Select Committee on Business, Enterprise and Innovation debate -
Wednesday, 20 Jun 2018

European Southern Observatory Membership: Motion

Chairman

This meeting has been convened for the purpose of consideration of a motion on the accession of Ireland to the European Organisation for Astronomical Research in the Southern Hemisphere which was referred to the committee by order of the Dáil on 14 June 2018. The committee has been asked to send a message to the Dáil not later than 27 June 2018 stating that it has completed its consideration of the motion.

The briefing prepared by the Department has been circulated to members. I welcome the Minister of State, Deputy John Halligan, and his officials to the meeting. I invite the Minister of State to make his opening statement.

Minister of State at the Department of Business, Enterprise and Innovation (Deputy John Halligan)

I am here today to present the terms and conditions of Ireland's accession to the international research organisation, European Southern Observatory, otherwise known as ESO, as contained in the accession agreement circulated to members last week. This agreement was negotiated on behalf of Ireland by a team comprising officials from my Department, who are with me, experts from Ireland's astronomical academics and industrial representatives.

As members are no doubt aware, the agreement was the culmination of several months of intense work and collaboration between the team and the European Southern Observatory, ESO, representatives.

The Government committed to initiate negotiations with ESO for Ireland’s membership as an action in Innovation 2020, Ireland’s strategy for research and development, science and technology. As part of a study commissioned in 2015, ESO was identified as a pivotal international research organisation, posing significant benefits to Ireland.

International co-operation in research and innovation plays an important role in the development and sustainability of a world class research and innovation system. International co-operation maximises the impact of international and national investment in research and innovation and develops international relations. Membership of ESO will help develop Ireland’s global footprint and support international relations with other members of the organisation and, in particular, with the host nation for the telescopes, Chile.

Benefits of ESO membership are significant, primarily that Irish researchers will be afforded an opportunity to work with facilities that would never be possible for Ireland to achieve alone. The skills that will be developed by students and researchers, such as high volume data analytics, photonics and software education, are advanced and industry relevant. In addition, Irish companies will be fully eligible to receive contracts from ESO, covering all business areas from provision of services to technical studies and delivery of advanced equipment.

The terms of Ireland’s membership are based on the ESO convention and protocols, and our negotiations were focused mainly on the financial contributions. A special deal was tabled by ESO during initial discussions in 2016 with the previous director general. This deal would calculate Ireland’s membership based on 2017 prices rather than 2018. The deal was secured by the negotiating team resulting in a saving of just under €400,000. As Ireland is joining in the final quarter of 2018, the cost for this year is €0.75 million, increasing to €3.46 million for next year, subject to indexation.

I am aware that several members have a keen interest in Ireland’s membership of international research organisations and the development of our research and innovation capabilities. I welcome the members' interest and encourage continued engagement with them. I would, however, remind members that this committee is to discuss the terms and conditions of ESO membership. Ireland has taken significant steps in recent years in achieving membership of Elixir, LOFAR and now ESO, as per our commitments in Innovation 2020.

I thank the select committee for affording me this time. I am happy to take any questions.

Deputy Maurice Quinlivan

I welcome the initiative taken by the Minister of State, Deputy Halligan. The Sinn Féin Party will be supporting the motion. We are very happy to support this great move by the Minister of State as we believe it will benefit indigenous companies in the sector that will be able to bid for contracts from ESO. We also recognise the significant benefits and opportunities that membership will bring to the academic, scientific and research communities. This is a positive move and it is something we are keen to see more of, in particular with CERN. I convey Sinn Féin's support for the Minister of State's proposal in this regard.

Will the Minister of State outline the value of the contracts that will be available to Irish companies each year as a result of our membership of the European Southern Observatory? What type of opportunities in the fields of research or study will come from our membership of ESO? Will Irish membership give us decision-making power in ESO?

