JOINT COMMITTEE ON ENTERPRISE, TRADE AND EMPLOYMENT díospóireacht -
Wednesday, 23 Jan 2008

Annual Report 2006: Discussion with Enterprise Ireland.

Chairman

We will begin consideration of the 2006 annual report of Enterprise Ireland. I welcome the representatives of Enterprise Ireland: Mr. Frank Ryan, chief executive officer; Ms Julie Sinnamon, executive director, entrepreneurship regional development and human resources; Mr. Feargal Ó Móráin, executive director, innovation research commercialisation corporate and investment services; and Paddy Hopkins, corporate services. I understand that Paschal McGuire, Jessica Benson and Enda McDonnell are here too. I thank all the officials for attending today.

A delegation from the committee met representatives of enterprise boards and other economic interest groups in the Tipperary, Waterford and Cork border areas on Monday and yesterday. Mr. Ryan's meeting with us today is accordingly timely. Members of the delegation may have questions for Mr. Ryan and his officials arising from that visit. I call on Mr. Ryan to make his presentation.

Mr. Frank Ryan

I thank the Chairman and members of the committee for giving me the opportunity to present an overview of Enterprise Ireland's 2006 annual report.

The 2006 annual report summarises Enterprise Ireland's activities and the performance of our client companies in that year. It outlines the various ways Enterprise Ireland has worked in partnership with those companies and other relevant bodies, including other development agencies, Departments, and the third level sector throughout 2006 to drive the development and growth of the Irish enterprise base. Enterprise Ireland is mandated to work with manufacturing and internationally trading services companies throughout the regions and offers a range of financial and non-financial supports to help their development.

In working with our client companies we are focused on assisting their export growth and improving their innovative capabilities ensuring they can compete successfully in overseas markets. Enterprise Ireland is also focused on creating new jobs by supporting entrepreneurs to establish companies that have high growth potential and creating the conditions for new job growth in existing companies. The development and sustained growth of Irish-owned companies will be the foundation on which future regional and national prosperity will be based. This vision will be achieved only if the challenges faced by Irish enterprise are met head on.

We launched our strategic plan, Transforming Irish Industry 2005-2007, in late 2004 in the context of the Government's enterprise strategy action plan. This recognised that the internationalisation of Irish-owned companies and their ability to compete successfully were essential for Ireland's future economic success. It clearly outlined the activities we are implementing to transform Irish enterprise into market-focused and innovation-driven businesses that can compete successfully on world markets

In 2006, Enterprise Ireland continued to meet the needs of our clients and to focus on achieving five high level strategic targets specified in our strategic plan which were designed to support the development of indigenous industry to end 2007. Significant progress was made in 2006 towards achieving these targets. Enterprise Ireland client companies employed 141,091 in 2006 with net job gains of 1,261. The north east accounted for the largest proportion of the gains, followed by Dublin and the mid east. The midlands, the north west and the west also enjoyed job gains.

By continually repositioning and strengthening our overseas network offer, Enterprise Ireland maximises support for our companies in their marketing and export drive. As part of Enterprise Ireland's strategic plan, our 32 overseas offices now report to a central international sales and partnering division and are subdivided into five key geographical areas. Enterprise Ireland client companies performed strongly in all these key export markets in 2006, achieving a €1.699 billion increase in new international sales leading to a growth of 12.1% in overall client exports to €11.8 billion.

Exports to northern Europe, including the United Kingdom, increased by 10.6% to €6.74 billion. The United Kingdom remained the strongest export market for client companies with €5.248 billion in exports, an increase of 9.4%. Exports to the Americas region increased by 12.4% to €1.299 billion. The US market delivered strong business for Irish companies while South America continues to develop as an export market. Southern Europe, the Middle East and Africa also provided strong sales opportunities for Irish companies with exports growing by 22.6% to €1.377 billion. Exports to Germany, central and eastern Europe increased by 13.5% to €894 million. Exports to Asia reached €654 million, an increase of 24.3%, making Asia the largest growth market for Enterprise Ireland client companies in 2006.

On a sectoral basis strong export growth was evident in 2006 across the key industry sectors of software, services and emerging sectors, industrial and life sciences, and food and retail consumer markets. Food and retail consumer markets continues to be our largest export sector, achieving €7.849 billion in exports, a rise of 11.4% over 2005. Industrial and life sciences market exports grew 11.9% to €2.493 billion. The largest percentage growth was demonstrated in software, services and emerging sectors which increased 16% to €1.437 billion.

I now turn to other export related activities in 20O6. Enterprise Ireland at home and overseas, works intensively with companies, creating and implementing successful strategies for market entry. During 2006, the agency secured 6,469 sales meetings for clients, organised 36 high profile trade missions to overseas markets, participated in 29 international trade fairs and organised 45 inward buyer missions to Ireland. In 2006 Enterprise Ireland commenced the appointment of overseas in-market business experts and established advisory boards to help clients accelerate their international success.

The Enterprise Ireland trade mission to India, early in 2006, led by the Taoiseach, accompanied by Senator Donie Cassidy, then Vice Chairman of the Joint Committee on Enterprise and Small Business, was the first all-island overseas trade mission. The mission visited three key business centres, in Bangalore, Delhi and Mumbai, and involved 85 Irish companies, industry associations and organisations from a broad range of sectors, including biotechnology, software, IT, educational services, sports and arts, and food and beverages. Over 500 meetings and three major networking events were held and 13 companies entered into contracts and partnerships estimated to be worth more than €35 million over a three-year period. A number of third level colleges and industry associations were successful in signing partnership agreements with Indian counterparts. During the visit, the Taoiseach announced the opening of an Enterprise Ireland office in Delhi to better service the needs of Irish companies in the Indian market. Significantly, this mission included delegates from 12 Northern Ireland companies.

This first all-island trade mission by Enterprise Ireland and Invest Northern Ireland paved the way for further successful collaborations. Later in the year, Enterprise Ireland and Invest Northern Ireland worked closely on an all-Ireland trade mission to Canada led by Deputy Micheál Martin, Minister for Enterprise, Trade and Employment, and Ms Maria Eagle, MP, the Northern Ireland Enterprise Minister.

A strong commitment to innovation through research and development leads to sustained export growth. Enterprise Ireland incentivises activities in a range of areas, supporting the following: in-company research and development; the commercialisation of research; and stimulating collaboration between industry and academia. In the context of the national science strategy research and development targets were set to 2007 to increase to 596 the number of companies investing over €100,000 in meaningful research and development and increase to 42 the number of companies investing over €2 million annually. In 2006, 601 Enterprise Ireland client companies engaged in projects involving research and development investments of €100,000 or more and 40 were engaged in significant research projects involving investments of €2 million or more.

