May I take this opportunity to welcome the new Minister of State at the Department of Education to the House and wish him success in his new role.
Adjournment Matter. - Means Testing of ESF Grants.
May I also welcome the new Minister of State to this House and congratulate him on his appointment as Junior Minister at the Department of Education. There has been much activity in relation to ministerial appointments in the recent past. I see that the new Minister for Education is reported today in the newspapers as being about to take a fresh look at the Green Paper. I do not blame him for doing so, considering how much of the old material was leaked in the media yesterday and the previous day. It is quite proper that a Minister should have a chance to go through something as radical and fundamental as a Green Paper which will have major implications for the future of education. He should not rush it even though we are about a year behind schedule not just for the Green Paper but in the implementation of the legislation itself.
Perhaps I could suggest that the Minister take a fresh look at the question of European Social Fund grants to third level students, those enrolling in the regional technical colleges and the Dublin Institute of Technology? It was a pity the announcement was made early in the new year that the ESF grants were to be means tested. This was bad timing as students had to opt for their choice of college by 1 February. It means that there was pressure on students to make decisions at a time when they were not sure what financial arrangements would be in place to enable them to pursue the courses they might opt for. It was literally putting the gun to their heads. It was a great pity and we will not know for some time the breakdown of choices made by students to the CAO and the CAS system for third level entry. It was bad timing. If you are going to review the grants or the allowances given to students at third level, due notice should be given to ensure that no pressure or panic is caused to families and students.
A full-scale review of the means testing and funding of third level education is necessary. Vocational education committee grants for degree courses and university grants are inadequately means tested at present. All sorts of anomalies operate. The cut-off level is far too low. The Minister announced — I think it was on 20 January — that the income eligibility ceiling for families will be increased by £2,000 for each child after the first child. That is welcome but, in the first instance, we have to raise the initial eligibility level considerably because it is extremely low at present. The figures of reckonable income provide for a cut-off point of £10,787 per annum, which is exceedingly low in terms of third level education. At £13,114 no maintenance will be granted. If income exceeds £14,672 the student will get no grant. The cut-off levels are very low in terms of the PAYE worker and the self-employed. In terms of the PAYE worker, it refers to gross income, and in terms of the self-employed or farmers it refers to net income. We all know there are people going to college who qualify under the existing means testing but whose family incomes are greatly dissimilar. There should be an overall review of the existing third level means testing in relation to allowances and scholarships.
First, we must look at the question of third level education and how committed we are to it, as a society and as a country. We have free primary and secondary education but we have no free nursery education, which psychologists tell us is very important in the early development of the child. As a country we have to examine our commitment to our children. At the other end of the scale, we do not have a system of free third level education. My view is that we should move in the direction of free education and access to education for all children of the nation equally.
The present ESF funding for education is not means tested which might appear to be an anomaly, but it is not because the grants given for the ESF scheme are, in fact, training grants. They are given for the employment of trainees under the terms of the European Community and Article 128 of the Treaty of Rome. The fact that our Department of Education and our Government have been able to channel these grants into an educational arena does not take from the inherent nature and basic principle underlying them. They are for vocational training, for technological training and should not be means tested. Indeed, I could take it a step further, these grants are given under EC regulations. It seems to be an anomaly to talk about taxing EC grants; in other words, the Government will derive an income from taxing funding which has been given under EC regulations, which do not refer to any taxation that may be imposed by the member state. The Department of Education may find themselves in serious difficulties, and perhaps with no small degree of embarrassment, if the EC probes into the manner in which the ESF funding is being used, and their attempt to recoup £2.5 million this year and the same the following year. This would come to approximately £7 million to £7.5 million for the three year duration of the certificate and diploma courses. That is a serious matter and I do not think there is sufficient justification for it.
The growth in ESF funding has been a tremendous success story in the vocational education committee system. In 1986 there were 10,600 ESF students with maintenance costs of £8.5 million nationally. In 1991 that had risen to 22,200 students and in the course of five years it had more than doubled at a cost of £22.5 million nationally. The EC funded 19,600 students so that the full balance funding from the State involved only about 2,600 students. I do not think that the fact that we have exceeded a quota, so to speak, is sufficient grounds for the Department to seek to breach an entire training scheme jointly run by the Department of Education and the European Community. It would reduce the possibility of access for thousands of students who might not otherwise be able to pursue third level course of studies.