I understand the special contribution fee of €14.66 million will be paid over a period of 11 years. I do not have a problem with that. Do the other member countries pay the same amount? Is the special contribution an additional fee to the cost of yearly membership? How much is yearly membership? Does the Minister of State anticipate that it might increase in the coming years? If the fee increases, how will it be worked out? In the unlikely event that we need to leave the organisation, how is that facilitated? Sinn Féin raised CERN in its pre-budget submission for the 2018 budget and will do so for budget 2019. Is there an update on the position in regard to becoming a member of CERN?

Chairman

There are a few questions.

Deputy John Halligan

I will deal with the cost. Some previous reports had indicated greater savings based on the accession calculation for 2017. However, this was not based on the gross domestic product, GDP, nor net national income, NNI, which is the figure on which ESO calculates member states' rates. While Ireland's GDP increased significantly in 2015, the NNI did not reflect the same dramatic increase. We have been very lucky in a sense in that we have been able to negotiate a good deal up to 2028, which is a reasonable deal compared to other states. Some 15 member states have joined ESO for good reason. We had come under immense pressure, and rightly so, from people such as the Deputy and others who are very interested in research and development and have a great knowledge of it that we should join these organisations.

Ireland will have two seats on the ESO Council - one will be taken by an astronomer and the other by a Government representative. We will also have a representative on the financial committee, which is important, and on the science and technology committee. We will also have an industrial liaison officer. The nomination process for these posts is under way.

The Deputy asked about the industrial return, which is measured through the ratio of expenditure in each member state and the percentage contribution to the budget spent on certain categories of contracts. Big consortia, such as IBM, InnaLabs, SensL, NASA, SGroup, Openet, ESA and Technology Ireland, have been advocating that we join. We are one of the few countries in western Europe which is not a member of ESO and we are missing out in many ways in disciplines such as astronomy. Let me remind members that Ireland has a great history in astronomy. At one stage, we had the biggest telescope in the world, located in Birr Castle. There is an interesting statistic that, as a percentage of the population, there are more members of Astronomy Ireland than there are of other such organisations in any other country in the world. If one looks at the telescope we opened, the I-LOFAR telescope in Birr, which is one of the biggest telescopes in the world, Ireland was chosen because of our astronomers and the knowledge of astronomy. We will be able to compete for business. Given the expertise of this community, it is well positioned to avail of opportunities provided by ESO membership. We will also be able to bid for contracts. Remember it will take ten years to build the telescopes and that will give an opportunity to some of our top researchers, universities and companies already dealing with the European Space Agency to win contracts. That is a good win for Ireland.

Chairman

There were a number of other questions on the cost. Perhaps the official will respond to that.

Mr. Joseph Moore

As mentioned, the €14.66 million is the once-off joining fee. As we are joining ESO, there is a cost associated with developing that infrastructure. Based on the membership of ESO and our net national income, our contribution to ESO will be €14.66 million. As mentioned, we got the opportunity to spread that payment over a period of ten years. In addition to that special contribution, we will make an annual membership contribution of approximately €2 million. That means that the cost per year is approximately €3.5 million but, of course, that will be subject to indexation as costs for the organisation rise and as the number of members in ESO change.

Deputy Maurice Quinlivan

If circumstances arose where we had to leave, what would be the position?

Mr. Joseph Moore

We are making a commitment today to remain for ten years.

Chairman

The other question Deputy Quinlivan asked was whether the cost of joining ESO was the same for every country.

Mr. Joseph Moore

It depends on the net national income, NNI.

Deputy John Halligan

It is based on the net national income, NNI, of every country.

Deputy Maurice Quinlivan

I know the Minister of State was not going to speak about CERN, but does he have an update on CERN?

Deputy John Halligan

As the members will know, I am a supporter of CERN. Representatives of CERN will come to Ireland in July and we will have a further meeting with them to discuss the prospects of joining CERN.

People may ask why we are joining the European Southern Observatory, ESO, over CERN. The reason is very simple. Researchers and developers involved in astronomy in Ireland are regarded very highly and have a considerable impact. The Department made the decision to join ESO, which I think is the correct decision at this time.

