INNOVATION:THE GOVERNMENT is to combine with US-based venture capitalists to create a €500 million fund to encourage small high-tech companies.
The move heads a series of initiatives - most of which have already been announced, or even introduced - to prepare Ireland for the years ahead.
The venture capitalists from the US will be offered a 15 per cent tax rate on profits to encourage them to invest, while major changes to intellectual property law will also be introduced.
The measure is modelled on Israel's Yozma Fund, which was set up in 1993 with just $200 million and today holds $10 billion worth of investments.
Divided up into five funds and invested gradually over 10 years, the money will be invested for seven years at a time in individual companies.
The ambition is to make Ireland the European Union's "innovation hub", the document, Building Ireland's Smart Economy: A Framework for Sustainable Economic Renewal, declared.
New businesses will be exempted from corporation tax for three years, though this move was included in October's budget.
Fast-track visas will be offered to world-class foreign researchers, and spouses, while RD tax credits, already in law in last week's Finance Bill, will encourage multinationals to spend more on research.
Enterprise Ireland, which has already expanded its Asian operations, is to do so again, while the IDA is to trawl farther afield for foreign direct investment.
The ESB and Eirgrid's already announced near-€30 billion investment in renewable energy sources, and the pylons needed to bring the power generated to users is also included in the document.
Some €30 million will be spent next year to insulate homes, and Minister for Energy Eamon Ryan made it clear that he "will seek more" if necessary.
A carbon levy will be introduced in 2010 to cut Ireland's CO2 emissions, but in a way that "does not impact adversely on the most vulnerable or on the economy".
The document "is intentionally not a stand-alone document" and should be read as a complement to the programme for government and the social partnership pact, Towards 2016.
Furthermore, it does not include "all areas of the economy" but "rather focuses upon those that will make the greatest contribution to the management of the current economic circumstances and lay the foundations for economic recovery".
Making it clear that new taxes are on the way, it says that the Government will take action once the Commission on Taxation reports in September.
"The immediate Government focus will be on tackling the recent growth in current expenditure; additional revenue through broadening the tax base will also need to be considered to address some of the funding gap," it went on.
The cost of dealing with State paperwork for companies will be cut by a quarter by 2012 in line with a commitment already taken at EU level.
Unemployed construction workers will be retrained to insulate homes, and to cut €200 million off the State's heating bills for its own offices.
"The public finances must be restored to a sustainable position and a key milestone in this process is the restoration of the current budget to a balanced position as soon as possible.
"This means eliminating for day-to-day expenditure as soon as is reasonable," said the document.
The cost of paying the national debt's annual interest bill will more than double over the next three years, from 5 per cent of all taxes to 11 per cent of everything collected.
Fast-track planning rules will be introduced to develop offshore renewable energy systems offices, designed to cut €200 million off the State's heating bill.
Restating the need for major public service reforms, the document said all public bodies would be required to produce annual statements showing how they spent the money they received.
"The public service contains many dedicated, talented and motivated staff.
Its framework and structures must be reformed to allow for the flexibility, responsiveness and accountability necessary to meet the complex policy challenges we now face," it said.