We are talking about substantial numbers. There are, at present in the 1991-92 year in the Dublin Institute of Technology alone, 5,344 students in receipt of ESF funding. There are 3,093 new entrants this year. The numbers show a substantial increase and obviously a very large number of students would be detrimentally affected. The amount of money is not really that large. We are talking in terms of a minimum of £15 for those living at home to a maximum of £38 per week for those living away from home. Overall the maximum is in the region of £1,500 per student. It is not an enormous amount of money but it enables students to pay for their digs. Students can go beyond that and work in the summer if there are no other sources of income.
I am concerned that it is a precipitate action. It relates to families, and more than families. We always seem to think in terms of means testing families. Many people in our society come from a family unit that has broken down. Families are separated, there are single and lone parents and youngsters are out on their own. These complications must be considered.
In terms of where we are going in Europe, we must now have a more flexible definition of where ESF funding would be allowed and where it would be forthcoming. It was defined strictly in terms of training but there is willingness now to redefine that famous or infamous Article 128 of the original Treaty of Rome and go from training to learning. We may find ourselves in the years to come in a position where not just diplomas and certificates but full degree courses may attract ESF funding. The rigid distinction we have at present will be eliminated. I know the Department of Education have done a lot of work in that respect and I hope those schemes will come on stream in the near future.
The existing vocational education authorities operate very largely on the basis of funding from Europe. Much development has been possible only because they have been able to obtain European funding. The other two types of grants which have been available, the higher education grant and the vocational education scholarships, are there to a very minor degree. In 1991 only 724 people availed of higher education grants in the Dublin Institute of Technology degree courses. ESF funding provides the lion's share of the vocational sector and that includes the Dublin Institute of Technology.
A statement from the Department came out of the blue. Subsequently another statement from the Minister stated that means testing would be looked at and that a review committee would be set up to see about more equitable income assessment criteria. We have put the cart before the horse. We should have set up the review committee first and looked at the deficiencies in the system. Then we should have examined the ESF funding to see if we are entitled under EC regulations to do what is proposed. We also need to see what adverse impact it may have on the third level student body which benefits at present.
I welcome a review of the existing means testing system which is inadequate. I do not think that in doing so we should throw out the baby with the bath water. I urge the Minister to reconsider the situation. We could have the review body established initially and this decision could be rescinded.
I would like to thank you and the Senator for the very kind remarks on my appointment for which I am very grateful. I am pleased to have the opportunity to address the House and to clarify the Government's position on the means testing of ESF maintenance grants.
The issue before the House cannot be usefully discussed or viewed in isolation. To be properly understood it has to be considered in the context of overall Government policy on education. In this regard I want to draw the attention of the House to a central thrust of Government education policy over the last five years.
The underlying theme of positive discrimination in favour of the disadvantaged has informed Government action in the area of education since 1987. This has been reflected in the provisions on education in the Programme for Economic and Social Progress. It is evidence of a core conviction and commitment to better the lot of the less well off.
In education the aims of equality and quality are inseparable. In achieving these aims the Government sees it as vital that the education system is effective in improving the quality of life for all rather than conferring added advantage on the already privileged.
Many of the measures taken by the Government in the area of education in pursuit of its policy of bettering the lot of the less well off have already been recorded in the course of previous debates in this House and there is no need to repeat them.
The revised arrangements for ESF maintenance have to be seen in the context of limited ESF support, constraints on Exchequer finances and massive increases in the number of third level students achieved over the last few years and projected over the next decade.
In the current academic year almost 40 per cent of school leavers entered third level education compared with 20 per cent in 1980 and 25 per cent in 1986. Under the Government's programme of expansion the participation rate will soon be about 45 per cent. Enrolments in third level education now stand at 75,000. A further increase of 15,000 students is projected over the next four to five years. In a period of less than ten years there will have been an increase of 34,000 students in third level education — a staggering increase of 60 per cent.
