I am particularly honoured to have been invited to give this Inaugural Lecture. The Erasmus Programme is a source of great personal satisfaction to me. There is nothing that I have done in public life that has been a cause of greater pride for me. I think that it has had practical value for the well over 2 million students who have participated. It hopefully has fostered a sense of European identity too. Ireland’s universities and students have already benefited greatly from the Erasmus Programme. Some 25,000 Irish students have spent time on the programme in other countries and 50,000 foreign students have spent time here. The potential for the further development of this programme is clear. Ireland, as an English speaking country with a well developed third level educational system, is clearly a justifiably popular destination for European students. The Sorbonne Declaration of 1988, followed by the Bologna Declaration of 1999, had the aim of convergence of Higher Education structures leading to the achievement of a European Higher Education Area by 2010. It needs to be seen in a wider context. It foresees lifelong learning as the bigger message linked to the Lisbon Strategy and the intention of providing comparable degrees based on the adoption of “common three cycles” is already the agent for massive changes (especially the rationalisation of the length of undergraduate degrees). This should greatly facilitate increasing participation in the programme. Ireland has made moves towards the three cycle structure over the past five years and is ahead of the United Kingdom, for example, in the adoption of the ECTS (European Credit Transfer and Accumulation System) credit scheme and use of the Diploma Supplement.

The future agenda of the Bologna process has interesting prospects with IT development as the basis for distance learning being of particular importance. The potential is significant and I think that there will be a successor to Bologna. Clearly there is a challenge ahead both for Ireland and Europe as a whole. It is to Ireland that I now will turn.

The Irish educational system has been a justifiable source of great pride for Irish people everywhere for a very long time. In many respects this justification has been the direct consequence of the dedication and ability of teachers through the ages combined with the commitment and enthusiasm of generations of parents who recognised the power of education to “open doors” for their children. Indeed apart from our lay teachers, our religious teaching orders not merely provided an often superior education at little or no cost at home but did so abroad also. Without any effort it is possible to find in Asia, Africa and America, both North and South, numerous public figures today who accurately attribute their success to learning from Irish priests, brothers or nuns. More recently too the relative success of our graduates in making their way in the world has reinforced our self image as being a well educated people, able to debate any issue, and able to compete anywhere.

However, we are part of a rapidly changing world where others are not standing still and emerging countries, like China and India, are entering quickly into areas which were the historic preserves of the OECD countries. I have the impression that in some quarters we have not fully embraced the comparative analysis of education standards either internally or with the external world. I must say from my preparation for this lecture, it became apparent that it would be good to have more research done to inform policy. While we have much to feel positive about, it is also clear that the reality of Irish education is perhaps less positive than many believe. I believe that it is no exaggeration to say that we are now at an inflection point in terms of deciding on future policy.

Although my presentation this evening is focussed on third level education I would like to spend some time on the system that feeds it – in other words, our second-level schools. Higher education builds on earlier levels of education, and if there is a quality problem at second level, then it places a limit on what we can achieve at the third and fourth levels.

Schooling in Ireland is under funded – as all indicators show. Perhaps even more important, it is mired in a system that has failed to challenge some obvious flaws. Our school teachers are amongst the best paid anywhere. I for one believe this to be a good thing. It should go without saying that teaching should attract and retain the right people and teachers should be held in the highest regard. The overwhelming majority of our teachers deserve this respect. However not all do. Keeping on those who are unable to adequately discharge their duties is completely unfair to the pupils. It is also unfair to their colleagues, who are damaged by their underperforming colleagues and who often have to deal with making up the ground lost by the students who have had poor teaching. It is absolutely necessary to challenge poor performance and acknowledge and deal with these problems rather than by sweeping them under the carpet. Since I last spoke on this subject there has been some debate on it and the last Minister for Education expressly recognised that there was an issue to be addressed. On the 27th March she said “is it too much to ask the (teaching) profession to put in place a mechanism to get rid of people who are under performing. The unions are the key to finding an effective way forward but clarifying that there is an issue here is not fair to all the good teachers that there are or, more importantly, to the school children”.

