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JOINT COMMITTEE ON ENTERPRISE, TRADE AND INNOVATION debate -
Tuesday, 23 Nov 2010

Nurturing Innovation and Inventiveness: Discussion

I welcome the delegations to this meeting. The delegates attending are as follows: Professor Frank Gannon, director general, Dr. Ruth Freeman, director of enterprise and international affairs, and Dr. Graham Love, director of policy and communications, with Science Foundation Ireland; as well as Dr. Alastair Glass, chairman, Professor Roger Whatmore, chief executive officer, and Dr. Cian Ó Mathúna from the Tyndall National Institute. I thank them for attending. I apologise for the delay but we had some housekeeping matters to sort out.

I draw the delegates' attention to fact that by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to this committee. However, if witnesses are directed by the committee to cease giving evidence in relation to a particular matter and they continue to do so, they are entitled thereafter only to qualified privilege in respect of their evidence. Witnesses are directed that only evidence connected with the subject matter of these proceedings is to be given. They are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name, or in such a way as to make him, her or it identifiable.

Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official, either by name or in such a way as to make him or her identifiable.

I will now call upon Dr. Glass to address the committee, followed by Professor Gannon. Is that the correct order?

Dr. Alastair Glass

Professor Whatmore will make our opening statement.

My apologies. So Professor Whatmore will be first, followed by Professor Gannon. Is that all right?

Professor Roger Whatmore

If we had the option, it might be more appropriate if Professor Gannon spoke first.

That is grand. You have the option. We are here to be informed.

Professor Frank Gannon

I thank the Chairman and other members of the committee. This is a good opportunity for us to talk to the committee about a subject that may not gather the same headlines as others these days, but is equally important. We are talking about the prospects for economic growth and recovery. It is important to do that, as we have spoken enough about the other side of the equation.

A preparatory statement has been presented to the committee but I will not read directly from it. I will instead present some highlights that I think might be important. Science Foundation Ireland was established ten years ago at a time when innovation was not really on people's lips in the Department. The legislation which set up SFI stated that it was "to promote, develop and assist the carrying out of oriented basic research in strategic areas of scientific endeavour that concerns the future development and competitiveness of industry in the State".

Ten years later, SFI can claim that it is doing exactly that and with great effectiveness. It is interesting that when SFI was set up the expectation was that some of these fruits might be obtained by 2015. We are already there in a major way. The documentation refers to SFI's excellent publication output and I will come back to that shortly. More importantly for the purposes of today's discussion, extensive academic-industry partnerships are funded by SFI. Tyndall is a good example, and it will provide the committee with further specific examples. The partnerships funded from SFI are working with 601 collaborations, which include 389 distinct companies. They also include 149 multinational corporations and 165 SMEs, which shows that SFI avoided the potential trap, that was there at the start, of becoming an academic excellence-only or publications-only organisation. We have moved the organisation in such a way that it does both: it has excellent outputs and excellent interaction with industry. These, in turn, feed into other enterprise agencies - the IDA and Enterprise Ireland - whose job it is to create employment in physical terms as a consequence of what SFI is doing. In IDA, it is significant that the number of investments by companies in research and development has shifted from 10% of their general wins to 50%. The whole system is working. SFI is doing its part and Enterprise Ireland and the IDA is playing its part. SFI is also being innovative, which is important in this context. Innovation permeates the whole system. It is not just a matter of putting it in a box. It is important for the growth agenda. The programme span has been put together and tailor-made for what is needed. We monitor our metrics and we have a systems approach where we know how the different parts fit together. We firmly believe one cannot isolate the endpoint of an application without having the rest of the system in place. We have effected a culture change in the higher education institutes, which are now willing to speak to the same agenda we have of supporting excellence and collaboration with industry. This is demonstrated by the collaborations I mentioned earlier.

SFI has worked closely with industry groups of all kinds. We have a series of actions with IBEC and others. We also have joint programmes with Enterprise Ireland and the Health Research Board.

When the letter came from the committee, the topic seemed like a leaving certificate question. It states: "nurturing innovation and inventiveness - discuss". Invention is "an idea made manifest", according to Wikipedia, and innovation is "ideas applied successfully". There are whole theses on innovation but that is the nub of it. It is important to consider where these ideas will come from. We talk, perhaps excessively, about the role of universities and institutes of technology. Innovation comes in all areas, all companies and all factors in life. That is the way the modern economy must move. It may seem I have forgotten this point when I talk but I assure members that we have not forgotten it. Within our world, one needs good people to get ideas. One needs excellent people doing excellent work in a relevant area. We focused on frontier research, research at the edge to which others had not been. This allows the researchers to be the first to see it. One is not in a predictable, mapped territory when one is at the edge. We are strong believers that excellent research groups funded by SFI are constantly looking for the unexpected consequence. This is shown in some of the examples we have included. Research in immunology that we were supporting resulted in someone discovering a new sort of cell in the body and that cell was important in treatment of asthma. The person did not set out to find the cell but when doing work excellently the cell was found and the person could see how to apply it. A series of examples of this are included on our website, which has had 126 new additions in the past two months. The research that is funded is a story worth telling in its own right. We are at the frontier and we are publishing at a high level. That is when an idea or an understanding is captured. The growth of this is significant. There has been a 26% increase in these in the past year. The quality is also significant. Ireland has moved to the top 20 of countries in terms of quality of output. We were languishing in the high 30s until recently. We have the right people moving in the right direction. The number of times other people in the world have cited our papers has also increased significantly. That is all good and it means there are ideas.

With people and ideas, we must also have links to industry. Some of our programmes are designed and tailor-made so that this happens. These programmes include the centres for science, engineering and technology, CSETs, and strategic research clusters. Centres such as the Tyndall National Institute are good examples and I am pleased it has been included in today's discussion. The challenge that arises is to ensure that the research we are performing is in a zone with socio-economic benefit. Economic benefit is a component of this but the social impact is increasingly viewed as a requirement of research at national, European and international level. This creates new opportunities.

