EDUCATION:WHEN THE then minister for education Donogh O'Malley brought in free secondary education in the 1960s, there was stiff opposition from those who viewed it as a cost – and questioned its benefit. Similar forces decried the efforts of successive Lemass governments to drive down taxation on companies, ultimately leading to today's 12.5 per cent corporate tax.

The complexity of these policies rendered their worth immeasurable at the time of their introduction. Even today, decades later, their precise effect cannot be calculated. But most of us know they have been pivotal in Ireland’s transformation from an agricultural society to a modern state. The good part of the Celtic Tiger, from the mid-1990s to early 2000s, could not have happened without these visionary policy interventions. Too bad that, like latter day Romans, we threw much of it away. But that part of the story is for another day. Back to the obsession with measurement and cost benefit analysis and how, ironically, it could prevent good medium- to long-term planning.

Our country is in the midst of a severe economic crisis. As with any crisis, this has brought on a preoccupation with the present. It’s a measure of the hysteria that to even mention medium- to long-term plans for Ireland suggests one is not aware of the current crises in banking, public finances or employment. To break from the columns of the enraged in this respect is almost heresy.

It’s beyond argument that the issues with the banks and public finances must be addressed and that they naturally consume considerable attention. But there is a worrying obsession, particularly in academia and in the media, that the only game in town is balancing the books. They seem to think balancing the books is a strategy for future growth. It isn’t. It is an essential ingredient for growth but insufficient on its own.

Ireland does not have deep reserves of oil, minerals and other resources. In recent years we’ve priced ourselves out of many markets. Brains and creativity are our only chance. The innovation agenda, often referred to as the “smart economy”, seems to be the primary means by which growth may be achieved, assuming the prerequisites of saving the banking system and balancing the public finances are delivered.

The decision, in the late 1990s, to commit Ireland to enhancing its research base as a platform for developing products and services with higher market value (thereby maintaining our living standards), and the recommitment to that decision in the recent revised capital investment programme, may yet prove to be on a par with free education and low corporate tax in terms of Irish prosperity.

As recently as the 1980s, Ireland’s output of high-quality scientific publications was below that of Bangladesh. The quantity of such output relative to our population was well below the EU average. In the last 10 years, our output has accelerated more than at any time in our history. In terms of volume, we have exceeded the EU average and are now at OECD (Organisation for Economic Co-operation and Development) levels. At the same time, we have improved our quality dramatically; in 2008 we broke into the top 20 country ranking for scientific quality for the first time. The international standing of our third-level institutions has seen a similar rise, with all universities climbing the international rankings and TCD and UCD present in the top 100.

Some will argue that this is academic piffle and ask what it has to do with the economy. Well, as an early indicator of what we might expect from this development, take a look at IDA (Industrial Development Agency) Ireland. Their job is to attract foreign companies to locate in Ireland. Five years ago, less than one-tenth of IDA Ireland’s investments were in research, development and innovation. This has climbed dramatically, reaching 49 per cent in 2009, with a value of €500 million. In other words, high-tech foreign companies are increasingly interested in Ireland as a place to invest in higher value activities.

Nobody is pretending research and development (RD) projects in themselves will provide thousands of jobs. But they are transforming industry in Ireland, directly stimulating advanced enterprises and lending more traditional companies an increasingly sophisticated foundation. This is key to retaining existing employment and creating conditions for the emergence of an employment-dense innovation environment in Ireland. But it will take time.

I am nervous of calculations of very specific jobs numbers that will be created as a result. Evidence suggests public investment in RD is associated with improved economic performance, but it is not possible to be absolutely precise or quantitative in this respect. There is no mathematical formula or cost-benefit model that can prove this beyond any doubt.

Some of the cost-benefit brigade use this as an argument to punch holes in Ireland’s research and innovation strategy. But this strategy is too wide-ranging, too complex and requires a timespan that is too long to be computed in this fashion. Would the introduction of free secondary education or lowering corporation tax have happened with this thinking? We must hold our nerve on the research and innovation plan. Given time, it will deliver.

Graham Love is director of policy and communications with Science Foundation Ireland

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