Amid the scandals, universities still need new funds

The recent scandals at some of our third-level institutions revealed by an RTÉ investigation could not have come at a worse time for the third-level sector in the public debate around sustainable funding.

The questions raised about inappropriate expenses and governance and a lack of clarity on mergers, research centres, and procurement were compounded by the attitude taken by the institutions towards the Public Accounts Committee. This will damage these institutions politically and in the public eye.

It is likely that the third level sector will try to deflect from these revelations by highlighting the sharp cuts in funding since the recession. Of course, it has to be pointed out that none of the revelations on the Prime Time Investigates programme was caused by lack of resources. Good governance is not dependent on financial resources.

Some of the collateral damage is that the argument for more and sustainable funding for the third-level sector is put off course. This could be a big problem for the sector. There have been substantial cutbacks in funding at a time when student numbers are rising and there are greater demands on staff. The decline of our universities in global rankings is the clearest indicator of the problem.

As someone who works in the sector, I can attest to the negative effects on students and staff in the less visible but critical frontline work. The Cassells Report on the funding of our colleges indicates that an additional €1bn in core funding and €5.5bn in capital funding is required over the next 15 years.

An important discussion has to happen on how we sustainably fund our third-level sector. The benefits apply to everyone. A multinational attracted to Ireland because of a highly-skilled graduate workforce will also hire non-graduates, and the spending of all of the workers will create indirect jobs for others.

The Cassells Report suggests three alternative funding models: Full State funding without a student contribution; the continuation of the current student contribution with increased State funding; or a loan to be repaid by graduates at a rate dependent on their income. The first two options essentially amount to the status quo in terms of sustainable funding for the third level sector.

The third option provides a reliable model to allow colleges to plan with some certainty in income.

Objections to the reintroduction of full fees with an income contingent loan include that it may hinder the ability of students from poorer families to go to college. The Cassells Report points out the removal of fees in the mid-1980s did not improve access for poorer students. Indeed, it may have made the inequality in our education system worse by allowing richer parents to redirect resources to fee-paying secondary schools and grind schools.

The root causes for lack of participation from poorer students at third level arise when students are in primary school, and perhaps even pre-primary school. Disadvantage is embedded at that stage, with the lack of resources and the lack of expectation that these children will even go to college leading to persistent inequality.

We are fooling ourselves if we think that any reform of the fees or how they are paid will have a significant impact on equality of access. It is likely there are students in the middle-income groups who may be reluctant to take on debt for college, even where repayments are set relative to future income.

There is evidence that poorer families are more debt-averse.

The solution may be to supplement the income contingent loan system with a fair grants system for those most in need. But if we want to make sure we harness all of the talents of our young people, it makes sense to sustainably fund third-level with a graduate loan scheme while ensuring the money saved goes directly to address disadvantage at primary level.

Dr Declan Jordan is senior lecturer in economics at Cork University Business School


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