Simon Coveney (Cork South Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The Government recognises the need for sustained funding for programmes aimed at driving innovation within Irish-based firms, building exports and creating jobs. Funding to support industry investment in innovation is essential to maintain an enterprising and productive economy. This innovation is core to creating and maintaining high-value jobs, helping to attract investment and develop business in Ireland.

Investment in research, development and innovation (RD&I) by our indigenous companies is critical to ensuring that we have a strong competitive economy which translates into improved job creation and enterprise performance. Companies which invest in RD&I often achieve greater levels of growth, delivery and drive societal benefits, and produce solutions to global challenges such as climate change, sustainability and digital transformation, as well as the creation and maintenance of high-value jobs.

Over 25 years, Ireland has gone from a base of 800 RD&I active firms with a research spend of €300 million to almost 1,800 RD&I active enterprises spending of €3.88 billion in 2021. Enterprises in Ireland reported a 19% increase in research and development (R&D) expenditure to €3.88 billion in 2021, compared to €3.26 billion in 2019. Labour costs accounted for the largest proportion of R&D expenditure, rising to €2.05 billion in 2021 from €1.7 billion in 2019. This reflected a growth in employment of R&D staff to 32,961 in 2021 from 27,755 in 2019.

Irish-owned enterprises reported a 22% increase in R&D spend between 2019 and 2021, up from €963 million to €1.18 billion. In 2021, there were 32,961 persons engaged in R&D in Ireland. Of this total, 50.8%, or 16,739 persons, were employed as researchers, of which 2,491 were PhD qualified researchers. In addition, there were 8,690 (26.4%) technicians and 7,532 (22.9%) support staff.

The number of R&D personnel engaged in small enterprises in 2021 was 9,338, accounting for 28.3% of all R&D personnel. Medium enterprises had 8,659 persons engaged, accounting for 26.3% of all R&D personnel, compared with 14,964 persons or 45.4% of R&D personnel engaged in large enterprises.

From Eurostat’s R&D intensity rate survey in 2019, Ireland ranked 13th in the EU 27. Ireland is also identified as a ‘Strong Innovator’ in the European Commission’s European Innovation Scoreboard for 2022. This underlies the need for sustained and ambitious RD&I investment programmes that my Department and its agencies are rolling out to deepen innovation capability across the enterprise sector, in particular the innovation performance of our SMEs.

The policy framework set up by my Department supports a key role for innovation and SMEs in economic policy. The Enterprise White Paper, published in December 2022, provides a fresh impetus for progress in indigenous job creation. It sets a vision for enterprise to succeed through competitive advantage founded on sustainability, innovation and productivity, as well as delivering rewarding jobs and livelihoods.

To this end, the Enterprise White Paper will step up enterprise innovation with ambitious targets, including achieving a doubling of business expenditure on research and development (BERD) and a doubling of the number of High-Potential Start-Ups (HPSUs) from research. To maintain and build on Ireland as a strong innovator, core enterprise innovation initiatives for 2023-2024 will bolster in-house research, development and innovation activity, industry-academic collaboration, research commercialisation and deliver an increased number of spin-outs. We will also work to ensure the range of advisory and financial supports offered, including the new measures being introduced as part of the European Regional Development Fund (ERDF) funding programmes, are targeted and optimised to best help businesses at every stage of their innovation journey.

My Department published the National Smart Specialisation Strategy for Innovation in June 2022. Its overall objective is to ensure that Ireland’s innovation ecosystem at national and regional level is fit for purpose, particularly given our strategic priorities around the twin digital and green transition, as well as the need to address regional economic imbalances. Smart specialisation will be deployed to address ecosystem gaps and improve performance across all regions, building on place-based strengths. The strategy is focused on driving growth based sectoral strengths and emerging opportunity areas. It is also central to ensuring effective connections between the Regional Enterprise Plans, national level innovation policy implementation and the Regional Assemblies.

Smart Specialisation is supported by almost €400 million in ERDF plus national co-funding over the period 2022 to 2027, aimed at scaling the existing network of national R&D facilities and clusters, as well as increasing the intensity of business R&D across all regions through strengthening industry-academic collaborations. This includes strengthening the technological universities capacity to help with research and technology transfers between SMEs and higher education institutions.

