Science Technology and Innovation Investment now 9 times what it was in 2000 – R&D Tax Credit increased

Minister for Science Technology and Innovation Dr Jimmy Devins TD applauds Government’s vision in increasing investment in Science Technology and Innovation in these difficult times.

Speaking after today's budget Minister Devins said,''The Government sees this investment as a priority to underpin Ireland’s competitiveness in a knowledge-driven global economy. The expenditure provision for Science, Technology and Innovation in my Department’s Vote will be €335 million in 2009, an increase of 3% on the 2008 allocation and is now over 9 times the level of investment made in 2000. This investment is testament to the determination of the Government to maintain the already substantial effort to build a knowledge economy in order to make secure our economic future.

The fiscal environment for Research and Development has also been significantly improved by increasing the R&D tax credit, which can be offset against a company’s corporation tax liability from 20% to 25%. This measure will enhance our competitiveness as a location for new internationally mobile research-related investment, and also encourage existing overseas and indigenous firms to add research functions to their operations in Ireland or to increase their level of research activity.

I also welcome the allocation of €265 million, an increase of 44%, provided for infrastructural investment for higher education, including additional capital funding for strategic research as part of the Strategy for Science Technology & Innovation.

This level of support sends a clear signal to Irish business that this Government is continuing to support their efforts to develop new products, to stay competitive and win new markets in a challenging environment. The investments will support enterprise research and innovation and continue to build Ireland’s 3rd level research base thus providing a basis for growth in employment and incomes in the years ahead. The funding will be used by the development agencies, Science Foundation Ireland, Enterprise Ireland and supplemented with IDA funding, to increase in-company research and development, to promote the commercialization of research and to strengthen the collaboration between industry and the education sector, to bring the outputs of Ireland’s growing research base to the marketplace and to help Small and Medium Enterprises to innovate, to stay competitive.

The investment will continue to drive our targets under the Government’s Strategy for Science, Technology and Innovation. Enterprise Ireland will focus on growing both the quality and quantity of R&D performed in enterprise, on supporting collaboration between its client companies and third level institutions and maximizing the commercial outputs (spin-out companies, patents etc) from the enhanced research activity in third level institutions.

Science Foundation Ireland will continue to add world-class Principal Investigators and their teams in the strategic areas of ICT, Biotechnology and in their new area of focus - Energy. SFI will continue to support strategic partnerships between industry and academia through Centers for Science Technology and Engineering (CSETS) and Strategic Research Clusters. Building human capital at the highest level is at the core of our strategy.

The rapidly growing reputation of Ireland’s research base, the availability of world class researchers, high quality graduates, increasing PhD output and the research friendly fiscal environment is greatly assisting IDA Ireland in winning highly competitive research investments for Ireland. The enhancement to the R&D tax credit provided in this Budget will further enhance our attractiveness as a premier R&D location.

In 2007 the IDA supported 45 R&D projects and the figures for 2008 and 2009 are expected to be close to 60. Global leaders now choose Ireland as a location for cutting edge research and development activities, again a testament to the Government’s foresight and clear evidence of the long-term dividend to Ireland of this investment.

There is clear and encouraging evidence that the investment being made is helping Ireland to compete in highly competitive global markets and to grow quality employment and productivity in innovative firms.

As we enter a period of intense global competition and higher costs, Irish business requires improved efficiency, quality, and productivity. The need for firms to innovate and add value across all aspects of business is now greater than ever. Past experience has shown us that countries with long-term competitiveness have high levels of R&D and they produce world-class talent and have dynamic firms that use that talent to innovate and compete on world markets with world-class products and services. This is the route the Government supports for Ireland as we return to export led growth in the years ahead,’’ concluded Minister Devins.