more clarity (e.g. cluster strategy) Pointed out deficiencies (e.g. insufficient focus on commercialization efforts; skilled trades) Recognized that many stakeholders must collaborate Government cannot act alone; innovation is everybodys business; role for all key stakeholders Demonstrated sense of readiness to move forward Canadians mobilized; ready to commit; wanted fast action Slide 17 17 Canadian views captured for policy analysis Views summarized in Canadians Speak on Innovation and Learning Analysis of key issues & recommendations by stream 2000+ recommendations; 5 key horizontal issues with 93 recommendations for prioritization at National Summit (National Summit Discussion Guide) Slide 18 18 Agreement reached on 18 priorities across 5 themes 1. Improve R&D & Commercialization research capacity commercialization outcomes access to capital 2. Enhance innovation environment support innovation in tax system speed regulatory reform modernize IP system 3. Strengthen Learning Outcomes access learning opportunities innovation in learning system careers in skilled trades lifelong learning 4. Build an Inclusive & Skilled Workforce increase labour force capacity integrate immigrants in workforce invest in workplace training 5. Strengthen Communities Slide 19 19 and Government commitments announced accelerate timetable for regulatory reform review of foreign ownership restrictions in telecom sector benchmark Canadas innovation performance reconvene in 2 years to assess progress & determine next steps Results published in Summit Summary Report Slide 20 20 Government followed up with timely actions Budgets 2003, 2004 & 2005 delivered on most priority recommendations: Increased funding for research (e.g., CFI, Granting Councils) Expanded support for successful programs (e.g, IRAP) Improved business environment (e.g., tax measures, risk capital) Improved financial assistance for students, foreign credential recognition Increased funding for RDAs, CFDCs, Atlantic tech clusters, social economy External Advisory Committee on Smart Regulation provided recommendations in September 2004; Report on Actions & Plans tabled March 2005 CBOC benchmarking report released in September 2004 Auditor General audit of Innovation Strategy (November 2005) Slide 21 21 Policy learning from engaging stakeholders in Innovation Strategy Slide 22 22 Post-Summit review of engagement strategy mixed Engagement process achieved core objectives: consensus obtained on innovation challenge & need for action government delivered on most commitments & responded to priority recommendations (e.g., Budgets 2003, 2004, & 2005) themes identified at Summit continue to resonate in public policy discussions & program funding decisions But not all expectations realized and many private sector stakeholders did not develop action plans Slide 23 23 External assessment critical of process Public Policy Forum (PPF) observations based on interviews of only 23 Summit leaders: National Summit was not successful in achieving its goals of creating a national action plan or in securing commitment from all sectors to participate in its implementation because of flaws in the process, agenda, participants, timing and outcomes. Source: Public Policy Forum, Engaging Leaders: Lessons from the Innovation and Learning Strategy (pg., 11) Slide 24 24 PPF focused on perception of coordination issues National Summit Process: pre-set course of action dominated by universities who monopolized debate complicated by having two-leading d