Are Fine Gael and the Government still planning to introduce income-contingent loans for third level students?

As the Tánaiste knows, the report from the committee headed by Mr. Peter Cassells, Investing in National Ambition, set out three funding options for the third level sector, including a predominantly State-funded system, a system of increased State funding with continuing registration fees and the recommended third funding option, increased State funding with deferred payment of fees but with income-contingent loans levied on graduates.

The Minister for Education and Skills, Deputy Bruton, informed Deputy Pringle and me on 5 April that his Department is undertaking what he termed "a technical evaluation" of how income-contingent loans would work. He seems to have pushed ahead with this study without consulting the Oireachtas Joint Committee on Education and Skills. When will the technical evaluation be published and will it include a full cost-benefit analysis? Before the Minister gave this reply last month I chaired a meeting with the Union of Students in Ireland, USI, attended by a cross-section of Deputies. The union leaders, Ms Annie Hoey, Mr. Michael Kerrigan and their colleagues outlined powerful arguments against proceeding with student income-contingent loans. Internationally, where student loan schemes have been introduced, there are large-scale debt default rates. In Australia, for example, outstanding debt is over 35 billion Australian dollars, with average student debt at almost 40,000 Australian dollars per graduate. In England, the poorest 40% of students will graduate with debts of nearly £44,000 and the "financialisation" or sale of student debt to the private sector is another reprehensible feature of the English system.

The Minister, Deputy Bruton, along with the Minister of State, Deputy Finian McGrath, and I represent a constituency with districts where third level access is below 20%, and in many parishes it is just 35% or under that level. The introduction of student loans would have a further damaging impact on progression and access to third level education, especially for important sectors of society, including students with a disability, lone parents, first-time mature students, part-time and flexible learners, students from a farming background and students on grants.

One insuperable argument against income-contingent loans is the Irish tradition of emigration and the fact we are an emigrant nation. The Higher Education Authority recently indicated that 12% of graduates emigrate for a first job. The USI estimates that nearly 4,000 additional graduates will emigrate to avoid repayment of large graduate loans. Does the Tánaiste agree that one fundamental reason for not proceeding with income-contingent loans would be the major ongoing cost to the State as outlined at the Oireachtas Joint Committee on Education and Skills last Tuesday by Dr. Charles Larkin of Trinity College Dublin and Dr. Shaen Corbet of Dublin City University? They oppose income-contingent loans and characterise them as a very risky course of action for the Exchequer, with complex legislative set-up, administration and loan recovery systems, costing the State €10 billion over the first ten years.

Is Fine Gael still determined to introduce income-contingent loans given the party's opposition to treating third level education as a critical public good in the 2016 general election? The party's partners in Fianna Fáil are of course sitting on the fence with this, despite 2017 being the 50th anniversary of the great Donogh O'Malley introducing free second level education.

As the Deputy states, the Government and my party have emphasised the importance of higher education and it is a central part of the Government's plan to support a strong economy and deliver a fair society. The package of measures announced for the sector in the budget reflects this priority, which will help all students. To recap, we are providing an initial investment of €36.5 million in the sector this year and €160 million over the next three years. It is the first significant investment in the sector for nine years and we are in a position to do this because of the improving economy. The Minister, Deputy Bruton, has made it very clear he intends to continue that support. It is the first significant investment in nine years, a period in which State investment in higher education fell by 33%, or €463 million. We are now keeping pace with the demographic increases and there are also targeted initiatives in priority areas, particularly in trying to ensure there is more focus on research, flexible learning and dealing with thousands of students benefitting from initiatives. There is a multi-year spending plan for the sector and we want to ensure we have a sustainable system of funding going forward.

As the Deputy knows, in 2016 the Minister published the Cassells report and, as committed to in the programme for Government, the report is currently with the Oireachtas committee. The Minister has said this is an area where it would be preferable to have broad political consensus and he is working to build that here. The Oireachtas committee is examining the option mentioned by the Deputy as well as other options. The consultation paper on the introduction of the Exchequer mechanism was published in March and it stated that technical work will be undertaken on an income-contingent student loan scheme by an interdepartmental group in order to inform future policy options, including in light of the recommendations that will come from the Oireachtas Joint Committee on Education and Skills. The work is of an administrative and technical nature and it will ensure the Department is in a position to respond once the committee has completed its work and published its recommendations. These issues are under ongoing consideration by the Department. The Minister will examine the final report and he is also doing some background work. No decision has been taken in this regard but the issues are being examined. Further work will be completed in order to ensure we have all the information we need.

I welcome the additional €38.5 million in the 2017 budget and the promise of €160 million over the next three budgets, as well as the proposal to increase the national training fund levy from 0.7% to 1% in forthcoming budgets. There must still be a fundamental and early decision on this and the Tánaiste did not reply to the central question of when the evaluation report will be produced and if there is an implementation plan for what I would regard as a very regressive proposal. It was her Government and the previous Fianna Fáil Government that slashed third level funding over the past eight or nine years, from almost €1.5 billion to under €1 billion. If the Government proceeds with this, it may as well tear up the national plan for equity of access to higher education for 2015 to 2018. With 45% of our workforce now being graduates, with education playing a primary role in Ireland's growth and recovery since the early 1990s, should the Government not look positively to the long-term earning power and taxes of graduates to fund a free third level system rather than embarking on a regressive, unwieldy and dangerous system of student loans? It should in this case follow the good example of Scotland, Germany and France.

I have no doubt these issues will be considered very carefully so there will be an equitable approach and we can ensure all our community can benefit from higher education. I will point out a couple of facts about the equity issue. Over 3,000 students from disadvantaged groups will benefit from the additional package of €8.5 million to support more disadvantaged students, including lone parents and Travellers, in attending higher level education. This includes the introduction of the full maintenance grant worth almost €6,000 from September 2017 for 1,100 postgraduate students in the lowest income category. That is absolutely targeted at equity issues that have been correctly raised by the Deputy. I can also speak about other initiatives for support, including the new frontier research programme, with work being done to cover increasing enrolments. There is also provision for expansion of apprenticeships and so on. There are quite a number of issues in addition to the Deputy's point on grants, with actions being taken to achieve equity in access to education.