Study now, pay later - FG's plan to charge graduates college fees
Published 15/12/2010 | 05:00
Third-level students could be facing massive hikes in fees when a new Government enters office. The rise of €500 in fees in last week's budget will bring the total student contribution to €2,000, but proposals from Fine Gael could double that.
Fine Gael's policy on third level funding, The Third Way, proposes deferred contribution payments by students of up to €4,300 for each year of study.
Under the plan students would pay their fees after they graduate when they are earning, through the PRSI system.
They would pay 30% of the total cost of their third-level education by having money deducted from their incomes.
In Fine Gael's policy document, announced last year, examples of how much a student could be paying are given (see panel).
The total deferred fees mentioned in the report range from €11,400 for a three-year Arts degree to €17,096 for Engineering. As an alternative to having income deducted, graduates could pay off their fees immediately after graduation.
The Fine Gael policy document does not mention how much students in expensive courses such as Veterinary Science and Medicine would pay. Based on the cost of providing these courses, the fees could be astronomical.
Under the Fine Gael proposal, all students, including those who have received student grants, would have to pay the deferred fees.
The Fine Gael plan differs sharply from the policy of the party's prospective Labour partners.
Officially Labour is sticking to its stance against third-level fees, but the party's education spokesman Ruairi Quinn did not rule out some kind of student loans scheme when I contacted him.
Labour will find it extremely difficult to maintain its pure opposition to fees, given the likely financial constraints of being in Government.
However, any reintroduction of fees would come with heavy political costs.
Labour will look at the fate of the British Liberal leader, Nick Clegg, who has come under sustained attack after raising student fees. The hike in fees has led to riots in England.
Ruairi Quinn said: "These issues will ultimately have to be decided in negotiations to form a new Government.''
He said the party was particularly concerned about making the means test for the student grant fairer.
"The present system is seen to favour those who are self-employed. We need a system that is fairer for PAYE workers,'' he added.
The Fine Gael proposals to introduce deferred payments of fees are likely to come under closer scrutiny as the party moves closer to government. Already, significant aspects of the plan are seen as impractical even by the party's own education spokesman, Fergus O'Dowd.
The party originally hoped to abolish registration fees as its new system of payment was introduced.
Fergus O'Dowd said: "Because of the financial constraints we are under I cannot see it [the abolition of registration fees] happening now.''
Leading figures in education have highlighted a number of flaws in the Fine Gael proposal.
Ferdinand Von Prondzynski, former President of Dublin City University, said the party should be given credit for addressing the fees issue, but he does not support the idea of charging students higher fees for certain courses such as Science and Engineering.
"There should be a flat rate fee for degree courses. If you vary the cost of courses, it acts as a disincentive to students studying subjects such as Science.''
Another significant drawback to the Fine Gael system, according to critics, is that deferred payments can only be collected from Irish-based taxpayers.
With so many graduates moving abroad, the Government may have difficulty collecting sufficient money -- and a "stay-at-home tax'' could be seen by graduates as an incentive to emigrate.
"Really we should be getting money from emigrants, because they benefited from an education here, and are bringing those benefits elsewhere,'' said Ferdinand Von Prondzynski.
A third significant flaw in the deferred-contribution model is that it will yield nothing up front.
Fine Gael had hoped that the initial money to pay for the scheme could be borrowed by the government, but with the IMF breathing down our necks this is now most unlikely.
A possible option for Fine Gael would be to retain some form of up-front student fee and then phase in a deferred-contribution scheme.
Labour still has a strong emotional attachment to free fees, but some commentators argue that the measure has done little to erode inequality in education.
"It was a massive gift to the middle classes,'' said Ferdinand Von Prondzynski.
"It paid for many well-to-do people to go to university from areas such as Foxrock and Stillorgan, but did nothing to increase numbers going from areas such as Ballymun.''
Whatever form the new model of third-level funding takes, it seems likely that students or their parents will have to pay more.
Any parent hoping to put their children though college in the coming decades would be well advised to start saving now.