Many teachers recognize that more can be done and point out, with justification, that we have a high relative pupil to teacher ratio (especially in primary schools), albeit that they have dropped in recent years. But however important ratios are, teacher quality is the key determinant – improving the ratios is simply not enough. Teacher quality should be subject to assessment and currently it really is not.

But there are other problems too. For example, we have serious issues regarding teaching methods and syllabi at the secondary level. And we can have confidence that change is possible – as we have achieved significant improvements in our primary school system. We have reduced numbers studying mathematics to higher levels, limiting not only the higher education choices of the students but damaging their intellectual development along the way. Part of our problem is the failure to provide for continuing education for teachers, which is key to improving their ability to be enthusiastic and inspiring teachers. It seems to me to be bizarre that a society which sees education as key to its future success and prosperity should have an educational system where teachers receive annual increments of fixed amounts independently of the quality of the work they do. It is hardly motivating to the young, enthusiastic and committed teacher.

The Department of Education and Science is now publishing Whole School Evaluation Reports which is a valuable advance. It will of course be essential to put in place an effective follow up mechanism. We will know that the evaluation system is working when it becomes the case that parents and pupils believe that bad teachers are no longer untouchable, and that head masters and mistresses no longer throw up their hands in despair and say that they can do nothing when parents complain. Unless this change happens, it can legitimately be said that society as a whole and not just the teachers’ unions simply did not have the courage to take on the issue. This is an acid test of our resolution to actually take on difficult issues and deal with them.

The Department of Education does not permit entrance assessment of pupils. The argument presumably is that such assessments will result in those from more advantaged families being more likely to succeed in passing into certain schools whereas children from poorer families will be denied the opportunity because they are less likely to be properly prepared for the entrance examination. Although the objective may be laudable, in terms of its equality objectives, the policy is not without genuine costs. In the first instance, school children of great academic potential will not be able to receive education with their academic peers at a level appropriate to challenging them, so that many of their formative years may be wasted. Secondly, this policy may result in the growth of more schools educating the rich who can afford fees in independent schools – and we see evidence of this in the over subscription to private schools while there are empty places in non-fee-paying schools. It seems that we are confusing intellectual and social elitism. Our present system sets out to destroy any possibility of intellectual elitism, whereas we should support it while resisting absolutely the denial of participation for social reasons. In other words, if intellectual elitism is to be valued and cherished, then it should be made clear that social elitism has no place in our educational system. Would it not be much better if we had a system that would allow some schools to provide education for those particularly gifted students with inbuilt mechanisms in the selection process and scholarships that will promote opportunities for the disadvantaged?

Finally on this subject let me refer to a development in the United Kingdom that is worth serious consideration in the Irish context. This is the Academies experiment that was devised eight years ago and which focussed on areas of underperformance and disadvantage. The idea really came from the earlier experiment of 15 City Technology Colleges run on independent lines with support from business and other voluntary sector sponsors, based on an example drawn from Sweden. In addition, this experiment did require substantial state funding. 83 academies are now open with a further 160 on the way. The results last year in GCSE examinations were double those for exactly the same schools in 2001. Both PriceWaterhouse Coopers and the State Audit Office have verified the startling improvements in performance, showing that this was an experiment which really worked.

What I find incredible about looking at the British situation is that, for all its manifest problems, they have masses of comparative information on the education system which does not appear readily available here. Take the information available on St Bonaventures for example: a Catholic School in the bottom 5% of schools in terms of social deprivation of intake. In the early 1990’s 20% of its pupils achieved 5 or more good GCSE’s in any subject. By summer 2000 the figure was 62% and by 2007 that figure stood at 81%, and at 64% including English and maths. Even allowing for some grade inflation which characterises education systems today, this performance is remarkable. According to Lord Adonis, the primary author of the academy idea, the changes came from “ethos, leadership, teaching and talent”. I would also suggest that public assessment and comparison has been essential in driving the success of this model.

