Scottish budget a ‘real-terms cut’ despite HE funding pledge

Scottish universities are set to suffer a real-terms cut in their overall budget despite being promised an extra 3.5 per cent in funding by Holyrood.

Unveiling her latest draft budget on 4 December, the Scottish finance secretary, Shona Robison, pledged to increase total investment in higher education in the country, while retaining its free tuition policy.

“We know that colleges, universities and the wider skills system make absolutely crucial contributions to economic growth, which is why in this coming year we will invest over £2 billion supporting them,” she told members of the Scottish parliament.

“We have listened to universities and are conscious that they must remain financially competitive with institutions in the rest of the UK,” she added.

“The UK government increased student fees to pay for a 3.08 per cent increase in university funding in England.

“Here, not only will we keep tuition free but we will increase total investment in higher education by 3.5 per cent.”

The increased investment was expected to primarily come from money being redirected from Covid-era student places.

An additional 2,500 funded places were created during the pandemic owing to school-leavers receiving higher than expected teacher-assessed grades after exams were cancelled.

Given the last of the students affected will graduate next year, these places can now be removed, freeing up £14 million.

Universities Scotland said if all this money was redirected to teaching resources, combined with new investment of £12.9 million, a 3.5 per cent increase in spend per Scottish student place was possible.

But, said director Claire McPherson, the overall resource budget for universities was not rising by 3.5 per cent. “Today’s outcome represents a 0.7 per cent real-terms cut in HE resource,” she added.

Prior to the budget, Scottish universities had upped their ask from the Holyrood government in light of UK-wide rises in employer national insurance contributions, which were expected to cost the sector £45 million in the financial year 2025-26.

This hike came after years of stagnating funding for institutions, and several have been forced to cut jobs and courses in response, with declining numbers of international students also having an impact.

Ms McPherson said the budget did not provide enough money to cover the tax rise and the “funding pressures run much deeper than that”.

“The last decade of public funding decisions has left the sector in a precarious state with no scope to insulate our students or staff from these pressures any longer,” she added.

“It’s an immensely difficult place for the sector to be in. Universities are an integral part of Scotland’s future, but a weakened university sector will put the Scottish government’s ambitions at risk.”

Mary Senior, the Scotland official at the University and College Union, said any new money coming to universities was “welcome, but this falls short of what is needed at a time when higher education funding is under unprecedented strain”. 

“Ministers are happy to take the credit for the successes of our universities, and for popular policies like free tuition, but they need to back that up by funding the sector properly,” she said.

“Ultimately, this is another disappointing budget, on the back of many others and is likely to increase the pressure on jobs.”

The budget still needs to be approved by the parliament, with a vote expected in February. Given that it does not hold a majority, the ruling Scottish National Party will be reliant on support from other parties.

tom.williams@timeshighereducation.com