Bord Snip: ‘Return on science investment not very compelling’

16 Jul 2009

Further science investments by the Irish Government must yield “clear economic returns”, according to the group tasked with identifying up to €5.3bn in public-expenditure savings, nicknamed an Bord Snip Nua.

The Department of Finance today published the report of the specialist team headed by UCD economist Colm McCarthy (pictured). The report contains hundreds of proposals that may be taken up in the next budget, including the abolition of the Department of Community, Rural and Gaeltacht Affairs, an increase in the retirement age and a 5pc reduction in social-welfare rates.

The group proposed an initial reduction of just over €100m in science, technology and innovation (STI), or 15pc of the 2009 allocation.

In relation to STI, an Bord Snip noted that between 2000 and 2007 there was a three-fold increase in government outlays for R&D and outlined a number of concerns.

“The evidence adduced to date for the impact of state STI investment on actual economic activity has not been very compelling,” the report read.

An Bord Snip said there was an absence of a clear business need to double PhD numbers, and it said it was concerned that the graduates will be under-employed or forced to emigrate.

“Indeed, some empirical evidence suggests that 20pc of new doctorate holders find employment overseas and of those who remain, most find employment in the public rather than the private sector.”

It said that funding of STI is dispersed through a large proliferation of supports, with many target the same or similar activities, and it argued for rationalisation of supports and reduction of large administrative overheads.

Streamlining the policy framework will improve co-ordination and maximise the potential for commercialisation of research, the report said.

An Bord Snip noted that exchequer funding of R&D has grown compared with other sources, which suggests “some displacement of private funding by public funding”, a trend it said should be halted.

By John Kennedy

Pictured: UCD economist Colm McCarthy, chair of An Bord Snip Nua