We must allow sufficient freedom for true invention and innovation to occur. One cannot predict exactly what will happen and make it come out at the other end. We must allow intellectual freedom for that to happen. This requires highly skilled teams of individuals at SFI and strong commitment to managing the awards we make. We monitor, follow and take care of how money is spent on behalf of the taxpayers. Our overheads for this are less than 6% so our management costs are low. We are intrusive in what we do. We work actively with the IDA and Enterprise Ireland but also with the HEA and the HRB. The future direction of SFI will continue to promote this philosophy, which has underpinned our success to date. We also hope to extend research funding of activities of SFI to include more direct links with the application phase of research in the domains SFI supports.

The legislation that set us up confines us to oriented basic research. We will continue to do that but we need to have more room to manoeuvre. Having done that, we will be able to work better, with no gap between SFI and Enterprise Ireland, which can occur at the moment. We look forward to that.

This will be done in the context of which SFI was set up, namely, to increase Ireland's skill base through excellent research. That will remain at the core of our activities and is also at the core of the reputational gain for Ireland. This allows other companies to come to Ireland and to grow in Ireland. We have a cornerstone role to play in the future of the country, working with other enterprise agencies.

I invite Professor Roger Whatmore to speak on behalf of the Tyndall National Institute.

I want to explain that the Order of Business is about to begin in both Houses. If members slip in and out, it is because of that.

It is a day of fluidity, as witnesses will understand.

Professor Roger Whatmore

It is an honour and a pleasure for me and my colleagues to be invited to address this Oireachtas Joint Committee on Enterprise, Trade and Innovation. I am the chief executive officer of the Tyndall National Institute. I spent 18 years in the electronic industry in the UK and 11 years as the Royal Academy of Engineering Professor at Cranfield University. I was part of a successful start-up. Dr. Alastair Glass is the chairman of the Tyndall National Institute. He spent more than 30 years at Bell Laboratories in the US and was responsible for a number of key innovations that led to Bell Laboratories leadership in high bit-rate fibre optics communication. I am grateful that he has flown from New Jersey to give evidence to this committee. He has a fantastic record in innovation. Under his leadership, Lucent Technologies founded a number of successful business ventures. He also spent two years as Deputy Minister of Research and Innovation in the state of Ontario, Canada. Dr. Cian Ó Mathúna has been a researcher at the Tyndall National Institute since the early days of the National Microelectronics Research Centre. He now heads our central microsystems centre and has extensive experience working in the EU. He is particularly keen on working with Irish industry and using our innovations for job creation in Ireland. He has had a number of successes in taking SMEs into Europe and he is a member of the innovation task force implementation group.

Like SFI, we looked at the topic as an exam question. My wife rapped me over the knuckles this morning for saying that innovatio comes from the Greek. It does not, it comes from Latin and she should know because she is a Classics scholar. It means renewal and in the context of this report we regard innovation as a renewal of the Irish economy by transforming Irish ideas, discovery and inventiveness into the exploitation of new market opportunities. We are talking about renewal and it requires a number of precursors. Discovery, new knowledge and knowledge transfer is very important. Science Foundation Ireland has played a stellar role in what it has achieved here in the past ten years. Ireland has developed well in the past decade but technology and product development are also required. There is room for improvement, especially in new areas. Venture capital is a limiting factor to business acceleration and investment. Expertise in the investment community is very important. Customer and market development is critically important. Within each of those areas a variety of expertise is needed in science, engineering and business, and talent development.

In the past decade Irish investment in research infrastructure, PRTLI, in research programmes in ICT and biotechnology, SFI, and in health research, HRB, has resulted in world-class research and a world-class research environment. That has been particularly successful in attracting skilled researchers to Ireland from around the world and developing our indigenous expertise. The work of Enterprise Ireland to support business and academic partnerships and intellectual property, IP, creation has made considerable progress towards knowledge transfer. However, the creation of wealth and jobs by exploiting IP requires the development of creative entrepreneurs, sophisticated investors, management expertise and market awareness.

The Tyndall National Institutewas created in 2004 by the then Department of Enterprise, Trade and Employment and UCC to be the national institute to support industry and academia in Ireland, helping to translate innovation and new knowledge into applications and jobs and to be a centre of excellence in ICT research and development. We are working collaboratively with other research bodies and industry to extract the maximum value from research investment. We now employ approximately 400 people and have a turnover of approximately €30 million. The majority, 82%, of the income comes from a wide range of competitively-won sources. Much of it comes from outside of this country.

We will highlight a few areas to show how we extract value from research. The first area is the development of human capital. The majority of the 135 postgraduate students at the Tyndall institute are PhD students. Approximately 60 PhD students have graduated in the past four years. We have many examples of those graduates going into Irish industry. Intune Networks cannot get graduates out of us quickly enough. We supplied five or six graduates to it in the past 18 months. The national access programme supports 230 individual projects involving 400 named researchers from around the country. That has produced a number of patents and a spin-out company.

We work very closely with the IDA and help it develop its client base. This year, United Technologies Research Corporation, UTRC, from Connecticut established its new European research centre in Cork, currently based in the Tyndall institute, because of the way we work closely with industry and other university groups. Recently Applied Materials, which is one of the world's leading manufacturers of semiconductor processing equipment, announced it will place a major research programme in the Tyndall institute, with people and equipment worth approximately €2 million.

We conduct research and development partnerships with industry. Since 2006, industry has contributed approximately €7.5 million to the Tyndall institute for research and technology development activities. We have collaborations with more than 200 companies, of which 80 involve financial exchange. A very good example of the way we work with industry is a new invention that emerged from the Tyndall institute this year, namely, a new transistor which we think will revolutionise silicon and keep us on the map. Companies such as Intel will keep pushing the technology forward. It is a "junctionless" transistor. It has allowed us to develop our relationship with Intel which announced a $1.5 million three-year research programme with the institute which will roll forwards beyond the three years, as it is intended to roll forwards on a year-by-year basis. We have two very good quotes in our report, one from Analog Devices which points out that if it had not been for the work done at the Tyndall institute by our design and technology evaluation group, the transfer of its processes from 6 in. to 8 in. would have been much more difficult. An Irish SME, Biancamed, pointed out that the work we provided to it in terms of translating some technology into a way it could use it was "world class".

