The Cassells Report; A clear solution to the problem of Third Level Funding?

Fiona Hughes spoke with USI President Annie Hoey about what Cassells Report means and how it effects UCC students.

Since the economic crisis, state funding for Third Level Education has dropped from 84% to 64%. Although the majority are making ends meet, at least five colleges are now running deficits and are in danger of failing to meet agreed targets on financial stability. To compensate for gaps in state funding, some increased income from private sources such as research and international student fees. Larger universities, including UCC, now generate close to 60% of their income from non-exchequer sources.

The Cassells Report, published on Monday July 11th, has concluded that although the higher-education sector has proved itself flexible and resilient in recent years, the system has been bled dry and is on the threshold of a disastrous drop. We should no longer take the contribution of higher education to Ireland’s social and economic development for granted. In 2015, UCC, DIT, UCD and TCD all fell in the world rankings.

Motley spoke to Annie Hoey, President of The Union of Students in Ireland (USI) about this ever growing concern.

“I think there is no doubt that the system as it is needs to be amended. We have seen institutions struggle over the past years to keep up with standards and demands placed on them. Many institutions have had to do more with far less funding which is a situation which cannot continue.”

This is without the additional pressures the future is expected to bring as the 80,000 students who applied to the CAO this year are said to increase by 28% to 102,000 by the year 2028. Consequently, colleges will need an extra €2.875 billion per year to compete internationally. How this additional cost will be funded is the most controversial and debated issue of the report.

In answering the question of how, Peter Cassell’s committee had some requirements to fulfil. These fell into two categories: access to and quality of the education being provided. In their own words, this future system of funding in Ireland needed to be sufficient “to deliver a higher-education experience equal if not better to that in neighbouring countries and competitors, meet the needs of the employer in the private, public and social sectors” and “achieve wide access and affordability for students from different backgrounds.” However, the question is now whether the report has achieved what it set out to do. Does one of the three options outlined by the committee fulfil all requirements?

  • A Predominantly State Funded System

 

The first of the three options, a predominantly state funded system, will be a move towards a free fees model of Third Level Education. Currently, the state funds 64% of the higher education system. With the free fees model, they will be moving closer to 80%. This will cost an additional €1.3 billion per year by 2030.

Despite this high cost and consequent strain on government revenue, Ms Hoey sees it as “the only long term and practical solution the Cassells Report can suggest.” According to the USI, it seems to meet all requirements set out by the report.

The worry with this option however, is its feasibility. Ireland’s recovery is still fresh and with many other areas in a state of disarray, is it possible to fund this type of system? The USI points out that Germany, Sweden, Norway, Denmark and Finland are examples of countries who successfully offer free third level education. However, comparatively, countries with such a system have higher levels of taxation than Ireland. For example, the Scandinavian countries mentioned have tax levels close to 40% GDP compared to Ireland’s 30%.  

To fund this type of system sufficiently would unavoidably cut into budgets for other sectors or increase taxes, meaning some people who do not go to 3rd level will subsidize those who do.

Ms Hoey sees this as a necessary sacrifice.

“Education is a public good and should be treated as such. Everyone in society benefits from a well-educated workforce- not just those who attend third level. When we start getting into the argument of ‘I don’t think I benefit from it so I shouldn’t contribute towards it’ we get into dangerous territory.”

“I may never drive in a road in Longford but I still believe I should pay my road tax as good roads and transport links benefit everyone. The same goes for a well-funded education system. An education system that is open and accessible to all who wish to avail of it is in the public interest and should be state-funded.”

     

  • An Increase in State Funding, Keeping the Current Contribution Charge of €3,000

 

In order to support the system as it now is, the government will need to provide €1 billion per year by 2030. This is €300 million cheaper than the free fees model. With this significant decrease, it is a more affordable option.

However, the system as it stands is in danger of failing to provide equal access to education. Students who do not qualify for a grant and do not come from affluent backgrounds are slipping through the cracks.

The contribution charge expected of Irish students is currently the second highest in Europe after the UK. In a USI study of 870 students, 87% feared having to drop out because of this high cost, 58.1% missed meals and 38.7% went hungry to stay in and fund college.

  • An Income Contingent Loan Scheme Charging Students €4,000 or €5,000 per Year of Study, to be Paid Back Later when they Start Earning over €26,000 a Year.

 

This system will see the government only funding 55% to 60% of higher education, meaning the state invest between €1.307 billion and €1.1557 billion per year in 2030 as a core grant as well as another indirect cost of between €150 million and €190 million. This is obviously the cheapest option from the government’s point of view which brings with it many merits, freeing up money for other areas. However, it has not received much support from the student community and has actually been vehemently criticized.

Ms Hoey sees it as a way to “push people further away from college and increase dropout rates.”

She outlined the problematic consequences of such a system in the countries where it has been implemented. In the UK, the loan system has been a comprehensive failure, with an almost 50% non-repayment rate. In America, education is the most expensive strain on the country, second only to military spending. In Australia, (the nearest model to the suggested Irish loan scheme), there are huge emigration problems and the loans system has had one in three dollars written off, creating an enormous hole in the general economy.

Problems for Ireland

More specifically in Ireland, she fears that “we will end up with a two-tiered, class system, where those who have parents who can afford to send them to college will thrive and advance, and those who cannot will be left debt-ridden and unable to progress in society. I also fear that we will end up with a system where higher fees is seen to mean a better quality of education, but that might not be true. So we end up with a crazy league table system, where a qualification from one institution is not considered as valuable as one from a different institution.”

“Social mobility and progression must be considered key tenants of a well-developed, thriving society. And a system where the people who cannot afford to access post-secondary level education are forced to bear the highest debt burden to do so, will only result in the class divide widening further.”

Those in favour of the loans model believe the opposite of this, they see it as a means of making third level education more accessible to all as nothing is to be paid for college at point of entry.

Ms Hoey disagrees.

“I fail to see how a loan system will make something more accessible to those in society who are already debt-adverse. There is a large difference between taking out a loan for maintenance costs- such as accommodation, food, etc. – and a loan scheme designed to prop up the shortfall in funding from the government. The system is at breaking point because the government does not consider funding post-secondary level education a priority.”

“Also, introducing loans will have an impact on chosen areas of study. The need to repay loans will steer some away from professions like social work and health care and toward higher-paying jobs in tech and financial services, which is something I would think is quite worrying.”

In none of these options can we find the perfect solution. Simply put by Richard Bruton, Minister for Education and Skills: “None…are easy.” The report will be referred to The Oireachtas Education Committee, meaning it will be a cross party decision. Given each party in the Oireachtas has a different view on this topic and each option is so evenly matched with pros and cons, the solution to be picked is not obvious.

The committee itself will take its own time to deliberate and will produce its own findings and recommendations based on the report. They may decide against all of these options and instead cultivate a hybrid of two or even all three. A new option altogether may even be created.

However, Ms Hoey is “not sure their job should be to go back and start all over again.” She sees the decision on funding higher education as one that “needs to be made, and kicking it down the road any longer isn’t an option.”

And so the search continues to meet the requirements of the ever growing higher-education sector. However, as Minister Bruton pointed out, this report is “a massive first step on this journey.” This is now an issue to be discussed and debated, a model to be shaped and moulded to meet our needs as best as possible.

For everyone deserves education, education that is accessible and of the highest quality. To be a nation that appreciates and upholds this sentiment is a desire to be cherished. Although a clear answer is yet to be found, I wait in hope for the goals of Peter Cassell’s committee to be achieved.