Willie O'Dea (Limerick City, Fianna Fail)
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Question 145: To ask the Minister for Jobs, Enterprise and Innovation the total spend on Innovation Fund Ireland in each of the years from its foundation to 2016; and if he will make a statement on the matter. [35037/11]

Richard Bruton (Dublin North Central, Fine Gael)
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Innovation Fund Ireland (IFI) is a key pillar of support for dynamic new industries and investments through the Fund facilitate job creation in innovative export focused sectors as well as providing a return to the exchequer over time.

The Fund has up to €250 million available to make commitments. This funding runs along two parallel tracks. The first comprises a €125 million pool of funds provided by the Exchequer and managed by Enterprise Ireland. Successful applicants who receive an investment from Enterprise Ireland will have to commit to investing an equivalent amount in 'Irish companies or companies with significant Irish operations' over the lifetime of their fund. The second is for a similar amount and designed to allow Ireland's National Pensions Reserve Fund (NPRF) to make a similar level of commercial investments assuming its criteria are met.

Over the lifetime of the funds, it is envisaged that the State will make a return on its investment. In terms of economic growth where the Funds invest in Irish start-up, scaling companies or companies with operations in Ireland, the State can expect to see:

an increase in employment;

an increase in the number of high potential start-ups;

the attraction of high potential start up and scaling European technology and life science companies requiring growth capital investment to Ireland;

increased commercialisation of the ideas and R&D coming out of the Universities and Institutes of Technology and

the enhancement of Ireland as a centre for technology, life sciences and venture capital investment within Europe through multiple fund iterations.

Following the first call for expressions of interest in September 2010, a large number of responses were received from a sectorally and geographically diverse group of companies. To date the NPRF have made three investments. The first investments were in DJF Esprit and DFJ Venture Capital resulting in a partner being hired on the ground in Ireland to invest in Irish companies. The other NPRF investment is in Polaris which has resulted in the establishment of the first Dogpatch Incubator Lab outside of the United States.

The first round of commitments out of the €125m of Enterprise Ireland managed funds are expected to be to be formalised in the near term that will amount to €60m of the total EI fund. As you will be aware I issued a statement on October 5th indicating my intention to issue a second call for expressions of interest for the remaining of the fund when the first of the new Irish offices associated with these new investments is established.

Venture Capital Funds are established by way of Limited Partnership Agreements. These involve limited partners such as Enterprise Ireland committing to invest an agreed figure over the lifetime of a venture capital fund. Venture Capital Funds are normally 10 years in length and during the first 5 years (known as the investment period) the Fund managers make investments in new companies and in the latter stages of the fund they follow those investments.

The exact drawdown per year for commitments under IFI to 2016 will depend on a range of factors which will only become clear when the expressions of interest are received and examined following a second call. Therefore, the annual spend over the period is dependent on the investments made of the fund and cannot be predetermined. However, in estimating this for budget purposes, previous Enterprise Ireland drawn down figures and international benchmarks have been used and these have been factored into the EI capital allocation announced by me last week.