Other Questions.

Industrial Disputes.

Thomas P. Broughan


144 Mr. Broughan asked the Minister for Enterprise, Trade and Employment the position regarding the investigation by the labour inspectorate into allegations of serious irregularities in the treatment of employees of the Turkish company, Gama, which has been operating here; if all workers have now been given access to money held in accounts in a bank in Holland; if the Garda has been requested to conduct an investigation into allegations that money had been diverted into accounts to which the workers previously had no access; and if he will make a statement on the matter. [25420/05]

Allegations of non-compliance with labour legislation in respect of a major construction firm were raised in this House on 8 February last by Deputy Joe Higgins. Those allegations were that certain non-national construction workers were required to work excessive hours and that such workers were in receipt of pay of between €2 and €3 per hour in contravention of the statutory minimums applicable.

The labour inspectorate of my Department undertook an investigation of these allegations. That investigation was completed within six weeks and required the exclusive attention of three labour inspectors under the direction of two senior members of staff. A report on the investigation was prepared and circulated to relevant parties, including the construction firm involved. Subsequently, the Department was informed that the firm proposed seeking a judicial review with regard to the investigation and inspector's report.

At an interlocutory hearing a judgment was given whereby the Department was restrained from publication of the inspector's report but permitted to forward the document to relevant prosecutorial bodies. On foot of this outcome, a copy of the inspector's report was sent to the Department of Social and Family Affairs, the Revenue Commissioners, the Office of the Director of Public Prosecutions, the Competition Authority, the Office of the Director of Corporate Enforcement and the Garda Commissioner.

The inspector's report was quashed in the judgment that followed the full High Court hearing of the case. That decision is being appealed to the Supreme Court. I am unable, accordingly, to elaborate any further on the content of the inspector's report or offer any observations on the actions that the prosecutorial bodies mentioned may be considering.

I was concerned that all Turkish workers would have access to the money that had been transferred to their bank accounts in Finansbank in Amsterdam. To that end, I and my officials met senior management from Gama Turkey and Gama Ireland, the legal advisers to Gama Turkey, and a human resources consultant retained by Gama. At that meeting I was assured by these senior managers, their legal adviser and the human resources consultant that all Gama workers in Ireland, past and present, would have full access to the money that had been transferred to their bank accounts in Finansbank.

I contacted the President of Finansbank. He assured me that, provided the consent of the workers was forthcoming, his bank would co-operate in ensuring that my officials would have sight of relevant bank records in his bank so that they could be satisfied that all workers would have access to the money in their bank accounts. Officials from my Department travelled to Finansbank on 14 April last. Following these meetings and contacts which my officials had with SIPTU and Deputy Joe Higgins, I am satisfied that a substantial number of Turkish workers who were in Ireland around last April received value for the funds that had been transferred to their personal bank accounts in Finansbank.

On 29 April, my Department sought in writing certain details on each current and former Gama employee, including the money transferred to Finansbank and the money transferred from Finansbank to their personal bank account in Isbank in Turkey. Despite reminders, this information has not been supplied to date. Accordingly, I cannot assure the Deputy that all Gama workers in Ireland, both past and present, have received value for the amounts that were transferred into their personal accounts in Finansbank.

In the meantime, there have been ongoing contacts between officials of my Department and the company. Matters were brought before the Labour Relations Commission and then the Labour Court. Arising from these actions, substantial transfers of money were secured for workers in lieu of overtime worked. In addition, certain professional Gama workers, in respect of whom transfers were not made into Dutch bank accounts, were also awarded sums of money by the Labour Court. Many of these Turkish workers have now returned home.

I thank the Minister for the fairly comprehensive response. First, will he indicate if he has worked out the exact statutory entitlement of each Gama worker so that when he hears from Finansbank in due course, he will be able to validate that each of them has received the full entitlement?

Second, have the tendering procedures that allowed this breach of law to occur been tightened up subsequent to the revelations relating to this issue? Are new tendering procedures for public contracts now in place?

