OTTAWA — Canadian universities want $200 million more a year for research in disruptive fields like AI, biotech and quantum science, partly to make up for the money they’re losing because of federal restrictions that are supposed to keep those technologies away from hostile foreign countries.

“We want to make sure that they have resources available to undertake this research now that some doors are being closed,” said Chad Gaffield, CEO of U15, a university lobby group. The association wants the next federal budget to pledge $200 million annually for five years for projects in critical areas subject to Ottawa’s new security rules.

U15 and several member schools—the University of British Columbia, University of Calgary, McGill University and University of Waterloo—all recommended the program in recent submissions to the House of Commons finance committee.

Ottawa has added new rules for federally funded research following a series of news stories about faculty around the country working with Huawei, the Chinese telecommunications equipment giant; Canadian intelligence agencies had expressed concerns about the links.

The restrictions go far beyond telecom or even AI and quantum; they extend to aerospace and energy generation, medical technology and ocean technologies, robotics and remote sensing.

In September 2021, Innovation Minister François-Philippe Champagne announced new requirements for researchers seeking federal grants, including filling out a risk assessment form about their partners and areas of study. The Natural Sciences and Engineering Research Council of Canada (NSERC) assesses the application, and may refer it to intelligence agencies for review.

Ottawa began rolling out the new requirements with the NSERC’s Alliance Grants, which give researchers working with industrial or other partners between $20,000 and $1 million annually for up to five years. Of the first group of applications subject to the guidelines, 48 were referred for security screening. Thirty-two were deemed unacceptably risky. 

That’s a small share of the program total—in 2022, NSERC awarded $85.9 million of those grants to 438 projects—but it also doesn’t cover projects smothered before the application stage because of the policy.

In February, the federal ministers in charge of NSERC and the other “granting councils” that dispense billions of federal research dollars ordered an even fiercer crackdown, forbidding partnerships that could be connected to foreign adversaries’ militaries or security services.

The list of sensitive areas would grow and a process for determining which foreign institutions are worrisome would come, Champagne’s spokesperson said at the time. Nearly eight months later, the universities are still waiting.

The increased scrutiny on research security has also affected partnerships that don’t include federal funding. For example, the University of Waterloo announced it would cut all ties with Huawei in May 2023. The firm spent $319 million on R&D in Canada in fiscal 2021, according to Research Infosource, and claimed about 10 per cent of annual expenditures went to research partnerships.

In a previous interview about declining graduate engineering enrolments, Waterloo’s associate vice-president Jeff Casello said his university has relied heavily on research partnerships but those have become more and more complicated.

“Some of those funding sources are no longer available to us and we now have to work much harder to fund this important work,” Waterloo spokesperson Rebecca Elming told The Logic in an email about the universities’ $200-million-a-year request.

Some members of the U15—the universities of Toronto, Alberta and Ottawa, plus McGill—referred The Logic’s questions about how the tightening restrictions have affected them back to the U15. The University of Saskatchewan said it agrees with the U15, without answering questions. Queen’s University replied with a refusal to comment. The other members did not reply.

For two decades, “all federal governments encouraged Canadian researchers to engage with China, [which] is a rising power in the world of research,” Gaffield said, citing collaboration on climate change and health. But a few years ago, that changed.

While the research guidelines don’t currently identify specific companies or countries that pose a security risk, Chinese companies and institutes have been the targets of most of the coverage and scrutiny.

Universities support policymakers’ increased focus on security, but the financial consequences of the shift away from some popular partners must be addressed, said Gaffield. “We need to open other doors.” The association says the $200 million will go beyond what the research security measures have cost universities in partnership funding.

The Logic sent questions to Champagne’s press secretary about whether the minister believes the universities deserve compensation for the federal restrictions, and whether the fields identified as sensitive warrant more federal funding in general. She did not answer either directly, instead relaying statements from departmental officials that pointed to federal funding for AI and quantum strategies and subsidies from the Strategic Innovation Fund, which have partly flowed on to university researchers.

Other countries are increasing research funding for sensitive technologies, Gaffield noted. For example, the U.S. CHIPS and Science Act opened a new security office at the National Science Foundation, but also gave it an extra US$81 billion to spend. German lawmakers have pushed for new safeguards on scientific cooperation with China, and added billions of euros to education and research budgets. Japan is offering funding for 27 research applications, including AI, robotics and quantum technology.

ISED has a report it commissioned on federal research support, which warned that other countries’ spending is staggering while Canada’s is stagnating. The House of Commons’s science committee recommended boosts in a report last year, and its chair, the Liberal government’s former science minister Kirsty Duncan (currently on leave with cancer), has repeatedly called for the government to move.