Mary Hanafin (Dún Laoghaire, Fianna Fail)

I move: "That the Bill be now read a Second Time."

I am delighted to bring the Bill to the House. It is a highly significant development for the future of Ireland's education system, the higher education system in particular. It is an explicit recognition of the importance and value of the institutes of technology to our citizens and to our overall education system.

The Bill is introduced at a time of significant importance for higher education in Ireland. The Government has identified the development of a high performance higher education system as a key strategic priority in supporting our wider social and economic goals in this knowledge age. In maximising the contribution of higher education to the social and economic progress of our nation, it is essential that our institutes of technology are supported in achieving the full potential of their roles. The Bill provides for greater autonomy for the institutes to fulfil their missions and, by bringing them within the remit of the Higher Education Authority, will support an integrated and cohesive strategic approach to the development of higher education in line with national priorities.

Our institutes of technology are a true success story. They have grown and matured over recent decades to become an essential and dynamic part of the education system. Notwithstanding their remarkable progress, it is worth remembering that they are a relatively recent feature of the educational landscape, having really only emerged in their current statutory form since the Regional Technical Colleges Act 1992 and the Dublin Institute of Technology Act 1992. While each institute has its unique history, the DIT is distinct in both its genesis and in the fact that is governed by specific legislation.

The history of the institutes of technology is instructive in that it illustrates just how far they have come and helps us to understand where they are positioned within higher education. The first regional technical colleges opened their doors to students in 1970. The establishment of the regional technical colleges was a Government response to a number of appraisals of Irish education carried out in the 1960s. Two of these appraisals, a 1964 OECD report entitled Technician Training in Ireland and the Investment in Education report of 1965, concluded that urgent attention was required in the area of advanced technical education to produce technically qualified people against a backdrop of new planning for industrial development.

The Minister of the day, having announced that eight regional technical colleges would be established, set up a steering committee on technical education to advise him on the role of these new educational establishments. The committee reported in 1967 and, in its report, considered that the brief for these new institutions should be to educate "for trade and industry over a broad spectrum of occupations ranging from craft to professional level, notably in engineering and science, but also in commercial, linguistic and other specialties".

At the time of enactment of the Regional Technical Colleges Act 1992, there were 11 regional technical colleges and that number has since increased to 13. The Dublin Institute of Technology was established by the City of Dublin Vocational Education Committee in 1977 and represented the consolidation into a single entity of six colleges located across the city. These colleges focused on applied education and training in a wide range of occupations, trades and skills and were, up to the 1970s, almost the sole provider of technician and technological training and education. Much of the provision in the early days was at second level but, gradually, an increased third level provision evolved.

Uniquely among the institutes of technology, the DIT has statutory power to make its own academic awards. The other institutes have made significant recent strides in terms of awarding their own degrees under delegated authority from HETAC. The majority of institutes can now make awards up to masters level — level 9 on the national framework of qualifications — while four institutes have authority to make awards at doctoral level — level 10. This is indicative of the progress the institutes have made and is a clear validated statement of the excellent academic standards in the sector. I am sure the House will join me in commending the institutes on these achievements.

One characteristic that is a particular feature of the institutes is their regional remit. It is evident in the original title — regional technical college — that this focus was central to their mission, and it is important to note that it has been retained through the significant developments that have taken place in the sector. This regional focus is enshrined in, for example, the local representation provisions of the existing legislation, and this is carried through into the Bill now before the House. The institutes have forged strong community and commercial links in their regions and this has been singularly successful. There are many excellent examples of collaborative activities with industry based in an institute's region. Such collaborations support the institutes in developing core strengths that are quite often unique.

Third level education in Ireland has been characterised by what we know as the binary system — a university sector and an institute of technology sector. It has long been the policy of successive Governments to maintain the system, recognising the importance of the distinctive role, mission and provision in both sectors. In more recent times, it has become apparent that, while preserving and valuing the differences, there is a need to better integrate the two components. Under existing arrangements, the strategic management of both sectors is different in that the Higher Education Authority operates as the funding and overseeing agency for the universities while the Department of Education and Science has substantial statutory functions relating to the operation of the institutes of technology.