We generate licences to industry. We have had 45 patents since 2006, 11 of which have already been licensed. We do a great job in leveraging EU funds. We were awarded €18.2 million in research funding since 2007. That accounts for 8.5% of Irish income drawdown from Framework 7.

We have been instrumental in creating six start-up companies. There was a very good story in today's edition of The Irish Times about Firecomms, which is a Tyndall institute spin-out. It has recently been acquired by a Chinese company, ZJF. That will involve the company injecting €5 million into our research funds and increasing the number of high-end jobs in Cork from 18 to 30.

Academic excellence is vital. Everything we do is based on excellence. We are now recognised as a major European centre in academic excellence. In 2009 we produced more than 200 journal papers, 50% of which were in the top 20% of their field. In 2009 SFI held an exhaustive review of the Tyndall institute. It commented that the Tyndall institute is an indispensable national resource and that the research there is first rate.

Although we are satisfied with the progress made at the Tyndall institute, we do not think it has gone far enough. We feel we can do better in terms of development and demonstrating the commercial potential of what we do. To that end, two new competence centres from Enterprise Ireland have been based at the institute. They will bring industry and academia together. We are hosting the competence centre in applied nanotechnology and the microsystems competence centre for Ireland.

We would like to respectfully offer some recommendations to further accelerate how ideas can be driven to the marketplace. It is vital that the investment in creative people is continued. The most creative scientists, engineers and entrepreneurs are highly mobile and are attracted to those environments with the best facilities and support for innovation. This country needs to continue the support it has had in the past decade to continue the presence of those people in the country. We need to place more emphasis on driving ideas to the marketplace. Since 2000, research funding in the natural sciences in Ireland has grown more rapidly than engineering and technology research funding. We feel that balance should be reconsidered.

In terms of strategic objectives and national challenges,the Government, together with funding agencies and stakeholder input, should identify major challenges where Ireland can become a global leader and fund partnerships to deliver on those challenges. That is now taking place under the prioritisation task force. The support provided by Enterprise Ireland for intellectual property management is vital. That needs to be continued and to be streamlined in the future.

I thank committee members for their attention.

I apologise for being late. Given the momentous events happening around the place there is much going on today. I hope I will be forgiven for not being fully up to speed. It is said that an economist is one who knows the price of everything and the value of nothing. True to that tradition, I wish to put the following question. In these presentations we have much interesting information about outputs and potential outputs, for example, the number of people educated at fourth level, pre-commercial endeavours, publications and partnerships. What is of concern to people in these testing times which will continue for the next five years, is the cost-effectiveness of the expenditure in these areas. Investment in innovation has rightly acquired a high priority but it will have to prove its value in more tangible ways than streams of statistics about partnership or collaborations, which are easy enough to manufacture if one sets those as the targets. From my relatively short acquaintance with the enterprise and employment brief, there seems to be a degree of demand for a more forensic and hard-nosed approach. A recent appointee, the former head of Intel, stated that it would be as important to weed out failures from the programmes as it would be to persist with measures that could tick the boxes of the key performance indicators, KPIs.

Against the backdrop of the new approach we must adopt towards everything the State does and every penny we spend, can our guests advise the State as to how we can put together a tighter framework to deliver the outputs we need cost effectively? Every scientist will claim his or her area is vital, needs more people and is on the brink of something or other. The State needs to find a way in which it can stand back. The difficulty is that, were this an area of enterprise, it could be evaluated easily by determining whether it succeeds and its rate of return. However, there would be a low rate of return in this context. Were it evaluated as a branch of education, one would examine the pupil-teacher ratio, the cost of each fourth level graduate or researcher produced and placed in a company, and so on. Some value would be placed on these, but it seems that we will need to move to a more tough-minded approach towards Ireland Inc.'s potential wins and be rigid in demanding performance and weeding out failure. Is this thinking being done by people who could produce metrics that would convince a Minister for Finance that factors are stacking up?

A great deal seems to be involved. As used to be said about performance indicators in the UK when they were first applied to schools, one is always concerned about people getting embedded in paperwork and in producing material to show they are ticking boxes. Perhaps we need to step back and use a simpler evaluative model that would show prima facie where we are on particular programmes, after which we could go beneath that to justify them. The State needs some honest brokers to do this on our behalf. Are they in place and are the systems sufficiently rigorous to allow us to stand over denying a social welfare pensioner X percentage of his or her pension to continue funding these programmes? That is where we are.

We have moved beyond the point of saying that research and development is great. We all know it is great. What we need is something more forensic. Are we close to having that? Referring to social welfare pensioner cuts, pupil-teacher ratios in primary schools or so on might be emotive, but this is where we are.

I invite Professor Gannon or anyone else to address the Deputy's questions.

Professor Frank Gannon

I thank Deputy Bruton for his question. Although people might discuss what they think over a cup of coffee, it is great when that is done up front, as it allows us to address the matter in an honest and, I hope, explicit way.

Several times, the Deputy asked whether things get weeded out. Scientists love what they do and they are all convincing. Approximately 20% of those who apply for funding are successful, so every good idea is not accepted. Where successful applicants are concerned, we are on their case and carry out ex post analysis and site visits to ensure that what they claimed they would do, their good selling point, is being done. We make these analyses with input from world peer review experts. They are unrelated to us and do not care about saying something is rubbish, as they are not in some constituency or other. We are led by them. However, international peer reviewers telling us whether something is good is only part of the answer. Something could be good, but it could also be useless. This is the citizen’s value for money component. We cannot avoid accepting the fact that much of what we contributes to successes but is not the success itself.

