I thank Senator Barrett for the work and thought he has put into the drafting of his Bill. I also thank Senator Crown for his contribution and I look forward to hearing the contributions of Senators Quinn and Norris. One of the great advantages of having a debate in this House on universities is the fact that we have a considerable amount of expertise among the Senators who are elected specifically from the universities and expertise right across the Seanad. The Bill seeks to amend the objects and functions of universities, as set out in the Universities Act 1997, to include a reference to innovation; to provide for matters relating to academic tenure; to provide a role for the Commission on Public Service Appointments in determining the rates, scales and ranges of remuneration of employees of universities; to allow universities to establish new schemes for superannuation; to provide for issues relating to the establishment of corporations by universities; and to require the development by the universities and the Minister of an intellectual property protocol. The Bill addresses a wide range of issues.
The national strategy for higher education to 2030 sets out a comprehensive roadmap for reform of the higher education system. The objectives of the reform programme are to ensure that the system becomes more performance-oriented, flexible and responsive while retaining and enhancing its diversity in terms of mission. A wide-ranging legislative programme is required to implement a range of governance, accountability, funding and structural reforms to allow us to meet the framework for modernisation set out in the strategy.
We are considerably advanced in setting in train the legislative underpinning for the modernisation of our system. A high priority is to provide for consolidation and mergers within the institute of technology sector, which was not touched upon in the Bill, and to provide for those newly merged entities, which reach the already published criteria, to apply for and become technological universities. The technological universities Bill is therefore currently being drafted by the Office of Parliamentary Counsel and will be published shortly. Legislation will also be required to support the new funding, performance and accountability framework for the system that is being put in place. This is intended to provide statutory underpinning for the respective roles, functions and powers of the Minister and a reformed Higher Education Authority for the governance and regulation of the system.
Legislation is also required to strengthen and reform the governance structures and accountability of higher education institutions. With this in mind, I previously sought the input of the Royal Irish Academy, universities and institutes of technology as to how best to create the smaller, more modern and competency-based governing boards that were recommended in the strategy. A broader higher education reform Bill, the general scheme of which is currently being drafted, will therefore reform the existing statutory underpinning of the Higher Education Authority setting out new powers, responsibilities and governance arrangements in terms of funding and accountability. It will also contain the amendments to the Universities Act necessary to implement governance and accountability reforms. I hope to return to that later because some of the proposals in Senator Barrett's Bill can be incorporated in the legislation I will be bringing forward later this year.
Senator Crown referred to research and innovation. Research and innovation are of major importance given their role in contributing to economic recovery, competitiveness and growth not only in Ireland but also across the EU. Continued investment in research and innovation is essential if we are to maintain employment and create new high-quality jobs. As well as the importance of this element of research, ensuring we have a good society is also hugely important. At the Royal Irish Academy last night, I presented gold medals to two professors, one in the humanities and one in the sciences. That is the balance we need to have. As Ireland moves from a policy focus on economic stabilisation to growth, sustained investment in research and development in the higher education sector remains of vital importance to enable the economy to recover and grow in the future.
The higher education sector provides a national base of skills and knowledge and complements the applied research that is necessary that is being largely applied in the business sector firms. Ireland has adopted a national strategy to maximize its participation in Horizon 2020 with an ambitious target of securing €1.25 billion for Irish researchers and companies during the lifetime of Horizon 2020. Horizon 2020 has the biggest EU research budget ever with €80 billion of funding available over seven years. The strategy outlines the support structures to ensure researchers and companies have access to information, advice and support to enable them to maximise opportunities under the programme. I am conscious that we do not want to be entirely driven by the opportunities for funding in that area. Research should not only be driven by where we can get funding.
Structural changes in our higher education system, including the development of regional clusters of institutions and the mergers of institutes of technology, will engender greater critical mass and excellence and allow our institutions to compete with the best institutions across Europe.
In addition, the new performance framework for the higher education system specifically includes metrics for EU research income and will encourage institutions to engage strategically with the programme. However, as I say, that should not be the only metric.
