Third Level Funding: Discussion with Minister for Education and Skills

I welcome the Tánaiste, Deputy Mary Coughlan, Minister for Education and Skills. It is her first time before the committee and on its behalf I wish her well in her new post and hope that we will all work together in the spirit of co-operation and try to enhance our education system. She is here to discuss two issues, namely, the proposal to reform funding of third level education and to address concerns regarding how the registration fee or student support services charge is dispersed in third level institutions. As a number of people are in the Gallery to listen to the presentation and discussion, I remind members of the long-standing parliamentary practice that they should not comment on, criticise or make charges against a person outside the Houses or an official either by name or in such a way as to make him or her identifiable. I ask the Minister to begin her briefing.

Go raibh maith, a Chathaoirligh agus a chomhleacaithe as an deis seo teacht os bhur gcomhair don chéad uair mar Aire úr. Ba mhaith liom ar dtús báire buíochas a ghabháil libh. Mar a luaigh an Cathaoirleach, tá súil agam go mbeidh comhoibriú idir achan duine, is cuma faoi cúrsaí polaitíochta.

I thank the committee and appreciate that it was due to meet on the day of my appointment. I am thankful for having been given at least some time to prepare for this meeting and for the opportunity to address proposals to reform the funding of third level education and the disbursal of the student services charge in higher education. I will address these two elements in turn.

The higher education system has undergone significant growth and change over the past two decades. The number of new entrants to full-time undergraduate higher education has increased from under 15,000 in 1980 to 42,500 in September 2009. In the order of seven out of ten school leavers now enter higher education in Ireland. The significant and consistent growth of the sector over recent years has been matched by large increases in Exchequer investment, details of which are set out in the submission circulated.

As members will be aware, the demand for higher education continues to grow. This is particularly so at a time of reduced opportunity for school leaver entry to the labour market, decreasing apprenticeship numbers and increasing demand for reskilling and upskilling in a climate of reduced job opportunity. This increasing demand has been manifesting itself over the past two years and our higher education institutions have been responding through increasing the number of places they offer.

This increased demand for higher education is encouraging in the context of our broader objectives for Ireland's development as a smart economy reliant on a talented pool of highly-skilled, innovative people. At a time of significant pressures on public resources and difficult investment choices, it is extremely important that we continue to invest in and provide the educational opportunities that will provide the basis for recovery and future prosperity. The Government's innovation task force report lays heavy emphasis on the pivotal role of the education system in strengthening our knowledge base and making innovation happen.

The commitment of the institutions themselves to accommodating current increased demand at a time of significant budgetary pressures and staffing restrictions is very welcome. In the current economic climate, the institutions have recognised their responsibility to the national effort in supporting individuals to pursue learning and personal development opportunities and to meeting our broader skills needs for economic renewal.

They are also demonstrating a commitment to manage their resources and, where necessary, to effect economies across all levels of activity. It is important, now more than ever, that we maximise the effectiveness of all of our investments. Last summer, my ministerial predecessor, Deputy Batt O'Keeffe, convened two workshops for the universities and institutes of technology and asked the Higher Education Authority to lead an efficiency drive in the sector. The institutions have responded well to the challenge and already significant savings have been identified, including, for example, major energy cost savings through joint procurement arrangements. In one case, a group of colleges will save €1.5 million on their electricity bills this year after coming together to tender for one supplier. Through a similar initiative, universities and institutes of technology in the Dublin area have procured a 40% reduction in electricity rates this year. The institutions are working actively to build further on these initiatives in exploiting the potential for further shared service opportunities across the sector.

The purpose of this is not simply about cutting costs. It is about ensuring that our higher education institutions are capable of delivering maximum benefit and maximum opportunity for learners from the resources available at a time of continuing growing demand for higher education.

Looking into the longer term, there are very significant challenges ahead in ensuring that our higher education system is positioned and resourced so as to be able to continue to meet national demands. My Department's projections for future demand for higher education indicate very significant growth over the next 20 years. Details have been circulated among Deputies. While continuing State investment will be essential to supporting the growth and development of the sector in responding to this demand, it is imperative that we look to policy options for creating an enhanced and more sustainable funding base for the sector.

The higher education strategy group is currently framing a vision and related set of policy objectives for the development of the sector over the next 20 years. As part of its work, the strategy group is considering the need to address the very significant future funding pressures on the system that will result if projections of significant future growth in demand are to be accommodated. This is a critical question for future national development.

Major policy choices around widening the funding base for the sector will have to be addressed. The level of Exchequer dependence of the Irish system is high by international standards. In building a sustainable funding base to meet future growth requirements over the next 20 years, this needs to be progressively reduced. The alternative is to curtail our ambitions for the sector, which would be counter to our national development objectives. Efficiency measures and new forms of revenue opportunity through commercial activities, growth in international education activity and philanthropy will form part of the equation. The question of a new form of student contribution or a graduate contribution will also need to be considered by the strategy group in this context.

Options for future policy approaches to the introduction of a new form of student cost contribution were set out in a report prepared for my predecessor last year. While there is no intention to introduce a new form of student contribution in the lifetime of this Government, the report has been referred to the strategy group for consideration. The report will form part of the group's deliberations in the context of its work in assessing options for diversifying funding sources to create a sustainable future funding base for the higher education system over the next 20 years.

Other challenges for the system will be to significantly diversify provision to accommodate growth through part-time and flexible learning options. Our model of funding allocation will need to support this. Changes in the funding allocation model will also need to clearly align funding with performance outcomes as a mechanism for supporting overall delivery on broader national policy goals. I expect to receive a draft report from the strategy group in the summer.

An important element of income for our third level institutions is that derived from the student services charge. In acknowledgment of the variation in the arrangements that existed in the colleges, a standardised charge was levied by the third level institutions, in the context of the introduction of the free fees initiative in the 1995-96 academic year, to defray the costs of examinations, registration and students services.

Statutory provision for such charges is provided for in section 40 of the Universities Act 1997, the Regional Technical Colleges Act 1992 and the Dublin Institute of Technology Act 1992.

The student services comprehended by the charge may include on-campus medical and counselling facilities for students, access and disability services, careers office, student facilities, student clubs, societies and other relevant support services to students. Currently, the student services charge is decided annually by third level institutions in consultation with the Higher Education Authority and the Minister. Students who are eligible for maintenance grants do not have to pay this charge as it is paid on their behalf under the means-tested student support schemes.

In the context of budget 2009, the Government indicated that it was prepared to accept increases in the level of the student services charge for the current academic year to bring it to up to a limit of €1,500 in individual higher education institutions. In the previous academic year, 2008-09, the charge stood at €900. The increase in the charge for the current academic year enabled individual institutions to bring the amount contributed by students more into line with the real cost of providing student services in those institutions. This was agreed on the understanding that the revenue generated by the increase adopted by each institution would reflect its requirements in defraying the full cost of items that fail to be funded by the charge. Where income from the charge did not previously meet the full cost of these services, this required an effective cross-subsidisation by institutions from their general block grant funding.

Systems of local accountability to students are in place across higher education institutions in respect of the use of resources generated by the charge. The Higher Education Authority has previously developed and issued a framework of good practice for the provision of student services to the publicly-funded higher education institutions. Further details are set out in the submission.

I recently asked the Higher Education Authority to ensure once again that all institutions are using the full income from the charge for the purpose for which it is intended relating to student services. The Higher Education Authority is currently in the process of reviewing this for all institutions and I look forward to receiving the outcome of this analysis in the near future.

I thank the Minister. She will be aware that her attendance today follows on from a number of committee meetings, most recently on 28 January, when members will agree we had a most interesting discussion. Members will have a number of questions and comments. I ask that they stick to two minutes each to facilitate the Minister in answering questions.

May I suggest a procedure? The Minister's speech is divided into two sections, the first of which contains an overview of third level education and the second of which concerns student supports. I suggest that we first have questions and answers on the general issues in the first part of the presentation and then have a second round of questions and answers on the student grants system.

That is a helpful suggestion. I recommend its adoption by members provided they keep their questions short, thus allowing everyone to contribute for a second time.

I welcome the Tánaiste and the Minister for Education and Skills to the committee. We hope to work with the Tánaiste on issues on which we can agree. I thank her for the presentation on higher education. I submitted a freedom of information request on her briefing material when she became Minister and I received the material today. One of the headings refers to higher education strategy, which was blacked out. I congratulate her on the fascinating information she provided. It is nearly as fascinating as her comments today.

When Deputy Hayes is Minister, he will be properly briefed.

I am glad the Tánaiste concedes that point. That is the first time anyone conceded it.

Deputy Hayes is still a very young man.

I need some protection from the Chair quickly.

Deputy Hayes's two minutes are up.

The previous Minister set out his view on the student contribution. The Tánaiste is now awaiting the review. What is the view of the Tánaiste on whether the contribution students make is enough? I ask her specifically to comment on the quote by Professor Michael Murphy, president of UCC, on 25 April:

Ireland has dropped well down the ladder of the OECD countries in terms of funding, which was even happening during the boom. There is a huge disconnect between the rhetoric from government about the knowledge and smart economy and the dramatic decline in the funding. It is just not sustainable.

