IUA Press Statement – Report of the Expert Group on Future Funding of Higher Education (Cassells Group) – 11th July 2016

11th July 2016: The Irish Universities Association welcomes the publication of the report of the Expert Group chaired by Mr Peter Cassells. IUA Chair, Professor Don Barry commented “I wish to commend the work undertaken by Peter Cassells and his colleagues on this issue of vital national importance. The report is an excellent example of evidence based policy making and clearly illustrates the crisis in higher education funding – and the pathway towards a solution.”

The report comprehensively covers the options for achieving funding sustainability and makes it clear that a “do nothing” approach is simply not tenable. How we fund higher education requires choices to be made and it is appropriate that these matters be considered by the Oireachtas. It is equally important that the issue is confronted immediately. The Cassells group has spent a considerable amount of time and effort doing the necessary groundwork. It is essential that the work of the group is not duplicated and that the process now moves on to reaching a speedy conclusion on the group’s findings” Professor Barry commented.

IUA Chief Executive Ned Costello said: “Long term sustainability is essential but it is equally important that measures are taken in the upcoming budget/estimates to address the immediate crisis. Many institutions are at or close to deficit conditions while student demand is continuing to grow. An immediate infusion of funds is needed: firstly just to ensure viability and secondly to begin to return our exceptionally high student staff ratios to normal levels.”

Ends

 

Additional Notes (the data in these notes refers to the university sector specifically): 

Staff:Student Ratios

While new entrants into higher education have increased, core staff numbers have fallen in consequence of the Employment Control framework. The net effect has been a deterioration in staff:student ratios. Pre-crisis, the ratios in Irish universities were already poor by international standards at circa 1:16 or 1:17 on average. Following the crisis, ratios now stand at 1:21 in the universities. This is significantly worse than the OECD average which stood at 1:14 in 2012.

 Recurrent Funding:

Despite an increase in the student contribution of €2,175 or 263 per cent—from €825 in 2007/08 to €3,000 in 2015/16, total income per student decreased by 24 per cent for the higher education system overall.

Increases in student contributions along with general reductions in overall state funding have resulted in a steady reduction in the proportion of total recurrent funding for core activities of higher education institutions funded by the State – from 78 per cent in 2008 to an estimated 64 per cent in 2016.

For the universities specifically, the core recurrent grant declined by €273m between 2008 and 2016, a decline of over 55 percent. When we look at the fall in the unit of resource which includes not only core grant but also fee income, the unit of funding went from €8,734 in 07/08 to €6,896 in 15/16. The cumulative decrease in the unit of resource in this period has been in excess of 21 percent.

Immediate Unavoidable Cost Increases:

By 2020 the cost base of the university sector will have increased by €99.16m arising from unavoidable cost increases. Many of these relate to public sector pay policy including the cost of pay restoration arising from the Public Service Stability Agreement and the cost of redundancy arising from LCR 207304. These increases are heavily front-loaded in 2017 and 2018. In addition to these costs, additional funding is needed immediately to allow for capacity increases without further eroding the unit of resource per student.