The House will be aware that the OECD completed a review of higher education in Ireland in 2004. A central purpose of the review was to support Ireland's strategic ambition of placing its higher education system at the front rank of the OECD in the context of the wider national objective of developing a world-leading knowledge economy and society. A key recommendation in the resulting report was that we should retain the differentiation in mission of the university and institute of technology sectors but that they be brought under the remit of a single authority for the purpose of achieving a unified higher education strategy. The report also recommended that the extent of external regulation of the institutes of technology be lightened, giving them greater managerial freedom in responding to the opportunities and challenges of supporting regional and national social and economic development. These recommendations have been endorsed by the Government. The Bill is the mechanism that will provide for this greater integration and cohesion in the system of higher education.

It is important to emphasise that the Bill is just one of a number of elements of the Government's approach to supporting the development of our higher education system. We all recognise that the primary purpose of education is to help people to reach their full potential as individuals. Without doubt, education also contributes to, and can be considered to be an indicator of, national well-being. G.K. Chesterton was right when he described education as "the soul of a nation as it passes from one generation to another". As we strive to broaden and deepen all aspects of our education, especially within marginalised groups, we can enhance human development and the well-being of our nation.

We also recognise that education has a significant contribution to make to the economic progress of the country. The OECD review summarised this importance when it stated: "Ireland was one of the first European countries to grasp the economic importance of education and economists suggest that this upskilling of the economy accounts for almost 1% of additional national output over the last decade or so." To acknowledge that fact is not, as some would represent it, to advocate a utilitarian approach to education. Rather, I see it as clear evidence of the impact of investment in education. The growth that it helps to generate enables us to invest even more and, in the process, enhance lives and empower people. With greater numbers progressing into higher education, our national skills levels are rising and highly qualified graduates are entering the workforce in large numbers. This high quality labour resource serves to attract and retain high quality, high skills employments. As we develop further into a high technology, knowledge-based economy, these high skills levels will be in increasing demand.

The rate of participation in higher education has increased consistently over the past 20 years. The most recent participation study confirms the continuing trend. It shows that the national admission rate was 55% in 2004 — up from 44% in 1998. The Government has recognised that, collectively, our higher education institutions now represent a hugely valuable national resource. To realise the full potential of that resource and to build world class strength in Irish higher education, we need to ensure the component parts work together on a system-wide basis.

As the €1.2 billion multi-annual investment package announced in the previous budget testifies, the Government has committed itself to investing in the quality of that system. During the next five years a total of almost €8 billion will be spent on the higher education system. The importance of quality is manifold. Ultimately, the outcomes are highly qualified graduates with the required skill sets to contribute in a complete way to societal and economic development. In acknowledging what has been achieved throughout our higher education system, we need to push forward and seek continual improvements in the quality of teaching, learning, innovation and research at third level and fourth level.

It is against this backdrop that, with the agreement of my Government colleagues, I announced the establishment of a strategic innovation fund for higher education. It is intended that the fund will drive transformation of the sector by promoting collaboration and change in pursuit of system-wide excellence. The objectives of the fund are to incentivise and reward internal restructuring and reform efforts; promote teaching and learning reforms, including enhanced teaching methods; programme restructuring at third and fourth level, modularisation and e-learning; support quality improvement initiatives aimed at excellence; promote access, transfer and progression and incentivise stronger inter-institutional collaboration in the development and delivery of programmes; provide for improved performance management systems and meet staff training and support requirements associated with the reform of structures and the implementation of new processes; and implement improved management information systems.

The fund is a five-year resourcing commitment of €300 million that will allow meaningful and far-reaching proposals for change to be brought forward by higher education institutions. A major emphasis under the fund is on promoting inter-institutional collaboration in building world class strength within the Irish system. The quality of higher education in Ireland must be measured against the highest standards across the world.