Coming to third level education, the government has explicitly recognized how essential this area is in its Programme for Government. Also, the National Development Plan 2007-2013 states, “that the quality of Ireland’s higher education system is vital to our social, cultural and economic wellbeing”. This is self evident but it is worth repeating. The competitiveness of the Irish economy and the employment of our people will be essentially determined by their relative capacities in a global economy. But this is about more than economic advantage. It is fundamentally about providing an adequate means to develop individual potential – with a good education system, there is no trade-off between what is in the interests of society and in the interests of the individual. And I should state unambiguously here that this recognition was not just paying lip-service to the issue. Concrete and important steps have been taken.

So where do we stand? Firstly I should recognize that we have done extremely well in achieving the numbers that are now availing of third level education. Ireland is one of the highest performers in the OECD in terms of graduate output in the higher certificate and ordinary degree level and this is no small achievement. Many others would love to boast similar statistics. Some 57% of the age cohort of school leavers go on to third level. The latest figures show that the universities, teacher training colleges, NCAD and other institutions had over 68,000 fulltime undergraduates and 16,000 graduates in 2006/7, while the IOT institutions had over 51,800 undergraduates and 1,500 postgraduates in the same year. Successive governments deserve great credit for this state of affairs as indeed does the Department of Education. The fact that I will not focus here on the successes but on the challenges does not, I hope, imply an imbalance in this lecture.

However, numbers are not everything. Looking beyond these figures we do not do so well in honours degree and post graduate numbers although this may not compare like with like. In terms of Ph.D graduation output we are ranked only 15th out of 27 OECD countries. I should however acknowledge that substantial progress has been and is being made also in this area – we have increased our PhD graduate numbers considerably in recent years but so have others so that our relative position has hardly changed at all!. There is a strategy to double Ph.D numbers and very considerable investments in R & D in the universities and institutes of technology are now being made particularly through Science Foundation Ireland. We must take care however that PhD degrees have quality controls. While many departments can deliver high-quality undergraduate programmes, not all are able to deliver high quality PhD programmes – nor should they. As we move further into this area, it is essential that we have a clear accreditation programme. In this regard I would like to welcome the progress signalled this week by the Irish Universities Quality Board. A devalued PhD would be destructive – damaging personally to individuals who have earned a genuinely high quality degree and ultimately damaging to Ireland Inc if people were not to regard our PhD standard as being of high standing.

Our low expenditure on the tertiary educational institutions is troubling as is the fact that there appears to be limited effort to devise and implement a strategy to identify and reward those colleges, faculties and individuals that are doing best. We are below the OECD average in spending and that average already reflects some very low figures elsewhere. Investment at the top level in the OECD would require us to increase our spending by 47%. To achieve parity with Finland – which has a widely admired knowledge based economy but which is only ranked number nine – would require a 23% increase in spending. So the problem is clear and the means to address it are not evident. We spend less, our academic staff-student ratios are worse than average, our facilities, though improving steadily are still well below par, and our support staff levels are much less than in competitor countries. We have increased the numbers in third level so dramatically over a short period, but without a commensurate increase in resources so that it is not surprising if we find that we cannot produce superior graduates without adequate resources.

The ranking of our universities in global tables whilst is improving reflects this situation. The Irish universities improved their relative positions in the Times Higher Rankings this year, but it is still the case that we have only one university in the top 100. Trinity College Dublin moved into the top 50 at number 49 and University College Dublin from 177 to 108. University College Cork and Dublin City University have also improved. Important though these rankings are as marketing tools both for universities themselves and graduates they do not provide decisive measurement. Indeed, one might argue that classifying complex educational institutions by a single number borders on the absurd, but nonetheless, these metrics do give us a starting point for discussion as to where we stand internationally. Behind these numbers lies the academic staff/student ratio again – our ratios are much less favourable than those pertaining in, for example, Edinburgh University or Copenhagen University – a fact recently cited by the Heads of UCD and TCD.

I should say here that the universities too have work to do – as always it is not just a matter of funding. They have to deliver top quality teaching and research and that is not always the case. Their Heads admit that the problem here is often the same as in the secondary schools – they cannot dismiss those who do not perform and all universities need to mainstream assessment of teaching quality (including by student feedback and peer review) in the open and transparent manner adopted for decades in the United States. While the US is not perfect, its standards in many of these areas are the more challenging reference point for Ireland rather than the European reference points. Supporting the anecdotal evidence cited above, a recent report by the Expert Skills Group concluded that, while on average Irish graduates are perceived by employers to compare well with their Northern and Eastern European counterparts, they are not perceived as well on maths and accounting skills.

