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Section 1 - Agency Overview

1.1 Minister's Message


The Industry Portfolio experienced a busy and successful 2007-2008. As Minister of Industry, I am pleased with the progress made on our mission to foster a competitive, knowledge-based economy that benefits all Canadians.

A competitive economy is one that provides jobs and opportunity to Canadians, and top-quality products and services to consumers. Our economic performance underpins the quality of life we enjoy in this country, and NSERC is making important contributions to this mission.

The Industry Portfolio is composed of Industry Canada and 10 other agencies, Crown corporations and quasi-judicial bodies. These organizations collectively advance Canada's industrial, scientific and economic development, and help ensure that we remain competitive in the global marketplace.

As a country, we must remain focused on how we can continue to provide an innovative and entrepreneurial economic environment, help our businesses capitalize on opportunities, and provide choice and quality to consumers. The global marketplace continues to evolve, changing with it the dynamics that influence Canada's performance. I am proud to say that the Industry Portfolio is playing its part:

  • We are working to make our market for wireless services more competitive, this year launching the policy framework for the Advanced Wireless Services spectrum auction. The framework aims to provide more choice and better service for consumers and businesses - something that we believe will also lead to lower prices.
  • We issued guidelines clarifying the application of the Investment Canada Act as it relates to foreign state-owned enterprises investing in our country to ensure that Canadians continue to enjoy all the benefits that foreign investment delivers.
  • We instituted an independent Competition Policy Review Panel to review and report on key elements of Canada's competition and investment policies and to ensure that they are working to the full benefit of Canadians.
  • We created an Automotive Innovation Fund to provide support to automotive firms undertaking large-scale, strategic research and development (R&D) projects to build innovative, greener and more fuel-efficient vehicles. Similarly, investments made through the Strategic Aerospace and Defence Initiative continue to encourage strategic R&D that will result in innovation and excellence in new products and services.

One of my key priorities as Industry Minister continues to be our country's science and technology (S&T) strategy, Mobilizing Science and Technology to Canada's Advantage, announced by Prime Minister Harper in May 2007.

  • Budget 2008 included measures and initiatives in support of our S&T Strategy that total $654 million over the next three years.
  • We put in place the new Science, Technology and Innovation Council to provide the government with objective policy advice on Canada's S&T issues.
  • The government allocated $105 million in 2007-2008 to support the operations of seven new Centres of Excellence, pilot projects that have the potential to make Canada a global leader in fields of research that offer a strategic opportunity for Canadian industry.
  • This past March, Canada's two-armed robot, Dextre, was successfully installed on the International Space Station.

This has been a year of progress and success, and it is my pleasure to present NSERC's Departmental Performance Report for 2007-2008. I am committed to building on these successes in 2008 and beyond, and I will continue to work with officials in the Industry Portfolio to make Canada more efficient, productive and competitive.

Tony Clement
Minister of Industry

1.2 Management Representation Statement

I submit for tabling in Parliament, the 2007-2008 Departmental Performance Report for the Natural Sciences and Engineering Research Council of Canada (NSERC).

This document has been prepared based on the reporting principles contained in the Guide for the Preparation of Part III of the 2007-2008 Estimates: Reports on Plans and Priorities and Departmental Performance Reports:

  • It adheres to the specific reporting requirements outlined in the Treasury Board Secretariat guidance;
  • It is based on the department's Strategic Outcome(s) and Program Activity Architecture that were approved by the Treasury Board;
  • It presents consistent, comprehensive, balanced and reliable information;
  • It provides a basis of accountability for the results achieved with the resources and authorities entrusted to it; and
  • It reports finances based on approved numbers from the Estimates and the Public Accounts of Canada.

Suzanne Fortier, President
Natural Sciences and Engineering Research Council of Canada

1.3 Program Activity Architecture

Figure 1 presents NSERC's Program Activity Architecture (PAA) in effect in 2007-08. Subsequent to the approval of NSERC's PAA for 2007-08, new programs were launched (see below). NSERC will use the updated PAA in future reports.