In total, €52.9 million was approved in support of 194 in-company research and development projects. Of this, €31.3 million was approved in support of 112 in-company research and development projects outside Dublin. In 2006 Enterprise Ireland's research and development advocates programme resulted in 35 client companies seeking support to engage in practical research and development for the first time.

It is imperative that greater interactions between companies and research groups in colleges across Ireland are forged. To achieve this, Enterprise Ireland is working closely with the colleges and our partner agencies to ensure that the major investment in the research infrastructure made in recent years is sharply attuned and accessible to enterprise needs. The innovation partnerships initiative enables Irish industry and third level institutions to work together in developing cutting-edge products, product enhancement and new services. In 2006, Enterprise Ireland supported 63 company-college collaborative projects.

The agency's applied research enhancement programme provides opportunities for institutes of technology throughout the regions to develop research capabilities in areas of strategic importance to the individual colleges and which are relevant to industry in the regions. In 2006 the programme was introduced on a national, non-competitive basis and eight centres had been funded with €10 million by end-2006.

In addition, an innovation voucher initiative was introduced by Enterprise Ireland in April 2007. The establishment of this scheme was a key recommendation of the Small Business Forum's report Small Business is Big Business, in May 2006 - to drive interaction between the research base and small business. In the 2007 pilot phase of the initiative 428 companies received vouchers with a total grant allocation of €2.14 million. Some 292 of these companies were located in the regions and received a total grant allocation of €1.46 million. A further 20 companies received vouchers with a total grant allocation of €100,000 at the beginning of 2008. It is intended to have five more calls in 2008.

In tandem with the direct connection to enterprise, Enterprise Ireland continued to leverage publicly funded research by developing a supportive commercialisation process so that investments deliver optimal returns to the Irish economy. In May 2006, Deputy Micheál Martin, Minister for Enterprise, Trade and Employment, announced the provision of a €30 million fund designed to build stronger and more professional technology transfer functions within higher education institutions in Ireland. Technology developed as part of academic research is being identified, protected and transferred to companies through an active managed process with Enterprise Ireland working in close collaboration with academic institutions. This is now happening through a central support office and a network of key agency staff on-campus. The organisation is working with researchers to develop their projects through a comprehensive and responsive financial and advisory support system. Through the commercialisation fund, expenditure of €29.7 million was approved in support of 155 research projects through proof of concept and technology development phases.

Nearly €200 million was secured by Irish researchers under the sixth framework programme, a European Union fund supporting research and development among industry and research organisations across Europe. Enterprise Ireland was mandated to lead Ireland's seventh framework programme efforts with the establishment of a dedicated support unit. A target of €600 million in funding has been set for Irish researchers over the lifetime of the seventh framework programme.

An environment conducive to entrepreneurial activity throughout the regions is critical to national competitiveness. Our focus is on assisting and developing a cadre of vibrant, ambitious enterprises to harness the abundant creativity of Irish entrepreneurs. Enterprise Ireland has shown a strong record in supporting the creation and scaling of new high potential start-up enterprises. These new businesses will be the employers of the future and the drivers of regional and national prosperity.

In 2006, 76 high potential start-ups were established with Enterprise Ireland support across all sectors. Over half of these were located outside the Dublin region. The total investment in the 76 companies was €47.5 million of which Enterprise Ireland invested €17.5 million. These companies are expected to create approximately 1,260 new jobs and generate exports worth €110 million over the next two years. Of the 76 high potential start-ups established with Enterprise Ireland support in 2006, 41 were located outside Dublin. The level of start-up activities over recent years has been dynamic. Some 79 existing start-ups secured key international first reference contracts in 2006. Enterprise Ireland's challenge in the future will be to drive the growth of these start-ups and other established companies to significant scale.

Maximising the factors and opportunities that will drive cadres of sustainable companies of global scale and significance is a key strategic priority of Enterprise Ireland. In 2006 it worked intensively with a portfolio of 50 clients across all sectors and regions to maximise their potential to grow to scale and compete aggressively in international markets. Access to finance is a key challenge to firms. The agency invested €175 million in a new round of venture capital funding in 2006 which is expected to leverage an estimated €1 billion for investment in start-up, early stage and development stage businesses.

Section 5 pf the report deals with world-class productivity and management development. Improvements in productivity lead to stronger competitiveness in world markets and are crucial to the success of Irish industry. A range of initiatives to enhance productivity among Enterprise Ireland client companies was run over 2006. These included initiatives around supply chain management, benchmarking, e-business and management development.

The productivity improvement fund, PIF, provides advisory support and financial assistance aimed at driving sustained improvements in productivity in fund recipient companies, thereby increasing exports or establishing a base from which they can develop their exports. In 2006, Enterprise Ireland supported 150 productivity improvement projects involving total investment of €102 million supported by €28.6 million from Enterprise Ireland. Some 81% of this funding was assigned to regionally located companies. In addition, Enterprise Ireland supported over 60 client companies' supply chain-enhancing projects. Building on the success of the PIF, a new growth fund for small and medium-sized enterprises seeking to increase sales and develop exports through improved productivity and competitiveness will be launched in early 2008.

The international selling programme, initiated in response to the Enterprise Strategy Group action plan recommendation, began in February 2006. This programme, provided by the Dublin Institute of Technology, is designed to assist exporting companies to develop medium and long-term international sales strategies. Some 32 participants from 30 companies completed the course in November 2006. A second programme took place in 2007, with 50 participants in Dublin and Cork, and a third programme will commence in February 2008.

The Leadership 4 Growth programme is a unique management development programme specifically designed for the CEOs of companies who have the ambition and potential to achieve significant scale in their chosen markets. Thirty-one CEOs of leading software and technology companies commenced the programme in 2006 and completed it in September 2007. As a result of the success of this programme, a second programme commenced in December 2007 with 32 participants from software and technology and life sciences companies. A third programme specifically designed for the construction sector will be launched in 2008.

Section 6 deals with driving regional enterprise. Achieving balanced regional development has been a guiding principle in the provision of Enterprise Ireland supports to client companies and in the formulation of initiatives to improve business infrastructure in the regions. In 2006, 70.9 % of all Enterprise Ireland company-related funding was approved to regionally located clients. Enterprise Ireland continued to work closely with local industry and research organisations to stimulate start-up activities throughout the regions. Initiatives included a variety of knowledge sharing and networking activities. For example, there were 400 attendees at the First Step seminars and 170 potential entrepreneurs took part in 14 EnterpriseSTART programmes. Enterprise Ireland also financially supported 84 participants on the regional Enterprise Platform programmes. Other support for entrepreneurs included the Business Angels Partnership formed in conjunction with InterTradelreland.

