IRELAND 23 September 2018
Special Report 75: Irish Universities Resource Management and Performance
Summary of Findings
Third level education in Ireland is provided through seven universities, 14 institutes of technology and a number of other institutions designated under the Higher Education Authority Act, 1971. This examination reviewed the arrangements for funding in universities, the progress in providing better cost information, the changes in the organisation and delivery of teaching, the outcome of quality reviews and issues relating to remuneration and pensions noted in the course of financial audit.
Funding in Universities
Up to 2006, a unit cost allocation model was used to distribute the core recurrent grant from the State. There were considerable delays in generating cost data used as part of that model. In 2006, a new grant allocation model was introduced by the Higher Education Authority. This new model ? the Recurrent Grant Allocation Model ? allocates funding based on the type and resource intensity of courses.
?742 million of the 2009 allocation of ?921 million was allocated for recurrent purposes and distributed using the grant allocation model.
The model is being introduced on a phased basis and the full redistributive effect has not yet occurred as an interim moderating mechanism, which dictates the extent of change in distribution between universities was subsequently introduced. In addition, a strategic performance funding component aimed at improving strategic management in universities has not been brought in. Continuous refinement of the model is likely for some time.
Accountability and Audit Arrangements
Under Section 39 (2) of the Universities Act 1997, I am the statutory auditor of Irish universities. Separately, the governing authorities appoint auditors to carry out a full audit of their financial statements. In order to avoid duplication, in completing my annual audit of the financial statements, I rely on the work carried out by the internally appointed auditors in the universities who complete their audits in accordance with international auditing standards.
Going forward certain adjustments are desirable to the current arrangements for the conduct of my annual audit of the financial statements. In particular, the introduction of formal arrangements between my Office and the universities which clearly set out, for example, the level of access by my Office to the working papers, reports and management letters of the externally appointed auditors. I consider that this would be best achieved by the inclusion of appropriate terms in the contracts between the universities and their external auditors.
Costing of Services
Work is underway on developing and implementing a full economic cost model designed to allocate all university costs to the primary activities of the university and produce consistent and comparable information across all universities.
However, there has been a delay in producing the first full set of economic cost data. The main reason for this is that the filling out of the Academic Activity Profile form, which allocates the pay costs of academic staff to the activities of the university, is not mandatory so not all academic staff complete it. In the absence of this data any emerging cost data is not reliable. Getting full value for investment in this new model depends on its universal deployment.
Teaching Organisation and Approaches
In recent years, universities have introduced a number of initiatives aimed at providing greater flexibility and choice to students. The initiatives undertaken include
- the adoption of the European Credit Transfer System1 (ECTS) to allow for credit accumulation and ease of transfer of students between universities in Ireland and abroad
- supporting this with modularisation and semesterisation2
- providing in certain instances for more elective modules associated with core course content.
Changes have also been implemented to improve the effectiveness of teaching and learning for students including
- the increased use of educational technologies
- alterations in teaching methods, for example, enquiry and problem-based learning, peer assisted learning and group work
- increased focus on learning outcomes
- changes to assessment methods.
There would be merit in evaluating the various initiatives in the area of teaching and learning in order to determine their potential contribution to improving learning outcomes, achieving cost-effective delivery and extending access and retention.
Reports from the first cycle of institutional quality reviews conducted during the period 2004/2005 were published in 2005.
This examination reviewed the responses of the universities to the recommendations and it noted that good progress has been made by the universities in implementing the recommendations. Details are outlined in Appendix C.
In the academic year 2007/2008 the salary costs of the universities exceeded ? 1 billion. While universities have authority to determine the number and grading of staff, the Minister for Education and Skills, with consent of the Minister for Finance, must approve the salary scales applied by each of the universities. In the case of senior staff, the Minister takes account of the recommendations of the Review Body on Higher Remuneration.
In the course of audit, a number of instances were noted where universities did not strictly adhere to the requirement for ministerial sanction. For example, in some universities the remuneration of senior staff exceeded the approved levels, unapproved allowances were paid and certain performance related bonuses were paid without the required approval.
In general, steps have been taken to cease the extra payments. However, in most instances these decisions have not had retrospective effect.
Issues that need to be clarified include
- the definition of total remuneration and, in particular, whether and to what extent recourse to trust funds is permissible.
- starting pay rules ? it was noted that new appointments were made at various points on existing salary scales above the minimum starting point in one university.
Staff in universities are permitted to engage in consultancy work provided it does not exceed a certain percentage of their working time. There would be merit in reviewing the arrangements for the monitoring, control and evaluation of this activity so as to ensure that value accrues to the university for the expenditure incurred while staff engage in this work. In particular, the value of the university remunerated time that is associated with this activity should be captured. It would also be useful if the commercial value of the consultancy were captured and the overall issue of intellectual property rights clarified.
In the public service, where certain professional or technical staff are unable to qualify for a full pension based on 40 years service by retirement age they can apply to have years added to their service for pension purposes. The situations where individuals would be unable to qualify for full pension can arise
- where a minimum number of years experience are required for appointment or
- the minimum entry age specified in a competition is over 25.
In universities, there is some doubt about the extent to which some additional payments resulting from awards of added years have become de facto entitlements of the staff.
The Attorney General has advised that in certain instances they may have become entitlements through statements made or commitments given to staff by universities. The Department has indicated that work is underway to identify all sets of circumstances where de facto entitlement exists.
With the transfer of university pension funds to the National Pensions Reserve Fund under legislation enacted in 2009, all discretions to award added years that existed prior to the transfer will continue to exist, however, they will now be exercised jointly by the Minister for Education and Skills and the Minister for Finance, pending the delegation of this function to the HEA.
- ECTS is a European Credit Transfer and Accumulation System which is used across Europe for credit transfer (student mobility) and credit accumulation (learning paths towards a degree). Credits are allocated to entire qualifications or study programmes as well as to their educational components (such as modules, course units, dissertation work, work placements and laboratory work).
- Modularisation and semesterisation involve moving from a stage-based structure (normally an academic year) to one based on modules and semesters. A module is a self-contained unit of learning with defined learning outcomes, workload and credits as defined by the ECTS. A semester is a period over which a module is delivered with most universities having two semesters per academic year.