The federal government will move from “over-indexing on warnings and regulation” to using Canadian-made AI in its own operations and encouraging businesses to adopt the technology, new AI Minister Evan Solomon has said.

Over the last decade, Ottawa has committed billions of dollars to attract top AI researchers to Canada and to encourage the building of data centres here. Despite that, tech leaders have expressed concern that the federal government was overly focused on the technology’s risks instead of its rewards, and was too cautious in buying AI products for its own use.

In his first speech since taking the cabinet role, Solomon pledged an updated approach. “We have to scale our AI industry in Canada,” he said Tuesday at a Canada 2020 event in Ottawa, pledging to support leading homegrown startups with funding and government contracts. He cited Toronto-based Cohere, which sells generative tools, and Ada, which develops AI customer service agents. The Canada Revenue Agency or immigration department could use chatbots to answer clients’ questions faster and more efficiently, Solomon said. 

Canadian firms developing technologies with both military and civilian uses, like cryptography or quantum computing, will benefit from the country’s plan to increase defence spending, Solomon argued. Startups will be “validated with a government contract so they can get investment from around the world,” he said. 

Solomon also suggested he’s not rushing to revive the Liberals’ proposed AI law, which died when Parliament was prorogued in January. “The United States and China have no desire to buy into any constraint or regulation,” he said, so the new Liberal government under Prime Minister Mark Carney will not seek to make rules that are unique to Canada. While the federal government won’t “abandon regulation,” new rules will focus on privacy and data protection.

The Liberals’ proposed law set out requirements for applications of the technology that could have significant impacts on citizens, but multinational tech giants claimed it was out of step with other major markets. Digital rights groups said the legislation was drafted without input from civil society and experts, but Solomon said Ottawa will not be launching a new large-scale consultation. 

To meet its AI goals, the Liberal government will need to “invest billions of dollars,” Solomon said. Some of that money has already been budgeted, including $2 billion to increase Canada’s AI processing power. Cohere is set to receive $240 million to fund the purchase of compute capacity at a data centre U.S. firm CoreWeave is building in Canada. Solomon also promised that Ottawa would spend to ensure Canadian quantum computing firms remain in the country. 

The federal Quantum Advisory Council has recommended to Ottawa that it set up its own version of the U.S. Defense Advanced Research Projects Agency’s Quantum Benchmarking Initiative. Firms involved in that program can earn up to US$316 million each by proving their technology can solve real-world industrial problems by 2033.