Figure 1
NSERC Program Activity Architecture

  1.0 People 2.0 Discovery 3.0 Innovation
Strategic Outcomes Highly skilled science and engineering professionals in Canada High quality Canadian-based competitive research in the NSE Productive use of new knowledge in the NSE in Canada
Program Activities 1.1 Promote Science and Engineering
1.2 Support Students and Fellows
1.3 Attract and Retain Faculty
2.1 Fund Basic Research
2.2 Fund Research in Strategic Areas
3.1 Fund University-Industry-Gov't Partnerships
3.2 Support Commercialization
Sub-activities 1.1.1 Science Promotion and Education Research
1.2.1 Undergraduate Student Research Awards
1.2.2 NSERC Postgraduate Scholarships
1.2.3 Canada Graduate Scholarships
1.2.4 Postdoctoral Fellowships
1.2.5 Industrial R&D Fellowships
1.3.1 Canada Research Chairs
1.3.2 Industrial and Other Research Chairs
1.3.3 Prizes
2.1.1 Discovery Grants
2.1.2 Special Research Opportunity Grants
2.1.3 Perimeter Institute
2.1.4 Research Capacity Development in Small Universities
2.1.5 Research Tools and Instruments
2.1.6 Major Resources Support Grants
2.1.7 General Support
2.2.1 Strategic Project Grants
2.2.2 Collaborative Health Research Projects
3.1.1 Collaborative Research and Development Grants
3.1.2 Research Partnership Agreements
3.1.3 Networks of Centres of Excellence
3.1.4 Strategic Networks
3.2.1 Intellectual Property Mobilization
3.2.2 Idea to Innovation Program
3.2.3 College and Community Innovation Program

New Programs

As a result of the 2007 and 2008 Federal budgets and to further the goals of the Federal government's S&T Strategy, several new programs were launched, including:

  • Centres of Excellence for Commercialization and Research (CECR) - The program is to create world-class centres to advance research and facilitate commercialization of technologies, products and services. These centres operate in the priority areas of the S&T Strategy: information and communications technology, environment, energy and natural resources, and health. The program funds the CECRs' operating and commercialization costs.
  • Business-Led Networks of Centres of Excellence (BL-NCE) - Announced in Budget 2007, the new BL-NCE Program's goal is to fund large-scale collaborative networks to support private sector innovation in order to deliver potential economic, social and/or environmental benefits.
  • Industrial R&D Internships (IRDI) - The program's aim is to create new opportunities for science and technology graduates. The program will fund internships with the participating businesses for graduate students and post-doctoral fellows to support the government's commitment to growing Canada's base of knowledge workers. The IRDI program will introduce interns to practical business problems while allowing them to apply their expertise to help meet the research needs of Canada's private sector.
  • NRC-NSERC-BDC Nanotechnology Initiative - This is a special opportunity developed by the NSERC, the National Research Council (NRC), and the Business Development Bank of Canada (BDC) for NRC scientists and Canadian academic researchers in nanoscience and nanotechnology to collaborate on large technology development-driven research projects in the critical areas of: energy the environment and information and communications technologies (ICT).
  • NSERC/NRCan/AECL Generation IV Energy Technologies Program - This program, co-funded by NSERC and the Natural Resources Canada (NRCan) Office of Energy Research and Development, in collaboration with Atomic Energy Canada Limited (AECL), supports research initiatives on large-scale reactor technologies. Canadian academic researchers, in collaboration with AECL scientists, may receive grant funds to investigate specific research that support Generation IV Energy Technologies in the area of Super-Critical Water-Cooled Reactors (SCWR).
  • Vanier Scholarships - To develop and attract the next generation of world-class researchers, a new class of doctoral scholarships named in honour of former Governor General Georges P. Vanier has been created. The Vanier Scholarships program will help attract the best doctoral students from here and around the world to study in Canada. The Vanier Scholarships will build on Canada's existing strength in graduate education and help build the skilled workforce needed to face the challenges of the future.
  • Canada Excellence Research Chairs - The program's objective is to strengthen the ability of Canadian universities to attract and retain the world's top scientific leaders. These prestigious Research Chairs will be offered in the four priority areas identified in the Government's Science and Technology Strategy; the environment, natural resources and energy; health; and information and communication technologies. Program funding will allow each Chair to assemble outstanding research teams and undertake cutting-edge research in areas of strategic importance to Canada.
  • College and Community Innovation (CCI - College and Community Innovation Program) Program - The objective of the CCI - College and Community Innovation Program Program is to increase innovation at the community and/or regional level by enabling Canadian colleges to increase their capacity to work with local companies, particularly small and medium-sized enterprises (SMEs). The government announced in Budget 2007 that NSERC's pilot CCI - College and Community Innovation Program program would be extended and broadened.

1.4 Summary Information

NSERC is the primary federal agency investing in research and research training in the natural sciences and engineering disciplines. It is funded directly by Parliament and reports to it through the Minister of Industry.

Our mission is to invest in people, discovery and innovation to build a strong Canadian economy and to improve the quality of life for all Canadians. NSERC advances the government's S&T priorities of building a stronger Canada, creating opportunities for young Canadians and investing in knowledge and creativity.

S&T Strategy

The new Federal Science and Technology (S&T) Strategy, Mobilizing Science and Technology to Canada's Advantage was released in May 2007. Through the S&T Strategy, the federal government has committed to maintaining Canada's G-7 leadership in public sector R&D performance. The Strategy builds on existing strengths, focusing efforts in areas where Canada can achieve global excellence, to make a real impact on the lives of Canadians and in the marketplace.

