The Republic trails the leading economies when it comes to research and development (R&D) spending, a new report from a Government committee has claimed. It outlines ambitious plans to more than double the amount spent on R&D by 2010.

The report, Building Ireland's Knowledge Economy, acknowledges there has been increasing public investment in R&D over the past five years, but suggests that more needs to be done.

The report was produced by an inter-departmental committee on science, technology and innovation, and was chaired by Mr Ned Costello, a senior civil servant from the Department of Enterprise, Trade and Employment.

It suggests an action plan to put the State at the forefront of R&D performance by 2010.

It says business investment in R&D should increase from €917 million in 2001 to €2.5 billion in 2010. It suggests the number of indigenous companies spending more than €100,000 on R&D annually should double from 525 in 2001 to 1,050 by 2010.

The report adds that the number of indigenous firms performing significant R&D (in excess of €2 million) should increase from 26 at present to 100 by 2010. It also calls for an increase in the number of foreign affiliates engaging in R&D.

It calls for the development of "less bureaucratic approach" to R&D support. The report adds that the State needs to develop a national plan to increase the performance, productivity and efficiency of research in the higher education and public sectors.

It says that the EU lags the US and Japan in research and innovation performance. Gross expenditure on R&D as a percentage of GDP is 1.9 per cent in the EU, compared with 2.7 per cent in the US and 3.1 per cent in Japan.

The report adds that R&D is important because empirical evidence suggests that enterprises that perform R&D are likely to survive longer and provide higher quality employment.

The Tánaiste, Ms Harney said the report would be given to the new Cabinet committee on science, technology and innovation at an early date.