Innovation Talk: New revenue streams vital for higher education

If you listen carefully you might just be able to hear the slow tick tock of the time bomb that may soon go off under our third-level education system.

Things are running along smoothly enough at the moment but demographic pressures are gradually building and difficult decisions will have to be made if the third-level sector is to remain intact.

The Higher Education Authority (HEA) has been warning of the dangers for some time, watching as the baby boom of the late 1990s and noughties and net immigration sent increasing numbers of youngsters into the primary system. This demographic tsunami as one HEA source puts it is now rolling through the primary and secondary school sectors, gathering momentum as it does so. What, however, is to happen when this wave breaks on a contracting third-level sector that is being starved of resources?

The recession has put higher education under pressure. Greater efforts are being made to develop other resource streams, for example getting companies to co-fund research activity but this isn’t going to help in faculties outside science. No one wants to see the reintroduction of university fees, even if we have one of sorts in the “registration” fee required for entry to third level. But without some new way to fund higher education the only option becomes a race to the bottom with declining standards and a loss of our educational reputation abroad.

The HEA is not exaggerating the threat in order to wrest more money out of the Department of Education. We already have one of the highest participation rates of school leavers in higher education in the world. Almost 65 per cent seek entry to third level and half of the State's 20- to 35-year-olds hold third-level qualifications, representing a pool of highly-trained talent which is an obvious attraction for the foreign direct investment brought here by IDA Ireland.

Close to capacity
However, the third-level sector is already close to capacity, with 170,000 full-time undergraduate and postgraduates and 30,000 part-timers, not to mention the growing number of adult-education participants signing on for courses as a way to improve job prospects. The HEA believes undergraduate numbers could grow by as much as 25 per cent over the next decade if demand continues as it is,but where are these students to go? How are they to be accommodated without new ways to resource higher education?

The Coalition’s new plans for the sector, with universities and institutes joining into regional clusters is meant to streamline higher education and so save money, cash that could potentially be used to increase student numbers without degrading quality. But who believes that this is going to be enough to meet the demands for third-level education likely to arise in the coming years?

If resources are not found quality will be the first thing to suffer. And we will no longer look forward to the publication of international university league tables that rank us hundreds of places down from the top 100. Leaving cert points requirements will rocket, allowing only the brightest to enter third level here in any faculty, but of course this assumes the brightest students haven’t decided to decamp to prestigious universities abroad.

The Government will have to address this issue now rather than after the tsunami has broken.

Finland's decision
Doing so is only a matter of common sense given the value graduates in any faculty provide in sustaining our economic development. If the wisdom of this is doubted, look at Finland's decision during its economic collapse in the 1990s to cut budgets except for spending on education and on research. Its innovation-driven economy is riding clear of the bottom while our ship of State continues to grind its keel on the river bed.

The question is what to do about it. The choices will leave either Department of Finance officials glowering or voters doing something similar. One would mean education and research being supported by the exchequer at higher levels. The other would mean the beneficiaries of education, graduates and their families, paying to sustain the third level sector.

This could be achieved through the reintroduction of fees or higher registration charges or via a graduate tax once the person starts earning, or perhaps low-cost student loans that would cover fees and be repaid some time in the future.

However, these options will send equality of access spinning and make it impossible for thousands to get into third level; poorer people will be blocked from entering. More than 40 per cent of undergraduates already don’t pay fees as they receive higher education grants, so how will they gain entry to higher education if money alone dictates who is allowed in the front gates. The tsunami is on the way, we would want to start planning.