[ale_divider style=”thin” text=”notext”] Divider Text [/ale_divider]
This article appeared on betakit.com by Isabelle Kirkwood. To read the original post Click Here.
[ale_divider style=”thin” text=”notext”] Divider Text [/ale_divider]
In a recent interview with BetaKit, Minister of Innovation, Science, and Industry, Navdeep Bains, indicated an openness to extending the National Research Council of Canada’s Industrial Research Assistance Program (IRAP) COVID-19 Innovation Assistance Program (IAP), similar to the proposed bill to extend the 75 percent emergency wage subsidy.
On Tuesday, the House of Commons passed the updated bill, which includes changes to the deadline and eligibility criteria of the Canada Emergency Wage Subsidy (CEWS) program. The bill now awaits Senate approval. One of the significant proposed changes to the program would be an extension of the subsidy into December. As part of an interview for a forthcoming episode of BetaKit’s Black Swan podcast, editor-in-chief Douglas Soltys asked Minister Bains whether the federal government was considering a similar extension of the IRAP IAP.
“I think it would make a lot of sense,” Minister Bains responded. “I think for consistency purposes, and … when we look at not only just the immediate short term support that we want to provide companies, but if we look at the restart and the economic recovery, we need a strong, robust innovation ecosystem, and we need to make sure those companies are positioned to succeed.”
“Clearly, we want to make sure that the wage subsidy and the timeline associated with that also mirrors the timeline associated with the IRAP program as well,” the minister added, noting he is working closely with Finance Minister Bill Morneau to “advance” the IRAP IAP initiative.
IRAP saw a $250 million injection from the federal government through IAP, which has now been fully committed after applications for the program opened and closed in the last weeks of April. Unlike most IRAP programs, which provide non-repayable financial assistance covering 80 percent of salaries and 50 percent of contractor costs depending on the sub-program, IAP provided a wage subsidy for up to 12 weeks to eligible employers.
Minister Bains told BetaKit uptake for IRAP IAP was “exceptional,” with over 2,200 taking advantage of the program. He noted the program allowed the government to leverage existing programming to support different sectors and was a good vehicle for the federal government to deploy funds in a timely manner, rather than create an entirely new program.
“We recognize that when we have these broad-based programs, if it’s the emergency response benefit, or if it’s the wage subsidy, or if it’s the business account, and … interest-free business loans, they’re fairly broad in nature, but they don’t necessarily capture everyone,” Minister Bains said.
“In this particular instance, we were focusing on pre-revenue companies. We were looking at high-growth firms that weren’t necessarily eligible, or as I mentioned, SaaS as well, the software-as-a-service companies, and I think it was great to see us leverage that pre-existing program,” he added.
At a time when the federal government has focused on supporting high-growth, “scale-up” companies, provincial support across Canada for early-stage, grassroots innovation has waned. In 2019, the Ontario provincial government cut funding to a number of innovation-focused programs, including its Campus-Linked Accelerator program. That same year, Alberta slashed its investor tax credit, which was aimed to increase investment in Alberta’s small businesses, and paused other initiatives aimed to spur growth in the sector.
During his interview with BetaKit, Minister Bains addressed the provincial cuts, indicating that the federal government was willing to “step up” where some provinces have stepped back.
“There are other jurisdictions that are going down the austerity path and that are making cuts. That is counterintuitive,” he said. “I think we need to focus on growth, we need to focus on and recognize that we are competing with other countries and other jurisdictions, and we need to step up.”
Bains pointed to this year’s Narwhal List, which named 42 Canadian companies on their way to unicorn status. He said the federal government was focused on helping scale-up companies like these in order for them to compete on more of a global scale, adding the COVID-19 crisis and high unemployment underscores the need for Canada’s mentality to shift to scaling Canadian companies and keeping them in Canada.
“Our government is committed to more than ever investing in early-stage ideas and also helping them scale up, and this is not meant to be partisan, but if the provinces are making cuts in that area, we will continue to find ways to support those companies, because that’s the only way we will be able to compete and succeed in this global innovation race.”
BetaKit’s full interview with Minister Bains will be released on Sunday, July 26 on the Black Swan podcast. Subscribe via: RSS, iTunes, Spotify Stitcher, Google Play.
Image source Navdeep Bains via Facebook.
