Ontario Budget includes new funding for skills, technology development and business growth

Last month’s Ontario Budget included a $674-million boost to support for technology, innovation and skills development as the province posted its first balanced budget since the 2008 financial meltdown and made a commitment of at least two more to come. Fuelled by 2.7% growth of provincial GDP in 2016, the $141.7-billion budgetary plan for 2017 includes funding to support autonomous vehicles, business growth, quantum computing and next-generation wireless consortia (see chart).

The research and innovation-related Budget measures complement two new programs announced in last November’s Ontario Economic Outlook and Fiscal Review — $28.8 million to launch a Small Business Innovation Challenge managed by the Ontario Centres of Excellence (OCE), and $32.4 million for a Scale Up Vouchers program. Both programs are funded for the next five years through the enhanced budget of the Business Growth Initiative (BGI).

The 62.5% increase in the budget (from $400 million to $650 million) will be used to fund the province’s Autonomous Vehicles Innovation Network. The province will spend $80 million over five years on the network which includes a Demonstration Zone in Stratford ON to attract and boost talent in the sector.

Several cities in Ontario are developing AV strategies including Ottawa which is seeking to build a cluster around Blackberry Ltd’s $100-million to refocus its QNX division towards AV.

Barrie Kirk, executive director of the Ottawa-based Canadian Automated Vehicles Centre of Excellence, welcomes the new funding but notes that other jurisdictions are spending more aggressively.

“The $80 million over five years is a very good step forward, but that is an average of $16 million a year and I would have liked to have seen more …. Support from government is still lagging what other jurisdictions have been doing and we in Canada and Ontario need to catch-up, including moving to a more relaxed regulatory framework,” says Kirk. “Stratford has done an excellent job of promoting itself as an AV testing centre. But … Ottawa will do very well with its own strategy. Ottawa's City Council passed a motion in late 2016 supporting AV testing, starting in Kanata. The ecosystem here is very strong and committed to making things happen … but it would do even better with more funding support from the province.”

5G also fared well with $130 million to support the establishment of two industry-led consortia, both of which were agreed to in a joint meeting of Ontario and Quebec Cabinet ministers last fall, and underpinning a plan to “create an open innovation ecosystem to accelerate the growth of information and communications technology”.

The Evolution of Networked Services through a Corridor in Québec & Ontario for Research and Innovation (ENCQOR) receives $67 million for a 5G-enabled ICT backbone through Ontario and Quebec. Global ICT firms set to participate include Ciena, Ericsson, Thales, IBM and CGI.

The Centre of Excellence in Next Generation Networks (CENGN) consortium receives $63 million and aims to bridge the gap between research and commercialization by providing testbed infrastructure for smaller businesses, government and academia. Confirmed participating companies include Cisco, EWA, EXFO, Fujitsu, Juniper, Nokia, Rogers, Telus, Viavi, WindRiver and Zay.

For companies located in Northern Ontario, connectivity to both consortia will be provided through the Ontario Research and Innovation Optical Network (ORION).

FinTech

The Budget also announced its intention to strengthen the Ontario’s nascent FinTech sector, leveraging Ontario’s position as a global leader in financial services and ensuring adequate consumer and privacy protection.  The province will announce a collaboration with the financial services and FinTech sectors in the coming weeks.

In a separate but related initiative, the Budget provided $4 million for a pilot cybersecurity program linking Ontario’s financial institutions to small business “to develop and facilitate the adoption of technological solutions”. OCE has been tagged to administer the pilot.

Colleges

Also announced prior to the Budget is a new $20-million Colleges Applied Research and Development Fund (CARDF). Managed by the OCE, the fund incents business-government partnerships to drive R&D and innovation. Once again, the government has chosen OCE to administer the program.

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