I am delighted to have the opportunity to address this House on the subject of science, technology and innovation, with particular reference to the report of the Science, Technology and Innovation Advisory Council, known as the Tierney report. A positive, adoptive attitude to science, technology and innovation is to my mind the single most important force for shaping long-term competitive success in indigenous industry. Science and technology is now a substantial area of public expenditure, thanks, to a significant degree, to financial transfers from the European Union as part of the present and previous Community Support Frameworks, and it is also becoming one of the most important influences on social and cultural development. Yet most of our indigenous companies are only dimly aware of the true importance of science and technology. This House, furthermore, too seldom addresses these topics — this is one of the rare occasions on which the House has entered into a full- scale debate on the issues of science, technology and innovation.
This House and our indigenous firms are not alone in underestimating the importance of STI. The absence of a public debate on the issues involved and their significance in shaping our society is partly attributable to lack of media interest. The coverage of science generally by the Irish media is poor by international standards and certainly by the standards, for example, of the "quality" British Media. No Irish newspaper has a science correspondent. RTE seems to have missed the significance of the publication of the STIAC report — the first major review of our STI capability conducted from our own resources.
On almost a weekly basis I have sought, as Minister, to intrude into public debate major issues relating to STI policy, the implications of the information society and the structure and direction of industrial development. I cannot comment on the extent of the endeavours of my predecessors but they too failed to engage the interest of the media. However, politicians need not feel too badly about this. Significant public events varying as widely as the annual North-South innovation lecture, delivered this year by Dr. Frank Car rubba, executive vice-president of Phil ips; to a packed RDS Concert Hall lecture by the British biologist, Dr. Stephen Dawkins; to an internationally prestigious conference in Limerick last week on science and technology parks, attracted virtually no media comment or analysis. Whether it is in the area of the biological or medical sciences, information technology, science, industry and the environment — in all of these areas, signs are that the public is interested and knowledgeable. We should in this House, in industry and the media take note of that.
If we examine, for example, the Community Support Framework 1994-1999, which outlines the development plan for the economy, as underwritten by EU Structural Funds, over that period we can clearly see that science and technology, or research and technological development, to give it its full European title, can be found across a range of the individual operational programmes. RTD-related activities can be found, as one might expect, in the operational programme for industrial development but are also contained in the operation programmes for agriculture, rural development and forestry, fisheries, environmental services, economic infrastructure and human resources.
In financial terms I estimate that at least £625 million will be spent on these activities in the period up to 1999. This expenditure will be funded on a tripar tite basis by the Exchequer, the EU Commission and the private sector. By far the largest spend, £406 million will take place in the research and development part of the industry operational programme so it may be worth looking at this in a little more detail. This programme follows on logically from the original science and technology programme, 1989 to 1993. This was initially oriented towards the development of an R and D infrastructure, from which firms would be capable of sourcing their technological needs. This approach prompted increased R and D spend by industry and a consequential demand for R and D assistance at the level of the individual firm.
This resulted in the launch, towards the end of that programme, of a new measure aimed at providing finance for in-company R and D. With this addition, the programme as a whole evolved to represent a balanced portfolio of actions capable of responding to broad industry — economic demand and with the ability to develop the culture of technological innovation upon which much of Ireland's future competitive advantage would depend.
The 1989 to 1993 science and technology sub-programmes provided the country with the opportunity to invest in and upgrade its R and D capability, and to introduce a new and innovative element into industrial policy. The influence of the programme has been to ensure this opportunity was grasped and the competitive position of Irish industry was enhanced.
Although industrial R and D expenditure in Ireland has risen rapidly in recent years, in the international context it is still comparatively low. Ireland's business expenditure on research and development as a share of national output, known as the BERD-GDP ratio, is well below the EU average and considerably less than countries such as Germany.
Many companies are still not fully aware of the pressing need to upgrade existing products and develop new products and processes on an ongoing basis to stay ahead in an increasingly competitive and sophisticated marketplace. This Government, therefore, believes that a sustained effort is needed to make the innovative capability of Irish firms and researchers commensurate with the scale of the competitive pressures facing Ireland in the coming decades. The new Programme for Research and Development, 1994-1999 is intended to provide the impetus to make this happen.
