Dáil Éireann Debate, Thursday - 29 June 2023
225. Deputy Bernard J. Durkan asked the Minister for Enterprise, Trade and Employment the extent to which innovation and technology is likely to feature in the creation of indigenous jobs throughout the country in the next five years; and if he will make a statement on the matter. [31957/23]
View answerThe Government recognises the need for sustained funding for programmes aimed at driving innovation within Irish-based firms, building exports and creating jobs. Funding to support industry investment in innovation is essential to maintain an enterprising and productive economy. This innovation is core to creating and maintaining high-value jobs, helping to attract investment and develop business in Ireland.
Investment in research, development and innovation (RD&I) by our indigenous companies is critical to ensuring that we have a strong competitive economy which translates into improved job creation and enterprise performance. Companies which invest in RD&I often achieve greater levels of growth, delivery and drive societal benefits, and produce solutions to global challenges such as climate change, sustainability and digital transformation, as well as the creation and maintenance of high-value jobs.
Over 25 years, Ireland has gone from a base of 800 RD&I active firms with a research spend of €300 million to almost 1,800 RD&I active enterprises spending of €3.88 billion in 2021. Enterprises in Ireland reported a 19% increase in research and development (R&D) expenditure to €3.88 billion in 2021, compared to €3.26 billion in 2019. Labour costs accounted for the largest proportion of R&D expenditure, rising to €2.05 billion in 2021 from €1.7 billion in 2019. This reflected a growth in employment of R&D staff to 32,961 in 2021 from 27,755 in 2019.
Irish-owned enterprises reported a 22% increase in R&D spend between 2019 and 2021, up from €963 million to €1.18 billion. In 2021, there were 32,961 persons engaged in R&D in Ireland. Of this total, 50.8%, or 16,739 persons, were employed as researchers, of which 2,491 were PhD qualified researchers. In addition, there were 8,690 (26.4%) technicians and 7,532 (22.9%) support staff.
The number of R&D personnel engaged in small enterprises in 2021 was 9,338, accounting for 28.3% of all R&D personnel. Medium enterprises had 8,659 persons engaged, accounting for 26.3% of all R&D personnel, compared with 14,964 persons or 45.4% of R&D personnel engaged in large enterprises.
From Eurostat’s R&D intensity rate survey in 2019, Ireland ranked 13th in the EU 27. Ireland is also identified as a ‘Strong Innovator’ in the European Commission’s European Innovation Scoreboard for 2022. This underlies the need for sustained and ambitious RD&I investment programmes that my Department and its agencies are rolling out to deepen innovation capability across the enterprise sector, in particular the innovation performance of our SMEs.
The policy framework set up by my Department supports a key role for innovation and SMEs in economic policy. The Enterprise White Paper, published in December 2022, provides a fresh impetus for progress in indigenous job creation. It sets a vision for enterprise to succeed through competitive advantage founded on sustainability, innovation and productivity, as well as delivering rewarding jobs and livelihoods.
To this end, the Enterprise White Paper will step up enterprise innovation with ambitious targets, including achieving a doubling of business expenditure on research and development (BERD) and a doubling of the number of High-Potential Start-Ups (HPSUs) from research. To maintain and build on Ireland as a strong innovator, core enterprise innovation initiatives for 2023-2024 will bolster in-house research, development and innovation activity, industry-academic collaboration, research commercialisation and deliver an increased number of spin-outs. We will also work to ensure the range of advisory and financial supports offered, including the new measures being introduced as part of the European Regional Development Fund (ERDF) funding programmes, are targeted and optimised to best help businesses at every stage of their innovation journey.
My Department published the National Smart Specialisation Strategy for Innovation in June 2022. Its overall objective is to ensure that Ireland’s innovation ecosystem at national and regional level is fit for purpose, particularly given our strategic priorities around the twin digital and green transition, as well as the need to address regional economic imbalances. Smart specialisation will be deployed to address ecosystem gaps and improve performance across all regions, building on place-based strengths. The strategy is focused on driving growth based sectoral strengths and emerging opportunity areas. It is also central to ensuring effective connections between the Regional Enterprise Plans, national level innovation policy implementation and the Regional Assemblies.
Smart Specialisation is supported by almost €400 million in ERDF plus national co-funding over the period 2022 to 2027, aimed at scaling the existing network of national R&D facilities and clusters, as well as increasing the intensity of business R&D across all regions through strengthening industry-academic collaborations. This includes strengthening the technological universities capacity to help with research and technology transfers between SMEs and higher education institutions.
The implementation of smart specialisation on a cross-departmental and cross-agency basis will ensure policy alignment across national and regional enterprise development initiatives, including through Regional Enterprise Plans and the forthcoming national clustering programme, along with activating international collaborative opportunities on regional enterprise innovation, including through EU initiatives such as Regional Innovation Valleys.
Enterprise Ireland (EI) plays a particularly important role in supporting indigenous job creation in Ireland. In 2022, EI created 19,660 new jobs, growing net employment by 5%. Support for innovation and technology through investment in RD&I played a crucial role in delivering this result. To this end, EI’s RD&I programme budget was increased to €136 million for 2023. Up to €132 million will be spent by EI on RD&I activities such as direct firm level R&D grants and equity; collaborative measures such as Innovation Vouchers, Innovation Partnerships and commercialisation of research. In addition, my Department is supporting the establishment of four new European Digital Innovation Hubs with an allocation of €27 million until 2026. The hubs have been designated by the European Commission as part of a European wide network to act as one-stop-shops for SMEs to strengthen their digital capabilities.
My Department has secured additional funding for research development and innovation of €117 million over the seven years of the ERDF. EI, working with my Department and the Managing Authorities, is using the ERDF funding for the following three innovation programmes -
• Knowledge Transfer Boost programme – to bridge the knowledge transfer gap between industry and academia by funding Tech Transfer specialists in the university system across Ireland.
• Technology Gateways programme – to provide each Technological University (TU) with an industry gateway. It will provide dedicated staff to work with industry to articulate company problems in a manner that can be addressed by the expertise in each TU.
• Innovators’ Initiative programme - to build on existing international and national best practice in immersive-based, needs-led innovation training programmes connecting with industry sector clusters in a particular region.
On 30 May, I announced the successful 17 applications for the Technology Gateway Programme. Calls issued for the other two programmes, Knowledge Transfer Boost and the Innovators’ Initiative, in February this year and the applications are currently being assessed.
Other supports available include the Disruptive Technologies Innovation Fund (DTIF), which is a €500 million challenge-based fund established under Project Ireland 2040 and set up under the National Development Plan (NDP) 2018-2027 for investment in the development and deployment of disruptive technologies and applications on a commercial basis. DTIF encourages enterprises in Ireland to collaborate and exploit the business opportunities associated with disruptive technologies by de-risking projects; build on research undertaken to support the delivery and exploitation of new technology-based solutions from that research; and foster deeper and wider RD&I collaborations between the public and private sectors in key technology areas. This year, and through to 2027, competitive call No. 6 seeks applications from innovative consortia with projects across six national research priority areas. Applications are encouraged for projects which complement the priority areas set out in the White Paper on Enterprise, including digital transformation and integrating decarbonisation and net zero commitments.
