IF IRISH society has changed enormously over the last 15 or so years, its universities have changed more so, says Michael McGrath, who was recently appointed director of the Conference of Heads of Irish Universities (CHIU).

The universities, while they have long played a significant role in the cultural and social development of the country, now also play a pivotal role in its economic development, he says.

"We have become a knowledge-based society. Knowledge is the key to economic success and the universities are the powerhouses of that knowledge," he says.

The universities have left their ivory towers and "have moved centre stage to produce highly-skilled graduates to supply the knowledge-based industries that are pushing the economy forward... When you talk to the multinationals and ask them what attracts them to Ireland, apart from the tax breaks, they always highlight the availability of a highly educated workforce."

McGrath is the first full-time director to be appointed by the CHIU. The conference represents the collective voice of the heads of the state's seven universities - UCD, UCG, UCC, TCD, UL, DCU and St Patrick's College, Maynooth.

CHIU's mission includes the development of common positions on higher education policy issues and the dissemination of its views to policy makers, a wide range of interest groups and to the general public. The current focus of the heads of the universities is the Universities Bill.

The issues that face Irish universities at the end of the twentieth century are far from being unique to Ireland, McGrath says. "They are universal... The relationship between the State and the universities, the funding of the universities by the State and the balance of accountability and the right to academic freedom within the universities are issues that are faced by most universities throughout the world."

Since the abolition of undergraduate fees, the universities are more dependent on the Government than ever before. "The universities would be fearful of a situation similar to that in local government developing. Local authorities are disadvantaged by the fact that all their funding bar water charges and commercial rates now comes from central government," McGrath says.

In recent years though, the universities have been totally preoccupied with coping with the unprecedented growth in student numbers that has taken place over the last decade and with the changing natures of both degree programmes and other university activities, McGrath says.

"Very few people realise how much the universities have changed over the last 15 or so years - undergraduate numbers have more than doubled, while those of post-graduates have nearly trebled."

Meanwhile there has also been a huge increase in the amount of research and development undertaken by the universities.

The universities are involved in up to 2,500 research contracts at any one time and have spawned over 150 campus companies.

"In 1994 it was estimated that 3,500 high quality jobs had been created in the sector," says McGrath. The universities earn a total of £50 million each year in R&D. "As a group we earn more in R&D contracts from the EU than all the British universities."

But if it all sounds rosy, the fact remains that the universities are strapped for accommodation and cash. Government investment in university R&D is way below the EU average. The sector receives an annual equipment grant of £2 million from the HEA. This year however, it has received nothing because of a lack of funds.

But the amount - even when it's forthcoming - is negligible when you consider that four or five years ago UCC had to spend £10 million to reinstate one high-tech laboratory after a fire in the National Microelectronics Research Centre, McGrath points out.

"How can we maintain a world presence in R&D unless our students can work with leading-edge equipment," he asks, adding that a figure of £20 million has been recommended for the upgrading of university R&D equipment.

MEANWHILE, the Report of the Science, Technology and Innovation Advisory Council (STIAC) recommends that basic research funding should rise from the present £1.5 million to £6 million annually.

The fact that the universities receive so little State funding for research means that they are largely dependent on the corporate sector and on the multinationals in particular, and that the content and extent of the research is outside university control.

The widespread belief that the universities are well-funded compared with primary and post-primary levels is a misconception, McGrath says.

"People have a view that the universities are running away with money. The universities receive a total of £227 million, including fees from post-graduates and foreign students, while FAS for example, receives an annual £430 million.

The OECD's 1993 report Education at a Glance shows that expenditure per student in Ireland is above the OECD average. However, McGrath says while in Ireland it takes a student an average of four years to complete a degree programme, in Italy or Spain it can take 14 or 15 years.

"It is more valid to compare costs per graduate and if you do so, you find that Irish graduates cost the State far less than the OECD average," McGrath points out.