The implementation of smart specialisation on a cross-departmental and cross-agency basis will ensure policy alignment across national and regional enterprise development initiatives, including through Regional Enterprise Plans and the forthcoming national clustering programme, along with activating international collaborative opportunities on regional enterprise innovation, including through EU initiatives such as Regional Innovation Valleys.

Enterprise Ireland (EI) plays a particularly important role in supporting indigenous job creation in Ireland. In 2022, EI created 19,660 new jobs, growing net employment by 5%. Support for innovation and technology through investment in RD&I played a crucial role in delivering this result. To this end, EI’s RD&I programme budget was increased to €136 million for 2023. Up to €132 million will be spent by EI on RD&I activities such as direct firm level R&D grants and equity; collaborative measures such as Innovation Vouchers, Innovation Partnerships and commercialisation of research. In addition, my Department is supporting the establishment of four new European Digital Innovation Hubs with an allocation of €27 million until 2026. The hubs have been designated by the European Commission as part of a European wide network to act as one-stop-shops for SMEs to strengthen their digital capabilities.

My Department has secured additional funding for research development and innovation of €117 million over the seven years of the ERDF. EI, working with my Department and the Managing Authorities, is using the ERDF funding for the following three innovation programmes -

• Knowledge Transfer Boost programme – to bridge the knowledge transfer gap between industry and academia by funding Tech Transfer specialists in the university system across Ireland.
• Technology Gateways programme – to provide each Technological University (TU) with an industry gateway. It will provide dedicated staff to work with industry to articulate company problems in a manner that can be addressed by the expertise in each TU.
• Innovators’ Initiative programme - to build on existing international and national best practice in immersive-based, needs-led innovation training programmes connecting with industry sector clusters in a particular region.

On 30 May, I announced the successful 17 applications for the Technology Gateway Programme. Calls issued for the other two programmes, Knowledge Transfer Boost and the Innovators’ Initiative, in February this year and the applications are currently being assessed.

Other supports available include the Disruptive Technologies Innovation Fund (DTIF), which is a €500 million challenge-based fund established under Project Ireland 2040 and set up under the National Development Plan (NDP) 2018-2027 for investment in the development and deployment of disruptive technologies and applications on a commercial basis. DTIF encourages enterprises in Ireland to collaborate and exploit the business opportunities associated with disruptive technologies by de-risking projects; build on research undertaken to support the delivery and exploitation of new technology-based solutions from that research; and foster deeper and wider RD&I collaborations between the public and private sectors in key technology areas. This year, and through to 2027, competitive call No. 6 seeks applications from innovative consortia with projects across six national research priority areas. Applications are encouraged for projects which complement the priority areas set out in the White Paper on Enterprise, including digital transformation and integrating decarbonisation and net zero commitments.

Simon Coveney (Cork South Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

My Department working with IDA Ireland, Enterprise Ireland and the Local Enterprise Offices (LEOs), continues to focus on promoting, encouraging and supporting investment from the FDI and indigenous sectors to support job creation.

Government support assists in creating and maintaining high-value jobs and develop business in Ireland. Currently, there are a variety of supports and grants available to all enterprises under a variety of headings, including innovation and technology as identified by the Deputy, with a particular emphasis on sustainability and digitalisation. Such grants are administered by IDA Ireland, Enterprise Ireland and the LEOs under my Department's remit.

The White Paper on Enterprise, published in December last year, outlines the Government’s approach to enterprise policy for the period to 2030. Key targets within the White Paper include maintaining full employment and growing the number of export firms as well as increasing expenditure levels of foreign-owned firms here in Ireland. Advancing Ireland’s FDI and trade value proposition and strengthening the Irish-owned exporting sector are two of the seven priority objectives for enterprise policy identified in the White Paper.

IDA’s strategy “Driving Recovery & Sustainable Growth” 2021-2024 is aligned to the White Paper and is focused on identifying growth opportunities and partnering with existing clients on transformative investments in RD&I, talent development, sustainability and to increase the productivity of Irish operations and their workforce.

