Professor Diarmuid Hegarty:

The Senator asked for solutions. I have three of them. The first is a proposal we made to the Government in 1999, basically in response to a tender to create places for students on programmes in IT. Our proposal was that the Government would pay for the first two years of the course and the employers would pay for the remaining two years. We did not levy any capital; the college funded that itself. The cost of that at the time was £5,000. Under the traditional model, the Department of Education funded £30,000 per place, broken down into £10,000 capital and £5,000 a year for four years. Effectively, we were training five students at the same cost as one student in the traditional sector. We believed this was what the Government needed and the Department would be delighted with the proposals. In retrospect, we realised what fools we were because, in fact, there was no appreciation of it. Indeed, it created so much embarrassment that the Government felt constrained to actually block private institutions from making subsequent tenders. If members want to deal with this problem and to have open solutions, that is possible but there is a need to engage. The Government needs to engage. By the way, we are talking here about students who studied for two years and then began working. Their employers were more than happy to pay their fees. They were glad to get the students because they were very useful to them after two years. We are back to there being a significant shortage of staff, and imaginative solutions such as that will work. It would not have worked two or three years ago.

My second suggestion is to consider tax relief on fees. After all, if a person is bearing an expense which would otherwise be borne 100% by the State, why not have the State support them by giving tax relief on fees? At most, the State will be paying 48% and it may be paying only 20%. That is another solution.

Another possibility is to encourage institutions to work with employers to put in place a student loan system. Under the European strategic investment fund, it is possible to arrange student loans. I referred to this in our paper. Those who are already in employment are obvious candidates for this and will be able to repay. We are not talking about large sums. If the committee wants the funding to fill the skills gap, that is definitely possible. It just needs imagination and engagement.