I know Professor Murphy quite well. In the context of the smart economy, much of the emphasis has been on research and development and a greater number of PhD graduates becoming available to the economy. That is why Science Foundation Ireland and the programme for research in third level institutions, PRTLI, have been charged with bringing that forward. As the Minister for Education and Skills and as a former Minister for Enterprise, Trade and Employment, I appreciate this role in the context of the smart economy. On the basis of the seismic investment over the past number of years and the attraction of many people of high repute to our shores, particularly on the research side, undergraduates should have access to that type of knowledge and investment. In the context of overall funding in comparison to higher level, expenditure per student is below the OECD average but slightly higher than the EU average. We are talking about an OECD average and the EU average.

We have seen a major increase in the number of participants in third level education and in investment in third level education. This emphasis has been on the basis of research and development. I agree there are disputes about where research should be, whether it be closer to market or at breakthrough level. Every university president or provost would say there has not been enough investment in third level education.

Does the Minister not agree with him?

If we brought every primary or secondary school teacher before the committee, they would all say the same. It is a matter of where resources can be best spent.

Does the Tánaiste accept the conclusions of the HEA that student numbers in higher education will increase by 30% over the next decade?

They are our projections. Seven out of ten young people are there now, as well as people who want to reskill, take up part-time education, develop new opportunities and participate in conversion courses.

Does the Tánaiste accept that the HEA said recently we will see a colossal increase in higher education over the next ten years? Given that 40% of college buildings are seriously inadequate, it is estimated that €4 billion will be required to upgrade buildings in the sector to deal with this increase. How will we do that without an independent revenue stream from the State?

That is why the previous Minister asked for a new strategy for the next 20 years in the context of the future and further development of third level education. We are in a difficult position because we are at the concept, thought process and views stage.

What is the view of the Tánaiste?

The HEA is correct in the context of the numbers based on the demographics available. On the basis of the increase in numbers of people attending third level education, universities and institutes of technology have been forthcoming in providing new opportunities, particularly for those who became unemployed, with difficult resource implications. Regarding the €4 billion figure discussed by the HEA, a number of investments were made in the 1960s and these need to be upgraded to be at the acceptable level of investment. Equally, there are stresses on the Department and the university sector to provide new facilities. The Minister has indicated that we provided a number of initiatives to deal with particular needs in the third level sector. I might disagree with the figure of €4 billion but I do not disagree that there must be considerable capital investment.

For the final time, what is the view of the Tánaiste on student contributions through a loan system, a graduate contribution or a fee system?

I have not formed a view.

After all these years in Cabinet.

I may have personal views——

What is the personal view of the Tánaiste?

I am not answerable personally; Deputy Hayes is asking me as Minister for Education and Skills. As Minister, I have not formed a view until such time as the higher education strategy group brings forward its perspective. In the programme for Government it is agreed that within the lifetime of the Government there will not be a fee introduced for tuition.

Is the Tánaiste prepared to go further in her personal view?

I am not prepared to provide a personal view ——

We must move on.

We must make the right decision for the future development of third level education, regardless of politics. We have disparate views on how that will happen. The answer is to listen to the perspective of Deputies Brian Hayes and Ruairí Quinn. It is when one listens to all people that one can make a final decision but at this time I am not formulating a view and I reiterate Government policy.

I have one last question.

Deputy Hayes will have a chance to put his question later. We will now take questions from Deputy Quinn. We have given Deputy Hayes much leeway. The two lead speakers get five minutes and everyone else gets two.

I thank the Chairman. The Tánaiste, Minister for Education and Skills is very welcome and I wish her all the best in her Department. I invite her to take into the new Department the practices she carried out in previous Departments in respect of how the Department in Marlborough Street relates to the work of this committee. We would have a better informed dialogue had this document and its executive summary been delivered before the last weekend. The meeting was not a surprise, it was prepared for the Minister's predecessor on foot of a long series of meetings. If we were attempting the junior certificate with this level of preparation we would not be looking at a happy result. The Minister has a very good track record in the Departments of Social and Family Affairs and Enterprise, Trade and Employment in respect of the relationship between the Departments and the committees. At the outset, in order to have a productive relationship, I ask the Tánaiste to examine communications between sections of her Department, her office and the clerk to the committee.

I will take that as a comment. I ask Deputy Quinn to pose his question.

We are all agreed there is not enough money going into the system. That is a self-evident truth. What is the view of the Tánaiste on the idea that in order to catch up with the deficit we have accumulated and to meet the increasing demand, we need a national consensus on an increase in the overall take of the GDP from currently under 5% to something of the order of 7%? We could move towards that target figure in the same way we got political consensus on achieving the ODA target in the millennium goals. This avoids the argument on whether one is spending more or less and getting it from fees or increased taxation. Does the Minister see some merit in that particular approach so that we get the argument on funding out of the way and look at the quality of the educational outputs?

I do not disagree with setting a target. The European Union set down a 3% target of GDP to be spent on, for example, research. For some that would be difficult to attain in the context of the present circumstances. If we were to set down a percentage of GDP to be spent on third level education that might take away from a new thought process which is that we must have alternative ways in which funding should be provided in higher education over and above that provided by the Exchequer. As the Deputy is aware, as a former Minister for Finance, the Exchequer has been asked for funding all the time whereas there are other ways in which moneys can be found to support third level education.

Setting a target of spend was easy when there were growth levels of 4% or 5% but it is much more difficult in a different perspective where seismic difficult decisions have had to be taken. It is hard to determine how that could be achieved. In the new framework for the next 20 years I would like to see a move away from what the Deputy is talking about and consider what may be called a thought process and an investment pattern over the next 20 years to achieve what the Deputy wants to achieve. The Deputy is correct in that such an approach would prevent much time and energy being spent on how much money is expended as opposed to sweating the assets available and looking at other aspects that are needed, such as teaching methodologies.

I thank the Minister. The second question concerns the rapidly increasing participation rates at third level. I believe we are ahead of our targets in respect of the 70% participation rate. That figure was not due to be reached until later in this decade which in one sense is very good news. Will the Minister agree that the participation rates from the various socio-economic groups show that the increased participation rate will only come from socio-economic groups who currently have a very low participatory rate in third level education and that in order to achieve that target to 2031, the door to third level education starts at pre-school or primary level? It certainly starts with literacy rates by fourth class. Will the Minister relate her third level strategy, which is under the remit of the HEA and is semi-detached from her Department, to the pre-school and primary sectors of her Department, because one cannot move without the other?

The Deputy is right and it is the reason we have had a huge development in early education. I recall a considerable amount of time being expended on whether pre-school is an educational or a social opportunity. It is a little bit of both. Those who attend pre-school have a greater platform from which to move forward, once they go to primary school. Equally, I agree that the emphasis on literacy at any early stage results in better outcomes. That is why the Government decided to place particular emphasis on children at junior, high infants and first class levels. I share the Deputy's view in the context of a hobbyhorse of mine which is mathematics. When I met the former EU Commissioner for research he indicated quite vociferously that we need to start at pre-school if we are to have the outcomes we want at mathematics. I do not disagree with him but we are where we are at this moment in time. Early educational intervention does have a forbearing on how young people progress to third level. I am an admirer of Pathways to Progression where people for one reason or another find themselves outside of the educational system where they can get back into it and grow and develop in that context.

The Deputy is correct in saying we have achieved the target set down for third level education which was to be achieved in 2013. In regard to the socio-economic groups, I am not sure if I have the information profiled here. There has been considerable progress on the basis of many of the interventions that have taken place in education and the supports. I do not take from the fact that there are significant challenges in a number of socio-economic groups, some of which, unfortunately, are societal. I would still be a great advocate of ensuring that according to one's ability everyone can achieve and have that access. Perhaps the synergy that will take place between skills and the Department will refocus and provide better platforms. I was involved in a number of interventions with the Department of Social and Family Affairs which were very progressive on the basis of targeting some vulnerable groups, and instead of bringing them into a second level institution as adults they were brought into the institutes of technology which had a greater reputation and has been very successful. Those interventions still continue but they are slow. I do not disagree that the emphasis on early education and early formation and tuition, regardless of other societal issues, leads to third level.

Given that Dr. Colin Hunt is chairing the education strategy group has the Minister met him? When the Minister indicated that the group is likely to report in summer, which end of summer is she talking about? While I am not trying to pin her down, will this be an autumn debate?

It will probably be an autumn debate.

In that context——

It will probably be this autumn. I would hope to have the report in July.

In view of the very interesting commonsense savings that appear to have been found already, the €1.5 million energy saving and so on, will the Minister consider specifically asking Dr. Hunt to look at our primary school teaching infrastructure, the costs of all those colleges, the opacity with which their constant behaviour is carried on and, in particular, to report on whether he considers it appropriate in the 21st century that all of them are denominational and that the teaching of religion is a mandatory compulsory subject?

There is a fair amount of latitude there in the context of that conversation, on which I would like to hear the views of all the members of the committee.

I am not asking the Minister to offer her opinion on the matter. Since there is a study group I am asking Dr. Hunt to actually consider it.

I have an open mind to ask——

I am not trying to pin the Minister down specifically. Can we have a look at this in the clear light of day?

We can have a look at it in the clear light of day but Dr. Colin Hunt is tried and tested in the context of his third level work as it stands. The savings that were found came from a number of the colleges coming together and where they were able to work together. That model——

Which colleges were they?

All of the institutes of technology and all of the universities. That model of working is one which many primary and secondary schools could use in the context of getting greater savings for themselves. There is scope for that to happen. On the issue of denominational education, I would prefer to leave that to a different discussion — a serious discussion. I know the Deputy's views and I have read what he has had to say on a number of these occasions. I would like to have an open debate on that issue, on the basis of a changing society.

