DISCUSSION WITH IAN BENNETT FINANCE DEPUTY MINISTER

Dr. Bruce H. Sells, FRS(C)
Executive Director

Posted: November 9, 2005

In our meeting with the Deputy Minister the group from the Canadian Consortium for Research (CCR) first considered the core operations of post-secondary education through a “Dedicated Transfer”. We had a long discussion on this topic. The major points that emerged were:

1. The Federal Government is concerned about university operating budgets but are prevented constitutionally from direct support since it is a provincial responsibility.
   
2. While a dedicated transfer, on the face of it, would appear attractive there is no guarantee that there would be an effective means of determining that the money would directly support post-secondary institutions. We were reminded that the Feds had transferred $ 41 billion for a Health Transfer without any solid guarantee that there would be a transparent and accountable result mechanism.
   
3. Consequently, the Federal Government faces a political reality that a Direct Transfer would not work since they would receive neither financial accountability nor political credit.
   
4. Instead the Federal Government has attempted, by indirect means, to support innovation in post secondary institutions through the “indirect costs program”, CFI, the “Canada Research Chairs” and undergraduate and graduate student scholarship programs.

The second major issue discussed was budgets to federal granting agencies. In the minds of those in the Federal Government this continued support is very much on the agenda. It was recognized that public support of research by government is among the highest in the developed nations.

We pointed out that new first-time applicants at NSERC had increased significantly. From 2002 to 2006 the increase has been 767-905 applications. This increase reflects both the success in attracting (and retaining) outstanding researchers to Canada and the new active researchers resulting from turnover by retirement in the academic community. The budget situation faced by CIHR is currently, without an increase, there would be a shortfall of ~ $60 million compared to last year’s distribution of $ 170 million to grantees. Consequently, an increase of 9% would provide a stand-pat budget for CIHR with no opportunity to initiate new programs.

The issue of automatic carry-overs (up to 10%) of research funds by Federal Granting Agencies from one year to the next was considered. This was raised since it would provide greater flexibility in the use of funds by the granting agencies. We were told of a review process that occurs towards the end of each fiscal year that allows agencies to make a case for carry-overs. This, however, was not automatic and had to be revisited each year with justifications. There was no enthusiasm for an automatic “carry-over” by Finance.

We were left with positive feelings regarding the Federal Government’s commitment to research. The best way to increase operating budgets of Canada’s universities, however, remains a challenge.