The central objective will be to increase the quantity and quality of R & D activity in Ireland. One of the specific targets set for the programme is to increase Business Expenditure on R & D (BERD) and STIAC has recommended a doubling of BERD by 1999. Other key impact indicators that will be monitored over the life of the programme include the number of researchers employed in industry, the number of R & D performing companies, the number with formal R & D departments and R & D intensity, as measured by the number of researchers per company.
The proactive, developmental approach of the 1989-93 programme meant that the original structure laid down would inevitably need to be revised in the light of experience.
Within the new programme, therefore, every activity has been examined and refocused into a new set of measures that are consistent and better align with the overall mission statement, which is: to support the enhancement of competitive advantage in Irish firms through ensuring the appropriate use of technology. It aims to achieve these goals through a portfolio of infrastructural, financial and skills supports attuned to the expressed and anticipated needs of Irish industry.
There are four measures, classified as follows: measure 1, Industry R & D Initiative; measure 2, Industry/Third Level Co-operation Services; measure 3, Human Resources Development; and measure 4, Research Support.
The industry R & D measure addresses an identified need for demand-led R & D in industry. The measure beings together under a single heading all financial supports for company-led R & D. By centralising R & D supports in a single measure, administered by the industrial promotion agencies, it will be possible to provide a unified approach capable of supporting the needs of Irish industry flexibly and efficiently. The measure is open to all companies regardless of size and ownership who are capable of meeting specified criteria in relation to finance and project quality.
Measure 2 — industry/third level co-operation services — comprises a number of different sub-measures or actions designed to increase the capability of industry, to improve the technological supports provided to industry and to increase third level/industry co-operation. It includes activities such as technology transfer. Forbairt technology services to industry, support for technology service centres in the regional technical colleges and the programmes in advanced technology, of which some Members will already be aware.
Measure 3 — human resource development — is designed to improve the ability of industry to manage the process of research and technological development, to enhance the interaction between higher education institutions and enterprises and to support high level researchers engaged in projects that are of direct benefit to industry. The enhancement of the capacity of the higher education sector to promote innovation and to support industry is an important policy objective.
The preceding measures are mainly demand-led and aimed at Irish industry whose competitiveness will improve through the use of technology. It is important, however, that this necessary process of targeting should not weaken the genuine spirit of innovation and the more outward looking perspective that has been adopted by progressive researchers within the higher education sector in recent years. In order, therefore, to continue to tap this vein of enterprise, measure 4 represents a single research support fund that can be flexibly deployed in support of high quality college-based research projects. Members may be aware that I announced, during the summer, a new board to administer this measure as well as extra funding for it in 1995.
The reason we are having this debate is that the establishment of STIAC, the publication of its report and the expectations surrounding the Government's response have injected new life into an age old debate about the importance of science and technology in our national development.
It is not a question of "should we do" science and technology but of "how" we do it. I would like to put a summary of the report's key issues on the record so that Deputies can focus their contributions.
The Tierney report, called after the Chairman of the Council Mr. Dan Tierney, whose enormous contribution I paid tribute to on previous occasions was published last March. It began by demonstrating the importance of science and technology for international competitiveness and then examined Ireland's position from that perspective.
The council concluded generally that innovation, based on the application of science and technology, is now the mainspring of international economic competitiveness.
The most innovative countries are also the world's economic leaders, with strong expert performance, based on high value-added products and services. In countries where STI policy has encouraged development through innovation, investment in R & D has been maintained at a high level.
For example, business expenditure on R & D in Ireland is just over 1 per cent of GDP: the average in Europe is 2 per cent, it is over 2½ per cent in the US and around 3 per cent in Japan. If that were to persist over the long-term, the consequences for our small firms, for our traditional and natural resource-based sectors where R & D has not been a priority and the prospects for our continued export growth would be very discouraging.
In more specific terms, the report points out that between 1970 and 1989, manufacturing employment in Japan increased by 4 per cent and in the US by 1.5 per cent while within the EU it decreased by 20 per cent.
This clearly indicated that those who successfully apply technology keep the benefits in jobs. Since 1970, employment in knowledge-based industry increased by over 20 per cent in OECD, contrary to the general trend in employment, indicating the job creation propensity in this sector.