The S&T Strategy emphasizes three Canadian advantages: an entrepreneurial advantage that translates knowledge into practical applications; a knowledge advantage that generates new ideas and builds research excellence; and a people advantage that increases and retains the highly skilled individuals that Canada needs to thrive in the global economy. Together these advantages resonate with the mandate of NSERC and its strategic positioning.

NSERC's focus on people, discovery and innovation maps directly onto the strategy's emphasis of building a People Advantage, a Knowledge Advantage and an Entrepreneurial Advantage. In broad terms, virtually all of NSERC's funding relates to these advantages.

The strategy's principles have been incorporated into NSERC's planning and decision-making functions. These principles are also solidly embedded in NSERC's way of doing business, which includes: a competitive, peer reviewed evaluation system to ensure world class levels of excellence and value for money; a blend of targeted and broad-based programs to ensure that priority research topics are addressed as well as a broad spectrum of science, from discovery to applied research and commercialization; a suite of collaborative research programs that foster partnerships between industry and post-secondary institutions and that encourage commercialization; and appropriate and effective controls that are proven and recognized to ensure accountability

Figure 2 highlights the financial resources expended by NSERC and Figure 3 presents the expected outcomes by program activity. The evidence presented in Section 2 suggests that all of the 2007-08 results successfully met expectations.

Figure 2
Summary Information for NSERC

Raison d’tre:

NSERC works to make Canada a country of discoverers and innovators for the benefit of all Canadians. To achieve this, we invest in people, discovery and innovation in Canadian universities and colleges.

Financial Resources ($ millions):

Planned Spending Total Authorities Actual Spending
899.8 $1,015.4 $1,012.5

Human Resources (Full-time Equivalent):

Planned Actual Difference
319 327 +8

Departmental Priorities:

Name Type Performance Status
1. Develop tomorrow's discoverers and innovators Ongoing Successfully met
2. Build on Canada's strength in discovery Ongoing Successfully met
3. Seize emerging research opportunities Ongoing Successfully met
4. Realize the benefits of university research Ongoing Successfully met

Figure 3
Program Activities by Strategic Outcome

  2007-08 ($ millions)  
Strategic Outcome/Program Activity Expected Results Performance Status Planned Actual Supports Priority
Strategic Outcome #1: People Highly skilled science and engineering research professionals in Canada
1.1 Promote Science and Engineering Student interest in research in the sciences, math and engineering is encouraged Successfully met $4.1 $4.4 1
1.2 Support Students and Fellows A supply of highly qualified Canadians with leading-edge scientific and research skills for Canadian industry, government and universities Successfully met $136.4 $137.9 1
1.3 Attract and Retain Faculty Enhanced research capacity in science and engineering Successfully met $167.8 $148.0 1, 2
Strategic Outcome #2: Discovery High quality Canadian-based competitive research in the NSE  
2.1 Fund Basic Research The discovery, innovation and training capability of university researchers in the NSE is enhanced Successfully met $403.6 $454.3 1, 2, 3
2.2 Fund Research in Strategic Areas Research and training in targeted and emerging areas of national importance is accelerated Successfully met $57.7 $75.4 1, 2, 3, 4
Strategic Outcome #3: Innovation Productive use of new knowledge in the NSE in Canada  
3.1 Fund University-Industry-Government Partnerships Mutually beneficial collaborations between the private sector and researchers in universities, resulting in industrial or economic benefits to Canada Successfully met $115.0 $181.8 4
3.2 Support Commercialization The transfer of knowledge and technology from Canadian universities and colleges to the user sector is facilitated Successfully met $15.2 $10.7 4
TOTAL     $899.8 $1,012.5  

1.5 Summary of Departmental Performance

Before NSERC's departmental performance is described, it is useful to situate NSERC in Canada's and the world's systems of innovation. NSERC's support for research and training is typical of many similar agencies around the world known as "granting councils." Along with the more traditional role of education, universities worldwide have become centres of knowledge creation. In most industrialized countries, universities play a key role in the economic development of the nation. Because of the socio-economic benefits of university education and research, government funding of these institutions and their activities has become the norm.

Funding Environment

Canada's research landscape has changed substantially over the past decade. Federal investment in higher-education R&D (see Figure 4) has increased dramatically over this period. In many areas of research, Canada is truly a world-class player, as demonstrated by its increased ability to attract and retain top talent. The national science and innovation system offers Canadian researchers the tools they need to be knowledge trailblazers, seize opportunities to innovate and address global challenges such as adaptation to climate change and sustainable energy. NSERC is committed to advancing the goals of the S&T Strategy and to helping the research community make the most of the opportunities it offers them.

Figure 4

In 2006, member countries of the Organization for Economic Co-operation and Development (OECD) spent $168 billion on university research. Canadian university professors and students performed 5.9% of this total. When measured as a percentage of GDP, Canada spends more on university research than all of its G7 competitors and places second among OECD countries, only slightly behind Sweden (see Figure 5).

