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Research spending ‘successful’ despite two-year drop

State investment in R&D has held up well despite the recession, according to Martin Shanahan, chief executive of Forfás, the national policy advisory board for enterprise, trade, science, technology and innovation.

Nevertheless, the organisation’s 2009-2010 report on funding and performance, published on 11 August, shows that funding has fallen for the second consecutive year.

Funding peaked in 2008 when total state R&D appropriations reached €946 million. The figure for 2009 fell for the first time in almost a decade, to €941m. The estimate for 2010 is €872m.

Last year’s figures includes all expenditures across 35 government departments and agencies active in some form of R&D. Higher education accounts for more than half the total spend, industrial production and technology 20.2 per cent, and agriculture 10.6 per cent.

The largest allocation was to the Higher Education Authority, which received for 33.1 per cent of expenditure.

It was followed by the industrial development agency, IDA Ireland, with 17.4 per cent and Science Foundation Ireland 17.2 per cent. The agricultural development body, Teagasc, and the Health Research Board each received about 5 per cent of spending.

R&D by government bodies only—excluding higher education—has been in decline since its €141m peak in 2007. Spending fell to €140m in 2008, €103m in 2009 and to an estimated €91m in 2010.

The trends reflect government policy, which sees higher education as the most productive source of discoveries that in turn feed into a knowledge economy. There is a strong government push to encourage researchers to commercialise their discoveries in the hope of spinning off companies, creating jobs and producing wealth.

So, more than €80m, or 88 per cent, of government-financed research went to applied research. Another €7.7m went to experimental development and €3.4m to basic research.

Some of the most encouraging figures come in international comparisons of state spending as a percentage of economic activity but excluding defence-related research. Countries such as the US and France spend large amounts on their defence sectors, bumping up their research expenditure totals, the report points out.

The report compares the percentages in 2000 with the 2010 estimates, a metric that puts Ireland ahead of the UK, US and EU-27 in terms of research budgets. On this measure, Ireland is 10th out of 15 countries. R&D spending in Ireland as a percentage of GDP rose from 0.32 per cent in 2000 to 0.67 a decade later.

Finland tops the list with 0.97 per cent rising to 1.12 per cent, Iceland is second (0.94 per cent to 1.05 per cent) and Denmark third (0.76 per cent to 0.98 per cent). The UK is 11th (0.43 per cent to 0.58 per cent) and the US 12th (0.41 per cent to 0.57 per cent).

In his comments on the figures in the report, Shanahan emphasised that continued state investment was “essential”. He viewed the overall investment performance as “successful” given that Ireland now had a credible research and development standing internationally.