The strong annual results for 2022 reported by IDA Ireland illustrates the country’s continued attractiveness to FDI, with 242 investments won over the course of the year. The results also reaffirmed the scale of the impact of the multinational companies (MNCs) operating in Ireland today. In 2022 IDA reached a record number employed in their client companies totalling 301,475.

Enterprise Ireland works to accelerate the development of world-class Irish companies to achieve leading positions in global markets. The agency will continue to help foster an environment that nurtures entrepreneurship, supports the sustainable growth of Irish-owned firms while increasing and diversifying our exports feeding directly in to job creation.

Enterprise Ireland companies now employ 218,178 people with 68% of these jobs outside Dublin. Enterprise Ireland client companies enjoyed strong employment growth in 2022 and the second highest increase in net jobs created by their client companies in a single year at 10,841. There was strong regional growth with 64% of new jobs created outside of Dublin.

The LEOs continue to help smaller prospective exporters to develop the required capacities to enter new markets and to increase job creation. In 2022, the LEOs supported companies who created 7,870 new jobs resulting in a net employment gain of 3,447 for the year. The LEOs client-companies now provide 37,863 jobs.

My Department continually engages with Enterprise Ireland, the IDA and the LEOs to ensure that the appropriate suites of support are in place to support our indigenous enterprises and our FDI companies in this time of transformation to enable them to continue to grow our employment.

Simon Coveney (Cork South Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Employment in the manufacturing sector in Ireland has increased from 280,500 jobs in Q1 2022 to 292,400 jobs in Q1 2023, an increase of 11,900 jobs (+4.2%) and all of these additional jobs were located outside Dublin.

Table 1: Number of employed persons (ILO) aged 15 - 89 years in NACE Rev.2 Economic Sector C (Manufacturing) and by NUTS3 regions, Q1 2022 and Q1 2023, 000s

			'000
	Q1 2022	Q1 2023	Change Q1 2022 to Q1 2023
Border	20.7	24.4	3.7 (17.9%)
West	37.9	39.7	1.8 (4.7%)
Mid-West	34.3	40.2	5.9 (17.2%)
South-East	25.4	28.1	2.7 (10.6%)
South-West	53.6	49.2	-4.4 (-8.2%)
Dublin	52.4	48.9	-3.5 (-6.7%)
Mid-East	36.3	42.7	6.4 (17.6%)
Midland	19.9	19.3	-0.6 (-3.0%)
State	280.5	292.4	11.9 (4.2%)

Source: Labour Force Survey (LFS), Central Statistics Office, Ireland.

The Irish manufacturing sector has performed strongly and has successfully weathered a number of shocks in recent years including Brexit, COVID-19, and the disruption caused by Russia’s invasion of Ukraine. Irish exports continue to perform well with goods exports increasing 25.8% in 2022.

Building on this strong performance and improving Ireland’s competitiveness position is a key economic priority for Government. As a small, open economy, Ireland is particularly vulnerable to external shocks. Consequently, we continuously strive for improvement, so that we remain a highly competitive economy.

As part of Project Ireland 2040, the National Development Plan sets out the Government’s over-arching investment strategy and budget for the period 2021-2030. It is an ambitious plan with significant public investment across all sectors and regions of Ireland which will improve our resilience to future economic shocks.

As part of the National Development Plan, the Government has committed to an investment package of €165 billion over the years 2021-2030. In Budget 2023, the Government provided €12.4 billion for capital spending on vital infrastructure which will help reduce supply-side bottlenecks and boost the productive capacity of the economy. This will see continued growth in investment across housing, health, and transport, as well as a major step-up in climate related investment.

The recently published White Paper on Enterprise recognises in particular two major global transformations that are currently underway: the move towards a climate-neutral society by 2050, with net-zero greenhouse gas emissions; and the digitalisation of the economy. Government will work to support businesses in the manufacturing and services sector in reducing their reliance on fossil fuels and improve their energy efficiency in the coming years through a range of initiatives, including grants and loans. While the transition to a net zero economy will not be easy, it also presents incredible opportunities for Ireland, specifically in the area of renewable energy production. Policy will also ensure Ireland is at the forefront of the digital manufacturing, managing and coordinating resources to deliver on the aspiration of the 2020 Industry 4.0 Strategy to become a world leading hub at the frontier of Advanced Manufacturing.