Establishing essential business and technology infrastructure is a priority for Enterprise Ireland. Significant strides have been made to date to put in place enterprise space, third level enterprise incubation facilities and specialised staff to further the development of new businesses. Enterprise Ireland's focus is on improving the business climate for enterprise and influencing the conditions which facilitate increased levels of entrepreneurial activity and sustainable business development in the regions.

In 2006, Enterprise Ireland approved grants of €7 million for 24 community enterprise centre scheme projects throughout the country at a total building cost of €26 million, including 14 new-builds and 10 extensions to existing centres. Enterprise Ireland carried out a review of its community enterprise centre, CEC, programme in 2007 with very positive results. The 105 CECs operating had an average occupancy rate of 87% with almost 1,000 enterprises employing 4,850 people in locations throughout the country.

It should be noted that in 2007 Enterprise Ireland established the county enterprise board support unit, which is part of the entrepreneurship and regions business unit headquartered in Shannon. The objective of this unit is to provide a range of supports to the county enterprise boards, CEBs, which will ultimately enhance their effectiveness and efficiency and enhance the impact of the CEBs on the future development of micro-enterprise.

By the end of 2006, Enterprise Ireland had invested over €46 million in business incubation activity covering 25 incubation centres, 16 of which are based in institutes of technology throughout the regions. These centres strengthen links between academia and industry and provide space and support to entrepreneurs.

In conclusion, strong results were recorded in both 2005 and 2006 under Enterprise Ireland's three-year strategy, 2005-2007: Transforming Irish Industry, and this momentum continued in 2007. The results for 2007 will be reported on later this year. Enterprise Ireland will build and advance on the progress made in 2005-07, ensuring that continued growth is achieved. Enterprise Ireland's new strategy, 2008-2010: Transforming Irish Industry, was launched by the Minister for Enterprise, Trade and Employment, Deputy Martin, in October 2007. A core objective over the period of the strategy will be to achieve the ambitious target of €4 billion in new export sales from Irish companies. Innovation across all aspects of business will be central to securing the company growth required to fuel the economy.

I am grateful for the opportunity to present an overview of Enterprise Ireland's 2006 annual report. My colleagues and I will answer any questions committee members may have.

Chairman

I thank Mr. Ryan for that comprehensive report, for which we are grateful. I call Senator Cassidy.

Senator Donie Cassidy

I will throw in the ball. We have heard a very positive and thorough report on the activities of Enterprise Ireland for 2006. The CEO, Mr. Frank Ryan, and all his officials present are to be congratulated and complimented on the wonderful work they are doing for Ireland. It is a magnificent report to come before an Oireachtas committee. I have attended many difficult meetings but this meeting has shown that having the expertise of Enterprise Ireland, led by Mr. Ryan and his team, has borne fruit for Ireland in regard to job creation in recent years. Enterprise Ireland could not be led by a better person than Mr. Ryan, as I have said on the Order of Business in the Seanad, when he was not present. Any time I have conducted business with Mr. Ryan as Chairman of this committee, it has been a pleasure. His stewardship has been exemplary.

That said, I come from the world of business. The issue that has emerged and will be the greatest challenge for this committee and the Department in the next five years is competitiveness, which will also be a serious challenge for Enterprise Ireland and the IDA in the context of job creation. Research and development is extremely important and is where the high-income jobs will be in the future. However, back at street level, particularly in rural Ireland, there are 80 to 82 locations where the IDA owns the property, has developed the sites and has been in place for quite a long time. It is working to promote job creation by encouraging organisations or multinationals to locate at these sites.

As one who, like Mr. Ryan, was not reared with a silver spoon, I realise Ireland's success over the past 25 years has been based on the success of the institutes of technology and the regional colleges in Letterkenny, Sligo, Athlone, Carlow and throughout the country. They have transformed the country and given the children of middle and lower income parents an opportunity for third level education. The future of the 80 to 82 sites held by the IDA offers many opportunities. For example, there are 6,500 students in Athlone Institute of Technology. We must assess how the spatial strategy operates in the midlands, particularly with regard to Tullamore, Athlone and Mullingar. We must consider the value for Tullamore and Mullingar of getting an arm of that institute into Mullingar, where the IDA has a substantial 68-acre site with all services in place. The same applies throughout the State. The site in Mullingar even has a bus stop, but no activity is taking place. It is the same in Tullamore.

The universities work hand-in-hand with the multinationals. The intellectual property rights for research and development and science are vested in the universities, as they are everywhere else in the world. A young person taking a science subject has to sign over his or her intellectual property rights to the university in question. Ireland could show the way in this area, through the institutes of technology, as has been done at a location in Canada. That initiative has been extremely successful. It operates by vesting intellectual property rights in the innovator who then licenses back a percentage of those rights over a period of 25 years. Most inventions will inevitably be out of date by the end of that 25-year period.

Ireland could, through the operation of such a system in the institutes of technology, become the central magnet in Europe for scientific innovation. This, in turn, will lead to significant job creation. Incubator units such as those to which Mr. Ryan referred should be put in place under the remit of Athlone Institute of Technology in Tullamore and Mullingar, for example. The IDA could provide the sites for these units and Enterprise Ireland could offer assistance in terms of funding. Through the recommendations of Enterprise Ireland and the IDA to the Minister, Ireland could become a leader in Europe in terms of attracting scientific innovators, thus offering opportunities for development that would carry us forward for the next 25 years.

We all know that a significant aspect of Ireland's attractiveness to investors is its corporation tax rate of 12.5%. Many multinationals are here primarily because they wish to avail of it. However, what is our strategy for the next 25 years in terms of job creation? The proposal I have put forward is only one of several that were discussed in the five years I was a member of the previous committee. Mr. Ryan knows exactly what I am talking about. Is there any way that Enterprise Ireland and the IDA can get together with the Minister to consider implementing such a programme? The IDA has valuable sites available throughout the State. Members of the previous committee visited many of these unoccupied sites.

An initiative such as I have suggested would represent another arm of improvement in terms of job creation on the island of Ireland. Enterprise Ireland should assist or even lead the way in advancing this worthwhile idea. It has been a major success in Canada. Perhaps the delegates will come before another meeting of the committee in the future to discuss how we might develop this idea and take it to the next stage.

Mr. Frank Ryan

We will certainly take on board the advice and input of Senator Cassidy on this issue. Coincidentally, we met yesterday with the Council of Directors of the Institutes of Technology. This was the first of our twice-yearly scheduled meetings with the council. We have a close working relationship with the institutes of technology and we hold them in extremely high regard. They make a fundamentally important contribution to economic development in each of the regions.

