Is this a Budget that will deliver the smart economy?

16 Dec 2010

The personal impact of what has been the most painful Budget since the founding of the State in how affects the take-home pay of ordinary people and those most in need of support has been well debated and discussed.

But what about this country’s capacity to rebuild and reinvigorate itself for hopefully better times by fielding 21st-century businesses and workers with the right skills and enabling indigenous firms to innovate, scale up and grow exports?

While the Government speaks of ‘moving forward’ and ‘moving on’, the key to achieving a return to growth is creating gainful employment. To do this it is essential we continue to invest in what are the pillars of a smart economy as set out by former Intel CEO Craig Barrett – smart people, doing smart things, in the right environment, with the right infrastructure.

While the extra 15,000 activation places and supports for the unemployed are to be welcomed, a key area of concern is the drastic reduction from €63m down to €1.5m for schools’ ICT.

A 12.5pc increase in the State’s science budget is a good thing. However, there has been no major change to the R&D tax credit regime and experts have warned the closure of the Patent Tax Royalty Exemption Scheme will be disastrous for indigenous industry.

The retention of the 12.5pc corporation tax regime is key for multinational investment. In addition the expansion of the BES scheme and extension of the tax exemption scheme for start-up companies for three years will be beneficial.

The €44m investment in100Mbps broadband for schools in the Budget will help spread this infrastructure to the regions, but the role of the State and semi-state bodies collaborating with the private sector to deploy next-generation networks needs to be better explained.

Read more of ‘Is this a Budget that will deliver the smart economy?’ at Digital 21. – Digital 21 is a campaign to highlight the imperative of creating an action programme to secure the digital infrastructure and services upon which the success of our economy depends.