1 day Ago By Calum Ross
Universities have warned that a Scottish Government body risks “compounding problems” at crisis-hit institutions if it moves to recover millions of pounds of public money without giving them the “space” needed to rebuild. The Scottish Funding Council (SFC) can order universities to repay part of their Government grant for the tuition of Scottish undergraduates if they do not meet their recruitment targets. The University of the West of Scotland (UWS) is having to repay millions of pounds, and cash-strapped Dundee University also faces future “clawback” of funding after a recruitment shortfall of more than 300 Scottish students this year.
In a new submission to MSPs, the sector umbrella body, Universities Scotland (US), warned this could have “damaging” consequences in a difficult financial climate, as the body called for institutions to be given more “space” to recover. “Whilst the process of recovery/or clawback is not new, fluctuations in student demand over the last couple of years have recently made it a bigger feature of the SFC’s role,” US said. “Clawback is presently underway for institutions in this financial/academic year based on 2022/23 performance.
This coincides with a far more precarious financial situation for individual institutions, which means the consequences of clawback are now potentially far more damaging to institutional stability.” In its submission to Holyrood’s education committee, US asked for decisions on funding clawback to be “fully cognisant of the impact this has on institutional stability and avoid compounding problems”. The body said: “Institutions have been navigating a volatile environment in the post-pandemic years, with recruitment from colleges and via articulation taking a major hit in terms of student demand, and other factors beyond a university’s control.
“Where an institution has experienced a setback in this regard, the funding model needs to allow universities some space to chart a pathway back on their student recruitment rather than have the policy of the ‘recovery’ of funded numbers actually become a barrier to the institution’s ability to recover in a wider sense and play its full part in its community and regional economy, to key sectors and to Scotland as a whole.” The submission has been published ahead of a meeting of the Scottish Parliament’s education committee on Wednesday. Education Secretary Jenny Gilruth and Higher Education Minister Graeme Dey are both scheduled to give evidence on the 2025/26 Budget.
In her Budget speech, Finance Secretary Shona Robison said she was raising funding for higher education by 3.5 per cent next year. However, US quickly pointed out that more than half of the money was being redirected from existing spending.
In its submission to the committee, US said it believed “there is scope for the Cabinet to honour the wording of the Finance Secretary’s Budget statement”, suggesting the Government should increase investment by the 3.5 per cent, through provision of an additional £14.5m of funding.
The body said “a key priority behind funding decisions should be on providing financial stability for each institution - this will require careful decisions”. The sector organisation also reiterated its call for a longer-term review of the higher education funding model in Scotland. Many institutions are struggling as a result of a drop in fee-paying postgraduate international students, whom they rely on to plug the funding gap created by real terms cuts to their Scottish Government grant over many years.
US said: “The full extent of the funding pressure facing Scotland’s universities is not fully reflected in any one budget outcome. There is a decade-long pattern of erosion of public funding of universities. “The need for Scotland to take a longer-term view of the funding picture for higher education is now absolutely vital.
” Dundee University’s principal Iain Gillespie resigned last month after the scale of its financial challenges were confirmed, with the institution facing a deficit of up to £30m. The Scotsman revealed how it was facing a further blow due to the potential clawback of funds by the SFC as a result of the university recording a recruitment shortfall of just over 300 Scottish students for semester one of this academic year, against a target of around 2,400 Scottish undergraduate entrants. Meanwhile, the UWS recently published financial statements for 2023/24 highlighted a “lack of uplift on Scottish Funding Council grant income due to a provision for recovery of funds of £10.
1m has been made in light of the shortfall in the student population”. UWS is one of a number of Scottish institutions to record a deterioration in its finances in its accounts for last year, alongside St Andrews University , Glasgow University and Napier University. Meanwhile, redundancies have not been ruled out at Dundee University, Edinburgh University or Robert Gordon University.
A Scottish Government spokesperson said: “The Scottish Government recognises the significant economic and social contribution of universities, which is why we are continuing to invest over £1.1bn to support the delivery of their world-leading teaching and research. “We continue to protect free tuition, which is why we are seeing a record number of Scottish students accepted to our universities and why Scotland has the lowest student debt levels in the UK, almost three times lower than in England.
“While universities are responsible for their own strategic and operational decision making, the Scottish Government and the Scottish Funding Council will continue to support individual universities as they develop their own plans to mitigate their financial challenges.” The SFC publishes conditions relating to its final funding allocations for universities alongside each year’s announcement. It allows universities to under recruit by 3 per cent for “controlled” subjects like medicine, dentistry, nursing and teaching, and by 2 per cent for the rest.
Beyond that, SFC rules say it “will recover main teaching grant equivalent to that associated with the recruitment below the tolerance threshold”..