Yesterday's meeting was under the chairmanship of Ciaran O'Cathain, the director of Athlone Institute of Technology. We discussed the programmes on which we co-operate and how these could be expanded and made more relevant for the future. The community enterprise centres on a regional basis have been extremely successful and are highly regarded in the communities in which they have been established. We have established incubation centres in every institute of technology. In addition, the institutes play a major role in the new innovation voucher scheme whereby small companies are encouraged to work with their local college. Approximately 450 companies have been supported in this way to date.

On people returning to Ireland to establish operations here, of the 76 high-potential start-ups in the last year, some 12% were established by Irish expatriates returning home. These people have the technological skills and knowledge to establish successful businesses in Ireland. That will be an increasing feature of the development of the economy into the future.

Deputy Cyprian Brady

I thank Mr. Ryan and his colleagues for their positive and upbeat report. As the Chairman mentioned at the outset, members of the committee spent the past two days travelling to various towns in the south east. An issue raised by most of the groups to whom we spoke was that of the relationship between Enterprise Ireland and the IDA and how that has implications for different localities. Will Mr. Ryan comment on how that is progressing?

Another striking observation from my perspective was that a significant number of the towns we visited did not have a third level institution. We were told in Thurles, for example, that for a town or village seeking a technology park, the advice is that it should be located adjacent to a third level institution. Several of the places we visited did not have an institute of technology and felt they were being excluded for this reason from whatever was available.

The second largest market is the Middle East-African market. There is a substantial differential between countries in Africa. Egypt, for instance, is relatively wealthy, while the economies of other countries are significantly underdeveloped. How does Enterprise Ireland see the State developing to tap into the African market in the future?

Mr. Frank Ryan

There is a close working relationship between the IDA and Enterprise Ireland. This relationship is extending now to include the county and city enterprise boards. I expect this close and developing relationship to continue. In a developing economy, as Ireland was until some five years ago, there tends to be a major focus on attracting foreign direct investment. This is the correct approach to take to climb up the economic ladder as quickly as possible. However, Ireland is now a developed economy and, thus, more akin to Germany, the United States or Japan. As a developed economy, issues such as innovation become far more important.

Some of our most successful entrepreneurs did not grow up beside an institute of technology or university. Mr. Philip O'Doherty, an entrepreneur in Burnfoot, County Donegal, for example, employs 300 people and exports throughout the world. Martin McVicar of Combilift employs 400 people in Clontibret, County Monaghan, and his company's products are sold internationally.

The great thing about innovation is that it cannot be channelled. It must be enabled and encouraged where it is found. Therefore, in future, Enterprise Ireland must ensure that it makes its services available both to those who come from the larger urban areas and to those who do not. Need is a great motivator. Last year, we were pleased to see that 70% of the funds paid out by Enterprise Ireland went to regionally-located companies, which constitutes a phenomenal difference from the position that obtained ten years ago.

The Middle East and Africa are strong growth areas for Enterprise Ireland. Last week, we supported the Taoiseach on a major trade mission to South Africa in which more than 50 companies participated. Its purpose was to build on a trade mission led in September 2006 by the Minister for Enterprise, Trade and Employment, Deputy Micheál Martin, in which 16 companies participated. Within that space of time, the numbers have risen to more than 50 companies and contracts of approximately €30 million were announced last week by companies participating in that programme.

This highlights the requirement for people to make a strategic change regarding the development of Ireland's export markets' international footprint. Although traditionally we have been very strong in northern Europe and North America, economic growth rates in both regions will not be strong in the coming years. Enterprise Ireland believes that approximately six to seven locations worldwide will supply most growth. Half of all global growth last year occurred in the three locations of China, India and Russia. In recent years, we have been building on our existing office structure. We have offices in China and Russia and when the Taoiseach led the trade mission to India, an Enterprise Ireland office was established there. Last year, the Minister for Enterprise, Trade and Employment, Deputy Micheál Martin, announced the establishment of an Enterprise Ireland office in Brazil. In addition, we have maintained offices in Japan and the Gulf for some time. These six or seven areas include South Africa, which is the foundation for growth in the entire Continent of Africa. Everything depends on South Africa's performance.

We are highly conscious of where growth will take place in the future. This means that increasingly, Irish companies will be obliged to employ personnel who speak Portuguese as there is no point in trying to sell in Brazil unless one can do so. Similarly, if one wishes to establish a strong foothold in the Russian marketplace, one must be able to speak Russian. Major changes will take place and not merely during the three-year timeframe of our next plan. It is realistic to believe that for the next 30 years, five or six key locations in the world will supply most of its economic growth. Enterprise Ireland's job is to ensure that an increasing number of Irish companies are present in such markets and secure an increasing amount of such growth opportunities.

Deputy Arthur Morgan

I also thank the chief executive officer, Mr. Frank Ryan, for his comprehensive report on behalf of his team and thank him for coming before the joint committee to elaborate on it.

I have a number of questions and comments. Many members have been approached by entrepreneurs seeking assistance and guidance when trying to start up a business or to expand a recently-established enterprise. They do not know whether to approach FÁS, the relevant county enterprise board or Enterprise Ireland. Would Mr. Ryan consider a one-stop-shop encompassing all the aforementioned agencies to be a useful project, until such time as a reform to streamline them has been introduced? It is easy to have a grasp on such matters when one is up and running and has ten or 12 employees. While it is easier to make progress at that stage, it is very difficult until then.

While the approval of €52.9 million for research and development projects in 194 companies is welcome, it appears to be spread quite thinly. Does it appear obvious to Mr. Ryan that such a budget does not come close to Enterprise Ireland's requirements in this regard, given the importance of research and development to all businesses? The leadership for growth project is magnificent and can achieve a great deal very quickly for those who are already at the cutting edge and wish to hone their skills. I will not refer to a waiting list in this regard because, usually, one must make a call to create a waiting list. However, is it obvious that this constitutes another programme in urgent need of additional funding to facilitate its rapid roll-out?

Given the current global economic conditions, Enterprise Ireland's target of €4 billion in respect of the transformation of Irish industry from 2008 to 2010 appears ambitious. I assume the agency does not intend to revise it downwards or at least will not admit to it. Perhaps Mr. Ryan might comment on the challenges facing Enterprise Ireland in this regard.

I tabled a parliamentary question on IDA properties recently and I understand it has approximately 28 properties lying vacant throughout the State at present. While the IDA requires a portfolio of properties to be able to hit the ground running if and when an opportunity arises, it seems obvious that Enterprise Ireland does not have sufficient properties. For example, it lacks space for incubation units. Could the case be made to transfer some of the IDA's properties to Enterprise Ireland or the local authorities for mixed use?