The basic message, therefore, is quite clear — investment in scientific research and technological development, and its successful application into innovative high quality products and services, is vital to sustained economic growth and increased high quality employment. Furthermore, there are no old industries — only old technologies.
In looking at our international position the council divided countries into "Leaders", those who spend more than 2 per cent of their GDP on R & D, "Followers", over 1.5 per cent, "Users", 1 per cent and "Laggards" under 1 per cent. Ireland just about avoids the "Laggards" categorisation and only with the assistance of substantial European Structural Fund support.
From its examination of the international perspective, the council concluded that Ireland is not well positioned at present in respect of the new technological and market dynamics. Many countries are engaged in sustained experimentation with policies and measures to stimulate their national innovation process. Such experimentation implies a willingness to take risks and presupposes a long-term view.
The council believes that Ireland has little choice but to engage in the same process. In particular, according to the council, there is an undoubted need to increase Ireland's R & D investment, both public and business, if the substantial technology gap that exists in the indigenous sector is to be reduced.
The report states that the challenges facing all countries, not least Ireland, from the ever-increasing speed of technological development, are that: the national capability in new technologies must be expanded; there must be transfer mechanisms to integrate new technology into less advanced sectors; enterprises must invest to prepare for these changes; and innovation must be an integral part of industrial policy.
What are the issues facing Ireland if we are to successfully address these challenges? The report argues that, despite the strong macro-economic performance of the economy, there are still some fundamental weaknesses and, of course, unemployment remains unacceptably high. At the same time, societal needs and expectations for improvements in education, health care and public services are no less than in other, more wealthy countries.
In the enterprise sector, overseas companies, which account for three quarters of manufacturing exports, are only weakly linked to the domestic economy. Indigenous industry is highly fragmented and, in general, of small scale. In a number of measurements the foreign sector is strikingly superior to its indigenous counterpart.
It is: more advanced on the path to a globalised market; twice as skilled in terms of technical and administrative personnel; twice as committed to R & D; and twice as productive on average. The unrelenting globalisation of markets, through the EU Single Market, bilateral deals between the superpowers and the new GATT round of trade agreements is an economic fact to which all Irish companies, whether foreignowned or indigenous, must face up.
The report shows that the globalisation trend is being hastened by developments in information technologies, leading to the information super-highway. Countries with the appropriate technological infrastructure to participate in such developments will be able to benefit from the globalisation of education, research, commerce, trade, banking and other services. Ireland needs to be fully supported by the most comprehensive and advanced networking facilities available.
It is against that background that we must be concerned that some 80 per cent of Irish companies would be regarded as having a "nil" or "minimum" technology capability — that is, perhaps, no specialist technology personnel, perceiving no need for technological capability or requiring support in sourcing technology from external sources.
This concern for the innovation capability and thus the long-term survival and growth prospects, of Irish firms has been reflected in every major report on industrial development, since the 1960s, including the most recent Culliton report. The matter has also been treated in specific reports on science and technology policy in the 1960s, 1970s and 1980s, the latter two carried out by the OECD.
The report says that some countries and companies have been more successful than others in adapting to and capitalising on the many changes and opportunities arising internationally.
The key to such success is the acceptance and effectiveness of the national system of innovation. This is defined as "the collection of all institutions and the mechanisms — public and private— that interact to stimulate and support innovations in products and systems within the national economy".
The interaction, inter-linkage, policies and incentives that enable these elements to operate coherently are vital. Equally important are the factors that influence the environment for innovation — education and training, technical culture, public and political awareness, availability of finance and, particularly, international sources of science, research and technological innovation.
The Council argues that the lack of an integrated national system of innovation and the fluctuations in Government commitment to science and technology over previous decades have been at the heart of the reason there is not a better appreciation of science, technology and innovation and of the culture of technological innovation in Ireland. The Government must recognise and promote a long-term investment strategy to build up the elements of the system of innovation.
Looking more closely at the main components of the system of innovation, the Council argues that, within the business sector there is a need to increase industrial involvement in research and development and innovation and to move business expenditure on it towards European average levels. There remains a negative attitude to entrepreneurship, risk-taking and innovation in many aspects of Irish economic life. There is a low concentration of scientists and engineers in industry. There is an unsatisfactory level of new company start-ups and an overly strong EU dependency, particularly on the funding side, throughout the national science and technology effort.