There are figures on start-up companies, licences and so forth. These are important and can grow, but our most important task is providing the ammunition for the IDA in particular to sell what is being done. I will provide an example that illustrates the current situation. Approximately two weeks ago, a joint event at Stanford University in Silicon Valley in San Jose was put together by Science Foundation Ireland, SFI, and the IDA. Having discussed with the IDA which industries it wanted to impress, we selected 12 SFI-funded researchers from various institutions. The IDA got approximately 100 people from 70 industries to attend the session. This was not easy, as those people had plenty of other things they could have been doing. The event's structure saw an industry person who was working with an Irish academic speaking first, followed by that academic. The figures we have presented are real in the sense that they relate to genuine partnerships, interactions and relationships. The industries, be they IBM, Intel, HP and so on, spoke, after which the Irish spoke. The scientists from Ireland were engaged in discussion by the industries.

The feedback from the event is that it has had a monumental impact in terms of real IDA jobs. When they are announced, they will not necessarily point to the event in question, but they are a component of Ireland's competitiveness. Competitiveness is not only a question of energy, salary and other costs. It is also a question of the right people coming through. If we do not have them, industries will not be able to find them and develop in Ireland, so they will not bother moving here. The right people are coming through because we are selecting excellent people in strategically relevant areas.

The IBM smart cities initiative could have gone anywhere. It came to Ireland because it found the right combination of skills and culture, allowing IBM to work with those people on developments. The initiative involves approximately 100 jobs. Professor Whatmore referred to the United Technologies Research Center, UTRC, which would not have come to Ireland unless there was a research environment. Some 60% of graduates from the Centre for Telecommunications Value-chain Research, CTVR, which we have been considering lately, go into industry. Approximately 25% of graduates go directly into industry.

It would be a false analysis to segment the investment in people and the people who bring the ideas closer to industry, only to deduce that we can do without the latter. Having examined this matter all over the world, there is no way that industries of an economic value we want for Ireland will come, stay or grow here unless we have the right people as well.

How to measure inputs and outputs is everyone's bug bear. We are discussing reputation, which is an intangible asset. What value does one place on a Coca Cola bottle as opposed to something else? It has a value when it is recognised by others. Reputation is shown by the 2,000 academic interactions. Dr. Ruth Freeman, who is sitting beside me, conducted an analysis of the interactions with the best universities in the UK, including Oxford, Cambridge and the Imperial College. The best people are working with the best people. This is a reputational gain.

The best peer reviewers are visiting to see what is going on and to spread the word. Most importantly, companies are coming to Ireland, interacting, staying and growing. Ten years ago, the IDA could not get high-tech companies to come to Ireland to look at what was occurring. They came for manufacturing and some advanced manufacturing, but not beyond that. We measure a lot of things, but everything we measure provides the data and shows considerable output. However, the actual euro connection is very hard to establish. That is not an excuse and this is a fact everywhere. Commissioner Máire Geoghegan-Quinn recently asked a group to look at how to put metrics together, to really measure the connection between the research input and the subsequent consequences, which are not and cannot be direct.

If we only go for the direct we shall fail massively because we will then only be dealing with what is available, the immediate, and what may be copied from elsewhere. We need to have a much more skilled base in order to do that. Generally, in response to Deputy Bruton, we are forensic and very analytical. We go through all our programmes. We stop things, including high-profile centres, although we do not shout about this, since there is no point in embarrassing them, but we have done so. We change managements and change their directions. We might tell managements to stop doing a certain line as it is going nowhere. We may see an opportunity that had not been anticipated and we might push managements to do that. We are a very active intrusion into their activities, which I believe is worthwhile. We weed out, select and believe absolutely, in tandem with what was put together ten years ago. Those may have been better times but the analysis is not undermined by that.

Without having the skilled excellent research base in relevant areas, we will not be able to bring in and retain the top industries in terms of their economic impact, and that is where the jobs come from. We are a part in that particular triangle.

Dr. Alastair Glass

I am a members of Jim O'Hara's committee for prioritisation of research in Ireland for the future. That committee will address some of the issues that have been raised. It would be nice to be able to say that as a result of these investments, we now have 1,000 jobs or an enormous income or industry growing in Ireland. At that point we are still somewhat young. Tyndall is now five years old and it takes four years to graduate a PhD student, so the high usage one might expect from a place such as Intel is really only emerging now.

One of the things the O'Hara committee is focusing on is identifying those areas for integrating the strengths we already have in Ireland - what are the areas we can identify where we can really maximise the joint value of such activities across Ireland? I would hope that out of such activities we can point to those areas of national importance where the investment delivered the value. There are only some areas-----

There are some benchmark areas from where one could develop. I do not know who the leading people are. There is talk about Israel, but presumably it has a military wing that makes its particular situation unique. Perhaps the Danes are likely candidates. Is there any way we could benchmark against them, and while accepting, perhaps, that we are five years behind them, we nonetheless could set an international standard so that Jim O'Hara might come back to people such as me, with a healthy scepticism, and show from the scorecard that we are beating the best? I accept that it is great to have someone such as Jim O'Hara, with his proven reputation, doing this for us, but we also need to see metrics that mean something. Is it feasible to have international benchmarks as regards how we stack up?

Dr. Alastair Glass

Some things are easy to measure, and those are the things one sees in our write-ups. However, some things are not so easy to measure. If we put together activities where we can identify the outcome as a direct result of the input, then we can make a lot of progress. That will not be the whole portfolio, but it will be a piece of it, and will allow us to say that this is the value Ireland has achieved as a result. I believe it is possible, although many people have struggled with this around the world.