Enterprise Ireland worked with Invest Northern Ireland on the joint mission and I assume it intends to build on this development. Mr. Ryan should comment in this respect. I refer to Enterprise Ireland's properties abroad. Are they owned or leased? While they are listed in the agency's financial report, has it bought or leased them? Clearly Enterprise Ireland considers that it is getting value for money in this regard.

Page 37 of the report pertains to management capacity. All members regularly encounter instances in which companies that have evolved from family businesses or that someone established through sheer enterprise lack the requisite skills to move to the next level. Mr. Ryan should comment on this aspect of the report.

When examining such reports, one always encounters an unusual item. I note the reference on page 77 under the heading, remuneration and other costs, to a voluntary leaving programme. I am curious about it. It reminds me of something that would appeal to Members of these Houses at times. Mr. Ryan should comment on this programme.

Mr. Frank Ryan

With the permission of the Chairman, I will enlist the help of my colleagues to provide some of the answers. Mr. Feargal Ó Moráin will deal with the budgetary aspects of research and development expenditure. Ms Julie Sinnamon will comment on the leadership for growth and management capability building programmes. Mr. Paddy Hopkins will deal with the question on overseas properties and the voluntary retirement programme. I will deal with the other issues to the best of my ability.

As for the agencies, while it can be confusing at times, it is our business to remove such confusion. In that regard, approximately 18 months ago we met Mr. Roddy Molloy of FÁS to work out a different approach to supporting entrepreneurs on a regional basis. It can be confusing between Leader programmes, county enterprise boards and Enterprise Ireland, etc. We have been holding information evenings, to which all are invited, to try to get an understanding of the needs of particular entrepreneurs and subsequently to guide them in the right direction.

The most important thing to note is that it requires a great deal of confidence to establish a company in the first instance. It takes even more confidence to walk into the reception area of a State body to seek assistance in that regard. One wishes to encourage, rather than to dash, such confidence. We have conducted a number of such events nationwide and they are proving to be highly effective. In many cases, people put up substantial amounts of their own money when starting up such enterprises and we want to be certain they have thought it through thoroughly before proceeding. There also is responsibility on us in this regard. We think this should be the process in the future. Enterprise Ireland's role is to assist such enterprises in respect of exports because that is where our key skills lie.

Unfortunately, it is not possible to revise our €4 billion target downwards. In the heady days of last summer, when the economic condition was better than it looks currently, this target sounded like a good idea. I assure members that we will be exhausting our resources to achieve that target. We have come up with a good new strategy, launched by the Minister for Enterprise, Trade and Employment, Deputy Martin, last October, on which we will now focus.

There is a growing demand for incubation units. It is wonderful to see Ireland third in international rankings of entrepreneurial countries, with more people establishing businesses. There is some catch-up required for space availability for SMEs but it is a good problem to have and one we look forward to working on.

Deputy Arthur Morgan

Can Mr. Ryan expand on that answer in terms of factories and modular units? Are these useful and could Enterprise Ireland use them fairly quickly if given access to them?

Mr. Frank Ryan

The straight answer is that in some cases we could and in other cases we could not. The factories were built for a different audience. They tend to be large investments and most SMEs cannot fund it. It is more likely that the SMEs will approach an incubation centre in an institute of technology or a community enterprise centre and grow from that. It takes longer to get through that period. Unfortunately we cannot always take advantage of the larger facilities.

Mr. Feargal Ó Móráin

We agree with Deputy Morgan on the importance of research and development for our client companies. Innovation is central to the strategy launched for the next period. Innovation at company level is the priority. Every company does not need to have people in white coats in laboratories. For most small companies it is a question of the owner on the shop floor coming up with ideas, listening to customers and evolving to meet the market. We promote research and development in that context. The limiting factor is not money but the number of companies we can get involved. We work hard on internal targets of the number of companies involved in our programmes. We have research and development advocates on the ground who are generally retired businesspeople. We give them lists of companies who are not involved with us and it is their jobs to knock on doors and interest them in engaging in research and development. We advertise, promote and do all we can to maximise the number of companies involved.

In light of EU state aid guidelines we have been reviewing the research and development schemes. The Minister will relaunch the rules and regulations on incentives offered to research and development in the next few days. The limiting factor is not budgetary at present but the extent to which all clients can be engaged in innovative activity including research but more particularly development work. It is vital that all our clients are engaged in this to the maximum extent because their future depends on it.

Ms Julie Sinnamon

We launched the Leadership 4 Growth programme last year, initially with companies in the software sector. It requires a major commitment from these companies. They spend three one week periods in Stanford and much time in Ireland on coaching, etc. We were not sure if there would be an appetite for a second programme and whether the impact would be worth the cost in terms of money and time. The results are extremely positive, in terms of developing an appetite for growth and the capability and confidence within companies that they can grow.

We launched a second programme and broadened it to include companies from the life sciences sector. They have completed the first two modules. We advertised a tender and are currently recruiting institutions to run a programme for the construction sector. Given the issues in the construction sector there are major opportunities in the UK with the Olympic Games. We wish to support the construction companies with a similar programme. We are examining the other sectors that may be suitable for this programme. There is an intent to roll it out to other sectors but one cannot repeat the model that worked for software. Stanford was particularly suited to those companies. With construction other suppliers will be more relevant. Extending this programme to other sectors is part of our plan.

With regard to the issue of management capability building, we believe one of the big inhibitors for growth of companies is the capability of the management team. This has been highlighted in work with scaling companies. We support those companies in terms of other development programmes. There has been much talk of the Leadership 4 Growth programme but there are many other sectoral programmes in the food, beef and dairy companies. We seek to develop management capability and support the companies to bring in new managers to plug gaps. It is an issue and we must work at an individual company level to address it.

Deputy Arthur Morgan

My question concerns whether Enterprise Ireland has sufficient funding to do what it seeks to do.

Ms Julie Sinnamon

We are putting increasing amounts of the budget into this area and it is something that will require more funding.

Mr. Paddy Hopkins

All of our properties overseas are leased. The reason is that we must be flexible because we move from location to location. One does not want to be encumbered with disposing of properties in that scenario. We share many of those properties with the Department of Foreign Affairs and, in some cases, the IDA and other State organisations. We also accommodate some incubation space for our client companies. This has been popular with clients.

Regarding the voluntary early retirement scheme, Enterprise Ireland has gone through dramatic change in the past few years, restructuring from the technology and services we were delivering. Following discussions with the parent Department, a voluntary early retirement scheme was introduced in 2006. The cost, as outlined in the accounts, was €8 million in 2006 and it involved 80 people. We took back approximately one in three to reinvigorate the organisation and provide new skillsets to deliver the business needs of our clients.