I am not talking necessarily about the issues of patronage and all those other things about which there has been a discourse, but the third level sector, the five teacher training colleges, all of which are denominational, all of which are funded directly by the State and all of have a mandatory compulsory requirement regarding the learning and teaching of religion. There is no conscience clause and yet they are State funded. I am not asking the Minister to offer an opinion here now, I am simply asking if he is not already going to do it——

In broad terms, he is.

Will the Minister inform him of this committee's query — or my query——

——in regard to that issue because it is an issue we will have to answer?

I thank the Minister. It might be helpful if the committee could agree that all of the discussions in regard to higher education funding would be sent to Dr. Hunt before his final report.

That is a very good idea.

Is that agreed? Agreed. I will have to move on as there are time constraints. The next five contributors have two minutes each in the following order, Senators Cecilia Keaveney and Fidelma Healy-Eames, Deputy Ulick Burke, Senator Brendan Ryan and Deputy John O'Mahony. Senator Bacik has indicated her wish to contribute. The normal precedence is for a non-member of the committee to speak last but people will ask to contribute in due course. I refer to the next five speakers. We will start with Senator Keaveney.

I was pleased to hear the Minister's comments on the early preschool service. There is little point in talking about third level education unless we have a very good strategy from the outset.

A comment was made at a music therapy conference recently, namely, that in light of the evidence when will it become negligent not to prescribe music therapy? The same applies to education. In the light of the evidence on the link between music and mathematics, co-ordination and so on, when will it become negligent not to have a preschool music programme in place and to treat the arts more centrally? I am aware the Minister has an interest in that area, which is the reason for my question.

A question arises regarding this issue. Institutes such as Letterkenny Institute of Technology, LYIT, are doing great work with incubation units. They have expanded the concept of third level and further education in the north west. There has been a great deal of cross-Border co-operation in higher and further education, and there is a strong student cohort that crosses either way.

Has the Minister had an opportunity to examine the concept of a university for the north west? There seems to be two projects in that regard, namely, the Derry for Us campaign and the north west university concept. Whether it is decided to have an expanded Derry complex or a Derry-Letterkenny complex, will it have funding implications for third level funding into the future? Will it be driven in terms of its employment potential as well as its education potential in its own right? The foreign students who come here to avail of centres of excellence in universities provide an employment opportunity as well as the difficulties we are speaking about in terms of getting funding.

That begs the question whether we should make it easier to bring in more foreign students to avail of the courses we offer. That debate has been held a number of times but it remains integral to this particular debate because foreign students also bring in capital and funding that is badly needed in any country.

I welcome the Minister. I have two questions. I read a report inThe Irish Times recently that UCD plans to increase the number of its post-graduate and international students to allow it address its budget deficit. Has the Minister asked it about its undergraduate capacity? Will this result in fewer places for undergraduates and an increase in points, which would be unfair to our own Irish born students? What intervention has the Minister made with UCD in that respect?

From September 2010, which is only four months from now, 1 million students will be attending education in this country, largely as a result of the recession. We expect an extra 55,000 students at third level. The current budget at third level is €1.8 billion, almost €2 billion, which is one seventeenth of the national income intake. A report inThe Irish Times last week indicated that with the current surge at third level alone, the budget needed could be double that figure. Where is the money? Can the Minister fund that? It is to be welcomed that universities and ITs are coming together and saving €1.5 million in electricity costs but we are talking about double the budget needed at third level. How will the Minister fund that this year? Is she regretful that she has a deal done with the Green Party that she cannot get out of in the lifetime of this Government?

I welcome the Minister. In view of the indebtedness of all higher education colleges, the fact that the Minister has no intention of introducing a student contribution and the fact that when the higher education bodies were asked to maximise the effectiveness of investments all they could come up with was a saving in the ESB bill, how does she believe the colleges will function appropriately in coming years without the necessary resources? All of the presidents and chief executive officers of the institutes have clearly indicated the problems that have arisen in colleges in terms of delivering a proper education.

The demand for third level places is increasing but an area that has increased tremendously, and there has not been a real response from the Department or the Minister, concerns those seeking second chance education. One of the Minister's colleagues has withdrawn the back to education allowance. There is a demand for second chance education but it cannot be delivered because those people cannot get access to third level or higher education. I ask the Minister to answer those two practical questions.

When the governing bodies and the Higher Education Authority representatives came before this committee earlier in the year to debate these same issues, they informed us that when there was an increase in the student services charge from €900 to €1,500 their budgets were reduced accordingly.

We are dealing first with the general issue of funding for third level education.

I understand that. I am dealing with funding.

Any question relating to student registration charges specifically——

I am dealing with funding. The nature of the question means that I cannot ask half the question.

I am pre-empting——

I am clear on what the Chairman is saying but I will not contribute to the next part of the discussion.

Thank you.

They must run the colleges in the same way this year as they did last year and because it is possible to include more or less any function a university does and define it as a service to students, they had no alternative but to shift some of the student services increase into the general funding of the colleges. The notion that fees do not exist or that fees have not been increased is nonsense.

As I have to attend another meeting I would like to ask a question on the student registration fee. I welcome the Minister. She mentioned earlier that she would not introduce student fees in the lifetime of this Government. Is she also saying she will not increase the student registration fee in the lifetime of this Government? In that regard, could the Minister give me her views, as Deputy O'Shea mentioned, on supporting the main core grant by the student registration fee in the institutions that took place in the past year?

I draw the attention of members to a point in a note from the clerk. Officials from the Departments of Education and Skills and Social Protection will appear before the Joint Committee on Social and Family Affairs next Wednesday, 12 May, to discuss proposals to address difficulties regarding the back to education allowance. Members of this committee will be welcome to attend that meeting. The clerk informs me it will be at 11 o'clock.

We have heard from five contributors. Senator Keaveney asked about Letterkenny IT, the expansion of higher and further education and job opportunities. Senator Healy Eames put two questions regarding the increase in the number of post-graduate and international students and asked whether that would result in fewer places for Irish students and an increase in points. Deputy Ulick Burke asked how colleges will function without resources in light of the fact that the Minister has no intention of increasing the student contribution. Deputy O'Mahony sought clarification that the student registration fee will not be increased during the lifetime of this Government or third level fees introduced. Senator Ryan asked if the decrease in funding means that some of the student services charges have been shifted into general funding. I ask you to bear in mind we will have a further discussion on that issue.

If I did not mention music therapy for Senator Keaveney, my life would not be worth living. I appreciate her views. It is important to reiterate that although much of the smart economy is based on research, development, science and mathematics, that does not take from the humanities and the role of the arts.

There have been a number of strategic alliances over the last year among many of the universities. Hopefully, this will achieve greater synergy. It is also practical in that such alliances can deal with appointments of specialists, lecturers, professors and so forth. The innovation alliance that has taken place is the correct choice. This did not arise as a result of diktat but from the universities, and I laud that. I am aware of the strategic alliances that are taking place between the Letterkenny Institute of Technology, LYIT, and Magee campus, and of the plans of the Magee campus for their expansion. My predecessor was very much involved in the discussions taking place in Northern Ireland on higher education and how that can add to an all-island provision of third level education. Personally, I am a supporter of LYIT's strategic alliance and when I met with Sir Reg Empey at the last North-South Ministerial Council I agreed with his view that we had better stop talking about this and see some action. The directors of the colleges are both aware of that and I intend to support it in the best way possible.

On the issue of our undergraduates raised by Senator Healy Eames, it will not be at the expense of our undergraduates. I am advised that is the situation.

Does that mean——

The undergraduate numbers in UCD will be protected.

Where will UCD get the extra income? Will the Government be providing extra income to the college?

The internationalisation will be self-financing; much of this will be self-financing. When we talk about third level investment and streaming there is the internationalisation of third level education and the income supports that come from that, the commercialisation of many of the investments the colleges have at present and, quite correctly, the investment from the Exchequer. It is important to reiterate with regard to the work we have done so far in higher education that a recent report from ECOFIN ranks Ireland very highly in terms of efficiency and productivity, particularly due to our efficiencies in teaching, research and performance.

Can the Minister confirm there will be adequate capacity in UCD to cater for the increase in places for international postgraduates and to protect undergraduates?

The HEA has advised that the applications for this year are up 8% and applications to the CAO are up 6%. That will be accommodated in the current spending that has been allocated to the universities. They have given a commitment that, despite the resource difficulties and challenges they face, they are in a position to accommodate the increase in student numbers.

Deputy Ulick Burke asked about savings measures and so forth. That is only part of some of the work that has been done. We are doing further work on shared services. There is potential to do further work on savings. They might sound small but they are important. In much of the work that has taken place over the last two years there has been greater concentration on getting greater value for money and that work will continue. It is very important. On the issue of the debt of the university and third level sector, the reason we have set out a framework and strategy is to examine how exactly we will fund third level education over the next 20 years, be it in institutes of technology or universities.

I noted what the Chairman said about the back-to-education issue, and there will, perhaps, be further discussions on that. Senator Ryan spoke about the student charge, although I am not sure I am allowed to discuss it now.

I would prefer that the Minister would not get involved in that right now, unless she has a general comment about the costing.

I can give an assurance that there are no plans to increase the student charge this year, although under section 40 they can raise whatever they wish.

To clarify, the Minister will not seek an increase in this year's forthcoming budget.

There will be no increase in the charge for the coming academic year.

Yes, we are aware of that. However, what about 2011?

