Feargal Quinn (Independent) | Oireachtas source

I welcome the Minister of State. We had the experience of working together when he was Chairman of the Oireachtas Joint Committee on Jobs, Enterprise and Innovation. I thank the Leader for finding time for this debate.

In discussing Innovation 2020 I welcome the Government's investment in this area. It is vital we make that investment to ensure we remain competitive. I cannot fail to mention that while the Government calls for businesses and individuals to innovate, when people speak about certain types of innovation and science, it backs away. Some of the controversial issues include nuclear power, genetically modified organisms and hydraulic fracturing or fracking. These may be at the cutting edge of innovation and may cut emissions or create jobs, but they are just too politically controversial and we do not seem to go there.

As Senator Hildegarde Naughton said, it is clear that we are not doing very well when it comes to patenting products. I hope the report can spur on some activity in this area. The programme calls for a strengthening of intellectual property awareness and I am interested in the form that could take. Given that the issue of patents is quite complicated, I wonder if local enterprise offices have the capacity to advise people. Does the Minister of State have any concrete measure in mind to help SMEs in this area?

We should make it easier to set up businesses in order to support entrepreneurship. One simple way to support and foster more entrepreneurship is to make it easier to set up a business. I have raised this issue so many times that people will think I have a particular hang up about it and I do. It is far too lengthy a process and costly to set up a new business in this country. For example, to start a business in Ireland takes four procedures and six days and costs €130. However, in New Zealand which ranks as the best in the world in starting a business it takes just one procedure and half a day and costs less than €100. That is very quick and it is a totally online procedure. We should follow New Zealand's example and allow for the procedure to start a business to be undertaken completely online, which involves a very low cost and takes a very short time. Making it quick and simple may help to nudge people towards starting their own business. The Government should aim at having one online procedure lasting a maximum of a couple of hours and costing a maximum of, let us say, €50 to set up a business in Ireland. If we could do this, we would be getting somewhere.

I refer to the lack of access to credit for SMEs. The programme makes no mention of crowdfunding.I am a great believer in crowdfunding, which is developing quickly, but is not mentioned in this report. The report mentions the need to ensure the availability of a comprehensive and competitive range of financial services to meet the needs of innovative enterprises. However, it totally fails to mention crowdfunding, which is a system that is growing hourly and is perhaps the most innovative way for a business to gain access to credit. Can the Minister of State give any reason for the omission of crowdfunding from the report?

I would like to see it made easier for SMEs to access research and development credit. The report states there should be more enterprises engaged in research and development investment, including enterprises in the locally traded sectors, to drive productivity performance. However, how are we to get these enterprises, particularly SMEs, to invest in research and development?

I would like to address two other areas but I am aware it will not be possible to cover them fully because of time constraints. The report states agrifood research is to be informed by consumer insights and to improve translation of research input into commercial products on the market. I hope these consumer insights do not only include national insights. I believe we have a hang-up in that regard and that we should be looking at international insights. For example, Fonterra, a New Zealand dairy co-operative is developing dairy products specifically to cater for the tastes of the Chinese consumer. I believe the fragmentation of our dairy industry is hindering us. We also have a lot more to do in terms of food innovation. It should not just be about selling Irish food products abroad. We are doing a very good job in that area but not enough. For instance, we should be developing country specific products and tailoring to them to the specific market. Of course, this would mean selling a slightly different taste in cheddar to the Chinese market, taking on board its taste. It is extremely important to listen to the consumer in the different markets. We can do something in this area.

I was interested to read in the report the request for Departments to use research to inform evidence-based policy and regulation. This is important. Perhaps staff in some Departments do not have the capacity to undertake research on policy, such as taxation which has an impact on taxpayers, but one of my main concerns relates to when the Government increases things such as the minimum wage by a nice round figure rather than basing the increase on more detailed economic research. The "latter curve" is a well known economic principle. It shows that sometimes when a government puts too much tax on a product, the tax revenue goes off a cliff. We have seen plenty of examples of that. Governments sometimes assume that if they increases the tax on something, they will automatically get extra money. However, increasing a tax often produces the opposite result and sometimes a reduction in tax produces a greater return. This message must be sold to the Department of Finance as I do not believe that principle is fully understood.

It was good to have this debate and to hear what the Minister of State had to say, despite the restrictions on time. I believe his heart is in the right place and while he may get a bigger job in the next Government, I hope he will continue with the same enthusiasm he has shown in the past. I believe that with that enthusiasm, he will be able to make the necessary changes.