The Canadian federal government's financial watchdog told Parliament last week that the National Research Council of Canada (NRC)—a CAN $800-million-a-year (USD $611 million) agency—is in danger of outgrowing its financial resources. Sheila Fraser, the auditor general, also said that the NRC needed “stronger governance and improved priority setting” and noted “with concern” that “the council's research activities are expanding faster than its financial capacity to sustain them.”

In addition, the auditor general told reporters, “NRC's Governing Council… provides no effective challenge to management plans and decisions to ensure that the council's research activities continue to be sustainable.”

Its biggest challenge, her report said, is for the NRC to “review its corporate mechanisms for setting priorities to avoid an imbalance between its research activities and available funding. Although it has had no core budget increase, it is currently launching several long-term initiatives that include major increases in infrastructure and...

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