INNOVATION: Last month Innovation published an article based on work by UCC researchers Declan Jordan and Eoin O'Leary. A survey they performed indicated that industries which interacted with higher education institutes had a lower probability of being innovative than those whom had no contact with the third-level world.

From this survey, they surmised that Government policy which currently provides large sums of money for research in third-level institutions will not have the impact that is expected. Because this is such a tantalising soundbite result, it needs to be countered by some factual analysis that points to the contrary.

The focus of the article's attention was the Irish government's policy. However, of course the data that underpins it must have had a universal relevance. There is no reason to presume that Irish industries are less effective at interacting with third-level institutes and, there is no reason to anticipate that the collection of scientists in Ireland are different in their relevance to industry than those in every other country in the world.

There is a global aspect to the consequence of this study because every government in Europe, Asia and South America is pursuing the same path as the Irish government - investing heavily in research with a view to having a positive consequence on the innovation capacity of local companies.

Therefore, this study would suggest that everybody has got it wrong, not just the Irish. However, much more analysis would be needed to provide confidence for a radically different policy here. The study itself requires more detailed analysis and it should be recognised that the survey was based on a response rate of 22 per cent.

Questions must, therefore, be asked about the extent to which the data obtained in the survey is representative of all industry.

The primary survey which they performed was carried out in 2004 and this leads to a possible explanation for the results that they obtained. Government investment in "the knowledge economy" only began to a real extent in 2003.

This means that the scientists and engineers with whom the industries were interacting in 2004 had only just had the resources made available to them at a level which it would be generally accepted was required in order to increase their research capacity. What the data may point to, therefore, is the very negative consequence of not supporting research.

The survey and the message that it conveys also overlook a very significant fact: most of the impact of the scientific research comes through the transfer of knowledge whereby individuals that are trained in the Higher Education Institutes (HEI), move into businesses and then have an internal effect on the company.

It is noteworthy that the National Development Plan places great emphasis on increasing the number of skilled scientists and engineers (doubling this number by 2013) above the baseline of 2005.

This is done with the awareness that most of these skilled individuals will move into industries and the economically relevant sector and act as direct transferal mechanisms. This impact would have been missed by the survey and it should be recognised that the training of these unskilled individuals only comes through the research laboratories which are the target for the funding by SFI, the Higher Education Authority and others.

From an SFI perspective, the level of engagement between researchers supported in the HEIs and industry has increased year on year since SFI first made awards in 2002. Over one-third of SFI's funding goes directly into research which is targeted for collaborative joint research projects with industries (CSETs and SRCs). Currently 76 companies are engaged in these projects.

In addition, SFI-funded researchers are interacting with over 250 companies through a variety of mechanisms. These companies are collaborating because they see a direct benefit to the companies strategic objectives by engaging with researchers based in Irish HEIs.

The steps between investment in third-level research and the new high-tech industry-based economy of the future is one that is actively ongoing and this transition is taking place in an evolutionary manner.

To stop the process begs two serious questions: Where will the new ideas and new products come from if we are not generating an environment and training people who are skilled in thinking in a novel way and in providing new product possibilities? And, if we are not going to take every measure to move towards more sophisticated industry, what is plan B?

Frank Gannon is director general of Science Foundation Ireland