The budgetary process is only starting now, so we will have to see——

The Minister cannot rule it out.

——what cards we will be dealt. That will determine where we will get our spending reduction. The Government has said there must be a further €3 billion reduction in our expenditure next year. I can only say that for this academic year there will be no increase in the charge.

The Minister is not ruling it out for September 2011.

No decisions have been made either way.

The Minister is not ruling it out.

I am not ruling it in either.

When the Minister introduced the student services charge, or increased it, the funding on the other side was reduced. Effectively, the Minister shifted the burden from the Government to the students.

Am I allowed to get into that discussion?

Just two sentences. I would prefer to wait until the further discussion.

With respect, there was another question. The HEA report states that €4 billion will be required next year.

I answered that. It will not be needed next year. The sum of €4 billion will be required over the next number of years.

Yes. Where will the Minister get that money, given that less that half that amount is being put into third level education at present?

A total of €1.8 billion is being put into third level education this year. If we are to consider increased investment in third level education, the Exchequer cannot be expected to deliver all of it, unless we find ourselves in a situation where our economic growth is such over the next three to four years that we can provide that type of funding. That is the reason the strategy states that we must examine alternative teaching methodologies, blended learning and other ways in which people can participate in third level education. We must also consider new frameworks for internationalisation of our student population, building on our reputation, commercialisation of much of the investment and spend the State has expended on third level education and the role of the Exchequer. The entire burden of funding third level education cannot fall on the taxpayer.

Thank you. We will move on. I will first call Senator Ó Domhnaill and then Senator Bacik.

I welcome the Tánaiste. Much of the discussion in the first section has centred on the funding issue. There will be a need for additional capital and current funding in future due to the increase in student numbers. The Tánaiste made an important point when she mentioned that different learning models can be adopted. I am aware of many individuals who are studying on-line. There are different ways available for people to study. People in Donegal who wish to do a course in UCD or in some other college, who do not wish to travel or have young children, might prefer to study on-line. We must think outside the box and consider new ways in which third and fourth level education can be delivered, not necessarily in the classroom but also in the home.

With regard to funding, we must examine international models where, perhaps, the private sector receives some type of incentive to provide funding in the third and fourth level sectors. That can be done; it has been done in the US and the UK. Perhaps it can be examined in this country as well. I agree that all the burden should not necessarily fall on the taxpayer. The universities have an obligation too. I welcome the cost saving exercises which have been undertaken and I hope they can continue. There are other areas where, hopefully, there can be cost savings.

The foreign students are a very lucrative market. A student from outside the EU pays a very high charge, which provides excellent remuneration for colleges in countries like Ireland. The UK is particularly keen on attracting foreign students. Even in the North, the University of Ulster and Queen's University are actively marketing in countries in Asia and elsewhere to attract foreign students. While I would welcome that, we must balance the capacity issue for local students as well. There is an issue in that regard, but there is also an opportunity on which we should try to capitalise as long as it would not interfere with the access for Irish students partaking in Irish universities.

There are a couple of issues, but the funding issue is fundamental. We must look outside the box on how we can achieve that. I would be of the view that all of the burden should not fall on the taxpayer. There are other ways. The heads of the universities, when they came before the committee previously, were anxious to point out their funding needs but they cannot be coming hand in fist all the time either. They must come up with mechanisms of raising private and university funding if the taxpayer is being asked to fund as well. There are as many opportunities for the universities as there are for the students.

I welcome the Minister and given that I am not a committee member, thank the Chair for allowing me participate in this debate. As a Senator for Dublin University and also a lecturer, albeit on unpaid leave currently, I have a strong interest in this. I want to express the concern of my colleagues and academic staff, and through our union, IFUT, about the funding shortfall at third level. Others have already eloquently described the shortfall that the HEA has put at approximately €4 billion over — I take the Minister's point — not the next year but, certainly, the next ten years. We will see an increase of 55,000 undergraduate students coming in but we are coping currently in the third level sector, as across the public service, with a recruitment freeze, which means that we will not have the staff to cope adequately with this increase in undergraduate numbers. I take the point of Senator Ó Domhnaill and others that the universities must take it upon themselves to raise funds. Clearly, raising funds through research applications, etc., takes time and requires the freeing up of academics. The Minister must bear in mind the need to support the universities in fund-raising for themselves.

That brings me to the other point I wanted to raise. With respect to the Chair, others such as Senator Ryan have rightly raised this concern about the increase in the student services charge, which cannot be divorced from the overall university funding concerns. I thank USI and the Trinity College and DIT students unions which all have been active on this issue and have pointed out, as the Minister has, that there has been a 67% rise in the so-called student services charge to the point where the concern is it has become a leakage into the core grant.

The HEA has accepted that there is a correlation in that increases in the services charge are matched by reductions in the core grant paid by the State. Of course, much as in this debate there has been a slippage into the student services charge issue, so there has been a real slippage from what was meant to be earmarked for student services into the core spending of the universities. It amounts to fees by the back door, particularly when the Minister has not ruled out an increase for the 2011-12 academic year.

There is also the real concern among students that the impact of the cuts in student services is that such services have deteriorated while the student service charge has increased. Clearly, there is no added value to students for paying this charge. As I stated, it amounts to fees by the back door and that is the real concern among students and academics alike.

I have a couple of comments and questions. The first relates to Deputy Quinn's specific question about ring-fenced funding for education, not just at third level but in general. The Minister responded by stating that in a difficult economic time when the economy is no longer growing it is not feasible to increase the percentage of GDP funding. I would argue that it should make no difference. Just as the overseas development aid has fallen, for instance, it has maintained a reasonable par in real terms. At a time when the economy is doing badly, education funding may slip but, as a percentage of GDP, remain static. I support the Stand Up for Education call for a 7% GDP commitment for education of all types.

I also reiterate the importance of preschool, to which I am glad the Tánaiste alluded, and the importance of intervention at an early stage to ensure that a student is in a position to go to third level in the first place. It goes even further back. Perhaps the Government could look at the issue of providing free books, not just to the free child care kids but to every two year old in the country.

From the experience of many teachers, if a child from a deprived background does not have a book in the house but has a load of DVDs, then he or she is already at a loss on entering a crèche or school. It would be a low-cost intervention to achieve that love of books. I have a one year old and a three and a half year old. I suppose they are privileged in the sense that we saw the importance of books and before they could even read, they were looking at books. They knew what a book was and they were touching them. It is very important, but I do not want to go on about that because we are talking about the technicalities of higher-level funding. However, the mainstay of the funding needs to go to the bottom of the tier.

Deputy Quinn referred to the ethos being enforced upon people in third level. I do not want to get into that debate, but there are quite a number of Catholic institutions that may be superfluous in the modern age. We have witnessed the rise of private institutions such as Hibernia College. I met with delegates from Hibernia College, as a number of Oireachtas Members may also have done. While I have no axe to grind one way or the other in terms of the public versus private debate, as long as value for money is given and as long as the departmental ethos is put forward and the curriculum is put forward, it beggars belief that a private institution, as well as not costing the taxpayer any money, is delivering the teacher training service for half the price of the public institutions. I would be interested in the Tánaiste's views on how we can lower the public cost of providing such training.

The following is a devil's advocate question. I am not giving my opinion, as Chairman, but I do think it is an important question to ask. On the smaller colleges such as Marino and Froebel, Froebel is no longer associated with Trinity College Dublin and I understand a similar situation applies or is about to apply in the case of Marino. In that context, do we need so many training institutions in the modern age? Perhaps Marino and Froebel could be amalgamated into St. Patrick's College, for example, and keep Mary Immaculate College for the regional balance and have the Hibernia College as well. Would that make sense in terms of a cost saving to the Exchequer which could then go into education at the other end?

I do not want to bring the redress board and the deal with the church into it either. I am not trying to bash the church but at the same time, church-owned properties are very valuable. Will more work be done in terms of handing some of those properties over to the State to cover the cost of redress? Someone left a message on my phone asking whether tax would be charged on some of the money raised from the institutions for redress. The Tánaiste might not be able to comment on that now. It might be a pie-in-the-sky story. In terms of the church properties, could a case be made that the institutions could move to cheaper locations because the State is funding the up-keep of privately-owned church property? For example, does the State contribute to the St. Laurence O'Toole Trust and if so, why would it because it is church-owned property, not State property?

Perhaps money could be saved by asking the church authorities to move out to cheaper land and free up that land to make money for the State. It is already happening with the Grangegorman campus, from the State's point of view, where there are a number of the DIT institutions coming into Grangegorman where economies of scale will be reached.

I thank the time-keepers——

That is the Vice Chairman.

I thank the Vice Chairman for reining me in. We will leave it at that.

Please continue.

No, thank you. It is easy to lose track of oneself. It is difficult to chair oneself.

The Chairman is doing a good job.

This is similar to being examined in ten subjects at once. I agree with encouraging foreign students to come to Ireland to pursue courses. Our approach in this regard should be strategic. It was as a consequence of running such strategies in the past that we benefited from the experience of the Irish diaspora. I am aware, from the experience I gained in my previous Department, that this was extremely helpful in the context of trade. As a result, we have been able to build on our reputation.

Last year I cleared the way for Enterprise Ireland to participate in third level education. Work involving a number of Departments is currently taking place in respect of some complex issues. The first of these relates to the need to assure quality. This is extremely important, particularly because we have a reputation and a brand to maintain. This is an issue about which I have been vociferous.