The changing global environment requires a flexible, agile approach, and our FDI policy will evolve to take advantage of the new opportunities this transformation will bring, whilst also providing continuity as an investment destination. We will ensure our domestic manufacturing and services sectors are supported in terms of resiliency and opportunity to grow and scale. We will focus our efforts on developing an integrated system wide approach to create an ecosystem that accelerates start-up growth and scaling, that includes access to finance; investments in R&D and innovation; access to skills; and an appropriate regulatory environment as well as a tax system that encourages investment in start-ups and scaling.

The steps taken by the Government in recent months along with the measures outlined in the Government’s National Development Plan and White Paper on Enterprise 2022-2030 means we can be optimistic about maintaining and improving the competitiveness of the Irish economy in the long term.

Simon Coveney (Cork South Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Employment in the services sector in Ireland has increased from 1.920 million in Q1 2022 to 2.011 million in Q1 2023, an increase of 90,900 jobs (+4.7%) and 63,500 of these jobs were located outside Dublin.

Table 1: Number of employed persons (ILO) aged 15 - 89 years in NACE Rev.2 Economic Sector G-U (Services) and by NUTS3 regions, Q1 2022 and Q1 2023, 000s

			'000
	Q1 2022	Q1 2023	Change Q1 2022 to Q1 2023
Border	137.1	144.0	+6.9 (+5.0%)
West	161.6	176.4	+14.8 (+9.2%)
Mid-West	162.3	167.2	+4.9 (+3.0%)
South-East	149.0	154.3	+5.3 (+3.6%)
South-West	264.9	274.2	+9.3 (+3.5%)
Dublin	658.8	686.2	+27.4 (+4.2%)
Mid-East	280.0	296.5	+16.5 (+5.9%)
Midland	106.4	112.3	+5.9 (+5.5%)
State	1,920.2	2,011.1	+90.9 (+4.7%)

Source: Labour Force Survey (LFS), Central Statistics Office, Ireland.

The Irish services sector has performed strongly and has successfully weathered a number of shocks in recent years including Brexit, COVID-19, and the disruption caused by Russia’s invasion of Ukraine.

Building on this strong performance and improving Ireland’s competitiveness position is a key economic priority for Government. As a small, open economy, Ireland is particularly vulnerable to external shocks. Consequently, we continuously strive for improvement, so that we remain a highly competitive economy.

As part of Project Ireland 2040, the National Development Plan sets out the Government’s over-arching investment strategy and budget for the period 2021-2030. It is an ambitious plan with significant public investment across all sectors and regions of Ireland which will improve our resilience to future economic shocks.

As part of the National Development Plan, the Government has committed to an investment package of €165 billion over the years 2021-2030. In Budget 2023, the Government provided €12.4 billion for capital spending on vital infrastructure which will help reduce supply-side bottlenecks and boost the productive capacity of the economy. This will see continued growth in investment across housing, health, and transport, as well as a major step-up in climate related investment.

The recently published White Paper on Enterprise recognises in particular two major global transformations that are currently underway: the move towards a climate-neutral society by 2050, with net-zero greenhouse gas emissions; and the digitalisation of the economy. Government will work to support businesses in the manufacturing and services sector in reducing their reliance on fossil fuels and improve their energy efficiency in the coming years through a range of initiatives, including grants and loans.

The changing global environment requires a flexible, agile approach, and our FDI policy will evolve to take advantage of the new opportunities this transformation will bring, whilst also providing continuity as an investment destination. We will ensure our domestic manufacturing and services sectors are supported in terms of resiliency and opportunity to grow and scale. We will focus our efforts on developing an integrated system wide approach to create an ecosystem that accelerates start-up growth and scaling, that includes access to finance; investments in R&D and innovation; access to skills; and an appropriate regulatory environment as well as a tax system that encourages investment in start-ups and scaling.

The steps taken by the Government in recent months along with the measures outlined in the Government’s National Development Plan and White Paper on Enterprise 2022-2030 means we can be optimistic about maintaining and improving the competitiveness of the Irish economy in the long term.