Third, given that three labour inspectors worked full-time on the case for the duration of the investigation, we now have just 16.5 manpower equivalent people involved in labour inspection in Ireland, which is the equivalent of one inspector per 117,000 workers. Is that the current position and, if so, does the Minister agree it is unacceptable?

In regard to the details pertaining to each worker, our officials, in particular our labour inspectors, worked hard to secure as many personal details as possible about each worker. They contacted SIPTU and Deputy Joe Higgins for names and so on. We also worked out formulae regarding workers' entitlements for previous and current work and overtime. The overtime issue was ultimately dealt with by the Labour Court. We had further meetings with SIPTU and the indications are that the retrospective element is no longer an issue. We used the recognised REA rate, which the company is legally obliged to pay.

I can only refer to the tendering procedures in general. When people or companies tender, one expects the information contained in the tender to be truthful and transparent.

With full compliance with our labour law as part of the contract.

We cannot attempt to prejudice a tender on notions we have based on experience or occurrences. I do not control the tendering process. Companies present the REA rates and so on as part of the tender submission. The key issue is that, on winning a contract, the company should do what the tender document says. Trust and observance of the law are also important issues in this regard.

With regard to the labour inspectorate, the current staff levels are not acceptable going forward and I sanctioned an additional ten posts. We are drafting proposals for a medium-term expansion of the inspectorate.

To how many?

I will not outline specifics. We are working on proposals. We want to recruit the additional ten inspectors and the recruitment and training process is almost complete. The intention is to concentrate on the issue of migrant labour.

Does the Minister accept there is a perception that rogue companies such as Gama and Irish Ferries can trample all over the rights of workers and that the Government is particularly weak in tackling such companies?

We could not be described as weak regarding how we tackled the Gama issue. I do not say I subscribe to the Deputy's terminology regarding the companies as I do not want to be found in breach of a court order.

It is patently true anyway.

When the Gama issue was presented to us, we acted resolutely. Up to €25 million was returned to the bank accounts of workers, which is a substantial amount by any benchmark. The recognised rate increased significantly and the blockage regarding the recognised agreed rate of pay in the construction sector caused by one union objecting to the modus operandi was substantially addressed. We achieved a good result in that case.


Deputy Joe Higgins and others deserve credit for that.

Departmental Bodies.

John Gormley


145 Mr. Gormley asked the Minister for Enterprise, Trade and Employment the measures he has taken to implement the recommendations made in the enterprise strategy group report. [25502/05]

The past decade saw the most rapid and sustained economic growth in the history of the State. In a short period, this has provided levels of prosperity in every region that would have been considered by earlier policymakers as impossible.

As a small open economy we have few defences against the powerful changes taking place in international trade and business. Nationally we have an enthusiasm to maintain our increased prosperity and there is recognition among the international business community that we are committed to doing so. Within Government, I have a commitment to ensure the environment for doing business in and from Ireland provides the right balance of entrepreneurial incentives and policy architecture to help enterprise expand and prosper. The enterprise strategy group's report matches these objectives and presents a package of policy adjustments to keep our economy vibrant and competitive. The group's recommendations do not propose an abrupt transformation of domestic enterprise, rather they seek to substantially enhance our existing enterprise base by strengthening existing policies and by identifying important capability gaps. Implementing the group's report must be seen in an important international context. Ireland faces a number of strategic issues in maintaining and expanding the higher living standards, growth and employment levels achieved over the past decade. Among these are increasingly intensive competition for markets and mobile investment due to globalisation.

The accelerating pace of global change including structural changes being felt across the enlarged European Union, is driving unprecedented changes in the way business is transacted around the world. The enterprise strategy group's report gives us the analysis and context in which to reorient and reinvigorate enterprise policies and the associated institutional arrangements to implement them.

The report is a valuable contribution to embedding strategies and change appropriate to the new realities and challenges facing the Irish economy. I have mandated and agreed many changes that substantially advance the enterprise strategy group's implementation process.

I will briefly summarise the early and substantial progress to date. The enterprise strategy group recognised a new and important relevance for indigenous enterprise in transforming our economy into one based on innovation and knowledge. Consequently, significant changes have taken place at Enterprise Ireland to transform its professionalism and engagement with small and medium-sized enterprises.