Despite the explosion in numbers of students at third level, more than half of all students at present in third level colleges received grants. The total student support for fees and maintenance provided by the State is about £72 million. The average support per student is £1,900 per annum.
The massive growth in student numbers is nowhere more evident than in the case of ESF aided programmes. In 1986 there were some 10,600 students on ESF aided third level programmes. In the programme of support negotiated under the European Community Support Framework provision was made for an expansion of that number to 19,600 by 1993. That threshold in fact has been reached by 1990. Since 1990 a further 2,600 students have joined the same programmes for whom no ESF support is available. The State, therefore, has had to meet the full cost of these extra students which amount to a cost of £10 million per annum.
A stark choice faced the Government in deciding to revise the arrangement for ESF maintenance grants. The only alternative to the decision taken was to restrict the number of students attending the third level courses. This would have involved denying some 2,600 students their places in college and was, obviously, not a viable option. The Government took the only equitable solution which would not militate against the students from the lower income groups. Even at that, the savings achieved only partly offset the short fall in ESF funding for the programmes.
I want to stress that there will be no change for students already enrolled on ESF aided third level courses. For example students already enrolled on ESF aided certificate courses in a college who, on successful completion of their certificate studies, wish to transfer to recognised diploma programmes, either in the same college or in another college, will not be affected in any way by the changes in the ESF maintenance grants scheme — they will continue to receive their maintenance grants — nor would it apply to those continuing or resuming such courses after gaining work experience. It will only apply to those students starting their third level studies for the first time in September 1992 and the Minister has already committed himself to a review of the entire system by that date.
Furthermore all students on these ESF third level courses will continue to have their tuition fees paid for them, regardless of income. What is at issue is means testing for maintenance grants only. They will, therefore, still have a considerable advantage over other third level students.
The revision in ESF grants are only one of a number of measures which have been announced to remedy inequities in existing student support schemes. They comprise a package of measures and none should be considered in isolation from the others. Mature students, families with more than one child attending third level education and lone parents will benefit under these improvements.
The objectives of the measures announced in relation to third level student grants is to achieve absolute equity in the distribution of available funds. Within these limits the means testing introduced for ESF maintenance grants will ensure that a greater number of students from the lower income families will be enabled to participate in third level education. The total cost to the State of the improvements made to the higher education grant scheme will amount to £4 million in a full year.
The Government are satisfied that the revised arrangements, forced on them by limited funds, protect students from the lower income groups but accept that there is still a problem for students from middle income groups. The Government are conscious of the financial pressures placed on the families in these groups in providing for third level education for their children. Accordingly, the Minister has announced his intention to complete a review of the criteria for elibility for student grants by September 1992. Having been a member of a Higher Education Grants Committee associated with Kilkenny County Council for almost 18 years, this is something I have advocated over the years by way of motion, and resolution to various Ministers. I am glad that, at long last, some Minister has seen fit to carry out that review. I hope it will be a proper and full review, taking every consideration into account. We are all too well aware of what we find when the lists are presented to us over the years. As a member of that committee, I have seen this myself. The people who qualified for grants often raise question marks and I hope in this review we will have a fair and equitable system. I believe Senator Costello feels the same.
I would say "amen" to that.
The review will be of the entire grants scheme including recent changes and will be a total overhaul. It will be comprehensive in scope and objective. The overall aim will be to ensure equity within and between the different schemes. The review will include the removal of any outstanding barriers which may militate against students from disadvantaged backgrounds. To the extent that it is practicable and affordable it will seek to address the particular financial pressures on students from the lower to middle income families. The review will, in particular, re-examine the financial criteria for eligibility for student grants and develop more equitable means assessment criteria, but the same rules must apply to all.
I want to finish by assuring the House of the Government's determination to secure a substantial increase in ESF support for this country from 1994 onwards. This could result in a higher level of support for existing programmes. All possibilities to enhance the level and extent of student support will be explored within the context of extra resources.
I look forward to a full fair comprehensive review which I hope will provide us with a more equitable system for all concerned.
The Seanad adjourned at 4.30 p.m. until 2.30 p.m. on Wednesday, 4 March 1992.