The strategic innovation fund is an important mechanism to enhance the quality of the system. The promotion of and support for research, while an educational and economic imperative in its own right, is also a key mechanism to enhance quality in the system. The quality of research feeds into the quality of teaching and learning, which feeds into the quality of graduate and researcher in turn. It is a virtuous circle in business school parlance. My Department's support for research at third level has been increasing significantly since the late 1990s when we commenced the programme for research in third level institutions, PRTLI, introduced a funding line for technological sector research and established the two national research councils. Congruent with this is the support of the Department of Enterprise Trade and Employment through Science Foundation Ireland and Enterprise Ireland, and other research activities supported by other Departments, including Health and Children and Agriculture and Food.

It is stating the obvious that higher education institutions are intrinsic to these developments. Notwithstanding the massive progress made on research over recent years, we need to move this agenda to a new level. A national research plan is in the advanced stages of preparation. This plan will integrate research activities across the relevant Departments and the various institutions and agencies, educational and otherwise, involved in research. The Taoiseach and the Minister for Finance have indicated that investment in our intellectual capital through higher education will be a central objective of the new national development plan.

In investing in the development of third and fourth level education to support wider social and economic goals, a central government objective is to ensure that all citizens have a fair and equal opportunity to share in the considerable personal benefits of participation at these levels. Improving access for societal groups that, for one reason or another, have not traditionally participated in higher education is one of our key objectives. The institute of technology sector has a strong record of opening up opportunity and I want to build on that throughout the higher education system.

Recent surveys indicate significant improvements in participation rates from young people in the lower socio-economic groups and from areas that traditionally have been under-represented. This is the result of a number of key targeted programmes and interventions. The goal of first, second and third level educational disadvantage and community education programmes funded by my Department over the past decade and more has been to achieve tangible improvements in participation, progression and successful completion among younger and older age cohorts from disadvantaged groups.

The Action Plan 2005-2007, published in December 2004 by the national office for equity of access to higher education, identifies a number of practical goals which will help to achieve further progress. Support for these innovative measures will be an important priority. Increasing numbers of students are also being encouraged and supported in making the choice to participate in higher education by improvements in the higher education grant scheme, with priority for funding being given to students eligible for the top-up grants.

In moving forward on these various fronts, the Government is taking a system-wide approach to the development of higher education. The various elements are interlinked and interrelated. The strategic innovation fund addresses modernisation in terms of system-wide practice, organisation and structure. It incentivises the teaching and learning improvements that are key to supporting progress on the action plan for access. It stresses quality improvements aimed at excellence. The various research strands provide the knowledge and skills for national innovation on which future economic and social progress will rely. I emphasise again that research feeds into improvements in teaching and learning and thereby into the quality of graduates and future researchers. These elements are being addressed in tandem with change in the governance of institutions and with increased resources for the development of institutional infrastructure on the capital side.

Essentially, the point is that higher education is a system of institutions, programmes, initiatives and supports. In a country of our size, to produce maximum gain for society and the economy, the focus must be on aligning the various elements to achieve the system-wide quality improvement that will support our wider national goals.

The changes introduced by this Bill are an essential element of this approach. The development of the institutes of technology has been governed by the various regional technical colleges and Dublin Institute of Technology statutes since 1992. Prior to that, vocational education committees statutes applied. These provided for a tight prescription of what the institutes could and could not do and required the close involvement of the Department of Education and Science and the VECs in institutes' activities. It is fair to say that the legislation governing the institutes was of its time and appropriate. However, the evolution of the institutes as providers of third and, in some instances, fourth level education means that they have outgrown these rules. To develop them further and to allow them to contribute to their full potential, new rules are needed.

While the Bill is a technical one primarily amending previous legislation, its effects are far-reaching. When enacted, it will have a significant impact on the system of higher education in Ireland. Many of the amendments concern replacing the respective roles of the Department and the VEC with the Higher Education Authority and there are improved governance provisions which will support the institutes in developing within the ambit of the HEA.

I wish to outline some of the important features of the new Bill. I shall mention these grouped by the roles of the different players as provided for. Parts 2 and 3 contain similar provisions relating to the institutes of technology governed by the RTC Acts and the DIT respectively. The Bill provides for the designation of the institutes of technology as institutes of higher education under the HEA by amending the HEA Act 1971. This designation and the amendments to the RTC Acts and the DIT Acts in the Bill mean that, in practice, the HEA and the institutes will engage and relate in a way very similar to the way the HEA and the universities engage.

