strategy statement03 - 05

Increased levels for the National Minimum Wage;

A range of commitments in relation to the development of the

Employment Rights legislative framework and associated Codes of Practice.

Ireland has benefited from a willingness to continually reappraise and reshape its industrial policies, programmes and institutions. Over the past decade, key changes have involved the creation of distinct and separate focuses on indigenous development and securing and growing FDI, the increased breadth and sophistication of science, technology and innovation policy, and concerted and more wide-ranging efforts to develop a probusiness environment. All of these strategic directions remain valid. However, Ireland’s successful development has had the effect of redrawing the industrial policy map, firstly, in terms of EU state aids regulations which limit the amount and type of direct state aid which may be given to firms, and secondly in the degree to which the investment decisions both of foreign and indigenous firms are reliant on such aid has changed.

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The growing significance of regional development issues also poses challenges for enterprise policies and raises a number of cross-cutting issues where the Department’s goals will be significantly impacted upon by issues such as the National Spatial Strategy and decisions on infrastructural provision.

Sustainable development presents opportunities and threats for the enterprise sector, especially in terms of the need to reconcile objectives for improving competitiveness, productivity and innovation with the need for environmental and social improvements. The challenge for the Department is to put policies and practices in place which facilitate enterprises in maximising the available opportunities and minimising the threats. Over the period of this Strategy Statement, it is expected that three areas of sustainable development will be particularly important for the enterprise sector: climate change, resource productivity and corporate social responsibility.

Department of Enterprise, Trade & Employment

These issues are addressed in detail in the Department’s Sustainable Development Strategy. The Strategy sets out objectives and actions for both the Department and enterprises over a period of time in the areas identified above. The strategy will influence the way many of the tasks in the new Departmental Strategy Statement are undertaken. Of these, climate change poses the greatest challenge to the enterprise sector. Due primarily to the strong economic growth of the past decade, the target for emissions reductions set for Ireland under the Kyoto Protocol represents a very substantial challenge.

The significant changes in the overall enterprise environment give rise to strategic questions about the scale of our direct industrial policies and associated institutions which must be addressed during the strategy period.

Ireland’s low gross expenditure on R&D across industry and third level education is a particular cause for concern. Ireland’s current stage of development means that different sources of competitive advantage are needed. One key source of competitive advantage is the ability to develop, secure and apply knowledge and skills. If Ireland is to make a successful transition to innovation and knowledge-based competitiveness, the framework conditions which permit, encourage and sustain innovative creativity must be significantly strengthened over the period of this strategy statement.

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This will require cohesive action from all elements of the national system of innovation including government, enterprises, education and the financial system. It will require continued rapid development of R&D capacity and capability in the higher education sector, achievement of world-class research excellence particularly in strategic areas allied to the needs of industry, and attraction to Ireland of significant R&D activity. Building the R&D capability of industry and its absorptive capacity to ensure industry can fully utilise the human and technological outputs of the investment underway will be key priorities. Research collaboration between industry and the third level sector must become fully embedded. A modern framework for