Cutbacks announced at Alberta Innovates

EDMONTON – The Alberta government is consolidating its four Alberta Innovation agencies into one, and will be cutting their overall budget by $44 million. Deron Bilous (pictured), minister of economic development and trade, said the move was a “very tough decision” prompted by low oil prices.

The provincial government announced April 14 it was consolidating Alberta Innovates Bio Solutions, Alberta Innovates Energy and Environment Solutions, Alberta Innovates Technology Futures and Alberta Innovates Health Solutions into one corporation as part of a larger review of agencies, boards and commissions.

The Edmonton Journal reported that Bilous would not reveal how many jobs are on the line nor how much funding will now be available to researchers and inventors.

“We want to obviously minimize the impact of a cut as much as possible and not to disrupt very important research that’s going on in the field,” he said.

The four existing agencies are led by 30 executives who earned nearly $8 million in 2014/15. Bilous would not say how many executives will keep their posts or how much the government has budgeted for any severance packages.

Health Solutions CEO Pam Valentine is Alberta Innovates’ interim CEO while government begins a national search for a permanent one to be hired by the fall.

The government last month cut the annual budgets of the agencies by $44 million, nearly 13 percent. Eliminating overhead costs is expected to save another $2 million.

Bilous defended the move as necessary. “At times, from talking to entrepreneurs, there was a little bit of confusion,” he said, adding some were getting advice from one of the four agencies, while applying for funding from another. “They would be kind of going back and forth and, I think, again to facilitate that process, to make it a little bit easier, quite frankly. Having one board, one point of entry, will really expedite the process and make it more efficient and more user friendly.”

Hearing murmurs of a potential consolidation last year, health researchers worried a merger would reduce the money available for medical research in Alberta, potentially affecting access to cutting-edge treatments for patients.

Researchers funded by Alberta Innovates may have to slow down some of their projects. Bilous said the agency will “lengthen the pace” of some grants as an alternative to ending them abruptly.

Rolling out grant money more slowly is “problematic” for researchers, who may have to lay off staff or cancel purchases, said professor David Evans, vice-dean of research at the University of Alberta’s faculty of medicine and dentistry.

Alberta Innovates Health Solutions funds university graduate students, post-doctoral fellows, some professor salaries and collaborative research projects on cancer and aboriginal health, among others.

The restructuring also comes as Mayor Don Iveson announced a new strategy to establish Edmonton as Canada’s “health city” – one poised to foster the development of new medical technology.

The details of who and what Alberta Innovates will fund and how will be up to the agency’s new board of directors, which is also tasked with restructuring the consolidated entities. In 2014-15, Alberta Innovates corporations issued $160.7 million in grants.

Each of the four corporations had a board of directors. Their terms were allowed to expire before a new 10-member board was appointed April 13 to oversee all four organizations. Chairing the new board is engineer and Cenovus Energy senior executive Judy Fairburn, who was previously board chair for Alberta Innovates Technology Futures.

The official consolidation of the four agencies will have to wait until the government introduces legislation later this spring, meaning the four agencies will likely operate separately until the fall.

Choosing the agency’s new priorities and which ones they’ll dispense with are also up to the new board in consultation with Bilous. Although he wouldn’t point to what areas the agency will move away from, he said government is interested in funding innovation in clean-energy production and energy efficiency technologies.