It is a great pleasure for me to be here this evening at this inaugural lecture in the Annual Lecture Series organised by the Irish Software Association in conjunction with their AGM. I was delighted to accept the invitation from your esteemed Chairperson, Mary Cryan when she initially told me about the AGM at a meeting in the Department at the beginning of March. I want to sincerely congratulate Mary for her outstanding work as leader of the Irish Software Association.

Ireland has quite justifiably earned the title 'software capital of Europe'. Second only to the USA, we export more software than every other country in the world and more than 40% of the packaged software and 60% of the business applications software sold in Europe is now produced in Ireland.

The list of major international software companies working in Ireland is very impressive. Companies such as Berlitz, Cap Gemini, Cambridge Technology Partners, Corel, Digital, Ericsson, IBM, ICL, Informix, Lotus, Microsoft, Motorola, Novell, Oracle, Philips, Quarterdeck, Siemens, Symantec and Sun Microsystems are all operating successfully in this country, providing direct and indirect employment to thousands of our young skilled workers.

The 1997 National Software Directorate Software Industry Survey shows that there were 561 indigenous companies operating in Ireland employing 9,200 people, half of the sector's workforce. These companies are making great headway in the development of new products and new markets. The figures for last year will be available shortly and will show a further increase in the number of companies operating in the sector, as well as an increase in the numbers employed. Enterprises such as Nua Ltd., Transware Ltd., CBT Systems, Iona Technologies and Vistatec Ltd. in Dublin, Piercom Ltd. and Blackbird Data Systems Ltd. in Limerick, Mallon Technology in Co. Louth and Toucan Technology Ltd. and Unisoft Ltd. among others in Galway are developing steadily and creating a vibrant indigenous software sector.

The seriousness with which this Government takes the development of the software sector can be measured by the fact that Ireland is the only European country with such a state-supported National Software Directorate. One of the Directorate's tasks is to provide the Government with the sectoral analysis which it needs to support the software sector in a positive way.

The National Software Directorate has its own website, which combines information about the industry and funding opportunities with the Directorate's online software industry directory, a fortnightly news letter on the industry in Ireland and with Opportunity Ireland's job lists. Our Department, through Enterprise Ireland, provides a wide range of supports to software companies, including feasibility studies, employment grants, research and development grants, and management development and support.

This Government is committed to working with managers and personnel in these companies and to assist them to develop their R&D management skills. The R&D Management Initiative, jointly sponsored by our Office of Science and Technology and the EU, was established in order to ensure that the R&D spend within firms is tightly focused and well targeted. A key element of the initiative is the training of Irish management in the specifics of R&D management, which is very different to financial or marketing management.

An exciting new development in this area is the launch of a National Institute of Technology Management. The Institute's primary aim is to raise technology management standards in Irish business. The Masters Degree being offered by the Institute is based in UCD and is a collaboration between the university's Engineering and Commerce faculties.

One of the issues preoccupying both the State and the software industry at present is the advent of a skills shortage in both the electronics and software sectors. This Government is tackling the issue head on.

Enterprise Ireland, has published in conjunction with Ernst & Young Computing Skills and the Jobs Market, a guide designed as a source of assistance for both recruiters and job seekers in the software industry. The guide lays out the most suitable qualifications for each type of job in the industry and is designed to streamline the process by which graduates can enter the software labour force. The National Software Directorate has also launched a video and booklet, explaining the different careers available in the software sector, aimed at secondary level students and their career guidance counsellors.

The National Software Directorate is currently co-ordinating an initiative to make careers in software more attractive to women, who, even though their numbers are growing are still in a minority position in the industry.

My Government colleague An Tánaiste Mary Harney launched Opportunity Ireland, a campaign to tempt our emigrant graduates home to work in the software and electronics sector in Ireland. The campaign is jointly undertaken by our Department of Enterprise, Trade and Employment and Enterprise Ireland. Opportunity Ireland aims to inform Irish emigrants of the work and career prospects available in Ireland and therefore provide a supply of experienced and talented graduates which will help to fill the industry's current and future needs.

The Government is not confining its efforts to the recruitment of existing industry workers. The future skills needs of the sector are being tackled by measures undertaken by my office. The Science and Technology (Education) Investment Fund, which was launched late in 1997, will provide funding for the software industry workers of the future.

As the global economy becomes more knowledge based,- that is driven by R&D,- the key to our continued success is to reposition Irish industry higher up the economic value chain. This approach has been endorsed by the ESRI in their recent publication on National Priorities for Investment 2000 - 2006. Ireland needs to put in place the technological infrastructure and expertise which will ensure that we continue to create, attract and sustain successful high tech companies. The wide impact of technology on economic and social development puts an onus on Government to prioritise its investments into areas of maximum impact.

It was against this background, that last year I asked the Irish Council for Science, Technology and Innovation (ICSTI) to carry out a Technology Foresight Exercise which would firstly seek to identify the merging technologies that would be key to national development in the medium to longer term and secondly to present a plan of action to address the opportunities and challenges associated with those technologies. I am pleased to say that ICSTI recently presented me with its findings on Technology Foresight. I am in the process of having these examined and I will be submitting proposals to Government in the near future on possible implementation options.

The Report will be formally published by ICSTI at the end of April and I would encourage all of you here tonight who are interested in the future of the software sector to read the recommendations in the Technology Foresight Report and over time begin a process of implementing those recommendations which affect your day to day business.

Finally I want to close by congratulating Mr. Gerry Jones on his appointment as the rising Chairman of the Irish Software Association. Gerry is a member of the Research Technology and Innovation/Measure 1 Committee. I understand that Gerry is a very active member of that Committee and provides very important inputs to its decision making process. I have no doubt that he will also bring this enthusiasm to the post of Chairman of Irish Software Association. I want to wish Gerry and the Irish Software Association all the best in their work in the course of 1999.