Ms Michelle Murphy:

We welcome the invitation. I will not go through our entire introductory statement. It has been circulated.

The national risk assessment has identified a lack of investment in education as one of the seven social risks facing the country. Human capital has been singled out in that report as an area for investment. Education is recognised as crucial to the achievement of our national objectives. Competitiveness, social inclusion and active citizenship are also referred to.

The Central Statistics Office, CSO, population projections indicate considerable investment is required to ensure the higher education sector can continue to cope with the projected increase in demand. In recent years, however, funding has been out of step with this. Failure to invest in skills has been highlighted by the OECD as resulting in the danger of low levels of innovation, higher levels of underemployment, unemployment and vacant jobs. Educational success is now about critical approaches to problem solving and the capacity to live in a multifaceted world.

The report highlighted Ireland should be considering benchmarking its funding against funding in the countries with which we aspire to compete. This is an important point. The report outlines some options in funding. However, regardless of what options the Government takes, public investment will have to increase significantly over the next decade due to the shortfall in investment we have had and the demographic challenges of the future. In this regard, we propose that a framework to 2028, with a roadmap, should be set out for sustainable funding and revenue.

There are strong arguments, from an equity perspective, that those who benefit from higher education and who can afford to contribute to the cost should do so. People with higher education qualifications do reap a substantial earning premium in the labour market, which increases with age. There are arguments against it, however, especially in light of any complementary strategy to do with long-term future funding. An issue arises over fees in part-time education. With regard to the current fiscal rules, would the Government loan guarantee be recorded on the general Government balance sheet? That is a challenge we face. We have argued consistently that there should be flexibility within the Stability and Growth Pact concerning public investment in fields such as education, health care and child care.

Ultimately, the funding for higher education has to be considered within the overall future funding requirements of the State. I refer to the requirement to pay back our national debt and to the National Pensions Reserve Fund, which has been transferred to the State. Future pension payments, water infrastructure, broadband, child care and all these issues will require an increase in the overall national income, no matter what way one decides to fund higher education. In that regard, we welcome this discussion but we believe the future income needs of the State need to be considered in the broader discussion, and higher education should be considered in light of education as a whole along with early childhood education and primary and second level education. Life-long learning is crucial.