The agency has restructured how it delivers assistance to clients, taking into account the enterprise strategy group's recommendations, and a few months ago I launched its strategy for transforming Irish industry. This strategy contains notable changes that are also aligned with the enterprise strategy group's proposals. For example, Enterprise Ireland has radically reorganised its services to exporters and a new internal organisational structure has been put in place to reflect this. This is an important first step in helping Irish companies internationalise their business.

The enterprise strategy group pointed to shortcomings in marketing capability and this is being addressed by Enterprise Ireland and FÁS in a joint pilot programme to develop increased levels of sales and marketing talent within Irish companies that I announced on 24 August. The enterprise strategy group also referred to the importance of management capabilities in Irish firms. Human resources are already a core component of Enterprise Ireland's business development model in that the agency adopts a holistic approach to business development, which covers key business functions. As part of Enterprise Ireland's restructuring a client-management development and mentoring division has been set up to focus on addressing this recommendation.

Additional information not given on the floor of the House.

The following are some examples of our planned and measured approach to the process of addressing each of the enterprise strategy group recommendations and linking them with specific performance targets to help later evaluation of success and progress. Last week I announced our initial response to the enterprise strategy group's one step up proposal.

Last week's launch also featured "open day" at the Royal Hospital where workers seeking to improve their skills could see the full range of available training programmes and education courses. The one step up initiative gives workers the opportunity to acquire new skills and competencies. This will allow them to perform higher, added-value tasks, be able to bring new knowledge to their work and not be left behind as the economy evolves into more specialised activities.

The enterprise strategy group made some important recommendations about innovation and research and development. In this regard funding for Science Foundation Ireland is critical and has been assured until 2009. Furthermore, Enterprise Ireland has established a new support structure for technology development. Groups of technologists now assist client companies in the development of strategic technology innovation, which will result in the smooth introduction of new processes and in bringing new products and services to market.

The Government has also appointed a chief science adviser and last year we published our action plan for promoting investment in research and development to 2010. The enterprise strategy group recognised that without more market relevant research and development the future of many companies here is at best uncertain. My Department is working on the strategic implementation plan that will tell us the best way to implement the research and development action plan. This will take into account many of the enterprise strategy group's science and innovation related policy suggestions.

In the main part of his answer the Minister looked backwards saying, correctly, how well we have done over the past ten years. He notes that the enterprise strategy group suggests that we need to change things slightly and gradually. That was the tone in which I understood him to respond. I need to read the full response later.

I could not disagree more with him. There is a range of strategic issues which, if the Minister were to look forward rather than backward, he would see require us to make urgent changes. These include the rapidly changing global competitive market, the fact that other countries will emulate our low tax rates, and the fact that our cost-competitiveness is running far above that of our competitors.

Unfortunately, he did not have time to list the changes verbally, apart from those internal to Enterprise Ireland. The enterprise strategy group looked specifically for the following improvements which have not been implemented: export Ireland and technology Ireland divisions within Enterprise Ireland, the need for 1,000 graduates in sales and marketing on a co-operative basis; a budget of €20 million a year for enterprise-led networks, the one step up initiative programme, higher education benchmarking with the very best, increased research and development to match our basic research and development within firms and applied research and development. These are only some of the group's recommendations. I regret that the Minister did not have time to finish reading his response. I look forward to reading the balance of it later.

The only answer he seems to have describes an internal reshuffle within Enterprise Ireland which does not nearly match the changes we need to face the future.

The Deputy must not read the newspapers. We launched the one step up initiative last week and I allocated the additional funds in last year's Estimates for this year to implement the enterprise strategy group's recommendations immediately. The one step up initiative aims to upskill the workforce. I am totally committed to this plan and have already taken action on it.

The changes in Enterprise Ireland are fundamental to the enterprise strategy group because it concentrates significantly on indigenous enterprise. This is not a casual implementation — the Deputy misinterpreted me if he so understood my tone. That is not my position.