Deputy Mary Alexandra White

I am delighted to welcome Enterprise Ireland. Coming from a business background this is a healthy set of statistics and I hope this can continue.

On page 4, under the heading Sectoral Performance, it states that the largest percentage growth was demonstrated in software, services and emerging sectors. What are those emerging sectors?

Representing the constituency of Carlow-Kilkenny, I am delighted that the IDA business and technology has a very good tenant, who is working with Mr. Michael Kelly, CEO of the enterprise board in Carlow in conjunction with the IDA. We are thrilled that there will be a long-term investor, which is important. Carlow is ideally located, with very good transport links. There are two good third level institutions, St. Patrick's College, which is linked with Maynooth and Trinity College, and the institute of technology under Dr. Ruairdrí Neavyn. We are pleased to have emerging students and hope the science and technology sectors will be built up. There is a scarcity of science graduates and we must ensure our second level pupils are going on to read science.

Are there any emerging trends in terms of investment in renewable energy technology? I see that as a key driver for our economy and for local, sustainable, long-term jobs, in view of peak oil and the threat of climate change.

Mr. Frank Ryan

There is a lot happening with regard to emerging sectors because one must make one's own future. In the past, Ireland would have exported a lot of products, but increasingly we are exporting products and services. Companies who previously only exported products will be adding a services dimension to their offering to the marketplace. That is one fundamental change that is taking place.

Ms Sinnamon, in her comments on the leadership for growth programme, mentioned the construction sector. Ireland was very active in the international construction industry until about ten years ago, when the economy took off here. During those ten years, the construction sector has become more focused on the domestic market and less on the international market. We are now moving to change that around because we have excellent construction companies producing products that can be supplied to the United Kingdom easily from here and services which can be delivered on a worldwide basis. Those services have been developed because Irish construction companies can literally construct anything now, from major roads and bridges to advanced production facilities, including those for the most advanced semi-conductor and pharmaceutical companies in the world. Such skills are in demand in other locations. Enterprise Ireland is working with such companies to internationalise them in that area.

Another emerging sector is in environmental products and services. As part of the new strategy announced last October, we have formed a stand-alone environmental products and services department. Today we have over 60 companies in this area who last year exported over €140 million worth of products and services for the environmental sector around the world, ranging from water and waste treatment to power and energy generation. That is another area where we see strong growth opportunities. We regard the environmental area as an enormous opportunity and it is an area where Ireland is ahead, in terms of technologies. Unfortunately one cannot say that about all the sectors in which we operate, but it is true of that area. Mr. Ó Móráin and myself have already met the Minister for Communications, Energy and Natural Resources, Deputy Eamon Ryan, and hope to work closely with his Department on this issue.

We would agree with the Deputy with regard to the very strong development that has been achieved by the Institute of Technology in Carlow. We also look forward to an increasing number of graduates in the disciplines that will be in demand in the years ahead.

Senator Brendan Ryan

I thank Mr. Frank Ryan and his team for coming here today and taking us through this report. On the issue of our export performance the representatives made reference to the fact that the United Kingdom is our biggest export market. The United Kingdom obviously includes Northern Ireland. I am interested in the split between Northern Ireland and the rest of the United Kingdom and whether any trend has emerged in recent times relating to Northern Ireland.

The representatives referred to a level of collaboration with Invest Northern Ireland, in terms of a trade mission. Are there areas where Enterprise Ireland would be in competition with Invest Northern Ireland? If so, how does that manifest itself?

With regard to the community enterprise centre scheme, I am familiar with a group which, in seeking support from Enterprise Ireland, was told it must provide a building or site and be in ownership of same. It appears that a lease on either land or buildings would not suffice or if a leasehold was to apply, it would have to be for at least 99 years. Given the response to Deputy Arthur Morgan's question regarding types of properties overseas and the fact that Enterprise Ireland itself has property on lease, where is the consistency in policy?

With regard to productivity support grants, I understand there are regional differences in terms of the levels of support available and ask the representatives to clarify that. Is it the case, for example, that the BMW region would get higher levels of support vis-à-vis the productivity improvement fund than other regions? Let us say there are two companies operating in the same industry and in the same competitive environment, but one is located in the BMW region and the other is outside that region. Is there any flexibility in terms of the support available in order to level the playing pitch, as it were? I am thinking, specifically, of the poultry industry.

Mr. Frank Ryan

I do not have the statistics relating to Northern Ireland to hand but will submit them to the Senator, through the Chairman. We have a very close working relationship with Invest Northern Ireland and it is getting increasingly closer. We have a number of initiatives under way with it. The number of joint trade missions is increasing and we have jointly established the first cross-Border entrepreneurship programme. There are 40 entrepreneurs drawn from both sides of the Border currently engaged in that programme.

I will ask my colleague Mr. Ó Móráin to address the question regarding the details of the enterprise centres, leases and so forth. I also ask him to comment on the supports made available in different regions. The supports that Enterprise Ireland offers are undertaken under the state aid rules of Brussels, which differentiate on a regional basis in Ireland. In that context, there is not a lot we can do there. I invite Mr. Ó Móráin to address those questions now.

Mr. Feargal Ó Móráin

To add to what Mr. Ryan was saying about our relationship with Invest Northern Ireland, it also extends into the research and development area. We have very close contact with our colleagues in Invest Northern Ireland and in my case, with Ms Tracy Meharg, who is my direct equivalent and with whom I meet regularly. There is a developing and close relationship between the two bodies, based on our mutual interest in developing our client companies.

With regard to the details of the community enterprise scheme, I am not sure exactly what information the Senator is seeking. Our concern is always to make sure that anything we support financially will be in existence for a while, which would not necessarily be the case with an organisation which only had, for example, a three-year lease on a property or site. The Senator referred to us seeking a 99-year lease but I will have to look into that further and revert to him at a later date. I will examine what the current constraint is but I would imagine it centres on the length of time that the entity exists and the certainty that if we support a community enterprise centre it will continue to operate as such for the foreseeable future. Our concern would be that we might support a community enterprise centre in a specific location and then five years later the property could be sold or converted into a retail outlet. That obviously would not be what the State aid was intended for. I will revert to the Senator when I have more details on the specific case.

On the question of aid rates, as Mr. Ryan has said, we operate within the European state aid guidelines. We tend to operate to the maximum that we can do in different areas. While the Senator asked about the productivity fund, in the case of research and development, under the new State aid guidelines, the regional differentials have been eliminated by Europe. Therefore, the same rates for supporting research and development apply across the country. However, in the case of capital grants, the rates range from nothing at all for large companies in the east to 25% for large companies in the west, with small and medium-sized businesses in the latter region attracting somewhat higher rates. We operate to the legal maximum and that means there are differentials and that we can support large, expanding companies in the east of the country for research and development and training, but we can no longer legally support capital investment within the European state aid guidelines.

