The Potential of Philanthropy to Support Irish Higher Education

I still recall the international symposium held in Dublin on a growing crisis in Irish higher education which I attended in the end of September 2014. One of the many interesting presentations I enjoyed listening to was given by Ms Liesl Eler, Director of Development at Oxford University, who talked about the potential of philanthropy to support higher education sustainability.

Besides from sharing the successful story of Oxford University, Eler showed a comparison of fundraising results for UK universities in 2012/13 sorted by age of university, with the conventional wisdom thinking that the older a university is the larger the number of its alumni could be.

Table 1: Fundraising results for UK universities, 2012-13

Oxbridge Pre-1960 1960s 1990s
New funds secured (£000s) 178,349 6,142 2,113 639
Addressable alumni 208,928 105,968 93,895 77,429
All donors 40,155 2,763 1,583 208
Fundraising spend (£000s) 12,368 981 540 184
Number of fundraising staff 150 16 9 3
Cost per pound raised £0.07 £0.21 £0.33 £0.48
Note: All figures refer to medians for the group.

Source: Ross-CASE Survey 2012-13.

Copied from Elder’s presentation, Table 1 explains why philanthropy is much more successful in Oxford University than in the others. Obviously, Oxford University, as well as Cambridge University, invest heavily in fundraising through capital investment and human resource. On average, the two universities employed 150 fundraising staff in 2012-13, while the number for the rest pre-1960 institutions was only 16. Furthermore, Oxbridge seems to have a more efficient operation in terms of fundraising, costing just 7 pence to raise 1 pound, about one seventh of the cost of the 1990s institutions.

I have been wondering about the situation in Irish higher education, but did not have much time to look into the topic deeper. A few days ago, I came across a good paper – The Role of Philanthropy in Funding Irish Universities – written by Dennis O’Connor and Ruth Millar in 2012.

Table 2: Philanthropic income among universities in terms of GDP, per capita and per student

Ireland all third level UK all third level UK Oxbridge US all third level US research & doctorate level institutions
Total philanthropic donations €50m €856m €329m €23.1bn €15bn
As a % of GDP 0.03% 0.05% 0.20%
Per capita €11.14 €13.67 €74.14
Per student €258 €342 €8,226 €2,300 €3,075

Source: O’Connor and Millar (2012).

The authors, in Table 1, compared the level of philanthropic income among HEIs on a GDP, per capita and per student basis, and showed that Ireland lags far behind both the UK and the US. Whilst current Irish third level philanthropic income is comparable with the UK in terms of its share of GDP, it lags considerably when benchmarked based on all the other measures.

It was found by the authors that the information regarding philanthropic income in Ireland is, to a large extent, unavailable with one or two notable exceptions, which led the authors to argue that the amounts receivable are insignificant relevant to other forms of income. In the concluding section, the paper sets out the targets for each university if the sector in Ireland would like to catch up with the levels of Oxbridge, the UK, the US, and US research & doctorate level institutions based on per student basis.

Table 3: Targets for each university based on Oxbridge, the UK, US and US research & doctorate

UK Per Student Oxbridge Per Student US Per Student US R&D Per Student
UCD €8.5m €205m €57.3m €76.6m
UCC €6.5m €155m €43.3m €57.9m
TCD €5.7m €138m €38.5m €51.5m
DCU €3.8m €91.5m €25.6m €34.2m
NUIG €5.8m €92m €39.1m €52.3m
UL €3.4m €82.7m €23m €30.1m
NUIM €2.8m €69m €19m €25.8m

Source: O’Connor and Millar (2012).

The sub-totals of the targets under any column are considerably larger than the current level of the philanthropic income received by Irish third level institutions (which include both universities and institutes and technology). Although without the exact numbers for each individual institution, it suffices to say that if Irish HEIs seek to expand philanthropic income they need to consider it as a long-term strategy, have strong commitment from the board, and be prepared for the great challenges ahead.

Education at a Glance 2015: Ireland

Last week, the Organisation for Economic Cooperation and Development (OECD) published data on educational attainment and employment rates, in an interim update of its annual Education at a Glance publication. The report presents data on three major topics: education attainment, labour market outcomes, and the transition from school to work. In this blogpost, we focus on the performance of Ireland and compare it with the OECD average.

Table 1: Trends in educational attainment and average annual growth rate, 2000-13, %

Educational attainment 25-64 year-olds
2000 (%) 2013 (%) Average annual growth rate 2000-13 (%)
Ireland Below upper secondary 40 20 -5.1
Upper secondary or post-secondary non-tertiary 38 34 -0.7
Tertiary 22 45 5.8
OECD average Below upper secondary 37 24 -3.3
Upper secondary or post-secondary non-tertiary 42 42 0
Tertiary 21 35 3.9

Source: OECD (2015).