The second issue relates to exploiting what are seen to be third level opportunities. I do not agree with this. A number of matters have arisen for the Department of Justice, Equality and Law Reform and I empathise with it in that regard. The Minister for Justice, Equality and Law Reform holds a balanced view to the effect that we must ensure that we do not lose any opportunities. At the same time, however, he is determined that the law should be observed. I am a fervent supporter of exploiting the opportunities to which I refer. I agree that Irish students should not lose out as a result of such opportunities being pursued.

A balanced approach is being taken. Great opportunities exist in respect of the internalisation of education. Work is ongoing in the context of establishing a framework within which matters can be progressed. We have a good brand to sell. However, we must build on this. How the brand to which I refer can be used strategically is a matter of major importance, particularly in view of the fact that ours is an island nation to which trade is vital.

Senator Bacik referred to increased numbers of students, fewer teachers and a shortfall in funding. Many sectors, not just education, are experiencing challenges of this nature. As the Senator is aware, under the employment framework certain replacement teachers can be employed in respect of key subjects if there is a reduction in overall staff numbers of 6% over two years.

I accept the comments in respect of the student service charge. The core grant was used to supplement many student activities and to provide necessary supports. The real cost of the supports was not met, even with the student service charge. On balance, the €1,500 equates to the charge as it stands.

The Chairman asked a number of questions and I have experienced difficulty in trying to put them in order.

One of the matters about which I inquired was teacher training colleges. I also inquired as to whether the HEA should be subsumed back into the Department.

The strategy group has been asked to examine a number of issues. One of these relates to small and stand-alone colleges and how these can be dealt with in the context of third level. The group has also been asked to consider new formulations in education provision. I am aware of what has happened at Hibernia College, which has done very well and the standards of which are excellent. I am advised by my Department's inspectorate that those teachers who came through the system at Hibernia College have done very well. Some of these individuals may possess a degree more life experience than someone who is only 19 or 20. However, people are extremely happy with the outcomes. I am aware that Hibernia College is interested in expanding the suite of courses it offers. There is no doubt that it delivers opportunities in a very unique way.

I live in a rural area and I agree that new opportunities have arisen as a result of this type of activity. I am aware of what is happening in Gweedore, for example, where someone can pursue a masters degree in Gaelic. This initiative is supported by the university in Galway. There is much vital work that can be done. As members are aware, the availability of third level access is extremely important in the context of foreign direct investment.

I do not know from where the Chairman is coming in respect of the issue of redress. As he is aware, the Government met representatives of the church and of victims. It is the Government's view — I believe it was the view of the House at the time — that there should be a 50:50 split in respect of redress. The Taoiseach informed that congregations that this is what the Members of the House want. We have agreed to engage in a process in order to achieve this. That process must, of course, be taken in the context of the expenditure the State has already made in respect of redress. We are establishing a fund to support victims and this will take into account some of their care and educational needs.

Church-owned properties will form part of the redress scheme. These properties will be handed over to the State. Movement in this regard is already under way and is proceeding on the basis of the previous agreement. As anyone involved in politics is aware, matters of this nature take some time to be resolved, particularly in light of the major legal issues that arise. A number of opportunities exist in the context of what has been put forward. I am working on this matter with my Department.

Are sites being targeted?

Offers have been made and we must examine these in the context of the potential the properties involved hold. A number of the institutions involved are currently in use in the areas of education and health care. We have agreed a bilateral process in respect of this matter.

Neither I nor the Labour Party want to engage in a campaign of impoverishing communities whose members are very elderly. The country owes a great debt to these people for work they did in the past. I suggest that, in lieu of asking them to produce cash they do not possess or resources they need for their ageing members, they should hand over legal ownership of the educational infrastructure in order that it will not, as was the case in the past, be sold and moved out of the system.

There is a considerable amount of work to be done. Many of those involved provided a service to the Stategratis. When these individuals retired, three or four people had to be employed to replace them. This is a testament to the nature of their vocation and the amount of work they did. Lessons have been learned from the work that has been done previously. What we now know can be used in future bilateral negotiations with the congregations.

I agree with what was said about early intervention and early support. In the context of early intervention, parental education is also important. A high level of socialisation occurs in preschool settings because families are smaller, etc. I do not know, however, if I would be in a position to provide free books to every child aged two. Charlie Haughey is remembered for providing free toothbrushes. I do not know if I would be well remembered for providing free books to every child.

That would not be a bad legacy.

I hope to leave several legacies. I appreciate what the Chairman said in respect of this matter. However, the Department's Accounting Officer would have to be resuscitated if I agreed to that at this point.

There is great interest in the issues surrounding the student support service charge. I propose to take questions from the two main Opposition spokespersons before Senators Ryan and Healy Eames comment. The Minister can then reply. Other members may come in at that point.

I do not need to pose my question again.

If the Senator is of the opinion that his question was rhetorical, that is fair enough.

The Tánaiste earlier set out what she considers to be justifiable student service charge expenditure items. She referred to access, disability services, on-campus medical and counselling facilities, etc. However, she did not refer to library services. Is it her contention that universities can justify the student service charge on the basis of library costs incurred by students?

Does the Deputy want me to answer that question now or will I reply at the end?

Perhaps the Tánaiste might follow my line of thought in respect of this matter and answer the question now.

I have asked the HEA to examine for what the student service charge is being used. I agree that it should go towards the support of the——

So the Tánaiste does not accept that libraries constitute a justifiable cost.

It is on that basis I have asked for a forensic examination of exactly where this is being spent.

For the benefit of the committee and the Minister, Deputy Hayes asked the following question of Mr. Tom Boland of the HEA.: "On the issue of the library, is it Mr. Boland's view that it is a core activity of the college or it is a student service?" Mr. Boland replied, "It is both in fairness. It is obviously a core activity of a university but, equally, it is a service to students".

It is a matter of interpretation and definition because no clear guidelines are set down as to what it should be——

The problem is the seven university heads appeared before the committee on January——

I read what they said.

——and they justified the charge based on a large chunk of the money being ring-fenced for library and IT services. Is the Minister aware that since that meeting the presentations of the HEA and some universities were demolished and that Trinity College Dublin has amended its accounts to include a contribution towards core grant reductions? Effectively the authorities spoke with their students and said, "We are not going to play this charade anymore. The truth of the matter is as the core grant goes down, the fees go up. Everyone knows that and we are going to put in an honest contribution now called 'contribution towards core grant reductions'". Is the Minister aware of this fact? Does she accept that is a much more honest position than the pretence of the position of the other six universities?

The money is allocated for the benefit of the student. There are interpretations and differentials between a number of the universities but they must justify that the expenditure is for the benefit of the student and it is not an accounting measure. It is for the benefit of student services, be it registration, examinations, clubs and so on. It is on that basis I have asked the HEA to forensically outline for me exactly where that money is being spent. When I see that report, I will make a determination.

They told us last January.

I have not formally received the overarching work that has been——

Did the HEA speak to the Minister about this?

The HEA has been asked to provide me with an examination of where that funding is being spent. That has not been brought to me yet. When it is, I will examine that and I will make a decision arising from that.

The Minister stated earlier that the core grant was funding student services. Where is the evidence for that?

A number of institutions have the view that part of the core grant was used to supplement some of the investments.

Spend per student in UCD is €1,505; TCD, €1,952; UCC, €1,685; NUIG, €1,516; UL, €1,674; and DCU, €1,509.

There is no evidence that the core grant has supplemented student services. It is the opposite.

That is because the student service grant last year was €900. If one is paying €1,500, that means the core grant has to go into it.

The evidence from the universities is the opposite.

That is the information made available to me by the Irish Universities Association on student services expenditure. The differential is small in some cases and it is much more considerable in others.

I refer back to the TCD example. The college has amended its accounts to honestly state that the core grant goes down, which everyone accepts is happening. I have not heard the Minister accept that. Does she not think that is a much more honest position to take? Would she not encourage the other six universities to do likewise?

TCD has indicated its spend per student is €1,952 for 2009-10. The student charge is €1,500. Its view is that an additional €452 is spent on students.

Since the committee meeting in January, TCD has agreed in consultation with its students to change its accounts and it is the only university stopping the charade and the pretence and accepting that there is a reduction in the core grant.

Is the Deputy making the charge that every other university is dishonest? I will not stand over that.

If the Deputy is saying TCD is the only honest university, then every other one, as a consequence, is dishonest. He will not take that——

The Minister said that.

That is a consequence of saying one university is honest. The Deputy is implying every other university is dishonest.

University presidents accepted when they appeared before the committee that they have to disguise the figures because that is the nature of the system that the Government has allowed them to exist under. They do not want this charade; they want to honestly say the funds from student charges are funding core teaching activities in the universities. The Government and the HEA are playing ducks and drakes with the current position.

A number of members have a copy of a draft report from TCD regarding the student registration charge and income-expenditure account. Does the Minister have a copy?

I do not normally carry the universities' accounts in my bag.

We can get a copy. For clarification purposes, TCD has included in its draft report for the first time a contribution towards core grant reductions, to which Deputy Hayes refers. While the Minister can answer general questions, if she is not aware of that report, it will be difficult for her to comment on that. The Deputy should confine his line of questioning.

I accept that. I do not know whether the Minister is aware that TCD has agreed to amend its accounts as a means of including the reduction in the core grant.

Does she accept that a significant proportion of the student service charge is funding core teaching activity within universities?

No, I do not. It is not a tuition fee. If there is a charge, it must be justified by the institutions. I expect them to show form as to where the charge is being expended because that is what it is for.