Professor Roger Whatmore

Perhaps I can comment on Deputy Bruton's question on how return on investment is measured. He is asking, in effect, whether there is an honest broker who can do this type of thing. Forfás recently funded a study by external consultants into the development of nanotechnology infrastructures in Ireland. They used nano techniques to look at how Irish nanotechnology research had developed, where it now is and where it should go. That can certainly be done, and the study showed positive improvements in nanotechnology space, although it also emphasised the need for focus and prioritisation, which is what happens in Israel, as the Deputy pointed out.

Incidentally, Israel spends 5% of its GDP on research and development, outside the military zone, so that is all non-military spending. It is a very innovative society which translates research into jobs and wealth creation.

The biggest problem Ireland now faces as a state is how to safely reduce the size of its public service without slaughtering the quality of the service we deliver. Can people such as the witnesses, who are at the leading edge, indicate a solution? It seems to me that the application of ICT in the public service is probably in the dark ages, with some notable exceptions, relative to where it could be. Does SFI or Tyndall ever identify a very pragmatic research project, for example, to get an institution that might be somewhat Dickensian in its approach, up to speed? Is that something we might hope to get help with?

Professor Roger Whatmore

On that particular point, a company, Intune Networks, has just established an optical network which Tyndall and a number of other bodies are also helping with. It is a world leading ICT information transmission network of its type. This is world leading work in Ireland that will attract international business to develop systems using a completely new way of transmitting information over the Internet.

Dr. Graham Love

To respond to Deputy Bruton's question, specifically, we recently identified an excellent opportunity. We have discovered the Constraints Management Group which uses computer technology, effectively, to look at how best to choose from a number of choices to make the right decision. This relates to everything from filling a restaurant and the optimal alignment in an evening to choosing the right trees to cut in a forest most efficiently. To follow-up specifically on the Deputy's question, the one that has been identified by us is the application of this to the processing of patients within the HSE so that a very significant improvement in efficiency can be achieved in a clinical situation to enhance throughput. We have seen estimates of a twofold increase and better from the appropriate use of this technology.

This is something we started funding ten years ago, with no idea of the possible applications in this area. We already have an example of a spin-out in a particular industrial sector, and here is an example from the public service where it could make a very significant difference.

Professor Frank Gannon

In terms of reducing the size of the public service, perhaps Deputy Bruton should know that SFI has 50 people managing all the activities, which is a large portfolio, so perhaps we can help others, rather than the opposite way around.

Israel is a very interesting model. The Israelis have the Weizmann Institute, which is an inspiration for many policy makers around the world, whose only interest is in supporting excellent research. Its licensing income is €250 million a year and that is the largest income from any research institute in the world. If one asks the Weizmann people what they are going to do, they do not know. They are performing excellent research but, to touch on a point made by our colleagues from Tyndall, what is essential here is that they pass their inventions along the line to the next agency with responsibility for a given area, while they continue to do their job excellently. How does one put a value on Weizmann, apart from the €250 million in licensing income? It is because Israel is well known as a great place for innovation and things happen there because of the way they have been structured.

We must acknowledge that innovation and inventiveness play very important roles in the economic life of this country. In recent times the quality of Irish academic qualifications has been questioned, and while I might have had a different perspective, people from academia and those at the cutting edge had a view which they voiced here over the last six to 12 months, particularly as regards innovation, inventiveness, engineering and ICT in which mathematics plays a key role. What is SFI's view in that regard and has it ever given advice to the Government on how it could encourage students to take the higher level courses, which while pretty daunting, are fundamental to the engineering and science sector? Has SFI offered advice to the Government in terms of addressing the points system in that context?

On Science Foundation Ireland's interaction with the Government and its agencies, everything starts as an acorn seed. Professor Gannon stated earlier that some of the acorn seeds started on path 1 and ended up on path 10, having found something more interesting along the way. As somebody interested in horses, I would be more interested in learning about horses than asthma, despite my family history in that regard. I acknowledge the high level of achievement in our thoroughbred industry. Where does this fit in with this world? Do we export to Australia, Kentucky or elsewhere? The outcome in relation to the asthma gene is a massive breakthrough. We recently met with representatives of the healthcare industry. Deputy Bruton is correct that a significant breakthrough in this area could have a fundamental input into our overall health and, ultimately, our health expenditure.

What sieving of ideas takes place? I am sure any person who arrives at the door of Science Foundation Ireland must have a high academic qualification and expertise in his or her field. People without PhDs and so on often come up with ideas too. Are these people looked upon favourably and how are they evaluated? I am sure that down through the years there have been many people who came up with ideas but did not have qualifications. I am not suggesting that one should not have a particular qualification. However, where do these types of people fit in? Coming from a rural area, I often find much of the concentration is on centres of excellence in terms of educational achievements.

We are all aware of the tremendous strides made by the Tyndall National Institute during the past five years. I congratulate Dr. Glass on its phenomenal success. What links are in place between, say, Science Foundation Ireland and the Athlone Institute of Technology which is located in my constituency, the president of which is Professor Ó Catháin. It is reaching out to other countries in terms of its work. Does SFI have much contact with the institutes of technology and centres of excellence in terms of education and so on?

Professor Frank Gannon

I will try respond to some of the many questions raised by the Chairman.

The delegates are the people with the information.

Professor Frank Gannon

Yes. It is good to have an opportunity to discuss these issues. When I have finished, my colleague, Dr. Freeman, will answer the remaining questions.

As regards academic qualifications, a major driver in terms of more people engaging in research and science will be the availability of more jobs in this area. There are definitely more jobs coming through in the sciences. The EU, which has set a goal of 3% of GDP expenditure by 2020, has calculated this will create 3.7 million jobs. This is what is needed. We need people to do the work, thus creating jobs. That expenditure does not relate to only academia. It is spent at a ratio of two thirds in industry and one third otherwise. Ireland is good in that two thirds of its expenditure on research is carried out by industry in the private sector. The precise figure in this regard is 60%, which is an extremely good batting ratio. This means jobs. This message has not yet gotten through to parents or children, who usually ignore their parents and eventually come round in the end. As somebody who attended college before the points system I am not sure how that would work. The bottom line is that there will be jobs in very interesting areas. Research is intellectually challenging and interesting.

