Seán Sherlock (Cork East, Labour)

-----to the best of our ability. We are trying within the very meagre resources we have - which were squandered - to try to fulfil a programme that sets down these very parameters.

I fulfilled the research and innovation brief and am greatly encouraged that the research and development tax credit will bring about a benefit in ensuring we can try to fulfil that agenda. It is vital to our national interest. I acknowledge that the parameters set down in the agenda for research and development are as a result of work by successive Governments in the past, including the previous one. Through the State agencies they identified the vital part research and innovation fulfils in supporting jobs. The single message that emerges is that if we do not support the research and innovation agenda now, over a longer period it will be very difficult to be able to maintain existing jobs acquired through foreign direct investment. If parent companies see that we are not continuing our investment in such research this may send a signal that this agenda is being sidelined. It is vital that through initiatives such as the one announced yesterday we send a signal to the world that we will continue to ensure we can maintain the number of jobs we have, as well maintaining the quality link between research and foreign direct investment related jobs and thereby continue to attract further jobs.

I wish to speak specifically about the area of research and development. The positive evidence for economic recovery is clear. This year, for the first time in three years, we can look forward to positive growth which we fully expect to accelerate as we move into 2012 and beyond. This is by contrast with the years between 2007 and 2010 when the volume of goods and services produced in Ireland fell by 12%. On foot of recent gains in competitiveness and improving external demand the exporting sectors of the economy are once again performing very well generally. Last year exports increased by 9.5% in real terms, the strongest rate of growth for more than a decade. Looking to the future, export growth is projected at around 6.75% in 2011 and 5.75% in 2012.

Our focus now, and for the foreseeable future, is on the maintenance and growth of sustainable jobs. I am glad to say the auguries are good on this front. The number of foreign investment projects in Ireland rose by 15% in 2010. These came about because of the proactivity of State agencies such as IDA Ireland which was responsible for the creation of approximately 11,000 jobs, more than double the figure of 5,000 for 2009. That transcends two mandates, two Governments. I acknowledge, as one must, this came about as part of a previous Government's mandate. Moreover, these are quality projects. In the area of attractiveness for research and development projects, Ireland is positioned in fifth place, behind Finland, Taiwan, Israel and Puerto Rico. The joint Forfás and CSO 2009-2010 business expenditure survey on research and development, BERD, was published on 29 April and it, too, tells a positive story. The BERD results indicate that in spite of expectations research and development expenditure in indigenous Irish businesses remained strong during 2009 and estimates indicate continued growth in research and development spend in 2010.

During a recession one might expect to see companies make cuts in areas such as innovation and research and development spend but the BERD figures show that Irish businesses continue to invest in this area, mainly due to recognition of the importance of bringing new and innovative goods and services to the market in order to remain competitive and to grow exports. This is very positive as this sustained research and development investment is what will underpin future economic growth, jobs and exports.

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