Government cuts student fees by one-third for this year

The Irish government has cut fees for higher education students from €3,000 (US$2,900) to €2,000 (US$1,900) for the current academic year as a ‘one-off’ measure to help families cope with cost-of-living increases.

The reduction formed part of a €4.1 billion package of temporary measures announced in last Tuesday’s budget. The budget provided assistance with energy and public transport costs, business supports, social protection and tax improvements.

Many students also benefitted from increases in maintenance grants of 10%-14% and from a double payment of grants in December. About 40% of full-time undergraduates are on grants. PhD students in receipt of awards from the Irish Research Council will see their stipend increase by €500.

While students are happy with the budget, university authorities are not because the hoped-for substantial increase in core funding did not materialise.

The Irish Universities Association said that while there were many positive elements to Budget 2023 for higher education, the amount provided for the institutions was very disappointing.

An additional €32 million was made available for the sector, but this was to fund extra students arising from demographic growth. Money will also be provided to meet increases in public sector pay.

Deficit in core funding

However, just €40 million was allocated to meet the deficit in core funding, whereas much more had been expected. The association, which represents university heads, said this amounted to just 13% of the €307 million gap in funding identified by the government four months ago in a report called Funding the Future.

The Provost of Trinity College Dublin Professor Linda Doyle said at this rate it would take eight years to close the funding gap in higher education.

Jim Miley, director general of the association, said: “This is unacceptable. An accelerated funding programme is required if we are to make a meaningful impact on student-staff ratios. At a time of major challenge to our economy, investment in higher education and research is absolutely critical to the future supply of our talent and our capacity to compete as a knowledge economy.”

Increase in corporate tax receipts

The measures are being funded out of increased tax revenue, rather than UK-style additional public borrowing. Most of the increased revenue is due to bigger corporate tax receipts, mainly from overseas companies located in Ireland in the high tech, pharmaceutical and financial areas.

Corporate tax is expected to net the exchequer €21 billion this year and nearly €23 billion next year, which is double the take of just a few years ago.

The one-off fee reduction of €1,000 this year will be followed next year by a €500 grant for students from middle-income families.

The popular measures will certainly help the political fortunes of Simon Harris, the first minister of the Department of Further and Higher Education, Research, Innovation and Science, which was created after the general election in 2020.

He has made little secret of his ambition to compete for the top job in the Fine Gael party whenever current leader Leo Varadkar steps down. The party is in a three-way coalition with Fianna Fáil and the Green Party.

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