Income Contingent Loans will not benefit the state or the student

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Today, Tuesday the 2nd of May, a technical group will brief the Oireachtas on how an income-contingent loan scheme would work in Ireland. There is clear evidence that expresses the damage these loans could do to our state, our economy, and our students. IT Carlow Students’ Union stands firmly with our colleagues in USI and the Coalition for Publicly Funded Education in calling on the government to invest in fully publicly funded education.
The higher education sector requires €1 billion investment by 2030 as the number of students at third level is due to increase by 30% by 2030. Just last month, a report by Dr. Charles James Larkin for the Technological Higher Education Association found that an income contingent loan scheme would cost around €10bn over the first 12 years. There is little sense to introducing a scheme that will cost the state ten times the amount of investment needed in the same time frame.
The loan size is suggested to be set at €16,000 which equates to €4,000 per year of study. We believe in the presentation to the Oireachtas today; the proposed repayment terms include a payment of up to €160 per month until the graduate reaches the age of 33, with some higher earning graduates repaying their loan in full by their late 20s, while lower earning graduates could still be repaying their loan in their 40s and 50s. This suggested target is unrealistic considering the reality of graduate salaries in Ireland with the average Irish graduates starting salaries amounting to €26,000 – €28,000 which is subject to change depending on location and field.
Also included in today’s presentation, is a predicted 10% non-repayment rate for these income-contingent loans, which USI and Students’ Unions around the country believe is highly optimistic. Evidence from an Institute of Fiscal Studies Report in 2016 assessed the 70% of all graduates with loans in the UK will never finish their repayments, and the remaining loans will be written off as bad debts after 30 years.  
A loan scheme such as this will have significant and long-term effects on our graduate emigration similar to that in New Zealand. This type of scheme would likely lead to increased emigration to avoid repayment which in turn would have severe consequences for our economy, not to mention the brain drain that will follow. Ireland is a popular destination for multinational corporations for many reasons, one of which is our highly educated workforce, which will most likely be negatively affected if this loan scheme is introduced.
There is clear evidence that the ICL scheme will have many negative effects on our economy and will poorly affect our students. 

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