BACKGROUND - A Digital Economy Strategy for Canada

OTTAWA, May 7 /CNW Telbec/ - In the March 3, 2010 Speech from the Throne, the Federal Government committed to "launch a digital economy strategy to drive the adoption of new technology across the economy." ITAC, the Information and Technology Association of Canada, has actively advocated the formulation of a digital economy for many years. ITAC believes that Canada needs a digital economy strategy. In June of 2009, ITAC published its recommendations about what a Canadian digital economy strategy should strive to achieve.

The Federal Government is expected to initiate a consultation process for the formulation of a digital economy strategy soon. The information and communications technology industry eagerly awaits this important initiative in the ongoing work to build a robust knowledge-based economy in Canada. To give a sense of what such a strategy should cover, here are suggestions we have worked on during the past year. It is important to note that digital economy issues cut across our different levels of government.

Talent

Develop a national ICT skills strategy for Canada.

Coalesce the efforts of the private, public and NGO sectors to promote STEM literacy through a national campaign. Aim to improve Canada's performance in producing science and engineering graduates moving from 20th to 5th by 2015.

Industry and government should invest in programs that foster increased enrollments in next generation ICT careers (business/ICT professionals and specialized/multi-disciplinary technologists). It should support national collaborations among post-secondary institutions, employers and career transition organizations that improve pathways to these next generation careers.

The ICT sector should collaborate more closely with the academic sector to strengthen existing cross-disciplinary programs and encourage the creation of more.

21st Century Infrastructure

Assess our current situation and public and private investment plans and devise a "Made in Canada" solution to get Canada into a position of leadership in next-generation broadband by 2017.

Complete and implement a comprehensive cyber security strategy for Canada.

Complete the task of building an integrated Canadian Electronic Health infrastructure by 2017. This work should include creating the tools to digitize records, to access the records, to provide patients access to their records and equip them to more actively participate in their own care and to improve opportunities for collaboration among practitioners. Achieving this goal will improve processes and reduce wait times.

The Federal Government should proceed with the Canada Online project working closely with other levels of government and the private sector to build a foundation for a strong digital content industry through this process.

Innovation and Technology Adoption

Canada needs continued, clear and persistent communication from Government and industry leaders that business needs to step up its investments in technology. To resolve our productivity shortfall, which is costing us so much in terms of prosperity and competitiveness, we need to review our performance and the measures we have taken such as capital cost allowance incentives and determine whether further measures are needed. Our objective should be to close the Canada-U.S. gap in ICT investment per worker, which is currently at 37.4 percent to 13 percent by 2015, and entirely by 2020.

Governments should adopt a policy to be the best in the world in the use of technology in order to eliminate deficits, address the challenges of an aging workforce and improve 21st century services to citizens.

Governments should adopt the objective of leading in world rankings in electronic government.

Governments should continue to streamline cumbersome procurement processes and contractual terms that impede the ability of technology firms to compete for government business.

Governments should be knowledgeable buyers, buying solutions rather than inputs.

NOTE: ITAC recommended in June that governments play the role of lead user in new innovations through programs outside the procurement process. In its decision in the March 2010 Budget to establish the Small and Medium-sized Enterprise Innovation Commercialization Program, the Federal Government has made an important advance toward this objective.

Increase the amount of operational healthcare funding dedicated to ICT to at least four percent, to match the ICT investment in healthcare of the world's leaders in healthcare technology and services.

Industry and government should work together to further investigate both the potential environmental benefits of the application of ICT to the various industrial sectors, and to identify the most effective means by which investment in ICT can be encouraged across the Canadian economy. Canada's environmental and greenhouse gas action plan should include an explicit component of performance improvement to be achieved through increased use of information and communications technology as well as ICT-related process improvements such as tele-working.

Tax Regime and Promoting Business R&D

The Scientific Research and Experimental Development tax credit program plays a sustaining role in the life of knowledge-based companies. Broadening SR&ED's refundability will have an immediate impact on key jobs and projects. We recommend addressing the shortcomings of SR&ED to ensure all R&D investors can benefit from the program.

It may be necessary to consider other policy instruments to address the needs of firms who currently derive no benefit from SR&ED. ITAC looks forward to the Federal Government's comprehensive review of all Federal support for R&D announced in the Budget. We must make Canada a leader in business R&D.

Access to Capital

Our Federal and Provincial governments have taken strong measures over the past two years to improve access to capital for technology firms. At this point, we need to identify what is needed to tackle the remaining gaps and continue to fund the various programs such as IRAP, BDC and EDC.

The Regulatory Regime

Develop a comprehensive approach to a legal and regulatory regime that will foster leading investment, development and use of technology in the digital economy.

Review the need for new legislation or amendments to existing legislation to help secure confidence in the digital economy and implement the appropriate legislative changes in areas such as privacy, spam, spyware, identity theft and pretexting.

Implement a 21st century copyright act that will be a world leader in balancing the interests of creators, consumers and intermediaries in a digital economy.

Develop a comprehensive strategy for leadership in the digital content industry and adjust our laws accordingly.

Please see ITAC's document "Upping our Game" for further elaboration of these points (www.itac.ca).

For further information: Bernard Courtois, [phone] ext. 231; Lynda Leonard, [phone] ext. 223