There is now a major fundamental difference between the Minister and the universities.

It is on the basis of adjudicating on that that the HEA has been asked on my behalf——

We know what the authority is like. The Minister will wait forever to get a report from it.

I will not because I expect it on my desk.

I refer to another problem that students face in the present climate. The labour market for part-time work has almost disappeared. Those entitled to grants are waiting up to half the academic year before they receive it because of the slowness in payment by many local authorities. The Student Support Bill went through Second Stage in the House two years ago in June. A legal case is cited as the reason for the delay in its passage since and for the fact that for the past five years no student has been issued with a copy of his or her leaving certificate. I am looking forward to the fun when that case winds it way through the courts when at least 500,000 certificates will have to be issued by the HEA. Students have not received a formal copy of their leaving certificate for the past three or four years——

Yes. In some cases, they are required to produce the parchment to get a job and to confirm they have completed their leaving certificate. That is if they are lucky enough to get through the system and come out the other end. Will the Minister read USI's submission? Perhaps she could meet the representatives of this responsible body and explore with her colleague in the Custom House how moneys can be provided in order that the co-ordination of the cashflow for students can be addressed? That is an invitation because I do not expect her to be on top of all the details in such a vast Department.

However, she displayed a great deal of familiarity with the subject of foreign students. The Minister has experience from the Department of Enterprise, Trade and Innovation which has, among other things, responsibility for work permits. Therefore, she has, I suspect, as good a knowledge as I have of the wonderfully cordial relationship between the Department of Justice, Equality and Law Reform and the Department of Enterprise, Trade and Employment. We are wasting our time in trying to turn Ireland into a designated centre of international excellence for foreign students if we still allow the immigration service to brand every would-be student as a prospective criminal, terrorist or somebody who will be a laggard on the State.

It has a job to do, and it is not easy, given the current situation regarding international terrorism. One way its job would be made easier is if the Department of Education and Skills was to crack down on the bogus language schools and other schools which have attracted students to Ireland and not hide behind the law on this matter. It should take legal action. If the crooks and others who are running these so-called universities want to take the Minister to court let them do so, but let us not have the timidity of conservative advice which is enabling the Department of Justice, Equality and Law Reform to say it cannot verify student visas because of the apparent bogus activity which is quite widespread.

Foreign students who are studying medicine and other such subjects are here by virtue of the North American practice whereby one does a primary degree in medical sciences. People could arrive here who are in their early 20s, with a partner, husband or wife who may be working to subvent part of the education. The fees involved are approximately €35,000, but the partner, husband or wife cannot get a work permit. In a specific case of which I am aware, a woman has transferred her medical studies from Trinity College, possibly to Edinburgh where her husband, who is a Canadian citizen, can get a work permit. It is a classic example of the left hand not knowing what the right hand is doing.

There was a legislative proposal to have Enterprise Ireland as a semi-State promotional agency. The Minister, Deputy Batt O'Keeffe, who has in effect swapped with the Minister, Deputy Coughlan, made a decision on the basis of what he saw Enterprise Ireland doing during a trip to Ireland. I have reason to be impressed and I share his views that it is a one stop shop, in terms of promoting Ireland. It will not happen unless somebody grabs it together and drives it forward, which means bringing justice into the system.

To clarify, from the minutes of the report on 28 January, I note Mr. Boland indicated that he had been asked a question by the Minister's predecessor. The report for which the Minister is waiting has been ordered for some time. It is not something which was cooked up because of the current controversy. The report is still forthcoming.

There are two particular issues. If I was asked if I wanted to have a legacy, one would be that young people would be paid their student grants on time. I am a former member of a VEC and served on a local authority for a considerable period. As every member of the committee who is a practising politician knows, it is the biggest concern many people have. When I was Minister for Social and Family Affairs I agreed that we should examine a new format whereby we could streamline how this could be done. Unfortunately, things did not move on. The student support scheme was one of the first things we discussed and it is my clear intention to bring amendments to Government in the next week or two.

Cash flow was an issue but that has now been sorted, in that money is now allocated early to the relevant authorities. I will do two things. I am trying to put as much pressure on the Department of Finance at this moment in time to get the scheme out very quickly in order that people know where they are at.

I appreciate that.

The application forms shall be simplified because I know many members of the committee spend most of July and August filling them in for others who are frightened of forms. My predecessor asked that the form be simplified. I have examined it and it is to be hoped it will address some of those issues. If we can get the grant application process streamlined enough, it will mean that people who are eligible for and entitled to a grant will get paid on time. Many people in local authorities and VECs are very helpful and supportive in doing their utmost to help.

It is the system.

The system is difficult. It needs to be streamlined and we need investment to allow that to happen. We will have to focus on how we can best deliver a model by which this can happen.

In case the Minister is not aware of the situation, the VECs came together and suggested ways in which that might happen.

They should be part of the solution.

I have been briefed by a number of those people, who are clearly thinking of a pathway in which that can be done. They had a tsunami last year, when there was a huge increase in the number of people who were entitled to a payment as, unfortunately, their circumstances had changed, as well as the large numbers who continue to enter third level.

It was three years ago that the former Minister, Deputy Mary Hanafin, announced the scheme.

The work has been in gestation. It is going ahead.

The Minister can sing that.

Clearly that work will be delivered and finalised. On the issue of the foreign students, I signed off on the decision to allow Enterprise Ireland to participate in the promotion of education. I share the Deputy's angst. I had to share my anxiety with the Department of Justice, Equality and Law Reform on occasion. It was on that basis we put together a group, under the assistant secretary of my Department, to drive it forward. We need to get rid of anything which is bogus; it is not tolerable. That is why we will have the Q mark which people can achieve in order that we can quality assure the outcomes and, without a doubt, add to the reputation we have.

Will the Minister take legal action against the bogus schools?

They will not continue in operation if they do not have a quality mark.

Not in the timeframe that is normal for Marlborough Street, which is about five years. Can we move a bit faster?

Yes, we can. I have one or two in mind already.

We need one example. If the Minister scares one or two the rest will go, like head shops.

That deters from a new opportunity we have.

One is not mutually exclusive to the other.

No, they are not. That is why the group——

The bona fide language schools will tell the Department who the crooks are.

Yes. I will take whatever actions are needed in order to ensure we had a process by which people must have quality assurance in order to participate in education. It cannot happen otherwise. We are losing as a consequence. There is huge potential, as I know from my previous ministry, for it to be used both ways, that is, through trade opportunities and as an investment for Ireland Inc. This country has a reputation. We can do much more. Others have worked in this industry for many years and have been able to develop links. We want to develop them better. That is a focus I need to have. Enterprise Ireland will do a good job in the promotion of Ireland as a place for second and third level education.

I would like to move on. Senator Healy Eames and Deputy Flynn wish to speak. If anyone else wishes to speak following Senator Norris, please let me know.

Returning to the student service charge, as Deputy Hayes said, proof was supplied at the meeting the committee held with the university heads that the student charge was being used to shore up tuition, such as in the case of library usage in Trinity College. Similarly, UCD said the doctors' fee for students was extra and was not included in the student service charge. The sports campus fee in NUIG is an extra charge on top of the student service charge. Based on the Minister's welcome commitment that she wants to see all moneys from the student service charge going to services for students, will she now be advising those colleges to absorb those costs with the student registration charge?

There is a unique group of students which will be disadvantaged this year, namely, Access students. She is familiar with such students; they did not come through the formal second level system with a leaving certificate but went back for a second chance and have been upskilled by universities. They have been offered a place for September 2010 in college. They accepted places as Access students on the basis they would receive the back to education allowance plus their maintenance grant, because that is the only way they could afford to attend college. Many of these people must travel long distances of 40 miles or more and some have young children. They are second chance students, but now they are in danger of losing their second chance because the Department has decided they can only benefit from one allowance. The few hundred students we are talking about cannot afford to return to college without the maintenance grant as well as the back to education allowance. Those students will appear before this committee soon. Will the Minister move on this and enable these students to take up their Access places this September?

The Minister has responsibility for a huge area and for all levels of education. We are aware, for example, that one in every six students leaves school early and some 4% of students do not complete their junior certificate. What is the Department's commitment to each level in terms of funding? Does it intend to maintain current levels of funding or will it move to increase some levels and decrease others?

I welcome the Tánaiste to her first meeting as Minister for Education and Skills. We are delighted she is here. I share her aim that her legacy would be that grants would be paid on time to students throughout the country. The VEC in my area in Mayo was one of the slowest to commence payments of grants, which caused much distress to students, some of whom were upset by letters they received stating if they did not pay their fees on time, they would not be allowed access to libraries, etc. The problem, as I know from consultation with my local authority and VEC, is that these authorities must be provided with funding. The Minister is aware of the funding situation with regard to local authorities and VECs, particularly in the current economic climate, and knows they do not have the available resources. In the past, authorities may have paid out grants and waited for the funding to come in later, but they are no longer in a position to do that. Will the Minister explain how she intends to address this situation so as to improve on it and put authorities in funds in a more speedy manner? That is the crux of the issue.