Section 2(2) of Senator Barrett's Bill provides for the insertion of definitions of certain terms into the Universities Act 1997, including "research", "innovation" and "education". Sections 3 and 4 provide for the amendment of sections 12 and 13 of the 1997 Act, to include references to innovation in the objects and functions of universities, as set out by that Act. There is merit to the Senator's proposals in this regard and I would be happy to consider the inclusion of similar amendments in the General Scheme of the Higher Education Reform Bill, which is to be published later this year and to which I referred earlier.
Section 5 proposes to insert a new section 14A, dealing with matters relating to academic tenure, into the 1997 Act. I understand that there is a view that the 1997 Act does not sufficiently separate the question of academic tenure from matters relating to disciplinary processes in the employment relationship. However, I am advised that the proposed amendment would not substantially improve matters in this regard and may introduce unnecessarily cumbersome procedures. Again, that is something we can consider. I do not think we are differing in what we are trying to achieve here.
Section 6 largely deals with matters relating to remuneration. The effect of section 6 would be to give university staff a privileged position within the public service in terms of pay policy determination. The Bill would restrict the capacity on the part of the universities to manage pay rates, and it would restrict the capacity of the relevant Ministers, the Government and the Oireachtas to manage pay policy in the universities. It would create a potential risk of additional and uncontrolled Exchequer pay and pension liabilities in respect of the university sector, and establish a role for the Commission for Public Service Appointments which is not in alignment with its core function. This is the difficulty I have with this section. The commission does not have a function in this area as its function is to regulate recruitment within the public service. The Bill would also give excessive authority in respect of pay policy matters to two public bodies, in that it would give the HEA and the Commission for Public Service Appointments the authority to overrule the Ministers, the Government and the Oireachtas on matters of pay and allowances in universities. Unfortunately I do have a difficulty with that section of the Senator's Bill. It is not in line with the general policy with regard to pay, and particularly the role of the commission.
Section 6(13) and section 7 subsections (1) and (2) provide for the amendment of provisions relating to the preserved rights of staff. These provide for the preservation of certain terms and conditions of staff who were employed at the time of the coming into effect of the 1997 Act. It is my understanding that there is a general provision for the variation of these rights by agreement and I think this is fair and sufficient. Section 7(3) seeks to provide for the provision by universities of information relating to remuneration to the HEA. I will also give consideration to including an amendment along those lines in the Higher Education Reform Bill, which will be published later this year.
I am sorry this is rather a long contribution but I am trying to respond in detail to the Bill itself. Section 8 provides that new employees appointed to a university after the making of a superannuation scheme under the First Schedule to the Bill will become members of that superannuation scheme. It is proposed that the scheme may be a defined contribution scheme, and may provide for additional voluntary contributions, for the transfer of accrued rights from another superannuation scheme, for the transfer of rights accrued under the superannuation scheme to another superannuation scheme, and for benefits based upon the average earnings of a member of the scheme throughout that member's entire career as a member of the scheme.
The legislation we have at the moment is the Public Service Pensions (Single Scheme and Other Provisions) Act 2013. That Act provides for a single public service pension scheme for new public servants appointed on or after 1 January 2013. In addition, former public service employees returning to the public service after a break of more than 26 weeks in pensionable public sector employment become members of the single scheme, with certain exclusions for those on approved leave of absence. This scheme is a contributory defined benefit career average earning pension scheme where the benefits are based upon the average earning of a member of the scheme throughout that member's entire public service career.
All of the universities have defined benefit pay-as-you go schemes where pension benefits are based on the final salary at date of retirement or resignation. These schemes are based on the Department of Public Expenditure and Reform model scheme. These schemes apply to university employees appointed prior to 1 January 2013, if they are not members of the university closed schemes. The schemes are approved on an administrative basis but will be formally approved in accordance with recently published rules.
