James Lawless (Kildare North, Fianna Fail) | Oireachtas source

I congratulate the Minister of State, Deputy D'Arcy, on his recent appointment as Minister of State at the Department of Finance. As someone who originally comes from the same part of the world as the Minister of State, I am delighted to see him being promoted and to see north Wexford enjoying ministerial representation. North Kildare might follow in due course.

I was slightly confused when I saw that this Topical Issue was being handled by the Department of Finance. I had imagined that it might be the Department of Jobs, Enterprise and Innovation or perhaps the Department of Education and Skills because those Departments are normally responsible for research and development issues. I thought the relevant Ministers in those Departments would have to make their case to the Department of Finance for research and development supports to be included in their own budgets. Perhaps it is useful to have a direct path to the purse strings. It is worth highlighting in that context that the funding of research and development and innovation can sometimes fall between the two stools of the Department of Education and Skills and the Department of Jobs, Enterprise and Innovation. It is not always clear who is responsible for these matters. In this case, ultimate responsibility lies with the Department of Finance.

I hope the benefits of investment in research and development are self-evident. A pipeline of innovation brings multiple benefits and returns as the body of knowledge in areas like technology and process improvements advances. I will not recite the multiple studies that bear this out. I hope it is self-evident that investment in research and development produces multiple returns at the far side. The last Government's Innovation 2020 strategy, which was published by the Minister of State, Deputy English, contained some very ambitious targets but unfortunately they have not been met with funding. According to a report published this week by the Nevin Economic Research Institute, this is becoming an issue. It seems we have fallen far short of where we really need to be in terms of international funding. The report, which is based on a comparative analysis of 11 European countries, suggests that Ireland consistently spends too little on research. It points out that in 2014-15, Ireland's research expenditure of approximately €500 million represented 61%, or just over half, of the average spend within the euro group. Under Innovation 2020, we have a target of spending 2.5% of GDP in this area, but we consistently fall far short of that.

It is often said that the Irish experience of research and development and innovation has moved from one of benevolent neglect at the time of the foundation of the State, when other priorities existed, to one involving a graduate supply chain when IDA Ireland started to attract multinationals to this country in the late 1960s, and then to one of accelerated growth during Fianna Fáil's last period in government. Many initiatives taken during that time, including the establishment of Science Foundation Ireland and the programme for research in third-level institutions, accelerated the progress that was being made by bringing the best and most talented teams of researchers to this country. Indeed, the best people were groomed and educated in this country to a level that enabled us to punch above our weight. All of this is now in danger at a time when opportunities exist as people in the international research community are on the move. President Trump's America can be a cold place for people from certain corners of the world who are very eminent in their fields. Similarly, the Brexit scenario in the UK means that country is not a place where people feel comfortable staying in the long term. If we can invest in a way that allows us to avail of these opportunities, we will reap the rewards by attracting talented people to this country.

I acknowledge that investment in innovation is critical not just for universities and multinationals but also for small businesses. I welcome the representatives of the Sallins Business Association who are in the Gallery this evening. Innovation is the engine of small business every bit as much as it is the engine of large business. Indeed, the Small Firms Association has lobbied on this matter in the past as well. I hope the deficit I have outlined can be addressed. It is crucial for our industrial and educational policy, for the promotion of jobs and for the advancement of knowledge that we tackle this issue by closing the funding gap about which we have known for some time. Approximately 900 scientists wrote to The Irish Timestwo years ago to warn that this was happening. I was on the science march in Dublin city a month or two ago when eminent researchers, professors, fellows and academics came out and said "this is not enough" and "this is not going to end well". This was confirmed by the Nevin Economic Research Institute in its recent study. I put it to the Minister of State that we need to address this funding gap.

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