Ottawa is investing $900 million in Canada's aerospace sector over the next five years, Industry Minister Maxime Bernier announced Monday.
"Canada's new government has launched a new initiative for the defence and aerospace industry. It involves research and development and is intended to promote excellence and innovation in Canadian aerospace and defence industries," Bernier said in French.
"Through this initiative, contributions will be made to fund research and development strategic projects undertaken by major players in those industries in Canada," he added.
The Strategic Aerospace and Defence Initiative will be administered by Industry Canada's Industrial Technologies Office (ITO).
The initiative is expected to invest nearly $900 million over the next five years, with funding to reach a maximum of $225 million per year, in support of Canada's aerospace, defence, security and space industries.
The Industrial Technologies Office will begin accepting project applications for SADI funding on Monday.
Transparency and accountability measures will include providing Canadians with information such as project assessment criteria, the assessment process, contribution recipients, as well as regular updates on project results, program performance, and program accomplishments.
Bernier made the announcement in Montreal Monday alongside Public Works Minister Michael Fortier and industry executives.
Many aerospace companies are based in Quebec, including aircraft manufacturer Bombardier Inc., engine builder Pratt and Whitney Canada, components maker Heroux-Devtek and CAE Inc., one of the world's biggest providers of pilot training services.
The Aerospace Industries Association of Canada welcomed the announcement, with chairman Don Campbell saying the program will require aerospace companies to invest three to four dollars of their own capital for every federal dollar received.
"This new initiative strengthens the business case for investment and scientific innovation here at home," Campbell said in a written statement.
"Aerospace is a major contributor to wealth and job creation. Government partnerships with industry serve a valuable purpose in stimulating technology development which would not otherwise occur."
The association is the national trade organization representing Canada's aerospace manufacturing and services sector, which employs more than 75,000 Canadians.
The aerospace sector alone had sales of $21.8 billion, exports of $18.5 billion, and employed 75,000 highly skilled Canadians in 2005, according to the industry minister.
Election-related?
The investment will trigger further speculation of a federal election this spring, as the Tories are hoping to increase their political presence in the province.
They're looking to build on the surprise gain of 10 Quebec seats in last year's election and to capitalize on the surge by the ADQ, the provincial party that appeals to small-c conservative voters, in last week's Quebec election.
Bernier told CTV Newsnet's Mike Duffy Live said the announcement had nothing to do with a spring election.
"It's a program that we evaluated, we created after the election. We said we're going to have something for the aerospace industry, and we delivered," he said.
The Tory government had been expected to unveil their replacement Technology Partnerships Canada for weeks now.
The TPC, whose mandate was not renewed last year, provided venture capital for corporate research projects.
It had long been criticized by the Conservatives as an example of the ineffectiveness of corporate subsidies.
Some argue that corporate subsidy programs like the TPC were less efficient than tax cuts or other approaches.
The Liberals say that the new program is a remake of their earlier program.
Bernier said there were differences in the transparency and accountability of the two programs. Repayments will be publicized on the government website twice a year, he said.
"Everything will be on the table, and I think that's very good news for taxpayers across the country," he said.
