Educational News - Student loan scheme would cost Exchequer €10bn over 12 years, says Trinity economist

The proposed student loan scheme would cost the Exchequer €10bn over 12 years, an economist claimed.

Dr Charles Larkin of Trinity College Dublin said the Irish higher education system is neither small enough nor large enough to make an income contingent loan system work.

There is no plan at the moment introduce a student loan a scheme but an expert group has suggested it as an option to address the funding challenge for higher educaton.

The income contingent loan system, suggested in the Cassells report, would mean college was free at point of entry, but graduates would pay back once their salaries hit a certain threshold.

Education Minister Richard Bruton passed the report on the Oireachtas education committee for further exploration and to test the political waters. The committee’s report is awaited.

Dr Larkin and Dr Shaen Corbet from Dublin City University (DCU) carried out a detailed cost benefit analysis of the proposed scheme, suggested in the Cassells Report.

Dr Larkin told a conference today the analysis showed that it would cost the State €10bn over 12 years before repayments from students stabilised the system.  He said this would be in addition to  the State financing all grant recipients.

Dr Larkin was speaking at the launch of The Technological Higher Education Association (THEA), the newly-titled, representative body for the 14 institutes of technology.

THEA's chief executive, Dr Joseph Ryan, told the conference that the third level technological sector is in the midst of a funding crisis that must be addressed.

Dr Ryan warned that funding solutions should not limit student access.