Funding the Future - An annual options paper on the cost of higher education 2025

This year’s Budget will represent the first of five Budgets of this government’s term. Over this period, the Minister for Further and Higher Education, Research, Innovation and Science is committed to progressively and cumulatively meeting the dual objectives of:

• addressing cost as a barrier to participation in further and higher education for under-represented and disadvantaged learners; and
• reducing the cost of education for families across the country

This paper presents a range of evidence-based policy options to inform decision making for Budget 2026 in respect of reducing the cost of education.

While this paper is focussed solely on options to reduce the cost of education it is important to consider that, in addition to addressing the cost of education, funding will also be necessary to enhance the quality and international standing of our educational institutions, improve the learner experience and to drive high quality research to enhance the resilience of our economy and meet the skills needs of employers.

In any given year, therefore, making progress towards these goals will involve challenging decisions and balancing competing demands.

Options are intended to identify costs and potential impacts of measures, and the paper is published without prejudice to eventual government decisions. It is intended to stimulate public discussion on the choices which are available to support learners and families, and to better understand the trade-offs and opportunity costs involved.

Financial supports such as the Free Fees scheme and SUSI student grant scheme are critical to supporting learners. The 2022 review of the Student Grant Scheme (administered by SUSI) made clear that “a large majority of [students] report that they would have been unlikely to have pursued their studies without [the SUSI scheme]”. It is important, however, that such schemes evolve to take account of changing costs of living and ways of learning.

Each of the options outlined in this paper have merit and would support learners in some way. However, each measure also has a cost: the full implementation cost of individual measures ranges from hundreds of thousands of euros for very targeted changes to hundreds of millions of euros, very significantly in excess of what would be available to the department in an annual Budget.

In comparing different options, this paper is intended as a tool to consider the impact of different measures but also to consider opportunity costs. This means asking “If this measure is prioritised, what will it not be possible to progress at this point?” For example, if the government decides to invest more in student grants, the opportunity cost might be that there is less funding available to reduce costs for apprentices.

The unavailability of once-off cost of living supports will mean all measures will need to be funded from permanent recurrent measures in the expenditure base. Temporary cost of living supports have been used over the past number of years to support learners and families with reductions to the student contribution, but also to support some of the most disadvantaged learners through the Student Assistance Fund (SAF). As an example, this means to maintain the SAF at current levels on a sustainable basis in future years would require a core allocation of c. €9 million to be funded from recurrent expenditure, which would impact the adoption of other new measures.

With this in mind, the Minister will be guided by five policy principles in his consideration of budgetary measures over the coming years, subject to availability of resources:

• measures specifically referenced in the Programme for Government commitments, including those related to reduction of the student contribution and increases in the maintenance grant, will be progressively implemented over the term of the government
• critical measures which support student wellbeing of disadvantaged learners, and which were previously supported through cost-of-living packages, will be prioritised with sustainable core funding
• further measures will be considered on the basis that they are sustainable, equitable and targeted at those who most need them, including to advance the government’s focus on reducing child poverty and supporting access to student accommodation
• supports should be structured to ensure that work pays for families and learners
• student supports should evolve to take account of changing costs for learners, and changing ways in which education is delivered, such as part-time and tertiary degrees

Estimate costings in this paper are provided for each individual option, however, should two or more options be actioned, this may lead to an increase in demand and accordingly costs. Where changes to the Student Grant Scheme are costed, these do not include operational costs. An overview of the Student Grant Scheme and data used for costings is provided at Appendix 1. A summary of costings is included in Section 1, however, this should be read in conjunction with the main commentary for assumptions.

Options were informed by extensive stakeholder engagement, including a public consultation held earlier this year, and reflect the diverse needs of learners, families, and institutions. An in-person Stakeholder Event was held on 3 April 2025 in Croke Park where approximately 120 people attended. Attendees included students, representatives of the student population, access officers, student services employees, people who work with students on a day-to-day basis and organisations who advocate for underrepresented students in education. Feedback from the event is provided in Appendix 2.