Financial returns from Ireland’s expenditure in research have easily outstripped the original investment, according to a study released on 19 September.
It claims that while the Exchequer put in almost €1.2 billion over the period 2000-2006 the returns amounted to about €1.8bn.
The study by PA Consulting said that the figure for returns was probably a gross underestimate. This was because it decided against including financial returns—for example, from the construction phase—and measured only the direct commercial impact of expenditure, according to the report’s authors.
It did not attempt to factor in the enhanced ability to attract direct foreign investment from an improved science infrastructure or the indirect returns from downstream contracts and the value of the skills base arising from investment in research.
“As such, the study presents a minimum valuation of impact at this stage,” the authors concluded, so the results were “very encouraging”.
The minister of state for science, Sean Sherlock, welcomed the report, saying it underlined the positive impact of Exchequer investment in R&D.
It also showed that the benefits measured by commercial returns for companies were weighted towards the later years of the study period. Given the type of investment involved, “it is to be expected that the full effect will only be realised over an extended period of time”, Sherlock said.
PA Consulting was asked by the Higher Education Authority to assess the financial impact of Exchequer investment in research. The authority is the body through which money flows into the higher education sector but it also manages a key research funding scheme, the Programme for Research in Third Level Institutions (PRTLI).
The study looked at 45 investments in research centres and other initiatives funded via the PRTLI in 2000-2006. The consultants assessed the impact of the spend on the current and anticipated income derived as a direct result of the investment.
The report identified 50 companies which together valued returns so far at €753 million. The companies estimated that accumulated returns over the coming five years would add a further €1.11bn to reach a total of €1.86bn.