Call for tax on high earners to fund third-level courses

Future funding for third-level education should come through increased taxes for high-income households rather than any scheme of means testing for free fees, the Nevin Economic Research Institute (Neri) has recommended.

In a research paper, due to be published today at the Union of Students in Ireland national congress in Athlone, Co Westmeath, the economic think tank says there is a strong financial argument for greater investment in higher education given its returns to the economy.

Social insurance fund

“There is scope for additional taxation in particular areas including high-income households, capital and corporate income,” say the authors

, public policy consultant Austin Delaney and Tom Healy, director of Neri, a research body funded by trade union movement.

Another option mooted is to fund higher education through a general social insurance fund “which insures people in relation to lifelong learning, healthcare and continuity of income during periods of sickness, parental leave or retirement”. While desirable, given Ireland’s “severely under-developed” social insurance regime, it admits this “would take time and would be complex to implement”.

Broaching the question of means testing family assets, proposed last year by Minister for Education Ruairí Quinn but shot down due to political pressure from Fine Gael backbenchers, the researchers say: "Questions are legitimately raised about the extent to which the State should subsidise relatively high-income households or individuals in the provision of public goods and services . . . "Why should public authorities subsidise high-income households to undertake much-sought after prestigious courses in medicine, dentistry or specialised engineering where the employment and earnings potential of graduates are typically very promising?"

Deter students

The authors argue, however, that higher education “is a public good” and “is critical to the future economic development of the country”.

Advocating an increase in public investment to a “balanced, sustainable and adequate level”, they say: “There is a risk that a policy of high direct costs including elevated tuition fees could deter significant numbers of students from participating in higher education . . . Perception and other barriers to participation arising from very high fees should not be under-estimated.”

While the abolition of tuition fees had boosted the student population, it says additions to the student charge – set to hit €3,000 next year – have created new barriers to entry.