Ms Julie Sinnamon

The Senator asked about the relationship with Invest Northern Ireland and whether there is competition. There is no competition, rather there is strong co-operation. We are open about sharing whatever works for companies here and in the North. There is no basis for competition.

Deputy Chris Andrews

I thank Mr. Ryan and his team for their positive report in light of the uncertainty. It is a reality check that the situation is positive. It is great to see that we are still up to the changing challenges. Is Enterprise Ireland happy with the uptake of the innovation voucher scheme? Has it met or surpassed the expectations or targets set?

Mr. Feargal Ó Móráin

We launched the innovation voucher scheme last year and we have allocated approximately 450. When we launched it we did not know how fast the uptake would be. We had the experience of the Dutch who originally introduced the scheme and their experience was that it was slow at launch time but developed over a number of years into a large scheme. Given that we were nervous about how fast it would take off, the uptake has surpassed our hopes. The programme is exciting and has great potential for the future. We are having five more calls this year. In effect it is continuously open and the reason for specific calls is that we want to deal with them in batches.

We do not know how many applications we will receive this year but based on last year's interest we anticipate approximately 600 or 700. I do not know whether that will happen but it is our ambition to push numbers up. The major advantage of the scheme is that it is open to any small business in any sector and is not confined to Enterprise Ireland clients. It is our first instrument to get small companies to undertake small initiatives with the third level infrastructure, particularly going back to earlier questions on the institutes of technology. If we can get somebody to spend a few thousand euro on work and establish contact, hopefully over time that will lead to more contact. It is getting down to the ground and that is why we are so interested in it and will push it as hard as we can. The Deputy will have to ask the question on how successful it will be in a year's time. We will be happy to answer.

Chairman

The delegates will be welcome back.

Deputy Edward O’Keeffe

I welcome the delegates. Through our innovative Chairman we toured the whole of Munster in the last three days. We began in Thurles, which is agriculture based, travelled on to Carrick-on-Suir which had a tannery in the past but suffered, Dungarvan which is an agriculture-based town, Cappoquin which is still in the land of the living with a poultry industry that is on its knees and faces extinction, on to Youghal, which has a strong industrial base also in difficulties, and then to the Amgen in Carrigtwohill, where there might be a window of light this weekend. We then travelled to Mallow, which lost its sugar beet industry through no fault of Enterprise Ireland or the Government, but through EU policy and world trade, and on to Mitchelstown. It was a devastating and lonely trip but we learned much and met many sincere and genuine people with concern for their communities and environment, and all necessary concerns.

Enterprise Ireland spends taxpayers' money and pays grants. Looking at the dairy industry I do not know where Irish farming industry is going. Farmers have left the land but production has not dropped at farm level. In the primary meat and dairy areas we in the Munster region had much added value. From the day I went to national school added value was an issue. We were told we were not making enough of our fishing, dairy products, pigmeat and beef. There will be no added value in the food industry from Irish farming products in the years ahead. The delegates made a good point on the question of €7.8 million in exports. How much secondary processing is involved in that? We received major complaints from poultry people on secondary processing. We see more rationalisation in pig meat, which was important in Mitchelstown. The delegates know my strong views on that and my criticism of their organisation and personnel for allowing that. There is no added value left in the Irish pig industry, only secondary processing. There is a quick buck approach in management to generate money for shareholders. I come from the capital system and feel strongly about this because I represent people. We have seen further rationalisation in the pig industry, which is important to the country, as is poultry. I already mentioned sugar beet.

Enterprise Ireland has a role in protecting the industry. It pays the grants from State money to those people. Some $10 million was paid in Mitchelstown from 1998. I have the report and the press releases from former Deputy Michael O'Kennedy's time when he had to write along the line. Yesterday Ballyhoura Development boasted to us that it was building incubator units for the food industry in Mitchelstown. Further down the road when we pulled up in our bus I pointed out that €10 million was being spent in the deconstruction of Galtee Foods. We have outsourcing in the food industry. Dairygold in Nenagh outsources to Dawn. I would like to know if there was a grant paid for that, because other grants were paid.

The Committee of Public Accounts does a good job but it should be more forensic in its investigations. The Chairman made the point yesterday about duplication among the agencies, all doing the same and not knowing what they are doing. I feel strongly about taxpayers' money and what is happening in Mitchelstown. Ballyhoura Development should be queried because Enterprise Ireland is doing a community enterprise initiative with it. It is not right to spend money where there is a plant being closed down to build another operation up the road with the same money from the same organisation and with State funding. I made this point clear and it caused them embarrassment.

The food industry is under the remit of agriculture and the Minister for Agriculture, Fisheries and Food, but there is not one line about agriculture in the report. Agriculture and food comprise one Department under statute of the Oireachtas, yet it is concerned with industrial employment in the food industry. If there was more significant involvement from agriculture things might be different because enterprise has a different outlook. I do not want to be too critical because the delegates know my views on that.

At Dairygold in Mitchelstown we saw an Enterprise Ireland worker. Dairygold should pay for that worker, who costs Enterprise Ireland €50,000. I have cited that example and make no apology for doing so. The Minister for Enterprise, Trade and Employment, Deputy Micheál Martin, came up with a formula for me about joint funding by Leader, Enterprise Ireland and perhaps the North Cork Enterprise Board, so something is happening in that area. It is not right to have the State pay high redundancy payments and then have to pick up the pieces again and do something else. This is becoming a bit Irish in an Irish context. I would like some information on that situation.

There is a "get rich quick" syndrome in Ireland. I invest in the stock market and make no secret of it as I have to declare my interests, although it is not good news currently. I make no apology for this when I speak because people are people. There is a new approach, that management takes out as much as possible and is offered shares, investment and money and then goes into the building industry. This is happening in my town. We have the new scenario where as much as possible is taken from management, and shares and investment are offered. There is building and construction work in my town.