Figure 5

In 2007, university research represented 36% of all Canadian research, as measured by expenditures. This percentage is much higher than the OECD average of 18% of R&D performed by universities in member countries.

NSERC is the most important funder of the direct costs of research in the natural sciences and engineering in Canadian universities. In 2007, $4.3 billion was spent on research in the natural sciences and engineering in Canadian universities. NSERC directly provided almost one-fifth of the total funding. Figure 6 gives a breakdown of the total funding by direct source.

Figure 6

Nearly 12,000 university professors and more than 26,000 university students and postdoctoral fellows are supported by NSERC. (For a searchable database of all NSERC grant and scholarship recipients see NSERC funds are also used to support a considerable number of university technicians and research associates. Most Canadian universities benefit from NSERC programs, as do a growing number of colleges. Canadian industries and government departments are increasingly partnering with NSERC. Figure 7 presents the details of NSERC's support to client communities and partnerships. Estimates of the share of the population of eligible individuals and organizations funded or participating, and trends over the past 10 years, are also included.

Figure 7
NSERC's Clients and Partners, 2007-08

  Number Supported or Participating Share of the Population 1 Trends in Share of the Population Over Past 10 Years
University Professors 11,755 75% Small Increase
Undergraduate Students 9,502 7% Moderate Increase
Master’s/Doctoral Students 14,659 35-40% Moderate Increase
Postdoctoral Fellows 2,340 40-45% Small Increase
University Technicians, and Research Professionals 3,504 30%-35% Moderate Decrease
Partner Organizations:      
Universities and Colleges 93 75% Small Increase
Companies Performing R&D2 1,435 10% Moderate Increase
Federal Science Departments/Agencies2 26 80% Small Increase
Provincial Science Departments/Agencies2 23 25-40% Small Increase

Source: NSERC

  1. The percentage that NSERC supports of all individuals and organizations eligible for NSERC funding.
  2. Organizations in partnership with NSERC (across all NSERC programs).
  3. Percentage only applies for universities.

As the main beneficiaries of NSERC funding, university professors and students are NSERC's key clients. University administrative offices, such as research and scholarship liaison offices, are key partners in ensuring cost-effective NSERC program delivery. Further downstream, university technology transfer offices assist in generating the socio-economic returns at the core of one of NSERC's desired strategic outcomes. In addition, several NSERC programs require the involvement of industry and/or government partners. Detailed statistics on NSERC applications and awards can be found at:

Given the multitude of partners involved, it must be emphasized that the outcomes presented in Section 2 are shared achievements. There is no easy way to isolate the impact of NSERC funding. However, because NSERC funding is the key driver in the early stages of the process and exercises quality control at that stage through peer review, it is doubtful that many of these outcomes could occur without it.

Departmental Performance

NSERC measures its performance by evaluating its programs of research and training support according to their impact, cost effectiveness and continuing relevance. When reviewing performance of research support programs, it is important to remember that these investments take longer to bear fruit than most other government investments. The impact of NSERC's investment in research and training in the NSE can be fully assessed only over the long term. Therefore, the expected results reported in NSERC's Report on Plans and Priorities 2007-08 should be considered as planned results for the future. The performance information presented in this year's DPR is a retrospective look at outcomes resulting from NSERC funding over the past decade, and in some cases even longer.

In recent years, NSERC has been successful in:

  • Maintaining a strong presence in world science and engineering research by annually supporting nearly 12,000 of the most creative and productive Canadian university professors which are producing an increasing share of world knowledge of high quality;
  • Supporting the training of tens of thousands of master's and doctoral students, who have found well-paying, productive jobs and who are contributing to Canada's knowledge-based economic sectors by predominantly working in R&D;
  • Partnering with more than 1,400 Canadian firms to transfer knowledge created in the university sector to private firms that create economic wealth; and,
  • Supporting the development of new processes and products, some leading to the formation of new companies, all of which contribute significantly to the national economy; and more than off-set the annual investments made by NSERC.

In 2007-08, NSERC also implemented numerous changes to align with the government's S&T Strategy, including:

  • The effective design and delivery of programs (new and enhancements of existing programs) that reflect the objectives of the S&T Strategy and which are mobilizing the post-secondary research community around the Strategy's priority areas;
  • The creation of inter-agency mechanisms that foster a more comprehensive approach to the overall management of research support;
  • New partnerships with the business sector, including the rapid launch of new programs such as business-led Networks of Centres of Excellence (NCE);
  • Enhanced focus on priority areas in new and existing programs with particular attention to initiatives that cross the mandates of the individual funding agencies; and
  • Strengthening the commercialization, technology transfer, and knowledge translation and mobilization activities of all agencies through internal leadership and program enhancements.