R&D spend doubles, innovations static

Research and development (R&D) spending by Irish-owned firms more than doubled from 0.5 per cent of gross output in 1991 to 1.1 per cent in 1997 according to the latest Forfas survey. But the industrial development advisory board said indicators of "genuine technical novelty" pointed to little or no change during the 1990s.

Forfas said a rise in R&D activity of 15 per cent in 1995-1997 was less than in the early 1990s, when annual growth of 20 per cent was recorded.

Asked about R&D growth since 1997, the manager of Forfas's science and technology evaluation and indication unit, Mr Michael Fitzgibbon, said he expected a similar annual growth rate of about 15 per cent.

Forfas said patent statistics suggested innovation in the 1990s was "rather static". It added that this was difficult to reconcile with the increase in business sector R&D activity.

"Resident patent applications per 10,000 population places Ireland in 15th position out of 28 countries, a lower placing than was the case in 1991," the survey said.

Asked whether this was a measure of the quality of research carried out, Mr Fitzgibbon said much R&D activity in the State was confined to developmental work, such as improving processes and modifying products.

Multinationals dominated the field of pure research and most firms based in the State carried out this work nearer their home base, he said.

"There are a number of things which inhibit multinationals from doing research here. Our principal aim is to establish real research capability.

"Companies can't really do sophisticated research themselves. They need to co-operate with recognised experts in the field, principally academics."

The recent Technology Foresight report recommended the development of a national research initiative costing £500 million (€635 million). If the Government accepts the proposal, Mr Fitzgibbon said it would present a "much different picture" of the State's research capacity than at present.

The Forfas survey said Irish R&D activity appeared to be in a "mid-range" position when compared to other EU states. Expenditure was 1.1 per cent of GDP in 1997, as compared with 1.15 per cent for the entire EU.

But it added: "The aggregate position masks the fact that most firms continue to make little or no investment in R&D."

R&D intensity in the State's major high-tech sectors lags behind those elsewhere, it said.

Spending in the pharmaceutical sector in Sweden - the lead country - was four times greater than spending by Irish companies in 1995-1997. In the same period, Irish spending was less than half the OECD average. In 1997, indigenous firms spent £192 million on R&D, 36 per cent of the total spend of £535 million.