Professor John Hegarty:

On behalf of the Royal Irish Academy I welcome the opportunity to speak to the committee today on the findings of the expert group on the future funding of higher education. The Royal Irish Academy is an independent body representative of academics across the entire country, North and South, who are elected on the basis of their achievements.

Regarding the background to the problem at hand, since 2008 the higher education system in Ireland has seen a very severe divestment of its funding base. There has been a 38% decline in State grants from 2007 to 2014 while student numbers have increased by 25%. There has been a 22% decrease in funding per student from €11,000 to €9,000 despite the student contribution charge trebling. Academic and support staff numbers have fallen by 2,000 from 19,000 in that period. The higher education capital budget has been reduced by 85%. Despite the best efforts of committed staff to be more efficient and entrepreneurial and the patience of students, the net effect of the cuts is a significant decline in quality and the system is now, sadly, firmly on a downward slope. That is evidenced by recent falls in the international university rankings and a deterioration in the student-staff ratio from 16:1 to 20:1. The OECD average is 14:1. The ratio is an important measure of the degree of personal interaction and mentoring between staff and students.

Investment in infrastructure across the system has also fallen from more than €200 million in 2008 to €35 million in 2014 with a resulting negative impact on the quality of the system's capital stock and infrastructure. Added to that are the increased demands of the projected demographic increase in student numbers over the next 15 years. It is clear that the system really is in crisis. A strong, vibrant and internationally competitive higher education system is critical to Ireland's social, cultural and economic life. Action is urgently needed to redress the crisis by increasing the scale of investment in higher education. Recent external international shocks such as the Brexit referendum in the UK and threats to continued foreign direct investment make the case ever more compelling. The future is about talent not tax.

The publication of the Cassells report is an important step in the development of a clear pathway for a sustainable future for the system. The RIA welcomes the report and endorses its findings. In its submission to the expert group the RIA suggested a new approach from the status quo, acknowledging that while further resources are needed the reality is that the State is unlikely and unwilling to carry the burden of the entire cost. The RIA's proposals were similar to the final proposals of the expert group, showing a significant degree of consensus. The RIA proposed a multifaceted approach to meet the required annual additional investment in the system, which we calculated at approximately €1 billion. That includes a 25% to 30% increase in staff to improve the student-staff ratio to 16:1, which is still below the OECD average. Further growth in student numbers should only be considered following that adjustment in the interests of quality.

The cost of further investment in higher education should be borne equitably by its key stakeholders – the State, students and the institutions themselves. An emergency capital investment fund of €580 million per annum over ten years should be established to fund major repairs and replacements for existing capital stock. Institutions should also be allowed to operate an annual surplus which could be used for infrastructural maintenance. The student contribution charge should be replaced by a new student fee and support mechanism which would offer students the option of deferred payment through an income-contingent student loan and the opportunity to borrow living and maintenance costs.

I will say a final word about access. The average annual cost of attending college away from home is up to €11,000, while the maximum grant available is under €6,000. Those costs, coupled with the requirement for the upfront payment of fees, has had a detrimental effect on access. A total of 40% of families borrow to finance participation in higher education and that has had a particularly negative effect on lower income groups which tend to be more debt averse. Any new higher education funding model should therefore include provision for a well-developed student support system. Income contingent student loans would have a positive effect by removing the need for upfront payment. Part-time education, which provides an alternative higher education pathway for many, could also be incentivised by allowing part-time students to avail of the student supports available to their full-time classmates. That could be supplemented by the introduction of a new tax relief for part-time post-graduate students. The RIA commends the committee on its important work and looks forward to working with it as it builds consensus on how best to address this most critical issue at this most critical time for this country.