The State's direct role is to provide a balanced programme of applied research and development, strategic R & D in the important generic technologies, such an biotechnology, and to look to the future technology needs of the economy by providing assistance in "foresight" of emerging critical technologies. The range of public research institutes in Ireland has always been limited by comparison with other countries where such capability is provided by the State. They must have a critical competence, be it in areas of special national importance and give value for money in terms of contributing to their self-sufficiency, transmitting technology to the workplace etc.
The Council describes the third level sector as the vital source of people and capability in the generation and transfer of research and innovation skills into society. Basic research provides the essential underpinning for applied research and technological development and, according to the Council, we cannot achieve an innovative environment without access to the new knowledge and understanding provided by basic research. However, we must ensure also that we make maximum use of this knowledge. The Council goes on to say that the role of such research has not been appreciated in Ireland and that funding has been largely inadequate.
The Council also points out that there is a need for better interaction between industry and third level colleges to exploit research for the benefit of the country. Industry must provide a stronger "pull" effect by making greater use of the expertise in the colleges. In turn, the third level sector must provide a "science push" effect and achieve greater application of its knowledge to address industrial and societal needs. The Government must act as broker in creating this greater interaction. While the Tierney report made many recommendations on individual and specific aspects of our science and technology system, it addressed what I regard as two fundamental pillars which are needed to underpin our long-term strategy in this regard.
First, it recommended that we organise our national science and technology effort in a way which will allow us to take a comprehensive and long-term view of our needs, priorities and where we should concentrate our money. Second, but no less importantly, it addressed the issue of the understanding and appreciation of science and technology. In my period so far, as Minister for Commerce, Science and Technology, one fact has impressed itself very strongly on me — science, technology and innovation, for the public at large with the exception of the truly converted, has a huge capacity to turn people off.
I believe that the legacy of the Tierney report will be its lasting contribution to the debate on the value of investment in science and technology for a small country such as Ireland. I have attended a number of seminars organised by private interest groups and I have participated in debates in both Houses and at the EU Affairs Committee. The debate must continue, the debate must be widened, the debate must be public, the debate must give rise to questions, and it must provide answers. No interest is immune, whether big or small industry, Heads of Universities or PhD researchers, primary school teachers, newspapers and television, State agencies, civil servants or politicians. Journalists and the media, of course, have a critical role to play, with the potential for the most direct and immediate influence on the public and, therefore, on our public representatives.
I do not accept that it is impossible to turn a scientific article into a piece of popular journalism. I do not believe that we have to write every science article as if it were the most grave and serious matter of earth-shattering importance. It permeates every facet of our daily lives, for example: the application of microwave technology is a fairly recent development; now you can buy a microwave cooker for less than £100; microprocessors, often thought of as the preserve of high tech computer and communication companies, run our domestic washing machines; and laser beams used to be "STAR TREK" material; now they tell us our weekly supermarket bill.
On the subject of popularising and "demystifying" the subject, somebody recently showed me a copy of a magazine distributed free by a number of Dublin pubs, intended to keep the solitary drinker from staring forlornly into his pint. The magazine contained two pages of science snippets, culled from the international media, on scientific breakthroughs with potential practical application. They were written in a style which aroused your interest and held your attention.
Is it too much to ask that Irish scientists, industry, journalists and people in public life should follow that example on local research topics? It is a feature of other topics and professions. The weather forecast is a highly technical subject but, because the man in the street needs to know if it will be wet or dry, the technicalities are expressed in intelligible terms. Accountancy and medicine are complex professions but the lay person demands to know in simple terms whether his pocket or his health will suffer and the practitioners respond.
Lest it be thought I am taking an unfair swipe at the scientific community, politicians also stand indicted of forever speaking some kind of parliamentary gobbledegook, and civil servants for long took pride in writing in their own "officialese" and for ignoring the exhortations in Sir Earnest Gower's Plain Words to write and communicate effectively and simply. I say this not to cause offence. The point I wish to make is simple. Scientists do not suffer from a peculiar impediment of communication. Each profession, group, or band of fellow travellers develops its own specialist vocabulary — jargon to improve precision of ideas exchanges between themselves.