Given that the student service charge increased from €900 to €1,500 in the course of a year and that at the same time the core grant reduced, it is obvious a connection would be made of cross-subsidisation between the two. The Minister made the point in her submission that when the previous Minister agreed to a student service charge of €1,500, this was on the understanding that it would defray the full cost of items that fall to be funded within that charge. However, it was clear to us when the heads of the universities were with us that there was no clear definition of what was covered and none of them could provide us with a definition of "a student service". I am curious about this. How could the Department agree to a sum of €1,500 for the full cost of items to be defrayed if it did not have a concise definition of those items? This caused significant confusion that day. Some university heads felt library services should be included, but other universities differed. There was no clear definition. I hope that when the report the Minister has asked the HEA to deliver is delivered, we will have a clear understanding which all universities can follow. I hope we will not see Trinity College, for example, make a change in its accounting practices, particularly since a delegation from the university attended the committee and gave evidence that was completely different. My clear memory of what was said here was that the university had student representatives on the board and that everything was clear.

By the end of the meeting they admitted the facts.

Although there were some concessions at the end, they fought for three hours in here prior to that. It was a poor reflection on the universities that it came about in that way only after three hours of evidence. I ask the Minister to clarify this area in the interests of everybody.

I risk missing a vote and may be reprimanded in the newspapers, but this is a serious issue. The Minister gave a clear, honest and open indication in her speech of the situation when she said an important element of "income" for our third level institutions is that derived from the student services charge. She went on to say that in acknowledgment of the variation in the arrangements that exist in the colleges, a standardised charge was levelled by third level institutions. That makes it clear that this is a covert introduction of student fees. The inelegant phrase of "free fees" — which I disliked anyway — is now inappropriate and outdated, because the Government is introducing student fees. It is worrying that the Minister said a "standardised" charge was levied. In other words, by direction of the HEA and as an instrument of Government policy, the universities have been incited to form a cartel against the interests of the students. That should be illegal and is against the principle of competition.

A student from a disadvantaged area of Dublin, for example, might be in a position to shop around if this fee was not introduced. It is clear from the letter that has been cited already, from Mr. Tom Boland of the HEA to Trinity, there is a direct connection between cuts in the core grant and the increases in the registration fee. In other words, it is made plain, not only in the Minister's speech but also through the words of the head of the HEA, that this is the introduction of fees. I have no problem with that, because I understand there is pressure. We have a serious situation where because of the economic climate there is a reduction in jobs. Therefore, in addition to other pressures on the universities from increasing numbers there is further considerable inflation in the number of people who will opt to attend third level.

The situation with regard to finances is delicate and there has been a reduction of 26% in the allocation to the universities. This substantial reduction is justified by the cut in wages, the increase in student numbers — which have a benefit because the class sizes increase — and the increase in the registration fee. I will not use a word like "honest" as it is too emotive, but it would be better if the example of Trinity College was followed. I was not here for the other contributions and understand it may not have been fully open initially. However, it has now decided to be open. The other colleges have not been quite so open, but they are placed in a difficult situation all the time. As someone who ran two small businesses successfully in the past, I am astonished to discover that the grants were only made available this year, 2010, in February. These are the full grants from which the universities allocate their budgets. How can they be expected to allocate a rational budget when they only receive the grant two months after the start of the year of spend? This practice is extraordinary and I hope it will end.

Looking at the figures presented here, it is clear that various proposals were put forward by Trinity College, among others, to be included, not just library services. What is a university without a library? I was chairman of the Friends of the Library for many years. We cannot have a university without a library and do not offer anything without a library. That is thesine qua non of a university. Trinity College also proposed facilities such as the bio-resources unit, which is for the preparation and preparatory dissection of laboratory animals. Why should students pay for that? Other proposals were for the fee to be used for the centre for microscopy and analysis. That is not a student service. It could not be, unless one accepted the irrefutable logic of taking the view that everything provided by the university is a student service. One can take that view and then introduce fees.

I supported the Minister's colleague, the former Minister, Deputy Batt O'Keeffe, in the Seanad. My friends in the universities, the students and my voters all knew that. I believe in speaking the truth. I believe that in the current economic climate it is better to do away with the nonsense of "free fees" — that inelegant and illiterate phrase, which is an oxymoron. They are either fees or they are free. One cannot have it both ways, but the problem is they want it both ways. It would be better, in a situation where there are limited resources, to target those limited resources directly at those people who, although qualified, would not be able to afford university education. Some of our best people may come from these backgrounds. We should, as republicans, be prepared to support them in this regard.

I disagree with my Labour Party colleague Senator Bacik, who said in the Seanad that she would prefer full free education. I agree with her in principle but it cannot be done. The Labour Party has accepted in debate in the Seanad that one cannot do this without a prior alteration of the tax system. If we want Scandinavian services we will have to pay Scandinavian taxes but I do not believe that is practical in the current economic climate although I wish it were. I believe in a totally free universal health service and a totally free universal education system but I am also a realist and I understand that at present we cannot do that. I do not see how somebody from a deprived working-class area, whose parents may be unemployed, could possibly afford to go to university when the fees have crept up to €1,500 and there has been a proposal to increase them to €2,500 and the Minister is telling me these are not fees. When I was in Trinity the fees were £300. It seems extraordinary.

I advise the Government to be honest and open. I know there are difficulties with the coalition partners, the Greens, on this matter, who have managed to get the Minister over a barrel in recent political situations. We have to face reality and acknowledge there will have to be fees, otherwise, the most vulnerable people will be deprived of university education. The real battle should not be the students and their families against the Department of Education and Skills or against the universities. First, it should be a case of everybody involved in education supporting the Department of Education and Skills against the Department of Finance, to ensure that the allocation for student grants is sufficient to ensure that all people qualified can enter university. Second, that the means test is set at such an appropriately high level that people will be properly helped. I am not a member of this committee and I am very grateful to the Chairman for allowing me ——

If I heard all that before, I might not have been so gracious.

I have to say what I think is the truth and, believe me, I am shedding votes with every sentence, in fact, probably with every word, but I think it important that people are honest and say these things.

With regard to Trinity College, I have no doubt it attempted this kind of massaged approach but it has learned because the students' union was great and stood up to it. A working party was established and a report was concluded which is very fair. I salute the university authorities and the students. I will summarise one of the recommendations of the report. It stated that the student services element should in the first instance be disbursed on a whole series of things which really are student services. There is an absence of a definition of student services in the legislation but they guaranteed to discuss with the students what the effective distribution should be. That is all I want to say and I thank the committee for the opportunity to say it.

The Senator is most welcome. With regard to the Senator's comments about the Scandinavian model, I am quite fond of the Scandinavian model. However, I agree with the Senator that it is not a practical solution——

The Senator will know the public comment will be, "Jaysus, we are paying too many taxes already". Ireland is probably still one of the lower taxed economies in the European Union. I say that at risk of losing votes as well. There is not a willingness.

The Senator mentioned that the programme for Government referred to revenue raising. It makes more sense to spread out the taxes, take away stamp duty, take it away from income and instead put it on to scarce resources and reduce the income proportionately. I know from getting it in the face over the carbon tax. Under normal circumstances we could reduce income tax proportionately to put it on the resources but because of the economic situation, the carbon tax is the new income tax. There has been an increase in revenue, whatever about the money that is being ring-fenced for increasing fuel allowances. I do not wish to take up all my limited time by digressing.

I want to look at the issue of the student support grant. We have been playing ducks and drakes with this, between the HEA, the university heads and the Department. The buck has to stop with someone and I am glad the Tánaiste says that when the report is submitted, there will eventually be clarity on the issue of what constitutes a student support service. I am on the record as fighting against the idea of fees and saying they should come through the tax system. The argument that a registration charge is the tuition fee is a spurious argument.

It might not be a bad idea for every student going into first year or second year to be given a list of the cost of his or her education, not that they will be expected to pay it but rather that they know the cost. If the final €40,000 or €50,000 cost of the education was sent to every student as a bill, those minority of students who do not appreciate the value of an education might actually realise the value. People in the Visitors' Gallery have been very helpful in providing information on the core grant as against the student support charge but there are students who do not value their education. It is one thing to say that education is a right not a privilege but with rights come responsibilities. It costs the Exchequer less not to re-introduce fees between now and 2012, at a time when moneys are tight. If the Government were to introduce a loan scheme and registration charges were abolished as part of the scheme, then the revenue would not come in until 2012 so the hard-pressed Exchequer would have to pay more. Whatever the ideological debate, the financial argument is very much against bringing in fees before 2012.

However, there is an issue that needs to be addressed. I refer to a letter from Mr. Boland of the HEA to Dr. John Hegarty, provost of Trinity College on 24 February 2010. A couple of quotes were highlighted for the benefit of some Oireachtas Members. "In addition, a portion of the increase in the student services charge will fall to be taken into consideration in the 2010 budgets of the institutions...In addition, institutions will be in receipt of additional income from the increase in the student services charges...The internal allocation of funds between teaching and research is a matter for each institution."

Senator Norris referred to animal experiments which are part of a commercial service provided by the colleges in return for revenue which is not part of a student service. We need regulation of the third level institutions, we need properly audited accounts and a proper definition of what constitutes a student service. Tuition fees do not exist, thankfully, but there is a student service charge which, as the Minister has said, should be used for student services. Perhaps her definition is flexible and there may be room for flexibility. However, if the Minister leaves too much leeway, they will take advantage of that fact. There is a discrepancy between what her predecessor said, what her intent seems to be and what the HEA are saying, in terms of what the student support grant can be allocated to. This clarification needs to be provided before this September because otherwise, this will be regarded as being fees by the back door.