The changes at Enterprise Ireland aim to create an export led, technology, innovation based approach. Enterprise Ireland has created the divisions the Deputy mentioned. It has radically reformed its overseas division in terms of giving assistance to companies that wish to create a greater presence overseas. It has also announced a new productivity fund. Scaling up medium-sized Irish companies to become significant international players is a key item on Enterprise Ireland's agenda, as is the development of high potential start-up companies. Enterprise Ireland will be the engine for the development of indigenous enterprise over the coming years.

The model that achieved our economic transformation will not take us through the next decade. The enterprise strategy group's recommendations give us a blueprint for future development and we are committed to implementing it.

In regard to overseas marketing, we have, at my initiative, reviewed the existing FÁS graduate placement programme. Enterprise Ireland and FÁS have come together to develop a better resourced overseas graduate programme. This has been a very effective tool yielding significant intelligence on the ground, particularly in Asia. We will continue the programme in line with the need for greater marketing talent to be generated and developed.

This Government more than any other has achieved significant progress in research and development through the programme for research in third level institutions and Science Foundation Ireland. We are committed to building on and increasing that. I am chairing a Cabinet sub-committee preparing a strategic implementation plan on research to take us through to 2013, with very significant results.

We can return to the issue of research and development later. In terms of Enterprise Ireland, is it not the case that the Minister has mired the agency in that black hole of bureaucratic nonsense known as decentralisation by adding yet another town to the process by moving Enterprise Ireland to Shannon? Is that an example of the agile change which this report seeks?

Enterprise Ireland's response to this report has been very agile. It was ready and had the blueprint, a strategic vision for the future, and was in a position to launch it, which I did several months ago.

Will it move to Shannon?

Yes it will.

How many of its staff voted for that move?

That will not cause any difficulties in terms of the broad agenda.

How many of its staff have signed up for the move?

Company Closures.

Billy Timmins


146 Mr. Timmins asked the Minister for Enterprise, Trade and Employment the situation regarding the unsecured creditors of a company (details supplied) in County Wicklow; and if he will make a statement on the matter. [25443/05]

The determination of any payments due to creditors of Irish Fertiliser Industries is a matter solely for the liquidator. The position of unsecured creditors can be determined only by the liquidator when all the assets of the company have been realised and all liabilities established. The liquidator has made considerable progress in realising the assets of the company and establishing the full extent of its liabilities.

At this stage, the main production sites at Arklow and Cork remain the principal assets yet to be realised. Contracts have been signed for the sale of both these sites and it is hoped to close the sales in the near future. The statement of affairs presented to the creditors' meeting in November 2002 estimated the amount due to unsecured creditors was €72.7 million. Of this, €34.5 million relates to shareholders' loans which the shareholders, ICI and the State have agreed in principle to subordinate in favour of the other unsecured creditors. This action on the part of the shareholders will substantially increase the rate of dividend payable in due course to the other unsecured creditors.

While I do not have an up-to-date estimate of the amounts due to unsecured creditors, I am aware the liquidator has recognised significant additional liabilities to former employees in respect of contractual entitlements to redundancy terms. In addition, the liquidator has accepted, in principle, that the trustees of the Richardsons superannuation scheme, covering the employees in Belfast, have an admissible claim on the liquidation but the quantum of that claim remains to be established.

The liquidator is engaged in discussions with the trustees of the scheme with a view to agreeing the quantum of the claim and hopes to do so soon. The liquidator hopes to be in a position to make at least an interim payment to creditors before the end of the year.

Does the Minister agree that almost three years to the day after this company, in which the Government was the major shareholder, went into liquidation that the unsecured creditors do not know how much they will receive following the Minister's reply? Much was said in the last Dáil session about the way Gama Construction treated its workers but the way the Government has treated the workers and unsecured creditors in IFI in Arklow is outrageous.

Will the Minister give some indication when the unsecured creditors might know when they will receive some payment? Hundreds of thousands of euro are owed to small family businesses around the greater Arklow area. I am sure it is no different in the area around Cobh. The Minister stated he did not know the total figure owed to unsecured creditors. I would like to know why, three years later, we still do not know that figure, which I am sure could be calculated quite easily if the Government, a major shareholder in the company, inquired of the people behind it.

