2014-04-22 - Socio Economic Review 2014 - Full text and cover - FINAL

Contributing to higher education
There are strong arguments from an equity perspective that those who benefit from
higher education and who can afford to contribute to the costs of their higher
education should do so. This principle is well established internationally and is an
important component of funding strategies for many of the better higher education
systems across the world. People with higher education qualifications reap a
substantial earnings premium in the labour market which increases with age
(OECD, 2012:140). The earnings premium in Ireland for those with higher education
has increased by 22 percentage points since 2010. Third-level graduates in
employment in Ireland earn on average 64 per cent more that those with a leaving
certificate only (OECD, 2011), and 81 per cent of people aged 25 to 64 with a thirdlevel
qualification are in employment compared with 35 per cent of those with a
primary level qualification only. Ireland is one of the few countries where the
relative earnings of 25-64 year olds with qualifications from tertiary type A (largely
theory based) and advanced research programmes are more than 100 per cent
higher than the earning of people with upper secondary or post-secondary
education (OECD, 2013).
Ireland is the highest ranking country in the EU in terms of higher education
attainment, with 48 per cent of all 25-34 year olds having a third-level qualification.
At present third-level students do not pay fees but do incur a student contribution
charge at the beginning of each academic year. Undergraduate students are
supported through the provision of maintenance grants under the Student Grant
Scheme 2013. As a result of decisions taken in Budget 2012 postgraduate students
are no longer eligible for maintenance grant support. Without the introduction of
some form of income-contingent loan facility this decision is likely to have a
significant impact on entry into postgraduate courses in Ireland over the coming
years.
There has been much discussion regarding the future funding for Higher Education
Institutions (HEIs) and how they might be configured in the future. In the ‘National
Strategy for Higher Education to 2030’ the Higher Education Authority (HEA) discusses
broadening the base of funding for HEIs and sets out in detail how a student
contribution framework might be developed and managed. Various policy options
for student contributions are discussed in a report to the Minister (Department of
Education, 2009) and the fiscal impact of these options are outlined in detail.
Further research concludes that an income contingent student loan rather than a
graduate tax system would be the most equitable funding option for Ireland
(Flannery & O’Donoghue, 2011). Social Justice Ireland believes that Government
should introduce a system in which fees are paid by all participants in third-level
education with an income-contingent loan facility being put in place to ensure that
all participants who need to do so can borrow to pay their fees and cover their living
9. Education and Educational Disadvantage 199