There are approximately 70,000 undergraduate students in the seven Irish Universities. One proposal is to bring back fees for students whose parents earn 100k plus as a way of securing the financing of the universities in the future
(i) this assumes you can use the parents income for asssessing an adult for eligibility which is not without precedent but also not without problems.
(ii) Lets say 10 per cent of these families earn 100k per year plus and you can identify all of them and all of them decided not to study abroad (all optimistic assumptions). Of the 60 thousand or so Irish students, this would mean about 6,000 students eligible to pay fees.
(iii) lets say 5k per year would be the average fee. this would generate approximately 30 million euro per year (so about 4.5 million on average for each university). This is not trivial in absolute terms but is a small percentage of total university finance and its not even clear how much of this would be lost in collection costs. Relatively speaking, it would have little bearing on the destiny of the universities.
(iv) So the argument that fees can be returned in a meaningful way in this fashion doesnt seem sensible.
(v) either fees are not coming back or they are coming back in a meaningless way like the above proposal or
(vi) there is a radical change in fees meaning fees for the majority of students and big changes in the structure of fees perhaps with some high demand course being charged at higher rates.
the problem with the current debate is that many families are now trying to make financial decisions on the back of a very uncertain policy environment. If (vi) is on the cards, it surely could not be done without warning people. if the debate is to be an honest one though (vi) is what should be debated and at least costed rather than putting out a fairytale.
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10% ? Earlier today i found mmyself wondering how many would be in the 100k+ bracket & guessed it might be 50%. Of course no one knows, not even the minister
Thanks for the back of the envelope calculation Liam. I think it sounds about right. The latest income distribution data from the Revenue Commissioners (www.revenue.ie), Statistical Report 2006, shows that 12.6% of married couples (both working) had combined incomes of €100K or higher in 2004. This fell to 4.5% of married couples with just one partner working.
Of course, inflation will likely have raised the numbers (and maybe the percentages) in the €100K category since then. But 10% sounds like a working basis to me.
One thing you forgot: won't the fees be allowable for tax calculation purposes? Even if allowable at the standard income tax rate then the net contribution of the proposed fees becomes (even more) negligible.
Further proof that this is a) a panic measure, b) politically motivated ('only the rich will pay') and c) a distraction from the main issue (what kind of education system do we want/need and how will we pay for it?).
True in that 100k is being floated as household income. 100k would be in the top 5% of the income distribution but on a household level it would be a bigger slice but still, of course, focused on the PAYE sector
76k is the top 10 per centile of household income in the population according to SILC. clearly the people who come to university though would be higher as they are a selected sample but very difficult to know how much higher. even if it was closer to 20 per cent of students this would still be a small percentage of university finance and i think some of the commentary today from the ministry indicates that something stronger than a very selective return of fees is being considered with one suggestion being that industry would contribute to funding teaching.
Those are illiminating calculations regarding what fee re-introduction would do for the current funding crisis Liam.
At times when the fees debate comes to the fore, I am always inclined to raise other issues about student access to higher education. These are not directly related to the issue of the funding crisis that has instigated the debate this time --- but they are relevant to anyone discussing fees in the broader context of equity in (higher) education. The issues are:
(i) The importance of long-run family background factors in educational attainment (i.e. the literature by James Heckman and colleagues on long-run background factors
(ii) The need to tackle drop-out in secondary (and third) level
(iii) Funding for Access programmes - to prepare second-level students for third-level, and to ease their adjustment into third-level once they arrive. A recent Geary working paper by Patricia O'Reilly discusses Access programmes quite well: http://geary.ucd.ie/images/Publications/WorkingPapers/gearywp200816.pdf
(iv) Grant eligibility or the "college grants squeeze". A new report from the Higher Education Authority (mentioned by John Walshe recently) says that the "current 'inadequate' income thresholds for grants disqualify large numbers of salaried employees within this lower-middle-income group. At present, to get a full maintenance grant of €3,420, the maximum income limit for a family of four children is €38,675 a year. For more than eight children, it is €46,140 a year." We know that almost 35,000 students received financial maintenance support in 2004 (according to the National Office for Equity of Access to Higher Education in 2005). This figure of 35,000 is roughly one third of the entire student body, the same ratio as those who received financial support in 1980 (Coolahan, 1991). In my Geary working paper with Siobhan McCartthy and Carol Newman, "Household Characteristics of Higher Education Participants", we suggest that eligibility for maintenance grants is an important factor for encouraging particpation in higher education.
(v) The actual level of the grant payment. Little more than one year ago, it was announced that the higher education maintenance grant would increase by 10%, or twice the rate of inflation. The increase in the grant (by 10%) was presented as twice the rate of inflation, but the actual level of the grant is only €3,420, and this is much lower tahn what students need. There is research that estimates what students’ monthly expenditure actually amounts to; it averages at €698 per month according to Darmody et al (Eurostudent 2005). This approximates to €8,000 euro every year, nore than double what students are currently entitled to.
When fees were abolished approximately 31% of UCD undergrads were in receipt of local authority grants i.e. about 69% were paying fees so a system where 20% are paying is hardly a "return" to fees.
The income distribution of university students parents is very different from the population in general so 10% is a lousy approximation.
give us your guess kevin - you really think 50%? - looking at SILC would make 10% not seem like so bad a guess whereas the revenue figures makes it look like it would be a lot more than 10% but 50??. if it is 50 per cent at say 5k per year and the numbers stay the same then the amount potentially raised from that is more like 150 million which is clearly significant (though an awful lot of caveats about whether all this would actually be raised including the ones Gerard raises). The debate would then be about whether the fees replace the current spend or supplement it and the nature of the loan financing.
If anyone knows the income distribution of college students families(surveys underestimate it so real figures would be better!) please let us know!
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