About what?

About the total owed to the unsecured creditors. The Minister in his reply said the Government did not know that figure. I find it quite amazing that three years later we still do not know. Does the Minister think it right and proper that the Government, a major shareholder, should treat employees and unsecured creditors in such a manner? What total is owed to unsecured creditors and when might they expect to receive that money?

The Deputy's remarks are unacceptable and untenable.

In line with the Minister's behaviour.

No. The Government has not treated workers in an outrageous manner. Through statutory redundancy entitlements and payments from the fund quite substantial sums have been made available by the two shareholders. Employees will have received an average payment of up to €50,000. Whether one agrees with the rate or not, one cannot describe it as outrageous. Equally, one must accept the reality that the Government is not the liquidator.

I would like——

I would love such complex processes involving liquidators to be expedited, but there are key legal issues to be determined. The Government is not the liquidator in this case. For whatever political agenda, people may try to ignore the liquidator, remove him from the process and replace him with the "Government", which they would like to blame for everything. That too is neither tenable nor acceptable.

The Minister clearly stated that he was unhappy with the slow pace and that he would like to see things hurried up. As Minister he can amend the legislation. Does he believe the legislation is serving unsecured creditors in a correct and fair manner if, three years later, they have still not been paid for goods and services they supplied to a company of which the Government was a major shareholder? If not, will he make a commitment to change the legislation rather than hide behind the liquidator?

We were asked to bring the Deputy up to date regarding the situation of unsecured creditors. I have done that in——

The Minister does not know the figure or when the money will be paid.

——the reply. We are not the liquidator and do not get involved in the process, to which a range of legal issues relates. The Deputy knows that as well as I do.

We are no further on than three years ago.

Community Employment Schemes.

Liz McManus


147 Ms McManus asked the Minister for Enterprise, Trade and Employment the number of persons on community employment places at 1 January 2003, 1 January 2004, January 2005 and the anticipated numbers at 31 December 2005; if his attention has been drawn to the difficulties faced by many community and voluntary groups due to the shortage of community employment places; if any changes are planned with regard to eligibility to participate in the scheme; and if he will make a statement on the matter. [25428/05]

The main purpose of the community employment programme is to provide work experience and training for the long-term unemployed and other disadvantaged groups to enable participants to advance successfully to employment in the open labour market. FÁS also endeavours to ensure that local communities are supported in the delivery of services, particularly in the health, child care and drugs task force areas, which have been ring-fenced with numbers maintained at the 2002 levels.

As I announced on 10 November last, FÁS employment programmes, which comprise community employment, social economy and job initiative, will provide 25,000 places overall in 2005.

I am informed by FÁS that the number of participants on CE was 24,992 on 1 January 2003; 19,848 on 1 January 2004; and 22,194 on 1 January 2005. FÁS anticipates that the numbers on the scheme by the end of the year will be broadly in line with the January 2005 level.

The increase from three to six years in the time that over-55s may participate in CE schemes, which I announced in November, should help to ensure that there will be sufficient people available to fill the places on offer. No further changes are planned regarding the eligibility criteria for the scheme.

What is the Minister's attitude to community employment? Does he regard it as a valuable and important scheme that is no longer primarily for work experience and training as originally envisaged when Deputy Quinn established it at a time of high unemployment, but to undertake valuable community work that would otherwise not be done? If that is the case, does the Minister believe it is time he developed a new emphasis to ensure that the valuable work undertaken by community employment continues? Does he see a role for himself as Minister for Enterprise, Trade and Employment in ensuring that such work continues?

Regarding the over-55s, would he consider ensuring that, where people are fit and able and wish to continue beyond the six-year roll-over that he has granted, it will be possible? The extension was previously three years, and the Minister announced in November that there would be a six-year extension beyond 55 where people are fit and able for useful work beyond that age, in line with the view now of people continuing hale and hearty into their 60s and working.

I am somewhat surprised by the question, since the CE scheme is primarily a labour market intervention.

