When university fees were abolished in 1996 it heralded a landmark for the cost of education in Ireland, but 20 years on are free fees fit for purpose?
University tuition fees for undergraduates were abolished in Ireland in 1996 in an attempt to encourage greater access to third level education for all students regardless of their socio or economic background.
The introduction of free fees did succeed in achieving its primary objective of removing barriers to entry and promoting a level playing field for all students wanting to go to college. But if we fast forward 20 years, are free fees doing what they say on the tin?
When third level fees were abolished in 1996 universities introduced a minimal fee to cover registration, administration, student services and examinations. Initially, this fee was less than €200 per student each year. However, it increased annually and now in 2016 all 'free-fees' third level institutions charge a mandatory student contribution of €3,000.
The cost of entry to college is not the only thing that has increased substantially in the last 20 years and many parents agree that the cost of putting a child through college can add up quickly. Travel expenses have increased year-on-year and now transport for students is estimated to be approximately €1,215 annually. According to the DIT Campus Life Student Cost of Living Guide 2016, the cost of books and class materials has also increased to over €600 a year, while mobile phone costs are around €288.
For third level students living at home, the estimated cost of their education for one year is €5,016, which equates to €14,016 over the course of their lifetime in third level education. And for students living away from home, that figure increases significantly due to the rising cost of rental accommodation in Ireland.
Rent costs can vary throughout the country, and given the lack of supply, students can pay anything from €348 per month for a shared room, €563 for a single room or €1,000 plus for a one bedroom unit in Dublin, according to the Daft.ie rental report.
Research has shown that in total, those living away from home can expect to spend €8,265 annually and €31,170 during their lifetime in college.
Since 1996, the number of students entering third level education has soared and today more than half of all workers in Ireland have a third level qualification. This growth in student numbers is putting pressure on college resources and services and is a factor in the sharp increase in the mandatory student contribution fee in the last 20 years. So what are the solutions to the rising cost of third level education and how can parents continue to finance their children through college?
In July 2014, the Department of Education established an expert group to examine future funding policy for third level education. This expert group chaired by Peter Cassells, released its findings in July 2016 in which it called on urgent reform.
“The funding system is simply not fit for purpose”, Cassells said. “It fails to recognise the current pressures facing higher education institutions or the scale of the coming demographic changes. It also fails to fully recognise the pressures on families and students, not just because of the €3,000 fee, but also the high living and maintenance costs associated with studying.”
According to Cassells, there needs to be a new system that can respond to the changing needs of students, society and the economy. “Ultimately a more comprehensive and fundamental change in the funding model is required – one that will provide for a sharing of costs but that will do so in a fair and attainable manner.”
Whatever the outcome, reform is imminent. In the US, parents’ start saving for their children’s college fund practically from the moment they are born, and in the UK student loans bridge the financial gap for students and parents alike. However, in Ireland neither of these are commonplace and as the cost of sending children to third-level increases each year, so too does the stress and worry for parents that they will be able to meet these increasing demands.
Zurich Life has done the maths on the cost of education and for one child in Ireland from primary school right through to college graduation it is approximately €40,000. Although college students may be able to help out by undertaking some part-time work, given the increase in the cost of living, it's unlikely they will be able to contribute in any significant way.
Therefore, wouldn't it make sense to plan ahead and build up your savings year-on-year? Building up the funds to support your children’s education is easier than you think. For example, if you saved the Government child benefit of €140 per month for five years (as of January 2016) from when your child was born, by the time they start school you could have built up savings of €9,277 in time to fund this crucial stage in their education. With an Easy Access Savings Plan from Zurich Life you can gradually build up the funds necessary to support your children's education.
To find out how Zurich Life can help you save for your children’s education and future, visit https://www.zurichlife.ie/ or call 1850 804 164.
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