Department of Finance Releases Blueprint for Canada Innovation Corporation

On February 16, 2023, the Department of Finance released a blueprint for the new Canada Innovation Corporation (CIC). The agency brings to life the Budget 2022 $1 billion commitment to establish an innovation agency to drive Canadian business investment in research and development (R&D) and foster economic growth.

The CIC will actually operate with an initial budget of $2.6 billion over four years, as the agency will be transferred purview over the Industrial Research Assistance Program (IRAP), previously housed under the National Research Council. Operations are expected to begin in 2023. The blueprint document provides details on how the CIC will operate, with further details on the standing up of the CIC's operations to be annoucned in the coming months.

Mandate and Objectives

The CIC will provide targeted support to new and established Canadian firms by delivering funding and advisory services in support of innovation and R&D investment. The CIC will be operationally independent and take an outcome-driven approach to funding decisions.

The key objectives of the CIC include:

• Achieve operational excellence: by recruiting private sector experts to leadership, developing responsive programs, and delivering funding within weeks to minimize costs.
• Establish strategic capacity: by monitoring and analyzing industrial and economic trends to identify new approaches to support business investment and growth.
• Create a platform for program experimentation: by collecting data to evaluate and experiment with program offerings.
• Support strategic procurement: by providing technical review and supporting government procurements of leading solutions.
• Create links to complementary organizations: by providing incentives to utilize R&D facilities within higher education organizations and building a pipeline of firms to access other growth financing opportunities, such as the Canada Growth Fund, BDC, and other sources.
• Attract talent: by relying on experts to advise on strategy, operations, and funding decisions to increase credibility, encourage private investment and unlock procurement opportunities.

Advisory and Funding Opportunities‍

The CIC willl deliver funding and advisory services, aimed at encouraging Canadian firms to initiate and scale R&D activities in Canada for the purpose of producing new and improved, globally competitive products, processes, and services.The CIC will conduct three main activities:

• Delivery of funding programs: Financial support in the form of grants and contributions for R&D projects in emerging and established sectors. Initially, the CIC will target applied research, experimental development, and technological adaptation projects.
• Delivery of advisory services: The CIC will establish a business development team to better understand and work with businesses to reduce barriers to R&D.
• Foresight and experimentation functions: The CIC will establish a strategy team to conduct ongoing program impact evaluation for evolving private sector needs.

Program Suite‍

Available funding is expected to range from $50,000 to $5 million per project. Select, large-scale R&D projects may receive a maximum contribution of $20 million per project. The project evaluation processes will be calibrated to the level of funding requested. The Department of Finance has released an initial program suite comprised of a graduated framework of funding tools. The list is illustrative and indicative of the future flexibility of programs. Program design and launch will be undertaken by the Board of Directors and senior leadership and will evolve with changing business opportunities.Funding tools include:

• Smaller scale grants: for new and existing Canadian businesses.
• Larger scale contributions: To support the creation and growth of large-scale R&D capacity.
• Consortia contributions: To support collaborative R&D projects that enable the growth of emerging and established industries.
• International collaboration contributions: To support R&D collaboration to expose Canadian businesses to international leaders and increase export opportunities.