PRESIDENT'S LOG: We need to be spending more, not less, on innovation if we want a sustained economic recovery, writes FERDINAND VON PRONDZYNSKI
EVER SINCE the sky fell on us some time in 2008 we have, as a country, been struggling to see what we should be doing to get us back into economic health. What we have mainly focused on is controlling public expenditure and trying to shore up the exchequer.
The problem with this approach is that it deals with a really critical risk facing the country, but on its own it does not restore our fortunes. As anyone running a company knows, you cannot succeed in business simply by cutting costs. And this is where the national innovation agenda comes in.
It was first presented in the Government’s plan for economic recovery published in December 2008, Building Ireland’s Smart Economy. One of the key areas identified for attention was what was described as creating the “innovation island”, or developing economic success through human capital, or the translation of ideas into “valuable processes, products and services”.
Developing this innovation agenda was last year entrusted to a special working group, the Innovation Taskforce, chaired by the secretary general of the Department of the Taoiseach, Dermot McCarthy. And last week it published its report, with a launch in TCD’s (really excellent) Science Gallery by the Taoiseach.
It was one of those occasions where absolutely everyone who believes they are members of the nation’s great and good were present. After the launch speeches, I asked acquaintances from the academic and business worlds to tell me what they thought of the report, and mostly they answered positively but cautiously. Good ideas worthy of implementation was the typical response. Concerns about whether they will be implemented was another. One or two thought that the report was a bit long on analytical narrative, thereby blunting the impact of the recommendations – but that was on the basis of a glance rather than a closer analysis.
So what are the ideas in the report? They are built around what are called “principles for success”, which include the promotion of entrepreneurship and enterprise, sourcing capital for business development, enhancing the education system (particularly at third-level), encouraging “flagship projects”, and focusing the national research system.
All of this is described as an “ecosystem”, by which the report implies (I think) that there are different elements or organisms which need to interact successfully with each other to secure viable progress. In fact, the original definition of ecosystem in the biological sphere was developed in 1971 by the American scientist Eugene Odum, who defined it as a unit in which living organisms interact with their physical environment – maybe the taskforce might have drawn that out a little by differentiating between the “organisms” (entrepreneurs, educators, politicians, etc) and the “physical environment” (taxation, regulation, capital, etc). But the metaphor of the ecosystem could be a useful tool in understanding innovation.
A key recommendation of the report is also that the Strategy for Science, Technology and Innovation (SSTI), which has been the foundation for the development of research and development in Ireland, should be extended beyond its current end date of 2013 to 2020. And as part of this, we should commit to a national goal of spending 3 per cent of GDP on RD.
However, to do this we need a much greater dose of national resolve than we have so far demonstrated. The revised programme for government had already set the spending target on RD, and this represented an increase of the SSTI target of 2.5 per cent of GDP. However, in 2009 we can estimate that Ireland spent about €2.5 billion on RD, in the private and public sectors, and this according to my calculation amounts to about 1.4 per cent of GDP.
In addition, in line with budget cuts, the public expenditure side of this is now actually falling. In order to reach 3 per cent by 2013 we would have to double our expenditure, not cut it; and right now that may seem something of a stretch. Right now the agencies supporting research are scaling back, not moving forward, and on current trends almost no new research projects will be initiated in the near future. We cannot afford this contradiction between policy and practice.
As I have mentioned previously in this column, we have few cards to play if we are to recover and thrive.
We must welcome the report of the Innovation Taskforce, because it charts the way we must go if we are to be a prosperous society again. But getting there won’t be easy. We need to move decisively, and we need to do it now.
Another report languishing on another shelf will not save us.
Ferdinand von Prondzynski is president of Dublin City University