Most importantly, those universities that are far ahead of us today in Europe are not standing still – we are in fact not chasing a fixed target, but rather a moving target that is racing ahead with great speed. Third-level institutions all over Europe are developing strategies to access even more resources and to improve their performance, although no European university can expect to come anywhere near the resource allocation available to US universities through their vast endowment funds and complex fee structures. So it is clear that this is an urgent issue. It requires courage to address it. And this in particular raises the thorny issue of fees for those that can afford them, and for other means of increasing resources, such as through higher fees being paid by non-European students who have to be attracted to come here. Ultimately the point is a simple one: either we increase spending as well as increasing efficiency or our Universities will not be able to produce the best no matter how hard they try. If the Government cannot allocate additional resources then we will have to get funding elsewhere. If you deny this – and we would all love to avoid the issue – you are forced to admit that our system will not remain fit for purpose.

The issue of fees is sometimes discussed as a matter of social equality. In fact university fees far from damaging social equality can be argued to have the opposite effect. Low income families were always exempt from fees in Ireland and should remain so but there is good reason to look at this issue not least because of the advantages that university education brings to those who avail of it. These advantages are clear. There is a much lower unemployment rate amongst graduates and the earnings premium for 30-44 year olds with tertiary level education relative to upper secondary education is 59% in Ireland. Also there is no evidence that this premium is declining with the larger numbers of Irish graduates that we are seeing in recent years. All over the world governments are recognizing this reality by devising schemes for fee paying often through the use of loan systems that ensure no reduction in the access to third level for those who come from disadvantaged parts of our society. Here, on the other hand, we appeared, until recently, paralysed in confronting the issue even though every independent analysis from the OECD, the Royal Irish Academy, the Higher Education Authority and the university heads who wrote in the Irish Times a couple of months ago have underlined that we must do so. The National Competitiveness Council too has, in a number of its annual reports suggested the introduction of graduated fees within the undergraduate cycle. I must say that I admire the current Minister for Education and Science for having the courage to raise this issue for debate but I wonder whether the person giving this lecture in one or two years’ time will be able to point to change. This is one acid test of whether we are up to the challenge of our time and we have never been great at grasping the nettle with difficult issues.

Because of our history, we need a non-party political approach to dealing with the fees questions – a type of Tallaght strategy. And there are models for this elsewhere. The US Ambassador to Ireland at a Higher Education Authority sponsored conference some years ago, addressed the question of how politicians, subject to the vagaries of an irrational electorate, can rise above the immediacy or re-election concerns to bring about radical, if unpopular, change. He provided the example of where, some years ago, politicians from all parties in the State of Virginia, grappling with the need for reform of the State educational system, agreed to set up a broadly representative body to examine the issues and make recommendations for change. All parties agreed to be bound by these recommendations. The State of Virginia was able to introduce far-reaching reforms into its educational system that would not have been possible had the proposals come from the party in power.

More generally, the fact is that we spend less than others, as a percentage of GDP, on education than the OECD average and the same applies to higher education. We also spend less per student at all levels of education and whilst GDP may be questioned as a measurement of national capacities it gives, I believe, a reasonable picture of our relative position. It is also clear that in many OECD countries, as its recent Education at a Glance report has pointed out, private spending on education increased more rapidly than public spending between 1995 and 2005. For example, Australia, Canada, Japan, Korea, the UK and the US have expanded higher education by shifting some of the financial burden to students and their families. The same is not the case in many European states and the quality of their degrees is suffering as a result. Just count their references in league tables and if this does not convince get some details of the academic staff-student ratios in some of the oldest universities in the world. They are not good and we in Ireland should not head in the same direction.