The Deputy is correct, and I have spoken to him on a number of occasion about CERN. We have to join CERN at some stage. We will provide a further update to the committee when we meet representatives of CERN in July. We can apply for full membership, which is expensive, but to be honest, we do not have that level of finance available. There is also a category of associate membership, but the problem with associate membership is that it only gives us 10% of the credits back. I do not think associate membership is a good deal but my officials will negotiate with CERN in July. We will keep the members informed of how the negotiations go. All the members present want Ireland to join CERN and we think we should join it.

Chairman

Following the meeting of officials with the representatives of CERN in July, will the Minister of State and his officials supply the committee with a briefing document, if the Houses are not sitting at the time? Many members are very concerned about it.

Deputy John Halligan

We will not be in a position to join CERN in 2018, in case members might think we can reach a deal in July and join in 2018. There will be protracted negotiations that will probably go on until the end of the year. We will most certainly have a look to see where we stand in terms of associate membership or full membership next year. We cannot join in 2018.

Chairman

Does the Minister of State believe the cost is one of the main stumbling blocks?

Deputy John Halligan

To be frank, it is. The Department with the help of the members present have been fighting tooth and nail to ensure we get extra funding for the European Space Agency where we get a great return. I have addressed the Cabinet on the issue of joining ESO, which we think is very important for Ireland, our researchers, our universities and our businesses. It has been a tough fight for my officials to make sure we join ESO. We will keep fighting to join CERN. I would be confident that Ireland will be a member of CERN.

Chairman

I thank the Minister of State and I call Deputy Lawless.

Deputy James Lawless

I support the accession to the European Southern Observatory, ESO. This is an important step forward for Ireland and for the Irish astrophysics community. I was involved in this work last year. I joined the Minister at the switch-on of the international LOFAR telescope at Birr Castle. It was a great day for the astrophysics community. Some seeds were sown and some processes are in train already. The Minister and some of us talked at length on how this process might advance.

I pay tribute to people, such as Mr. Joe Hogan who was a great advocate for ESO membership and brought some of his business expertise to the process in terms of making the business case. Dr. Peter Gallagher is an outstanding astrophysicists, a person we can be proud of in the international science community but based in Trinity College at present. I know Dr. Gallagher was instrumental in making the case for ESO membership and he explained to me and many others the many benefits that would flow from it and how it would benefit the community and the level of access they would have to the equipment, facilities and research data available through ESO.

I also attended the astrophysics conference in Maynooth last year, where the keynote subject on the agenda was whether we would join the ESO. I know there was delight in the community when it was announced on budget day that we were to join. I am delighted that we are ratifying this. Deputy Quinlivan asked enough questions and covered any questions I had. This is a really positive development and I am delighted to support it.

I know the topic under discussion is the European Southern Observatory, but since we have introduced the topic of CERN to the debate, I would like to see Ireland joining all the international consortia and research collaborations because we get so much back. Each of these groups and each of the associations have a multiplier effect. When I joined the Minister of State at the European Space Agency, about 18 months ago now, we learned about the 7:1 multiplier effect, so that for every euro invested in space technology and the space agency, one gets €7 back, between contracts awarded, research opportunities and study opportunities. The same goes for ESO, which we are ratifying today, and for CERN. In CERN the figure is more in the range of 3:1 or 4:1, depending on how one calculates it. There is a significant opportunity. I welcome the Minister of State's comments and I know from private and public discussions of his interest and commitment in the matter, so I look forward to progressing it.

I understand completely the argument about why full membership of CERN is preferable to associate membership, but it might be worth looking at the Israeli model. What Israel has done is to go down the path where one has a higher level than associated membership and one gets between 25% to 30% back, above the 10% back that one gets as an associate member and one is on a fast track to full membership. That might be a model to look at. I understand the budgetary constraints but I am delighted the Minister of State and the Department are committed to that course of action. We will have to try to find ways around budgetary constraints but I look forward to next year or the year after when the committee will be in a position to join CERN. I hope it will happen sooner rather than later.