It was originally envisaged as such.

Yes, and it still should be. I do not agree with the Deputy that we should detract from it.

That is interesting.

In 2002, the progression to employment for CE participants was 41%, and in 2003 it was 46%. That means almost half of those on CE schemes progressed to full employment, the original and continuing motivation behind the CE programme itself. On the jobs initiative, there has been a progression of approximately 40%.

My preference is to transfer the social economy scheme to the Department of Community, Rural and Gaeltacht Affairs, since it supports community initiatives and has not really developed as a labour market progression measure. I have been in discussions with the Minister for Community, Rural and Gaeltacht Affairs, Deputy Ó Cuív, with a view to moving it to his Department —"mainstreaming" might be the wrong term — to provide a more secure underpinning for those community enterprises supported by the social economy programme.

We should not write off CE participants when it comes to progressing to full-time employment. With that in mind, in my discussions with FÁS last November, I asked that the content of programmes be examined to see whether we might do more to get certain people on CE schemes back into the workplace. FÁS is in the process of modifying the content of the CE programme, and the new approach will see the introduction of an individual learner planning process that will focus on meeting participants' learning needs. That individual learner plan will provide for the planning, organisation and recording of the work experience, training and development that each participant receives while working in community employment. It is to include further training and development for supervisors, a new application process and quality assurance procedures. I hope it will provide additional benefits to FÁS clients on that programme.

Will the Minister review the situation of people aged between 50 and 55, many of whom cannot get a place on the scheme? Many are aged just over 50 and for one reason or another cannot find employment in their own community.

I am intrigued by the Minister's response, since I feel the scheme has evolved well beyond a simple labour market initiative and into an acknowledgement of important work. My question's basic thrust was whether the Minister would present a revised scheme retaining the labour market initiative component within his Department and finally acknowledging an important social employment, full-time work programme through the Department of Community, Rural and Gaeltacht Affairs. Is that the sort of project on which he is now working, and when will it be presented to the House?

I am equally intrigued by the Deputy's proposition. We must be careful that we do not fall between two stools. The community employment programme does valuable——

For the Progressive Democrats, there is no such thing as community employment.

Clearly, community employment helps communities, but its primary purpose is to help the individual through providing a bridge from unemployment to full-time work. That should remain the primary focus.

Regarding Deputy Hayes's question on the over-50s and over-55s, we must be careful that we allow enough capacity within the overall programme to absorb new entrants from the unemployment register on to CE schemes so that there is genuine progression. The danger, if we get into the business of people remaining on CE schemes for ever, is that we might end up with no space and no possibility of access. We made significant changes last November, and I want those to bed down to see how they are operating. We will analyse and evaluate that situation not only in the context of the Deputy's questions but to see how it has worked hitherto. We will see if there is more room for the type of thing the Deputy suggested.

There is a number of complaints in regard to the differing benefits available under rural community schemes and community employment schemes when the three years have elapsed. There is some disquiet among those seeking to claim welfare benefits or secondary benefits after completing community employment schemes vis-à-vis their counterparts taking part in the schemes devised by the Minister for Community, Rural and Gaeltacht Affairs, Deputy Ó Cuív. Will the Minister comment on this?

I am loath to intervene in respect of my colleague's formulae and solutions for addressing the needs of rural Ireland as he has ascertained them.

It is a generous scheme.

The Minister, Deputy Ó Cuív, is a sensitive soul.

The Minister for Community, Rural and Gaeltacht Affairs has the capacity to generate schemes that meet the needs of rural and remote communities. In creating that Department and appointing Deputy Ó Cuív as Minister, the Taoiseach clearly demonstrated the Government's commitment to rural Ireland. The Minister has been responsible for devising schemes that are tailor-made for rural communities and the success of the scheme is testimony to the Government's commitment in this regard.

Research Funding.