Let me refer now to the issue of what kind of third level system we need, we currently have a binary system, with the universities and the institutes of technology, and I believe that this is a great strength. The disastrous experience of many converted polytechnics in the UK establishes the perils surrounding this matter. This should not be seen as a question of status. There should be a parity of esteem in Ireland for essentially different types of institution doing different things. A problem arises when every institution is trying to do the same thing and inevitably will be judged on the same institutional basis. They should not be and again excellence should be rewarded in specific areas and should be publicly evaluated. This is how to bring recognition and esteem, not through name changes. Since they are two separate groups each needs its own reference criteria for judging excellence. If there is a single set of criteria then you engender inappropriate homogeneity.

But even within that binary system I believe that we need greater variety in the types of institutions we have – in other words a more heterogeneous system. The problem is that our current system creates incentives to homogeneity through its centralisation and funding mechanisms. We should actively avoid creating homogeneity in Irish universities with everyone doing the same thing and getting the same resources based on the numbers of undergraduates. The reality must surely be that everyone should not do everything and diversity based on excellence should be promoted and rewarded. (The Scots are working on this at the moment, with the universities collectively working to prioritise their focus.) For example perhaps we should seek directly to have just one centre or two that specialises in new key areas, for example, in say Mandarin or Oriental Studies. It is good for students to have choice of where to study, but they do not need the same menu at every institution in the country! If we go that route, we will have a limited national menu and reduce our chance of having high quality in any one area in the country.

We need to continue to develop our capacity to take decisions on issues like this and the decision to have a strategic review of higher education led by the HEA and the Department of Education and Science is very timely. This review must take a long term view – what kind of system do we want to have in twenty years? If we know what we want, then we can work incrementally to achieve that. In the process of this review, which should lead to a new White Paper, we need to refine our goals more precisely within an integrated framework. For this process to succeed, we need to get comfortable about how our education system develops excellence. Fairness is all very well, but it is nonsense to think that all universities and institutes can be world class in everything. We need to have a rational, objective basis for funding higher education, and not one based solely on numbers or geography. We have begun this process, through the Programme for Research in Third Level Institutions, but it has a long way to go, and we need to monitor its success and failure and to respond to them in the future. The standards set by Science Foundation Ireland need to be emulated across the system – it has gained enormous success and respect precisely because of its clear rigorous processes, modelled in the US National Science Foundation. In general therefore we absolutely must, at all levels build in performance and track record as key components in funding and at the same time advance diversity remembering always that things measured always improve.

Another aspect of diversity has to be creating greater flexibility to institutions in fixing individual rewards. If salaries are automatically incremented, independently of performance and salaries are rigidly kept within standard scales, then we may have problems in recruiting and retaining the academic stars who contribute to building excellence in our institutions – not just by being there but by the way in which they interact with their academic colleagues. The cost of housing in Ireland has created problems for Irish academic institutions in recruiting staff – as it has in other areas, though the private sector is better placed to deal with this challenge. The recent drop in housing costs will hopefully reduce that problem. Turning to recent announcements, it must also be said that detailed investigation, auditing and command and control by government departments, thereby reducing autonomy, may seem like a good idea at a time of budgetary crisis but it is not. It is widely acknowledged that the greater the autonomy, within generally agreed confines, of the universities the better their performance will be. This of course must be subject to the institutions meeting the standards of good governance and transparency in their use of public funds.

So, in conclusion, it seems clear to me that many parts of the educational establishment at government, agency and university levels are genuinely and courageously trying to address clear problems. The most important of these however requires government intervention. I refer again to the question of resources. Everyone knows universities are under resourced. The OECD review in 2004 told us that we need a “quantum increase”. The HEA has drawn the same conclusion. So did the Farrell Grant Sparks Consulting Group Report and the recent OECD Education at a Glance survey. So the deficiency is staring us in the face. Top up fees and loans have to be part of the answer. So too does the facilitation and advance of philanthropic funding where alumni in particular must become more engaged. The HEA report of the Working Group on Supporting Investment in Higher Education sets out the steps required in a very clear manner. But this is only a part of the solution. It must be combined with fees, efficiency, and fostering excellence through diversity. This latter point is inextricably linked to creating greater autonomy combined with greater transparency and decision making in individual institutions. As the Breugal Report on European universities clearly established giving responsibility and power to universities is clearly the better way to go.

This speech was delivered by Peter Sutherland as the Erasmus Inaugural Lecture, in City Hall Dublin