However, in this age of mass competition for public support we need to be able to broadly convince the general body of people and carry them with us. By and large the groups who can best do this will best succeed in getting what they want. Most business schools recognise the importance of communication and include modules in "executive communications". Even politicians have been known to take private grinds at the Bunny Carr self-improvement school. There is a role for all of us in promoting the image and status of science and we must tackle this by a variety of means and on a broad front. Some efforts will of course be more successful than others. For my part and following the Tierney report, I have asked Forfás to prepare a three year awareness campaign, aimed essentially at policy makers and decision makers in the public and private sectors. As the Tierney report pointed out, there is an onus on the many organisations connected with science and technology to play their part in its promotion. Some already do — some could do more.
My office has in the past given modest short-term support to the industry lobby on research and development to help it to get off the ground and in turn to promote the need for more research and development investment in the business sector. It is vital for researchers at the work bench to have their own independent voice just as the voice of industry must be heard. To that end I was delighted to be able to announce recently that my office, with Forbairt and Forfás, agreed to sponsor funding for a three year period, to assist the Irish Research Scientists' Association in becoming a full-time association with proper back-up facilities. A cynic might ask why are we creating a stick with which to beat ourselves.
However, I stress that, like science and technology generally, promotion and awareness is not a case of throwing large sums of money at the problem. It is for all involved to ensure a continuous and widening public debate on the issues to bring about a shared appreciation of the role of science and technology as the long-term solution to our economic and social progress. This idea of a nationally shared appreciation should not be underestimated.
A significant outcome of the STIAC process was the consensus achieved on the role and contribution of the variety of players and activities in what has become termed the national system of innovation. Employers and employees, big business and small, high tech and low tech, academic and researcher, public and private came together to form a comprehensive and consensus picture of science and technology and how the pieces fit together. I do not say this as criticism but simply to reinforce my point that we all have to grasp at every opportunity to strengthen the role of Science and Technology in society and to overcome cultural divisions. Selling the message is what I want to do today and there are encouraging signs. The recently published Forfás survey on business research and development expenditure shows an average growth rate of over 17 per cent per annum between 1989 and 1993. That is partly because of the expertise and incentives available but it also comes about because of the growing reality in firms that they will only grow and maintain market shares where they are "up to speed" or leading the field in terms of their technological and innovation abilities.
The vision put forward by the STIAC report is that we must take the innovation road which will lead to economic prosperity, market leadership, value added exports, high quality jobs and all the economic spin-offs which that implies. The report of itself, or its vast number of recommendations, may not represent the total solution, but most importantly it defines the direction to that solution. Nobody pretends that the task will be easy or that we will be showered with instant success. Most people recognise that to change attitudes towards research — indeed change and promote the research culture itself — we must embark on a process of continuous change and advance, rather than think in terms of a "big bang" approach.
Where does the Tierney report go from here? After publication of the report, and with Government support, I appointed a task force to examine the recommendations and to report on their implementability or otherwise. The Task Force is chaired by Mr. John Travers, Chief Executive of Forfás. It includes representatives of Departments active in the science and technology field and also includes Dan Tierney and Professor Dervilla Donnelly who were on the original council. The Tierney report included a large number of recommendations covering a variety of topics some having specific price tags and others dealing with institutional arrangements for ensuring the Government can develop coherent strategies for deploying State funding on science and technology across the range of Government Departments, agencies and programmes. Some of these recommendations, which deal with tax breaks for research and development, were included in this year's Finance Act.
The Travers task force has now, I understand, just completed its examination of the individual recommendations and is in the process of drafting a report on its work. The task force is overseen and guided by a Cabinet subcommittee which I chaired and which includes my Government colleagues the Minister for Finance, the Minister for Agriculture, Food and Forestry and the Minister for Education. It is my intention that when the Cabinet Committee has taken its decisions based on the task force report I will bring the matter to Cabinet and I expect to publish the Government response to STIAC early in 1996. I look forward to the support of all sides of the House in pursuing this work which is of crucial importance to the long-term development of the nation and in that regard I look forward to further debate in this House as we proceed.