The Chairman also asked about quality. Our colleagues from Tyndall National Institute may be able to answer that question given they are involved in this on the ground. The quality of output, again taking the economist perspective, is so high the people involved must be good. Are there enough of them? No, we will need more of them. How do we get more of them? Apart from getting these stories out, on which we are working much better now than previously, successes must be visible and students must understand the opportunities. Sustainability in this area is also important. One of the worst problems that could arise would be a lack of sustainability. One cannot have a stop-start in this area; it has to be a smooth curve, otherwise people will be thrown off in the wrong direction.

The Chairman also asked about our sieving processing in terms selection of ideas. We have a skilled group internally who are attuned to what is happening in industry. Mr. colleague, Dr. Freeman, will provide more information on this in a moment. We look at the quality of an idea. If one comes in with a great idea but does not have a PhD it would be difficult for us. The reason it would be difficult is because we agree our contracts with the research institute. We sign agreements with the research institute. We do an awful lot of sieving of ideas in the process and have a high awareness of their credibility in terms of strategic input. This has been tested by Indecon who carried out a review for the Department of Finance approximately three years ago and by the Brooks report. External reviewers have examined this and we have come through. The proof is in the pudding. Rather than spell out how we do it, the fact is that the researchers we are supporting are working with all of these different industries. The industries are getting an invisible consultancy through this process. Each and every interaction with the industry is one that is important to the industry because they do not have to waste their time on it. Deputy Bruton said that if one sets a metric one will get it because people put down whatever is needed. However, we follow up and cross reference industries with our colleagues in the IDA. We also meet the industries and check that they know what they are doing. The question of how frequently we meet was raised. We know that 50% of the industries have a licence or formal agreements in place and as such they are real.

As regards Athlone Institute of Technology, all of the institutes are open to apply. We are rigorous in terms of quality. Our choices are made in terms of competitive quality. When I say that 20% are successful, this means there are 80% who believe they are wonderful and are wonderful in one particular area, but in this competition they do not make it. We would look forward to much greater engagement, particularly with the institutes of technology. There are many good examples that come to mind. Generally, there are not perhaps as many as one would want. We look forward to more of those coming through if and when the remit of Science Foundation Ireland is expanded, such that there can be more in the applied as well as the oriented basic research. That would be an essential step and should be linked with a greater awareness, in particular within the institutes of technology, that this is an opportunity for them to have their special reasons for getting good support, not just good academic support but material that is useful to industry. I will now invite my colleague, Dr. Freeman, to respond to the remaining questions.

Dr. Ruth Freeman

On Deputy Bruton's comment in regard to the contribution to society and helping Government, the availability of Government data in the UK has been seen as a progressive step in terms of putting data into the public domain. Researchers can come up with innovative solutions when they have this information. The ICT centres of excellence which are funded by Science Foundation Ireland would welcome the opportunity to work with the Government. An example is the processes developed at the centre in Galway which were used in the White House during the stimulus plan. It would be fantastic if they were used here as well to benefit the Irish Government and the Irish people. Looking at the academic track record of people is only one side of it and we have started to assess people in terms of taking things through to the next step through innovation, commercialisation and, again, linking up with Enterprise Ireland to ask about the track record of these people once we hand them over. If they say they have a good idea and they will put it out in the marketplace, how likely is it that will happen? We do that now and we see a shift in the higher education institutes where they are also assessing people's track record in innovation as well as in research excellence, teaching, and so on.

I refer to the Chairman's example of the horses. They now have four employees in that company. It remains an Irish company and, therefore, it has not been moved offshore. It is an Irish company that is going global quickly. They are working with Enterprise Ireland. The Chairman mentioned Australia. It is having an Australian launch in two weeks but it will remain an Irish company. That is something that has continued to be supported and we see that growing in Ireland.

Dr. Cian Ó Mathúna

I will go back to the question about mathematics and science. One of the things we do effectively and it has been driven strongly by Science Foundation Ireland is the outreach programmes. Many of our researchers last week were engaged in the Discovery Science exhibition, which was on in Cork. They engaged with young children and, most important, their parents to introduce them to various principles of science and to the fun side of it. That is what is needed initially before one can get people engaged in understanding the need for them to move into that science space.

The question was asked about whether everyone needed a PhD to engage in this space. My interest is somewhere between the fundamental research and the companies, products and markets - the applied research space. It is critical that we have strong technical people but what we do not necessarily have is strong entrepreneurs, business people and strong people in the manufacturing space. The Tyndall institute is very interested in the marriage between the technologists and the people who can deliver the products, companies and jobs. That is critical and, therefore, we are only one part of that.

I refer to institutes of technology. The Tyndall institute is funded by taxpayer's money and everybody in the institute understands that this money, as Deputy Bruton mentioned, could go to hospitals or anything else. We have to be focused on delivering value from research. As part of that, the engagement we have nationally is critical in that every one of the institutes of technology and all the universities across the island considers that the institute is something they can access. Over the past five years, through the SFI-funded national access programme, we have had more than 400 researchers from the different institutes of technology and universities coming to the institute to undertake research and enhance what they are doing themselves rather than replicating facilities. This country is too small to engage in that.

That is excellent. As Deputy Bruton said, it is important that we get a significant bang for every buck we spend.

What is the mandate of the Jim O'Hara committee? Will it conduct a one-off review and produce a report? Will it continue to ride shotgun on programmes? Will the group be expected to change the scoring applied to applicants? How strong is the mandate for the review group? Could it say it is not happy with the loading applied to applicants and it wants more emphasis on commercialisation and less on something else in order that there would be an implementation dimension as well?

Dr. Alastair Glass

We are about to enter our third meeting next week and we do not have any conclusions yet. We have had a set of hearings and we have heard from other countries as to what they have done in terms of focusing their research. We have heard from Sweden, Finland and the United Kingdom about their process and how they did it. We asked whether they had a government committee that decided what is important and so on.

