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The Professional Institute of the Public Service of Canada On June 6, 2008, the Treasury Board released the long-awaited report of the Independent Panel of Experts studying the transfer of federal government laboratories to academia and/or the private sector. Following up on the government’s intentions outlined in the 2007 federal budget, the panel identified five “early candidates” for transfer. The first two will be Agriculture and Agri-Food Canada's Canadian Cereal Research and Innovation Laboratory in Winnipeg, and Natural Resources Canada's Geosciences Laboratory in Ottawa. From August to December 2007, the panel scoured the world for models of government S&T commercialization via “major programs of privatization of both regulatory and non-regulatory laboratories and/or through creation of new government agencies that have special authority to pursue private-sector-like activities.” The range of initial transfer arrangements envisaged for Canada spans private-sector involvement to outright divestiture. But the end product is clear: the “partnerships” are to be “the initial arrangement in an evolving relationship” intended to move government science facilities from “a joint sponsorship arrangement involving government to one in which the federal government is no longer involved in ownership, governance or management.” The report is nothing less than a roadmap for dismantling government science. The identification of five initial candidates for transfer is only a preliminary step. The panel received proposals for transferring government labs in a vast range of areas: “agriculture; agri-food; horticulture; viticulture; fisheries and aquaculture; environment and ecosystems; ocean systems; health and biological sciences; medical devices; geosciences; space and earth observation; mining; nanotechnology; photonics; forestry; water systems.” “Nearly all” of the 56 proposals received were considered to be potential candidates in the long-term federal strategy for divestiture of federal science, not simply those identified as “highly ranked proposals” relatively close to finalization. Among the “promising” submissions were those that envisaged “a proposed divestiture by government of physical assets, human resources or intellectual property (e.g., data resources) or personnel, by transfer to non-governmental entities.” The panel is keen to see the process push forward. In order to generate momentum, the panel solicited proposals for lab transfers, although there was insufficient time for interested parties to submit fully developed proposals. As an indication of the haste with which the government would like to move, the five ‘early candidates’ for transfer were unanimously recommended by the panel because they can be transferred in 12 months. Within a year – slightly more than the time that has elapsed since the 2007 budget first indicated the government’s interest in transferring government labs – the government would like to see “completion of the necessary legal agreements to effect the new governance and management arrangements; the identification of the administrative and scientific leadership of the new entity, and the formulation of an integrated research program and detailed business plan.” What the panel has explicitly not attempted to achieve is greater opportunities for federal scientists to collaborate with research peers within and beyond the federal government. If this were so, the panel would have recommended removing existing impediments standing in the way of joint research, such as restrictions on research funding and the ability of government scientists to lead collaborative research projects. In fact, the panel is quite explicit that the myriad “examples of useful collaboration and networking” that currently exist are fatally flawed by the fact that they are “not-for-profit, cooperative arrangements”, that they contemplate no changes in the employment status of personnel, and involve no change in ownership of assets or sources of funding. Rather, the report seeks to shed government ownership and management of assets, personnel and programs. The report must be viewed in the context of the government’s larger policy direction and philosophy. The present government is determined not simply to promote the needs of industry within government, but to restrict and reduce the capacity of government to exist independently of, and potentially to interfere with, private industry. From his days as president of the right-wing National Citizens’ Coalition, Stephen Harper has been captivated by the goal of diminishing government to the point where it can be “drowned in a bathtub.” From the sale of government buildings to the $1.3 billion Public-Private Partnerships fund created in the 2008 budget, privatization forms an integral part of the government’s conservative philosophy of deregulation, and permanently diminished government spending and functioning. With respect to government science, in the conservative mindset, there is no justification for government occupying profit-making opportunities or competing for resources with private entities. The public sector must not compete with the private sector, and for-profit laboratory services is a growing industry. Rather than viewing the recruitment and retention challenge facing federal science-based departments and agencies as an opportunity to improve the attractiveness of federal scientific careers, the report sees the problem as the federal sector squeezing out private industry in the competition for scarce talent, with the solution lying in making federal government talent available to academia and private industry. But the government also understands that non-regulatory science is closely connected to, and an important precondition of, regulatory science and the regulatory capacity of government. This is precisely why the erosion of public science is a starting place and part of a larger attack on the regulatory capacity of government. In the panel’s view, the question whether to transfer federal labs is not a question of whether federal labs are regulatory or non-regulatory in nature, but rather those “which the federal government does not require exclusive ownership and operational control”. Quite appropriately, the panel noted the close interrelationship between non-regulatory and regulatory science, advocating privatization of regulatory labs as well as non-regulatory labs that provide “critical input” to regulatory functions. Indeed, the very presumption that government is the natural and most appropriate provider of regulatory science is “too broad a generalization.” What then can we expect in the near future? The panel’s report suggests procurement rules should be circumvented in establishing the new partnership arrangements, given the time, energy and costs associated with observing procurement rules. In this light, it is ironic that the panel’s report speaks glowingly of the United States Department of Energy’s National Laboratories. The DOE’s National Nuclear Security Administration is responsible for administering the contract for managing the Los Alamos and Lawrence Livermore National Laboratories. For over 50 years, the two labs have been operated by the University of California; in the 1990s, the U.S. Government Accountability Office (GAO) recorded numerous performance problems at the labs, including “cost and schedule overruns on major projects ... and violations of nuclear safety rules that resulted in overexposure of some workers to radiation at both laboratories.” Facilities management has also been an area of GAO scrutiny and concern, since aging facilities have led to increased need for maintenance and repairs. Procurement, property management, emergency management, and other mission support activities have been ongoing areas of GAO primary sources of concern. Problems with contract administration and project management led the U.S. Government Accountability Office in 1990 to designate the DOE as “a high-risk area for fraud, waste, abuse, and mismanagement.” The government faces real challenges in its bid to dismantle government science. A hint of the bumpy ride ahead is contained in the panel’s distaste for the way in which government lab privatization has been characterized. Employing the word ‘transfer’ was “not conducive to constructive dialogue with some stakeholders” because it did little to conceal the government’s intention to disassemble government science. Happily, euphemisms like “inter-sectoral S&T integration” and “alternatives to sole government ownership and control” allowed the panel to generate a more positive “and even enthusiastic” tone for consultations. As a sign of more intractable problems that may lie ahead, the panel notes that “non-federal parties are generally unwilling to undertake ownership of federal laboratories without long-term funding to defray the cost of operating and maintaining the facilities. Moreover, the opportunities for full transfer are limited by the fact that some federal laboratories undertake science activities that do not fit with the interests and capabilities of academia or the private sector.” The problem is a familiar one in the annals of privatization, but a common solution available to government is to prepare the labs for transfer by making them attractive to academia and the private sector – much as AECL (Atomic Energy of Canada Limited) is currently being prepared for sale to the private sector. The reason for the government’s haste is clear: opposition to this sort of move is inconvenient, and Canadians have learned to be sceptical of the claims made for privatization. Indeed, the Ontario government of Mike Harris – representatives of which now occupy cabinet positions in the federal government – met its demise partly on account of failed experiments in privatization. But only time will tell whether sufficient concern coalesces in order to reverse the dismantling of government science. Contributor: Chris Roberts, Research Officer. PIPSC Efforts on behalf of Public Science
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