This week, the Minister for Education, Richard Bruton, reaffirmed that his department is still strongly considering marginally – and gradually – increasing the rate at which employers must pay into the National Training Fund, with a view to using the proceeds to increase funding to higher education. But why is it that he feels the need to kowtow to the sector as a result?
The notion that employers contribute to the higher education sector seems altogether reasonable. Because of the standard of Ireland’s third-level institutions, their companies directly benefit from the well-educated graduates that enter the Irish workforce.
However, the government’s response, which pledges not only to consult employers on the matter but also to give them a great degree of input into decisions on education in Ireland, could lead you to believe it was planning some sort of dramatic levy. In reality, the levy is only jumping from 0.7 per cent to 1 per cent – and over a three-year period.
The fact that the government can’t even propose a small increase in how much employers contribute to the sector without excessive pandering sets a dangerous precedent. If every minor increase in tax had to be approved through such a process, the government’s room for maneuver on issues of taxation would be severely hampered.
It’s no secret that employers based in Ireland have it good. And given Ireland’s famously low corporate tax rate, Ibec’s claim that this increase will discourage companies from coming to Ireland is not only baseless, but verging on melodramatic.
Bruton should be more concerned with the delivery of a new and effective long-term funding model for Irish higher education, instead of indulging petty complaints from a group he is not directly accountable to. In a lobby crowded by universities and student groups, it’s clear that industry still has the ear of Bruton, a former Minister for Jobs.
This small increase in an already-existing tax is perhaps one of the least divisive recommendations made by the Cassells Report. It was a rare point of agreement between unions and universities. And while marginally raising a levy won’t solve the funding crisis, the extra €20 million generated is small change to employers that’ll go a long way in a sector starved of funding.