AbstractDespite a commitment by the Canadian government to support R&D programs, there is ongoing controversy about the types and levels of appropriate support Continual changes in tax incentives and grants available, have led to firms being inhibited in making long-term plans and have made it virtually impossible to assess prospective projects.The suggestion is made that research be split into basic, applied and development and an analysis conducted of the productivity gains of these components. There can be no substitute for a careful consensus-building exercise that seeks to involve all the major interested parties at every step of the way.