Table 1 shows the trends in education attainment in Ireland and OECD countries as a whole. In 2000, Ireland fell behind the OECD average in terms of the share of adults attaining at least upper secondary education. This situation was reversed in 2013 as only 20% of adults in Ireland had low qualifications in that year, while the number was 24% for the OECD as a whole. To a large extent, the change has been driven by the improvements at the other end of the education spectrum. In 2013, about 45% of adults in Ireland attained a tertiary qualification, compared to 22% in 2000. In terms of the share of adults attaining a tertiary qualification, Ireland shows an average annual growth rate of 5.8% during the period, much higher than the OECD average (3.9%).

Table 2: Trends in unemployment rate by educational attainment and average annual growth rate, 2000-13, %

Educational attainment 25-64 year-olds
2000 (%) 2013 (%) Average annual growth rate 2000-13 (%)
Ireland Below upper secondary 7.1 20.3 8.4
Upper secondary or post-secondary non-tertiary 2.6 14 14
Tertiary 1.6 6.7 11.6
OECD average Below upper secondary 9.4 13.7 3
Upper secondary or post-secondary non-tertiary 5.9 8 2.4
Tertiary 3.5 5.3 3.3

Source: OECD (2015).

Table 2 compares the unemployment rates by educational attainment between Ireland and OECD countries. A few trends emerge from the table. Firstly, it is clear that people with higher qualification have lower risk of being unemployed. Across OECD countries, unemployment rates in 2013 were 13.7% for people with qualification below upper secondary education, 8% for individuals with upper secondary or post-secondary non-tertiary education and just 5.3% for those with tertiary education. Secondly, for any educational attainment, Ireland had higher unemployment rates than the OECD average in 2013, showing a more challenging job market in Ireland after the 2008 financial crisis than many other OECD countries. Lastly, whilst unemployment rates have increased in both Ireland and OECD countries during the period, Ireland has shown a much larger scale of problem than its OECD counterparts. Partly, it could be due to the fact that until the early 2000s, Ireland had been enjoying the so-called Celtic Tiger period, when the economy of the country was growing at a much higher level than more recently.

There have seen many analyses looking at the difficulty faced by young people when they try to make the transition from school to work during recessionary periods, as those with more work experience are favoured over new entrants into the labour market. The OECD report argues that the proportion of young people neither in employment nor in education or training (NEET) is a better measure of the difficulties young people are facing when they are searching for a job, as it includes not only those who do not manage to find a job (unemployed) but also those who do not actively seek employment (inactive). Furthermore, the OECD suggests that the most important ages to look into when analysing the NEET population are 20-24 year-olds, as at this stage compulsory education will not affect the proportion of inactive or unemployed.

Table 3: Percentage of 20-24 year-olds neither in employment nor in education or training (NEET), 2013, %

NEET (%)
Luxembourg 8.2
Iceland 9.4
Netherlands 9.5
Switzerland 10.2
Germany 10.3
Austria 10.6
Norway 10.9
Sweden 12.9
Denmark 13.4
Slovenia 13.7
Australia 13.9
Canada 13.9
Czech Republic 14.2
Finland 15.5
New Zealand 15.6
Estonia 16.8
Israel 18.1
OECD average 18.2
Belgium 18.7
United States 18.8
United Kingdom 19.1
France 19.4
Poland 20.2
Slovak Republic 21
Ireland 22
Portugal 22
Korea 22.5
Mexico 25.2
Hungary 26.1
Spain 32.4
Greece 33.1
Italy 33.7
Turkey 35.9

Source: OECD (2015).

In 2013, about 22% of the 20-24 year-olds were NEET in Ireland, higher than 18.2% in OECD countries (Table 3). There are only seven countries in the OECD showing higher proportion of NEET than Ireland, namely Korea, Mexico, Hungary, Spain, Greece, Italy and Turkey, with the latter four were the only countries where more than 30% of the 20-24 year-olds were NEET.

In general, Ireland has seen significant increases in the educational attainment of its population, however it needs to do more to ensure more people could enter the labour market. In early 2012, the Irish government launched the Action Plan for Jobs (APJ) with the aim of creating the conditions to support private sector-led, export-oriented economic growth and job creation. It would be interesting to review the progress of the labour market since the introduction of the Plan.