Deputy John Halligan

I should say the intense demands on the capital programme and the tight fiscal space we are in means that we did have to make a decision on the best organisation to join in view of the money we have available right now. We chose to join ESO. We will meet representatives of CERN, as the Deputy said, in July and we will see whether we can negotiate a deal with it. As I said, and at the risk of repeating myself, we are all anxious - I am more anxious than anybody - to join CERN. We should do so, but right now we are in a very difficult financial situation in terms of trying to leverage more money to join CERN in this fiscal year. We will not be able to do it. As Deputy Lawless said, it is possible that we may be able to do a deal with CERN-----

Chairman

That might work for both.

Deputy John Halligan

Yes. It might be worth having a look at a deal. I appreciate the Deputy's interest in the European Space Agency and CERN, I-LOFAR and so on. The Chairman has my word that we will keep the committee informed on how our negotiations with CERN go in July. After we meet them, we will talk to the committee as soon as we can. We cannot get the ratifications through without the support of the committee.

Chairman

I thank the Minister of State. He said there will be two members on the board of the ESO, that one would be a politician and the other-----

Deputy John Halligan

One would be a prominent astronomer in Ireland.

Chairman

Will that person feed back to the Department of Business, Enterprise and Innovation after the meetings or how will it work?

Deputy John Halligan

Absolutely. My Department has always been upfront with representatives of the political parties, such as Fianna Fáil and Sinn Féin. We know the keen interest both Deputies have in research and development. We will feed back to the Deputies and the political parties because we require their support.

Mr. Joseph Moore

I endorse what the Minister of State is saying. Each member state is entitled to have two delegates to the council which manages ESO. It is a requirement that one of the delegates would be an astronomer and it is the intention that as well as the astronomer there would be a representative from the Department.

Chairman

A representative from the Department is not necessarily a politician. One could understand why ESO would want one of the delegates to be an astronomer.

Deputy James Lawless

I know that CERN representatives will be in Dublin in July and the Minister of State talked about meeting them. Are they due to appear before the committee?

I know that Professor Ronan McNulty was keen to appear before the committee to discuss CERN membership.

Chairman

We have said that Professor McNulty and a professor from UCD will be facilitated in the work programme in the autumn.

Deputy James Lawless

I thank the Chairman.

Chairman

Is Deputy Neville happy?

Deputy Tom Neville

Yes.

Chairman

Does the Minister of State wish to say anything further?

Deputy John Halligan

I do not wish to be condescending to the members who have been so supportive of research and development. We are grateful for that. They have been incisive in their questions over the past number of months on all issues of research and development, which is important to us. We recognise that in the tight fiscal space money has to be spent on health, education, housing and so on, but we must spend on innovation and research and development. We must give our researchers the same opportunity the 15 other countries in Europe give their researchers. The Department is forthright in its determination to join research organisations all over the world. I thank the members who are well up on research and development for their forthright contributions. We did not want the motion to pass on a nod and a wink, as it is great to have the opportunity to respond to the questions from members.

Chairman

I thank the Minister of State for that. In fairness, members are always constructive and when they come into the committee room, politics are left outside the door. The committee has dealt with nine Bills, which is a sizable body of work.

Deputy John Halligan

It is excellent.

Chairman

We have worked very hard over the past five months on the cost of doing business. We will be finalising our document in two weeks' time and will launch it in July. We will send a copy of our report to the Minister of State, Deputy Halligan. There is a common denominator running through the evidence we heard on insurance, finance and rates and the lack of skills in the construction and hospitality industries, about which I know the Minister of State is concerned. I will welcome feedback from the Minister of State on this report.

Deputy John Halligan

We will be delighted to give it.

Chairman

That completes the committee's consideration of the motion. I thank the Minister of State and his officials for attending the meeting.