Mr. Richard Kennedy:

I wish to thank the committee for the opportunity to address it today as it considers the proposals contained in the report of the expert group on the future funding for higher education. I also apologise for the absence of our president today. He is in Brussels, which is why I have the job. As the committee will be aware, farm families have always placed a very high value on third level education. Farmers recognise the importance of higher education in delivering a strong future for the next generation, whether they return to work in agriculture or in other careers.

Higher education participation benefits the individual, society and the economy. On this basis, we believe that the proposal in the report for higher education to be funded by a combination of contributors - the State, employers and students themselves – has merit. However, we believe strongly that any contribution from a student must not be burdensome. Any change to the funding regime in the future must not prove a barrier to participation for students from lower income groups. We also believe that the committee should consider what impact high student fees could have on participation in certain courses or career areas. The imposition of student charges must not lead to a situation whereby students are incentivised to pursue a course that is deemed to lead to a high-earning career or, conversely, to not pursue a course where the lifetime career earnings may be modest, such as farming.

I wish to deal with the issue of potential changes to the means test for third level grants, as proposed in the report. It is worth noting that the report proposes the retention of maintenance grants for third level. This is very important. The report recommends:

Increases in funding for higher education institutions must be matched by improvements in the student support system. This should include an increase in the value of payments, particularly for the lowest income groups, the introduction of a capital assets test, and an extension of supports to part-time and postgraduate students.

The IFA is opposed to any attempt to include productive assets, such as farmland, in the means assessment for third level grants. Productive assets are required by farm and other small businesses to generate income and are not a measure of additional ability to pay. As the committee may be aware, the existing method of assessment of self-employed income for the maintenance grant disallows a number of expenses that are included in income tax computation. These disallowances, which impact on farm families in the means assessment, include capital allowances, lease payments, stock relief and interest on borrowing for capital purposes. Approximately 40% of students from farm families receive a maintenance grant, which can be compared with 33% of the general student population. This simply reflects the fact that average incomes in farming are low, at approximately €26,000. Like all other families, where the farm income exceeds the threshold for grant qualification, the student will not qualify for a grant. Any system that would impute additional income based on the value of productive assets would discriminate against a particular cohort of students, preventing this group from accessing a grant and potentially from attending college.

In its deliberations on the recommendations of the report, I ask that the committee take into account the concerns of farmers in this area. The inclusion of productive assets in the means test for third level grants could deny access to higher education to students from low-income farming and other self-employed families and must not be introduced.