My expectation is that the committee will come up with something that is sustainable in the longer term. Even if they come up with a few initial suggestions for areas of national opportunity where we could be the best in the world, which I am sure will happen, for the system to be sustainable, that has to come from the stakeholders. One needs the industries and the researchers to come with the great opportunities. One does not want government deciding on an ongoing basis what are the great opportunities. It is absolutely essential that there is a national goal because it is hard for individuals in individual institutions to establish national goals and it is important for that to be done at national level.

Professor Frank Gannon

It is an important prioritisation exercise which arises a little from the innovation task force. The task force said there should be prioritisation and there should be a rolling look at this to identify the areas. It has happened; it is not that everybody has been waiting for the prioritisation to take place. SFI has three areas of prioritisation - ICT, biotechnology and energy. The IDA has five areas of prioritisation, which overlap with what we are doing. We have analysed internally the SFI groups. This is not randomly split and there are strengths. We can put together a list of ten to 15 areas that we know are putting stuff out that is not only excellent research but excellent relevant research and these are the areas that we anticipate will be the outcome of the exercise. We want to be very much involved in ensuring that all that information is available.

However, if one is prioritising, one is also deciding not to do some things and if one decides not to do something in some area because it did not make some hit list, that means for a country like Ireland, which is very open in the market to see what opportunities are there, we have to say, "we are not going to take those opportunities". That will not happen. We have to be much more flexible in how we interpret the priority areas. It will be an interesting challenge for the steering committee to come up with them such that nothing is excluded that suddenly comes up. There have been examples in every country where a prioritisation exercise has been undertaken and, within three years, they have missed the big one. That happens and, therefore, we have to be ready for that because the researcher, as Dr. Glass said, takes approximately five years to get things up and going. One cannot say, "Oh, there it is, we have to get up and going".

That leads to the second point. One has to have in the mix prioritisation plus flexibility that allows one to be in zones of activity that can grow. SFI was not in the area of energy under our legislation but we had one programme that had travelled to us from Enterprise Ireland in basic research, the research frontiers programme, where we happened to support energy-related research because it was the right quality and relevant research, which meant that when energy came to us, we had 40 different grants that we could point to and parcel in there. I would sound a little warning that excessive top-down delineation of where we are going could mean we pick wrong horses to go back to the Chairman's territory. One has to be available for both to happen - the prioritisation for sure but available to understand the consequences as well.

I welcome both delegations and I compliment them on their presentations. It is a little disappointing for them that only two or three members are present but it is the day that is in it. Normally, all the chairs would be full and we would have many questions to ask. I will not ask any questions. Given that some of the delegates have travelled long journeys to appear before the committee, I invite them to make any further comments they wish to the committee. This goes on the public record of the House and will be used by those doing research in the future and by members of the House. Some of the delegates may wish to make further contributions, contributions they felt they might have been asked about by members but were not asked. I invite the delegates to make those contributions.

I thank both organisations for the work they did in recent years in building Ireland to what it is today. We all look forward to their work in the future. Is there anything the Irish people and the Government can do to assist in their work? Do the delegates believe we could do more in the educational field to train people? Those who follow the science and research fields become involved in science research at a very early age. It is not something that happens when they begin third level education. It happens in their formative years, perhaps at primary or second level, when a good science teacher will encourage them to get involved. Is there more the Irish education system can do to assist Ireland?

Professor Whatmore may wish to deal with some of those issues.

Professor Roger Whatmore

I thank Deputy Fitzpatrick for his very kind comments, they are much appreciated. I have made a few notes because it comes back to what the Chairman said about young people and training. I would not like to comment on first and second level education in Ireland, I do not know anything about it. I attended the science discovery exhibition last week when it opened. I was struck by how excited the young children were, who were doing the little demonstrations we had set up for them, making goo or whatever. Somehow that excitement about science and discovery and mathematics has to be maintained right throughout the education system because they are very exciting subjects. Perhaps that means less robot learning, more discovery, more project related mathematics and so on.

I read a very good book a while ago by Malcolm Gladwellwhich pointed out that it takes ten years to become expert in anything. It does not really matter what one wants to be expert in - whether it is playing hurling, becoming a musician or a scientist, one needs to spend ten years hard graft to become expert. It does not matter at the end of the day whether one has the letters PhD after one's name or not, the point is one has spent ten years sweating at it. He gives a very good example of Bill Gates who dropped out of college and was somebody who did not get a degree. The fact was that he, at the age of 13 or 14 years of age, had been going into his local company where he could borrow computer time, and do interesting projects by himself with friends. He made himself into a computer expert but he spent ten years at it before he started Microsoft and we all know what that has become. We need to instill that degree of excitement in our young people and give them the time to develop within high quality facilities.

Professor Frank Gannon

I thank Deputy Fitzpatrick for the question and the invitation to provide more information. We are very anxious to get as much information to the Oireachtas and members as possible because we know it is a hard sell we have to do. It is not a hard sell because we are selling bad stuff but it is a hard combination as we have heard from the earlier discussion. We have now set up a science breakfast which is very digestible. The next one takes place on Thursday next at 8.30 a.m. in Buswells Hotel..

Dr. Graham Love

There is an invitation in each of the members' pigeonholes this week and an e-mail has gone through. We are aiming to bring one of our scientists in to speak in plain speak for ten minutes and have a conversation. The idea is to try to bring some of our achievements and information to any member of the Oireachtas who wishes to turn up. We try to bring it to a convenient place at a convenient time and we want to get this into the regular calendar. We did one of these a month ago. A small number attended on the day in question, but those who attended really liked it and there was a request to get it up and running and into the regular Oireachtas Members' calendars.

