The federal Liberal government is undertaking a sweeping study to find ways to improve Canada's research and development capacity, but sources say the initiative needs more work.

Industry Minister Brian Tobin and Human Resources Development Minister Jane Stewart are taking the lead in developing the white paper that will focus on how university and private sector research can be translated into market-oriented products and how to provide the workforce with better skills-training.

At a speech delivered in Halifax last month, Stewart said the country faces a tremendous challenge in ensuring there are enough skilled workers to meet the demand of employers.

"The quality and quantity of Canadians' skills will primarily determine Canada's future competitiveness and quality of life," she stated.

The government had intended to make the paper public this month, before Parliament adjourned for the summer, but that now appears unlikely.

The delay has led to speculation there is disagreement within the Liberal government over what mix of policies would best boost economic productivity and raise living standards.

Business lobbyists have been pressing for quicker tax write offs for investment in new machinery and technology, but social groups have been arguing for measures to help economically disadvantaged groups.

"There's a great opportunity here to bring in some policies that will make a difference," said Andrew Jackson, research director of the Canada Council on Social Development.

"Part of the skills agenda should be about trying to include relatively marginalised groups within the workforce."

It is expected the white paper will spell out in more detail the so-called "innovation agenda" in the Liberal red book of election promises last year.

The Liberals vowed to double federal spending on research and development, ensure better access to student loans, and to establish individual learning accounts to allow people to set money aside tax-free and withdraw it for education and job training.

CAUT president Tom Booth says he is worried about the direction the white paper may take.

"There's strong indication the big focus will be on commercializing university research," Booth explains. "The issue of continued underfunding of universities and colleges and accessibility to post-secondary education doesn't even appear to be on the radar screen."