Deputy O'Shea, the Labour Party Deputy for Waterford, made a very good point in Dungarvan on Monday when he said that in the south east there was involvement in fish, timber and agricultural production. I make this point, although we have lost many such industries. Much of the agricultural business we have lost is in the added value sector. Pigmeat and poultry are now marketed throughout the world. Mitchelstown is the equivalent of Northern Foods in the United Kingdom. Northern Foods owns Goodfellas in Naas. It was one of the most innovative food organisations in the world, although it has suffered much in the past few years because of the dominance of Marks & Spencer. In the town of Mitchelstown Galtee, Calvita, Mitchelstown and other brands of cheese were produced. They are now being outsourced. I do not understand why Enterprise Ireland did not become involved in having these brands outsourced to employees in Mitchelstown in a management buy-out. The position is similar with regard to pigmeat products in Glanbia, with rashers being produced in Nenagh, sausages in Galway and puddings somewhere in Waterford. Shaws ham and bacon is being produced in Scotland and imported. It is a bit Irish in an Irish context.

I do not think I am out of order in making these comments. It has come across loud and clear that things are going wrong, with Mitchelstown very much on the side. I come from the area. Enterprise Ireland's involvement with the food sector should be more forensic. Officials are running too much with the food industry and taking its proposals on board. I say this in the context of what happened in Mitchelstown with the closure of Galtee and the demise of the slaughter line. It was an innovation issue. Glanbia is not in the business of adding value but involved in commodities. If we do not seek to have value added in Ireland, there will be fewer jobs in rural towns. Commodities are only placed in a container. The point has been made clearly. The Chairman picked up on the point made about baby food produced for China. Mothers do not buy containers of baby food but rather little packs. Sending a commodity to China looks nonsensical in that it must be processed again. Why can we not do it here? White, Abbott and others could do it. Why can we not do it in Mitchelstown or elsewhere in Ireland rather than exporting the commodity?

I admire the work of Enterprise Ireland but it has lost its way a little in the food industry.

Chairman

The Deputy was a pig farmer for many years.

Deputy Edward O’Keeffe

I have a dairy farm. I do not keep pigs anymore, thanks be to God.

Chairman

I was wondering if the Deputy had any pigs left.

Deputy Edward O’Keeffe

There are many pigs in my area where farmers could employ 25 or 30 people. Much depends on the industry.

Chairman

The Deputy is still involved in the dairy industry, by the sounds of it.

Deputy Edward O’Keeffe

I will not return if something is not done about the issue.

Mr. Frank Ryan

With respect, we are very much aware of the Deputy's views on the development of the food industry in Ireland. I have been the recipient of the Deputy's genuine advice on a number of occasions and we have spoken on a number of occasions, the most recent being the day he led a delegation from Mitchelstown to meet us in Dublin.

I have been involved with the development agencies for 28 years and still have not been able to come up with a good answer to job losses. It is still heartbreaking for those involved when they lose jobs. I wish either I or somebody else could have found a solution during that period but we have not been able to. We must deal with the reality that State agencies can only do a certain amount. At no stage can we assume the responsibilities of the board or senior management team of any company in the State. In many cases we have to address the outcome of their decisions, our raw material. I will not mention any specific company. Any company which does not comply with the terms of legal agreements entered into with Enterprise Ireland will be pursued for repayment of all appropriate grants.

We are pleased that exports of food and beverages has reached a figure of €7.8 billion, the highest level in the history of the State and an increase of 11.4%. Indigenous exports now stand at a figure of €11.8 billion, also the highest in the history of the State. We are very much aware of the changes taking place in industrial sectors and will do everything in our power to stay up to date and deliver the best support mechanisms we can to those companies strategically involved in the development of the food industry.

Senator Mary M. White

The reception of the delegates today speaks for itself and demonstrates the respect this very experienced committee has for Enterprise Ireland, Mr. Ryan and his colleagues in particular. My own experience of dealing with Enterprise Ireland in the past 20 years began when we started Lir Chocolates and there was a 17% unemployment rate. The words "profit" and "making money" did not enter my head, as the exercise was about creating employment where I could. That was my agenda. I thank Enterprise Ireland and Mr. Michael Feeney for sticking by us through thick and thin, with all the challenges we met along the way in bedding down Lir Chocolates as a company with a tremendous future. He went beyond his duty in speaking to multinational partners such as Bailey's in consolidating the company as the maker of Bailey's chocolates in Ireland. Gaining such permissions helped us in our latest growth stage.

I have a personal issue regarding rural areas. My electorate is made up of county councillors who are on the road all the time. I am very conscious of the need to maintain communities in rural areas, particularly in County Donegal. Letterkenny is thriving but other areas in the county have the air that nothing is happening. Those living in such communities are wondering what the future holds for them. They suffered from the civil strife of the past 30 years.

People are leaving the agriculture sector because the children of farmers do not want to have such a hard life. Therefore, we need businesses in rural towns and villages to replace the jobs lost in agriculture.

Mr. Frank Ryan

I thank the Senator for her kind words about Enterprise Ireland and Mr. Michael Feeney, to whom we will be pleased to pass them on.

It must be realised that future economic growth will be driven by the performance of indigenous industry. Essentially this means that no county can be left behind. Entrepreneurs setting up businesses should be encouraged and will receive the full support of Enterprise Ireland.

I cannot stress enough the importance of the community enterprise centre scheme which has a particular role to play in the contribution Enterprise Ireland can make to the turning around of local economies, not just in Border counties but also in less central locations. We have received a sum of €21 million over a three-year period from the Minister, Deputy Martin, to support new community enterprise centres. The first tranche of €7 million was distributed last year and we have two more calls for proposals in 2008 and 2009. Anything the Senator could do to encourage communities in County Donegal to submit proposals would be helpful to keep jobs in the area. The county has other things going for it. While Letterkenny is booming, the operation of the institute of technology is essential to the development of the economy in the county. The same applies to the university across the Border in Derry. We are working with Invest Northern Ireland to ensure entrepreneurs will not be placed at a disadvantage by geographical location. We are taking this factor into account when organising schemes and programmes. The cross-Border scheme is primarily being run from Cavan and Armagh to facilitate individuals who previously had to travel to Dublin or Belfast. The development of less urbanised areas will remain a key priority for Enterprise Ireland.

Chairman

We have had a comprehensive and extensive discussion. As Senator White said, the meeting was well attended, which is a tribute to the delegates and illustrates the level of interest in the issue. I thank Mr. Ryan and his colleagues for coming before the committee, particularly at such an early hour. The report and outline given were extensive and the delegates dealt with searching questions in the professional manner we have come to expect from them. We look forward to receiving a progress report from Enterprise Ireland in the autumn or perhaps the late summer. I hope we will all be present again to receive the next annual report and hope the level of progress outlined in the 2006 report will continue and that challenges and changes will be met. As Mr. Ryan said, challenges can bring opportunities and growth provided we adapt, are flexible and utilise some of the significant technological and educational advantages this country has. I again thank him for the job he has done.

The joint committee adjourned at 11.35 a.m. until 9.30 a.m. on Wednesday, 6 February 2008.