Paul Nicholas Gogarty


148 Mr. Gogarty asked the Minister for Enterprise, Trade and Employment the measures his Department has taken to increase research and development spending to 3% of gross domestic product, GDP, as recommended under the EU framework programme for research and development; and if he is satisfied that the current ratio of gross research and development spending to overall economic activity in 2004 was estimated by his Department to be only 1.5% of gross national product, GNP, and that investment has increased a mere 0.18% in three years. [25500/05]

Pat Breen


153 Mr. P. Breen asked the Minister for Enterprise, Trade and Employment the measures he intends to take to remedy Ireland’s weakness in the research and development sector as identified by the National Competitiveness Council’s annual competitiveness report; and if he will make a statement on the matter. [25039/05]

Simon Coveney


198 Mr. Coveney asked the Minister for Enterprise, Trade and Employment his views in respect of the low uptake of and investment in research and development by firms; and if he will make a statement on the matter. [25393/05]

I propose to take Questions Nos. 148, 153 and 198 together.

The Government is fully conscious of the importance of research and development capacity to our international economic competitiveness and the ongoing well-being of the economy. To this end, significant investment of €2.5 billion has already been committed by this Administration in the context of the current national development plan. Reflecting the effectiveness of this investment, business expenditure on research and development rose from €917 million in 2001 to €1.076 billion in 2003 and real annual average growth in gross expenditure on research and development, GERD, for Ireland was 4.8% for 2003 to 2005.

This rate of research and development growth in Ireland exemplifies the Government's vision for Ireland to become a knowledge economy internationally renowned for the excellence of its research, with leadership in the areas of life sciences, medical technologies, software and information technologies, and at the forefront of generating and using new knowledge for economic and social progress with an innovation-driven culture.

The Government's ambitious decision to build a strong base of expertise in science and technology to drive the development of strategic research and development investment is already reaping rewards as reflected in the growth of business spend on research and development and collaborative ventures between universities and industry under, for example, Science Foundation Ireland's centres for science, engineering and technology, CSETs, initiative. However, we are fully aware that more needs to be done in terms of our competitive position in Europe and internationally. We welcome the focus that has been brought to bear on this key area in recent years by such bodies as the National Competitiveness Council, NCC.

To help achieve our vision for research and development and to ensure a coherent approach across a range of Departments, the Government approved a new co-ordination and governance system for science, technology and innovation last year, including the establishment of a dedicated Cabinet sub-committee, which I chair. This decision facilitates a genuine, whole-of-Government approach to the cross-cutting research development and innovation agenda. Earlier this year the Cabinet sub-committee mandated a high level cross-departmental group of officials to prepare an action-oriented strategy for science, technology and innovation for the period 2006 to 2013.

The strategy will outline for Government the steps necessary to enable us to achieve the Lisbon and Barcelona goals. Working in partnership with our agencies, schools, third level institutions and the enterprise sector, it will aid Ireland to realise its potential as a knowledge economy and attain a position of prominence in research and development which will maintain competitiveness and jobs in coming years.

How does the Minister intend to change the situation whereby in 2003, of the €1 billion invested in applied research, only €32 million came from the State? This places Ireland 21st out of 30 countries in the OECD in terms of state funding for research and development. Does he have any response to the finding in the summer quarterly report from the ESRI that research in this State is carried out primarily by companies whose parent company is based in another state and that there is no contact with State agencies or universities in respect of the majority of applied research and development?

I disagree fundamentally with the Deputy. Many indigenous companies engage in the research and development agenda.

The findings in the ESRI report indicate a different situation.

We have a greater number of researchers per 1,000 people than the European average. The bottom line is that since the establishment of the PRTLI programme during my time as Minister for Education and Science and the establishment of Science Foundation Ireland under the aegis of the Tánaiste during her tenure in my Department, there has been a dramatic transformation of the research landscape for which the Government deserves credit. We realise we must transform that agenda again and are preparing an action implementation strategy for research which will involve significant changes both in terms of prioritisation, targeting and envelopes over a six-year period to bring us to even higher levels of research and development.

The good news is that much of the foreign direct investment we have recently announced has included strong research and development components. Many of our indigenous companies, particularly those in the food sector such as Glanbia and Dairygold, invest heavily in research and development centres which provides new jobs for this emerging economy.