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Cornerstone Reform of Higher Education

Published: 15th January 2018

New competitive fund for innovation to be introduced, extra funding for multi-campus institutions. More funding for delivery of STEM courses, financial penalties for breaches of governance

The Minister for Education and Skills, Richard Bruton T.D. and the Minister of State for Higher Education, Mary Mitchell O’Connor T.D. today announced reforms which will link funding of higher education institutions to the delivery of key national priorities, including better alignment to skill needs of the economy, higher levels of performance and innovation, expansion of research; particularly with enterprise partners, better access for students at a disadvantage and improving lifelong and flexible learning opportunities.

This will be done by tying funding explicitly to delivery in these areas and by developing 3 year compacts with each college designed to deliver new System Performance targets, also announced by the Ministers today.

A high quality, responsive higher education system is crucial to delivering on our ambition to make Ireland’s education and training service the best in Europe by 2026. Today’s announcement ensures that our higher level institutions support innovation, are responsive to the changing needs of the economy and society.

Key changes to the funding formula being announced today include:


  • Increased money for the delivery of higher cost STEM courses.
  • Increased weighting to students who come to education at a disadvantage, emphasizing Government’s commitment to tackling educational disadvantage.
  • Life long, part-time and flexible learning opportunities to be incentivized.
  • Better alignment between the outputs of our Higher Education institutions and the skill needs of the economy.
  • The introduction of an Innovation Fund and a performance fund to reward institutions who excel in particular areas.
  • Removal of rigid 60/40 split of funds between universities and IOTs.
  • The introduction of a financial penalty for breaches of governance by institutions.
  • New funding streams for research.

Important reforms that will be prioritized in 2018 include the following: 

  • Increasing the proportion of funding that is allocated to universities (via a ‘top slice’) on the basis of research performance from 5% to 10% in 2018.
  • Establishment of a competitive Innovation Fund to support innovative proposals from institutions with potential application across the system.
  • Additional funding of €250,000 for institutions with multiple campuses (must meet certain criteria as proposed by the Review Panel).
  • Demonstrable impact of new funding on key skill gaps.
  • Consultation on a potential rewards based approach to performance funding to incentivise and reward institutions who excel in particular areas.
  • Design and introduction of a financial penalty system for serious breaches of governance.
  • Development of an online tool to clearly communicate how funding is allocated, the outcomes it generates and the ways in which it supports the range of objectives set for higher education.
  • Establishment of an Implementation Group to monitor progress and advise on particular recommendations.

Key new targets for the next 3 years include:

  • Increase by 10% the number of those aged 25-64 engaged in lifelong learning by 2020 and by 15% by 2025.
  • Increase by 25% the total number of students studying on a flexible basis.
  • All students will have the opportunity to undertake a work placement by 2025.
  • Increase engagement with enterprise by increasing spin out companies by 40% and licenses by 20%. Double overall higher education research income derived from industry to €48m.
  • Increase entry coming from disadvantaged and disability streams and ensure every DEIS school partakes in HEI led access programme.
  • Implement 2018 Higher Education Gender Equality Task Force Action Plan.
  • Expand alternate pathways by doubling apprenticeships, increasing Springboard by 30%.

The Review of the current funding allocation model (RFAM) was produced by an independent expert panel, appointed by Minister Bruton in 2016 and chaired by Ms. Bríd Horan. The Panel made 33 recommendations to reform the model by which funding is currently allocated to higher education institutions. 

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