The Problem with Naylor’s Panel Report

The report of Naylor’s panel reviewing Canadian Science is out. It is an incredibly eloquent “plaidoyer” for basic research both in terms of its role, past and present, in the advancement of society. It is of course music to the ears of Canada’s university researchers as well as administrators, though for different reasons. Government officials have not yet made any substantial comment and expectations raised by the report must be weighing heavy. The commitment of the Minister of Science, Kirsty Duncan, to basic research is beyond reproach, but she has to contend with “another minister of (applicable?) science,” and 29 of her colleagues around the cabinet table all with other priorities. This is seen in Budget 2017, which was not kind to her ministerial mandate –at least according to Canada’s rank-and-file researchers. The Naylor report made the job that much tougher by not making the required bold moves in re-prioritizing and re-allocating some of the current government’s expenditures on university research.

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First, let me be clear. I, like many Canadian researchers, wholeheartedly agree with much of the report. We support its call for de-politicizing research funding, and for granting decisions through expert review. We concur with its calculations on how funding for research has not kept up with overall growth of the economy, growth in population, or growth of the university system. And we welcome the finding that the governance system for research needs serious updating. Where the report falls short is in helping government identify redundancies and efficiencies, both necessary for sound implementation. There are a few hints in this direction but it’s unclear whether this is sufficient to be helpful to the minister.

The report recommends, among many other things, that the Federal investment in basic research increases from the current $3.5 Billion per year to reach $4.8 Billion over the next four years. What is bizarre is that at least $500 Million of the $3.5 Billion is not actually dedicated to basic research. These monies fund programs for targeted areas, mainly industry (such as Business-led Networks and the various NSERC’s Partnership Programs). In fact they were not part of the review’s mandate, even though their funds flow through the Tri-council, and hence are counted as part of the current expenditure. An additional $200 Million is allocated to administrative costs and small programs so the current funding for basic research is really about 2.8 Billion, including the indirect costs of research.

Let’s now take a look at the request by Naylor’s panel for an additional $1.3 billion to be achieved in four years.

First, the report rightly calls for an incremental increase over four years of $485M for investigator led basic research through the Tri-council (CIHR for health research; NSERC for science and engineering; and SSHRC for social sciences and humanities). I say that accepting this recommendation is a must and the increase should begin immediately. How it will be achieved is the question.

Naylor’s report notes that Canada invests 45% of funding into programs for targeted areas involving industry versus 30% in many advanced countries. Rectifying this balance should involve both new investments and a reassessment of the over $500M annually expended on targeted research by the Tri-council. Naylor must have already known both the problems and the solution, having been on the Jenkins panel. In any case, the minister should immediately review the targeted Tri-council programs, which are performing at a sub-par level, while receiving generous funding, courtesy of the Harper era. So, we propose to augment the budget for the Tri-council by $90 million annually starting in Budget 2018, and expect $125 to be transferred from the targeted programs over four years (i.e., 25% of it), which will then yield the full $485 million called for by Naylor.

The panel calls for the Canada Research Chairs program (CRC) program to grow to $405M from the current $265M. This program supports salaries for nearly 2,000 professors across Canada who teach and perform research. Ideally, the rebranding of the CERCs could have been used to support this program. However, a speedy increase in CRC funding by the full $140M, on top of the already committed $117-million (over eight years) going to the Canada 150 Chairs, will be a direct contribution to university teaching and research budgets, thus offsetting costs normally born and requested by the universities. It can therefore mitigate what we propose below about the indirect cost of research.

The report targets $140 million for student/pdf support, incrementing $35 million in student support annually. This is completely defendable. We need, however, to do something about the myriad of programs that support graduate students and postdoctoral fellows, including Mitacs, which already received $221 million in Budget 2017. They have been built over time with different rules, eligibility, and funding levels. We need to harmonize the programs for HQP.

In any case, top priority could be given to the above programs, in addition to corresponding indirect cost of research, and the requested amount for operating research facilities. In summary, $360-million for investigator-led basic research at the Tri-Council, $75 for the associated indirect cost, $140 million for CRCs, another $140 million for students/pdfs, and $65M for the operation of research facilities. This would require an incremental annual research funding of $780-million over 4 years, which translates into an annual increment of $195 million (i.e., 5.5 % per year) that will solve many of the shortfalls in funding basic research.

What about the rest of Naylor’s recommendations?

The report also points to programs that concentrate significant resources in the hands of a few researchers. Two in particular, the Canada First Research Excellence Fund (CFREF) has allocated $1.3 Billion to 18 research groups over seven years while the Canada Excellence Research Chairs supports 29 professors with funding of $10M each over seven years. The Naylor Panel suggests these programs undergo a value-based assessment. But why stop there? Why not say it the way it is.

In my opinion, these two programs are unnecessary luxuries that the Canadian taxpayer can live without. Naylor must have known that CFREF doesn’t look anything like the program originally sold to Flaherty by Stephen Toope and other presidents in 2014. One of the biggest mistakes of Kirsty Duncan was to proceed with the second competition for CRFEF ($950 million over 7 years) and to rush and rebrand the CERCs as Canada 150 chairs in Budget 2017 ($117 million over eight years). Think what she could have done by just re-allocating these funds according to the priorities set in the Naylor report. How can this be fixed?

CFREF presents the challenge that most of its funding ($1.3 billion) is already allocated. But there is still $200 million not allocated, and the first $350 million awarded in 2015 will start coming back in five years. This present an opportunity to roll most of these funds back to address the issue of the indirect costs shortfall –provided, of course, one agrees with Naylor’s assessment of these expenditures.

Indeed, the report calls for an additional $478M in support of indirect costs of research at universities (facilities and administration costs). These funds are assigned to university administrations as a percentage of the research grants awarded by the Tri-councils to their institution’s investigators. The report asks for an increase of such a percentage from an average of 21% to a minimum of 40%.

This program is obviously a darling for university presidents, and I, like many Canadian researchers, have concerns about the size of this ask, which will be the subject of a detailed blog post in the near future. But for now, here is how this piece of Naylor’s request could be handled.

As mentioned above, incrementally augment the indirect costs to reach an additional $75-million in four years. This corresponds to the additional $360-million increase in Tri-council funding. Next, eliminate CFREF in 2022 and re-allocate this money to indirect costs. After all, that was the original thinking of those who sold CFREF to government (Indirect costs for Canada’s world competitive universities!).

The report also calls for $300M for the Canadian Foundation for Innovation in support of research facilities. Government could surely find a way to mesh this request with the $2 Billion Post-Secondary Institutions Strategic Investment Fund also earmarked for research facilities.

Last but not least, Naylor’s report was right in pointing out the phenomenon of third party delivery programs (Triumf, CIFAR, Perimeter, AI Institute, Stemcell Network, Mitacs, etc). It was, however, timid –understandably so– in addressing this unshakeable fixture of political decision-making. Bringing their budgets to Tri-council could also result in some efficiencies, but they would have to compete with other research initiatives through peer review.

 

 

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2 Responses to The Problem with Naylor’s Panel Report

  1. Pingback: Naylor Report, Part II | HESA

  2. Pingback: INVESTING IN CANADA’S FUTURE; Strengthening the Foundations of Canadian Research (Review of fundamental research final report): 3 of 3 | FrogHeart

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