I am pleased that registration fees will not be increased for next year but if the principle in the programme for Government is not to introduce third level fees then there should be no increase in the registration charge either. The Minister's predecessor said there should not be an increase unless the costs of the services to the students were also being increased. It is clear from the financial statements from all of the universities that the cost to the student services has not increased. Therefore, they are using creative accounting. They argue they are getting less in the core grants so they aim to make it up as a student service. There are economic reasons for the core grant being reduced. It is also the case that we need to be more forensic in seeing how the universities are spending their money. There is significant waste and money is not being properly spent. The whole education system needs to be overhauled and this is a bigger question. As a result of the current economic situation, the money has had to be reduced at third level. It befits the colleges to cut their cloth accordingly. If I was given the choice between keeping the money for free pre-school education, which I accept is outside the remit of the Department, and putting it into early primary education, I would always put the money into the early years. If an area needs to lose out, higher education has the talented staff and resources to find other methods of funding as Senator Ó Domhnaill mentioned. I suggest to the Tánaiste that we need clarity on where the student support ends and the core grant begins.

If the Chairman does not mind I would like to try to make it to Leaders' Questions. I wish to reiterate a few points. Government policy is that we will not introduce tuition fees in the lifetime of this Government. The student charge is up to €1,500; it can be less.

In some cases it is more.

It is up to €1,500.

It is fairly uniform, which suggests the cartel I mentioned.

As the Tánaiste needs to attend Leaders' Questions, I ask members to allow her to answer.

Some of them have additional amounts on the basis of plebiscites that took place within the universities themselves, where they decided, for example in the case of UCD to apply €25 for a new student centre. There are instances of local arrangements to allow certain things to happen. I agree with what has been said about the real cost to educate somebody in university. The estimated student service charge is a percentage of unit cost and for an arts student it is 15.9% of the cost but in engineering it is 10.5%. In other words the overall cost of supporting an engineer is approximately €15,000 per annum. The student charge accounted for 3.5% of the unit costs in 1996-97. The estimated cost is now 11% to 17%

The Tánaiste did not answer my question.

She has not got to answer the Senator's question yet. She has only just started to reply.

All the questions are put together. That is the overall framework. I have heard what has been said about the dubiousness of certain things being accounted for as a student charge. I hope to get to analyse that in the context of the HEA report that will be brought before me. I do not want to harp on about Trinity College because there are many others as the Senator knows. However, as a former member of a student union — as a number of Deputies and Senators have been over the years — I believe in the interaction that needs to take place between the universities and the students. If that does not happen and it is brought to my attention that it is not, I will insist on it. It is part of the framework and should exist. A number of years ago we fought to get students on governing bodies. These issues are very important to young people and they are entitled to have a view.

I believe Trinity College is doing that.

Yes, I heard about a few of the rows. Even our party participates in those things.

Is the Tánaiste referring to the rows?

I have heard that too.

Much of this is down to definition and interpretation. As we all know universities in many ways are independent in their thinking and thought processes. Imposing a diktat is not necessarily seen as acceptable. However, I hear what people are saying in the context of a definition and interpretation. I will see if further guidance can be given by the HEA.

Does the Tánaiste believe the doctor's fee should come within the definition of a student service charge? It is very basic and very essential to life.

Yes, and I am aware very fine facilities and services that are provided by many of the universities and third level institutions.

I am talking about UCD where the students have had to pay above and beyond their student registration fee for a trip to the doctor. What will they do? They will do without.

This goes beyond the definition of a student charge. Based on the spend by each university on students, in certain circumstances the €1,500 does not meet the cost of the service.

Will the Tánaiste recommend——

No, I will not recommend anything.

Will the Tánaiste not recommend what should come within——

Sorry, Senator.

We need to get this clear.

Yes. However, we also have a time constraint. If the Senator wants her questions answered we will need to let the Tánaiste continue.

While I appreciate that, I seek clarification. Will the Tánaiste recommend the basic items that should come within the student service charge?

There is no definition.

Will the Tánaiste make a recommendation from here on out?

The Tánaiste has already answered that. She said that the report——

I would like to hear it from the Tánaiste.

She said it before the Senator came in.

I did not hear that.

I said it five times, maybe six times at this stage. I indicated that the HEA has been asked to investigate the issue. The universities and third level institutions have been asked to justify the spend. If they are not in a position to justify that, then that matter will be taken in hand. However, there is a framework of good practice. There may be need for further guidance. If we can come to agreement on how that can be administered, I will certainly move forward in that context. I have heard and read what has been said by the university heads and the HEA. I have heard the views of a number of members of this committee which I will also take on board in coming to a final decision.

In response to the issue Deputy Flynn raised, we are front-loading the money into the local authorities and the VECs. They will not be in a position of complaining they do not have the money to pay out. That will be front-loaded——

——from my Department this year.

They will be in funds come September. There will be no delay in paying out.

Exactly. That is an issue. The other issue is that I would like to get the scheme out very quickly.

That is new and did not happen heretofore.

Just before Christmas. So it will be for next year on.

The committee should welcome that and congratulate the Tánaiste on it. That is a major advancement on what has happened heretofore.

As the Deputy knows, it has been a problem.

It has been a major issue and we should recognise that.

The money will be front-loaded. I hope to introduce a simplified application form. There are a number of legal and other issues with the student support scheme. Clearly I would like to get that scheme through both Houses as quickly as possible.

Much has been said and written suggesting we are bringing in fees by the backdoor. The review group has been asked to review the future of third level education for the next 20 years. Third level education has grown seismically since the 1970s. Although we have grant aid for people on lower incomes there are stresses for many people. We would all fervently wish that anyone who wishes to attend a third level institution should not be prevented from doing so because of financial difficulties. That is a great principle but is sometimes very difficult to realise. Having said that, it continues to be a principle we all would like to see achieved. We have all benefited greatly from the development of education in this country. That has been based on access to primary, secondary, third level, fourth level and pre-school or early learning. That is the formulation that needs to take place and in which I am a fervent believer.

However, the Scandinavian model comes with a few red lights attached. One of the first things we did based on the financial resources available to us was to take people on lower incomes out of the tax net. In the Scandinavian model everyone would pay. We have always been of the view that we should encourage people into work and not to have a disincentive and create a poverty wedge that can happen as a consequence of high taxation on very low incomes. We have a low tax base. I agree that a tax on work is not the most appropriate of taxation measures in this country. I am strongly of the view that at long last we need to ascertain how we will properly fund local authorities to allow them to deliver core services. Having said that, further to the work done by Dr. Colin Hunt, we will have a public consultation on the basis of the work done thus far. I am sure members will have views on this and I would appreciate hearing them. I am sure members will have a view. I would appreciate those views.

We may ask Dr. Hunt to come before the committee.

Sure. We will listen with intent to what is being said here. Members of the Oireachtas are entitled to say a great deal about the future of education over the next 20 years. The work that is being done by the review group will lead to the production of a framework for the next 20 years. I am clearly intent on making decisions. We might not all agree with those decisions, but I hope we can ensure they are to the betterment of education over the next 20 years. On the issues of the back to education allowance and the third level grant, those who have an existing entitlement as a student will continue to have it.

I know that. I am talking about the unique group that is caught in the middle.

As I recall, the previous Minister, Deputy Batt O'Keeffe, said at a meeting he had with us that he would examine the issue of the access students. Perhaps that can be examined further at any meeting between those interested in social protection and education. It has been decided, on the basis that we have very difficult resource issues, that one cannot receive the back to education allowance and the third level student allowance. At this time, the Exchequer is not in a position——

The Government is seriously disadvantaging people who are already disadvantaged.

We are not in a position to pay it. As a Member of the Oireachtas, Senator Healy Eames is probably aware that we have been talking about the difficult economic situation for the last two or three years. This is one of the decisions that have had to be made with a view to reducing public expenditure. The Senator is probably aware that due to the economic——

That is a wicked decision, considering the amount of money that went into banks like Anglo Irish Bank, which the Government is now thinking about winding down.

If Senator Healy Eames wants to have that discussion, I will certainly participate in it. However, it is not appropriate to this debate on third level education.

It is all about the management of the public finances.

That is where it is appropriate.

The Senator has made her point.

Before the Minister leaves, may I ask her to consider the point I made about finalising the capital grant and making it available to the universities before the commencement of the financial year?

I have been advised that there were discussions with the universities during the Estimates process. They would have had a view of the amount of money that is to be allocated to them. An indicative allocation would have been set out during the Estimates process in November or December.

That is for this year, but is it possible to tidy it up more for next year?

We could try to do that.

I welcome the review of the payment of grants to students. Students with disabilities are particularly vulnerable in this context. I raised this issue in parliamentary questions I tabled to the Minister's predecessor. Those who need supports to assist them in their learning are not always paid the grants for such supports in September or October. Would it be possible to put in place a system whereby students with disabilities who apply through the CAO can be cleared for funding, subject to their obtaining the points and other academic qualifications required? That would speed up the process. Such students would know with clarity that their grants will be ready as soon as they start college in mid-September or early October. If that were administratively possible, it would save a lot of heartbreak.

We will look at that. There is a review of the administrative work that is done on behalf of people with disabilities. We will take that view on board.

As questions to the Taoiseach are nearly over——

The Chairman will get me fired. There is only one Minister in the Chamber, so I will definitely be fired.

I am conscious of the possible headline: "Tánaiste Boycotts Taoiseach's Contribution".

I thank the Minister for attending this meeting of the joint committee, giving us so much of her time and answering with honesty and clarity.

The joint committee adjourned at 4.25 p.m. until 10 a.m. on Thursday, 20 May 2010.