There are a number of areas where the current operation of the institutes will alter as a consequence of the role of the HEA. One of the main areas where the Bill will impact is on budgets and finances. To date, the practice has been that the institutes' proposed budgets were submitted through the relevant vocational education committee to the Department. The Department then determined a provisional allocation following examination and subsequently, taking any appeals into account, a final allocation.

The Bill provides for new arrangements whereby the HEA, rather than the VEC and the Department, will approve an institute's budget and allocate money to the institute from the overall allocation made by the Department. The HEA will therefore determine an institute's budget. This is in line with the funding relationship between the HEA and the universities. The HEA will also assume a role in establishing formal arrangements to permit institutes to borrow or underwrite borrowings, again in a manner similar to that prevailing in the university sector. This is an important managerial freedom in achieving a greater level of institutional flexibility and responsiveness. The authority will approve the format of accounts maintained by the institutes. This removes the Department and the VEC from their existing roles but the provisions relating to the role of the Comptroller and Auditor General and the laying of the accounts before the Houses of the Oireachtas remain.

The Department's role in the approval of research, consultancy or development work or the acquisition of land will devolve to the HEA. With regard to the director of an institute and president of the DIT, the HEA will now determine the procedures to be used for selection of a new director or president when the post falls to be filled. It will consult the governing body where a temporary appointment is to be made. The net effect of these provisions will be to loosen the restrictive statutory controls under which the institutes currently operate. The new arrangements will provide for a more autonomous and strategic relationship with Government through the HEA, reflecting the dynamic and competitive nature of the environment in which the institutes now operate.

In terms of internal institutional governance and management, the Bill clarifies the respective functions of the governing body and director or president. It includes a specific provision requiring the institutes to contribute to the promotion of the economic, cultural and social development of the State and to respect the diversity of values, beliefs and traditions in society.

The governing body will be empowered to require the director to prepare a strategic plan for the college, to approve this plan and to provide a copy of it to the HEA and the Minister. It will also require the director to prepare a statement of the policies of the college with regard to access for under-represented, disadvantaged and disabled persons and equality, including gender equality. The governing body will be required to approve this statement of policies. The governing body will also be obliged to establish written procedures for dispute resolution, other than industrial relations disputes which would fall to be dealt with under existing structures, following consultation with staff and student representative groups.

The director will manage and direct the academic, administrative, financial, personnel and other activities of the college. This will be carried out subject to the policies determined by the governing body and the director will be answerable to the governing body for the efficient and effective management of the college and his or her performance. The Bill designates the director, appointed by the governing body, as the accountable person. This means the director is the person who, when required, will give evidence to the Committee of Public Accounts of the regularity and propriety of college accounts, of the economy and efficiency of the college in using its resources, of the systems and procedures in place for evaluating the effectiveness of it operations and of other matters. Overall, these elements of the Bill provide for improved institutional governance at governing body level and give greater clarity to the respective oversight role of the governing body and management role of the director and president.

The Institutes of Technology Bill 2006 is about modernising our approach to the governance and the strategic management of higher education. It represents new challenges and opportunities for the institutes of technology and for the HEA. As we chart a new course for higher education, I acknowledge the massive contribution made by past and present students, staff, management and governing body members to bringing the institutes to this stage in their development. They have done the sector and the nation proud.

This legislation is a major milestone for the sector and for the development of higher education in Ireland. By bringing the institutes of technology and universities together under the remit of the HEA, we can achieve a more cohesive strategic approach that draws on the diverse strengths of all our higher education institutions. The new managerial freedoms and supports provided for under this Bill will allow the institutes of technology to make their full contribution in that next stage of development. I trust the House will agree with me regarding the very positive benefits of this Bill. Beidh mé ag súil le bheith ag éisteacht agus ag plé na nithe atá ann le Baill an Tí. Molaim an Bille don Teach.

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