IBEC says R&D key to industrial policy

Cliff Taylor,

Economics Editor

New policy measures to boost research and development and a longer-term programme of infrastructural development are among the recommendations in a submission from IBEC to a Government-sponsored review of industrial policy.

The economic progress of recent years must not lead to "complacency" according to the IBEC submission to the Enterprise Strategy Group, which argues that a new "enterprise mindset" is essential.

IBEC is one of a number of organisations that has made submission to the group, established by the Tánaiste, Ms Harney.

The group, which is charged with recommending a new approach to industrial policy, is chaired by industrialist Mr Eoin O'Driscoll, and has been engaged recently in a series of meetings with those making submissions. It is due to report in the coming months.

A central question for the group is how to make Ireland attractive for higher-skilled, research-based activities, as lower value manufacturing and services moves to lower cost locations.

A key recommendation from IBEC is the need to invest in research and development and innovation, including immediate measures to accelerate the level and pace of commercialisation of research and the licensing of patents.

IBEC also wants a streamlining of the supports and programmes for research, to make them more easily accessible to business.

In a related area IBEC also calls for increased emphasis on science and technology in the education programme at primary and second level.

A major challenge facing the enterprise strategy group is identifying ways to encourage indigenous industry to grow, at a time when competition is increasing for foreign direct investment.

In this area, IBEC emphasises the urgency of further investment in sales and marketing, including cross-disciplinary options in engineering subjects and sales/marketing.

Lack of sales and marketing expertise is seen by IBEC as a major barrier to the growth of many indigenous companies.

The submission also emphasises the importance of holding down costs for business and of not imposing significant new burdens in areas such as environmental taxes.

IBEC's call for a new emphasis on research and development is similar to one of the theme's of ICTU's submission to the group, even if the two bodies would differ on the detail of achieving this.

However not surprisingly IBEC does not support ICTU's call for Ireland to abandon its opposition to EU tax harmonisation and consider a higher corporate tax rate.

IBEC argues that maintaining this rate is " an essential element of Ireland's enterprise strategy."

Among the other main recommendations from IBEC are

A strategic investment programme in infrastructure for a six-year period after the current round of EU funding ends in 2006.

This should cover physical infrastructure and include areas such as energy, telecommunications and aviation, not covered in the current National Development Programme.

The addressing of deficiencies in technical infrastructure as a priority, including world-class telecommunications provision and moves to boost ICT penetration and PC penetration.

A new approach to fostering entrepreneurship, including new measures to increase the number of women in business, more education and training in this area and the addressing of gaps in the provision of seed capital.

Measures to raise the qualify of life, including equality of opportunity.

"A high-quality, affordable childcare system must be put in place."