The provisions proposed in this Bill provide that all new employees in universities would become members of a new scheme to be prepared under the Bill. It is proposed that the new scheme may be a defined contribution scheme and-or a defined benefit career-average scheme. However, a pension scheme cannot be a defined contribution scheme and also provide for benefits based upon the average earning of a member of the scheme throughout that member's entire career as a member of the scheme. A defined contribution scheme provides benefits based on the level of contribution and the value of that contribution at retirement date. These are two completely different types of schemes.
The schemes in the university sector - the single scheme, the model schemes and the closed schemes - are defined benefit schemes. There has been no proposal from the university sector for a defined contribution scheme. Furthermore, the introduction of a new scheme is not in accordance with the Public Service Pensions (Single Scheme and Other Provisions) Act 2013. That legislation, in accordance with Government policy on pensions, provides for a single public service pension scheme which applies to all public servants including university employees who are appointed on or after 1 January 2013. The purpose of the legislation was to standardise pension provision across the public sector. In terms of the Bill before us, we do not intend to approve separate and different superannuation provisions for the university sector. That is a section of the Bill that I have difficulty with in terms of Government policy.
Section 13(2)(c) of the Act of 1997 provides for the establishment by universities of corporations. Section 25(5)(b) provides that such corporations may only pay employees of a university in accordance with a framework agreed between universities and the HEA. I understand discussions between the universities and the HEA are ongoing in that regard. Section 9 of the Bill provides for the above but, as with the provisions relating to remuneration referred to earlier, it also provides that the Commission for Public Service Appointments may be requested to establish appropriate rates of pay where the universities and the HEA have been unable to agree a framework. Returning to the point I have already made regarding the commission, this is not one of its core functions, so I would have difficulty with that section of the Bill.
In Autumn 2012, the Department of Jobs, Enterprise and Innovation, published a document entitled Putting Public Research to Work for Ireland, also known as the national intellectual property protocol. This was developed by the Department of Jobs, Enterprise and Innovation working with other Departments, including my own, and drew on the knowledge of a dedicated group of experts from industry, the venture capital community, technology transfer offices, research-performing organisations, the Irish Universities Association, and State research funders. The key objective of the intellectual property protocol is to maximise the economic and societal benefits from Government investment in research-performing organisations, in particular the creation of sustainable jobs.
The protocol will make it easier and faster for entrepreneurs and companies to negotiate a commercial arrangement with research-performing organisations for intellectual property arising from State-funded research. It is about encouraging industry to collaborate with Ireland's universities, institutes of technology and other publicly-funded research institutions, to access and commercialise the intellectual property generated from such research and turn it into products and services for the global marketplace. The intellectual property protocol was designed and delivered in order to bring clarity, consistency and quality for companies working with Ireland's higher education institutes and other State-funded research organisations. The primary goal is to enable and encourage the use of State-funded research to drive business, innovation and economic competitiveness.
Knowledge Transfer Ireland has been established as a key recommendation from the report, with a remit to support business and the research base to maximise innovation from State-funded research by getting technology, ideas and expertise into the hands of business swiftly and easily, for the benefit of the public and the economy. As an intellectual property protocol has already been established, and the relevant policy and structures have been rolled out, I do not believe it is necessary to make specific provision for the establishment of such a protocol by way of primary legislation.
I have gone into some detail on the different elements of the Bill and I would be happy to work with Senator Barrett and others on some of them, in terms of incorporating them into the legislation we will be bringing forward on higher education. I have a difficulty with and unfortunately cannot accept other elements, particularly around the role of the Commission for Public Service Appointments, whose job is basically not in this area.
I realise there is strong work being done which is very specific. The Senator has drawn on his vast experience in the higher education sector, but I hope I have outlined the difficulties we have with some elements, particularly public pay policy and the Commission for Public Service Appointments. There are, however, other elements on which we will work with the Senator to be incorporated into legislation.
I thank Senator Sean D. Barrett and the other Senators who have contributed and will contribute later to the debate. I look forward to continuing to work with the Seanad on legislation dealing with the universities.