Professor Frank Gannon

The Deputy asked what general advice we would consider. First, we have to recognise that innovation, today's topic, what we are supporting with taxpayers' money and which is wonderfully exemplified by what is going on in Tyndall National Institute, is working. Every example that came from Tyndall has at its base SFI funding. These are realities that are happening on a daily-weekly basis. We must ensure that everybody in all areas sees that is important because to have growth in the economy it will not just be in the scientific areas but in the smart economy, beyond knowledge, into every area that is moving. The example was given about how to change governance through ICT. All of those things require everybody to be engaged and we want to engage and communicate that message with Oireachtas members. That is important.

If there is one message above all that is needed it is that we keep our nerve. Setting up an organisation ten years ago, investing a considerable amount of money accumulative over the years, people investing their time to come to Ireland to build their activities here, students investing to do their degrees and hoping for a career, and the EC Commissioner for Innovation coming from Ireland, all show that Ireland is taking this seriously. It is definitely the time to hold our nerve and sustain the funding that is available, otherwise, as one person said, it would be like starting to build the M50 and, halfway round, starting to dig it up again. We would have to start again in ten years' time and people would not believe we would come back again. That is very important.

In terms of getting people trained and switching on the scientists, Professor Roger Whatmore has given a few examples, but there are one or two other aspects. First, we have a programme of internship, called the Eureka programme - it stands for something that is very clever. It means that students who have come through a certain system can work in the laboratories of SFI funded scientists for a defined period. It is a small programme but it is an example of what SFI does.We have also presented the idea that in the days of high unemployment of skilled people when engineers in particular have moved away from the construction industry and know they will not be able to go back there, it is important to have retraining. We present the idea that SFI funded laboratories are a great location for these people. There is a win-win there. Excellent people who are highly motivated come in for a FÁS related placement but what the mechanism would be we do not know. Something like that would feed into the process of ensuring that maximum value is got for the investments in place. I do not know if anybody would like to add to those examples.

What about intellectual property rights? Obviously there are taxation incentives and so on but in the current climate everything is up for evaluation, examination and scrutiny. How important are those in the context of the work being done by Science Foundation Ireland and Tyndall National Institute in terms of the taxation structure and intellectual property rights? Some people consider that they are overly restrictive and could be expanded significantly particularly in the agri area, where there could be a significant focus.

Dr. Ruth Freeman

Just to give the background. Members may be aware that currently a review is ongoing of the policy and the implementation around IP, based on the innovation task force report and a Forfás report. What those reports have uncovered is that our IP policy in Ireland is not bad, it stacks up quite well against other places but we want to be best in class because it is part of the whole system we want to have to place. We are seeking to have model agreements in place. Consistency is very important. We came from a system where we had many institutions in place and they had their own policies. We need to see how we can be more coherent at a national level. That is ongoing and we are very involved and strongly support that. In terms of the tax credits - that is more a question for our colleagues in the IDA who are very much selling that as the piece of the value proposition for Ireland. The message we receive is that it is absolutely critical. The tax credits for patent income and the research and development tax credits are key parts of the value proposition.

Professor Frank Gannon

In answer to Deputy Bruton, that was specifically for the personal tax exemption. I have heard other discussions which have analysed this in different ways and come to a different conclusion. There can be differing perspective in this domain. I would leave it to the experts to work out that part. Dr. Freeman spoke about the more important part. Having a good IP system which is consistent, predictable and not fragmented into each college doing a different deal in a different way, is essential. Getting this right is very difficult because it is sectorally dependent, even item dependent and it depends on the input from the industries and on the area State aid rules. We are very engaged in all of those groups to ensure that we have understood - and through us - that the different colleges have understood what is happening. It might be useful for those in the front line because we do not hold the intellectual property rights which are held by the research institutions.

Professor Roger Whatmore

The area of intellectual property rights is a very interesting one. Most research institutions and universities do not make much money out of intellectual property. There are a few spectacular examples where a great deal of money has been made but the vast majority do not make money. Therefore, we must retain a good deal of flexibility in how intellectual property is used by industry in Ireland, from the point of view of industry using it to create jobs and allowing the research institutes to carry on doing research using the foreground as background for future intellectual property creation. Everything that is in the foreground today will be background tomorrow and one builds on that. If it is tied up exclusively it can become a blocking aspect for exploiting things in the future. I have found that most companies are fairly flexible if one is prepared to be flexible with them. Flexibility is the important factor and an understanding of the importance of the intellectual property being exploited. Creation of intellectual property is vital. It has to be created and protected and then one can talk constructively about how it can be exploited.

I thank the delegation. We are talking about our future. Science and scientific knowledge is the future, to state the obvious. Now more than ever, we need to be at the vanguard or the cutting edge when it comes to offering people the facilities that demonstrate Ireland's place as a scientific first-league nation. Not everyone can work or would wish to work in the highly paid skilled jobs but these jobs add value to our economy and attractiveness is important. We need to garner our maximum share of these jobs. As the delegates said, the competition is significant, not just from traditional countries such as Germany, the United States and Britain but from all over the world at this stage. I am heartened by what we have heard today. I hope the much-awaited four-year plan incorporates the proposals we have discussed here today. If not, it appears the plan would be grossly deficient. It behoves everyone to ensure that some of the points and suggestions made here are noted. We are pleased to have had the opportunity to articulate in our own way points which the delegates have addressed in a far more comprehensive and coherent fashion. I thank the delegates for their patience. I thank Dr. Glass, Professor Whatmore, Dr. Ó Mathúna, Professor Gannon, Dr. Freeman and Dr. Love, for attending today and assisting us in our deliberations and for giving us an opportunity to discuss issues. It is a very important area and yet it can be almost distant from us. The idea of a breakfast seminar is very attractive and some of us may attend. One can garner more information in a more informal setting and become almost familiar with the subject. Professor Whatmore referred to the enthusiasm of the young people and it would be great to capture and bottle that enthusiasm.

The joint committee adjourned at 3.35 p.m. until 2 p.m. on Tuesday, 7 December 2010.
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