University presidents back introduction of student loan scheme to boost funding for higher education
A split emerged today between universities and institutes of technology on the thorny issue of student fees.
University presidents have backed a study now -pay later, income contingent loan scheme for all students, with annual fees rising to €4,000-€5,000.
This would mean students not paying any fees upfront, but repaying the cost once they graduated and their income hit a certain level
But institutes of technology said there should be no fees at all for students on ordinary degree and higher certificate courses, known as Level 7/6 on the CAO.
But the institutes say a student contribution “ may be appropriate” for students on honours degree courses, known as Level 8.
Overwhelmingly, Level 7/6 courses are provided by institutes of technology, while universities focus on Level 8 courses.
At the core of the institutes of technology argument is that their students are more likely to come from less well off backgrounds.
The two sides made their case today at the Oireachtas Education Committee, discussing the Cassells Report on funding for higher education.
Fees are currently €3,000 a year and have been frozen for the past two years pending decision on longer term funding for third-level.
Colleges in Ireland have experienced a big financial squeeze in recent years, as a result of Government cutbacks couple with an increase in student numbers. A report last week showed that a number of institutes of technology are in very vulnerable position financially
The Cassells Report, published earlier this year, said the higher edication system needed an extra €600m a year by 2020, to meet day to day running costs.
It suggested a student loan scheme, linked to an increase in fees, as a possible contribution to increased funding - along with a substantial increase in contributions from the State and employers
The report proposed an income contingent loan scheme for students.
Irish Universities Association chair Professor Don Barry told the committee that a system where very high levels of fees, such as those applying in the UK or the US, are charged was not acceptable, whether paid up front or under an income.
But he said that, regardless, of the level of the charge, there were arguments in favour of deferred payment.
“It avoids pressures on families to pay up front at a time when family incomes are under a variety of pressures in the wake of the economic crisis.”
He said, in some cases, this involved borrowing at commercial rates with the requirement for immediate repayment – conditions which were more onerous than those envisaged for an income contingent loans scheme.
“In terms of the scale of resourcing challenge facing the sector, the burden spreading which a loans system allows, does, at a practical level, make some increase in the student contribution component more feasible”.
He pointed to figures put forward In the Cassells Report, suggesting repayment scenarios involving loans of €16,000 and €20,0000 - representing annual fees of €4,000-€5,000.
Prof Barry said that suggested “ that an affordable system can be constructed and that progressivity can be built into such a system.”
Prof Ciaran O’Cathain chair of the Technological Higher Education Association (THEA), representing the institutes of technology, said the cuts to third-level had had a disproportionate impact on the institutes, which was threatening their distinctive and unique contribution.
He said the institutes had a higher proportion of students from less well off backgrounds and played important role in offering access to third level.
Prof O’Cathain who is president of Athlone Institute of Technology said they were suggesting a variation on funding options suggested in the Cassells Report, with no fees at all for Level 7/6 courses, and the State and employers picking up the full tab for those students
“With regard to Level 8 and higher, and bearing in mind the greater costs associated with these higher levels and THEA’s acceptance of the proposition that private benefit accrues the further one progresses in HE, a student contribution may be appropriate.”