James Bannon (Longford-Westmeath, Fine Gael)
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Question 470: To ask the Minister for Enterprise, Trade and Employment the position regarding investment in research and development which is central to improving management and industry for the continuous growth in industry exports and to improve the quality of business; and if he will make a statement on the matter. [34405/07]

Micheál Martin (Cork South Central, Fianna Fail)
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The current National Development Plan provides for a step-change increase in the investment in technology, innovation and scientific research. It involves a commitment of €8.2 billion which is planned for the period 2007 to 2013 and aimed at building the skills needed for a modern knowledge-based economy and strengthening Ireland's research base.

For 2008, under the Vote of my Department an amount of over €326 million has been provided for the furtherance of these objectives. The Research and Technology Vote allocation for 2008 will build on an investment of almost €290m in 2007, and represents a €37 million (or 13%) increase on 2007.

This level of investment will allow Ireland to continue to build its research base and improve competitiveness through the development of innovative products and at the same time build the knowledge base that will establish our economy as an attractive place in which to do business in the future. The level of investment involved sends a clear signal to business that this Government is supporting their efforts to develop new products, stay competitive and win new markets and thus make a contribution to providing a sustainable long-term basis for future growth in employment and incomes.

The funding of €326m for Science and Technology announced in the 2008 Budget will be used to fund basic research, to increase in-company research and development, to promote the commercialisation of research and to strengthen the collaboration between industry and the education sector. The aim of building a robust research system will be achieved by building effective collaborative between industry and third level research, helping SMEs to innovate, to stay competitive and by supporting the efforts to bring the outputs of Ireland's growing research base to the marketplace. Three State Agencies — the IDA, Enterprise Ireland and Science Foundation Ireland — are responsible for delivering the science and technology strategy to the business and research communities and their 2008 Budgets will reflect the Government's commitment to this area.

In its strategy document "Transforming Irish Industry", launched in October 2007 Enterprise Ireland set its priorities for the period 2008-2012 and among the five key priorities is "driving innovation". In delivering on its Strategy, it is continuing its work with industry, to foster R&D activity both through financial support and advisory assistance. The focus of Enterprise Ireland efforts is to enhance the level of applied research taking place on industrially relevant topics, grow links between enterprise and academia to foster mutually productive relationships and boost the commercialisation of existing and new research. A portion of this support — provided through the Innovation Management Programme — will impact directly on improving management within its client companies.

A number of new initiatives are being prepared or are already under way to encourage an R&D culture in Irish businesses. In particular over the next few months EI and IDA will launch R&D offerings to companies. These new schemes bring together, under a single heading within each agency, financial supports for company-led research projects, providing an integrated and unified approach capable of meeting company needs flexibly and efficiently.

Another new programme that will be delivered by both agencies is the Competence Centre programme. Competence Centres will be collaborative entities established and led by industry in Ireland and resourced by highly qualified researchers associated with research institutions that are empowered to undertake market focussed strategic R&D for the benefit of industry. A Competence Centre is established when a group of companies come together to define their common research interest and can demonstrate the strategic impact of a Competence Centre on their business area. My Department foresees significant expenditure on new Competence Centres, estimated to be in the range of €1m to €2m annually per centre. EI have identified a number of candidate proposals from industry, and will be making a call to third level institutes early in 2008.

A new programme introduced earlier this year was the Innovation Vouchers programme. This initiative provides €5,000 vouchers to firms which may be used to purchase specialist innovation support from a number of research providers, principally third level institutes. It is an encouragement to small and medium sized enterprises to address a current problem which needs to be confronted, and it provides a gradual introduction to the field of research for companies that may be new to this area.

Encouraging results are being achieved by both Enterprise Ireland and the IDA as a result of the R&D programmes in place to date. For example, expenditure in excess of €2m on R&D activity by Enterprise Ireland assisted companies rose from a base of 21 companies in 2003 to 42 companies in 2007. In addition, Enterprise Ireland client companies spending €100,000 or more on R&D rose from 462 in 2003, to 617 in 2007. Separately, 54 Research and Development projects were supported by the IDA in 2006, the figure for 2007 is projected at about 50 and a similar figure is expected in 2008. Also under Enterprise Ireland's Commercialisation Fund, 140 projects were approved in 2005, rising to 155 in 2006, and a similar number will be funded this year to support and develop programmes with commercial potential.