Colleges and universities will need to work closer together to deal with Brexit challenges, a Scottish Government minister has warned.

Minister for Further and Higher Education, Richard Lochhead, will host a College and University Brexit Summit in Edinburgh this week to seek solutions.

Ahead of the summit, a report from a forum of Scotland’s colleges sets out the challenges facing the sector, including an ageing population and loss of EU funding, students and staff.

The College Brexit Forum report suggests colleges could help plug forecast skills gaps from loss of EU workers but stresses the need for a funding system which enables flexibility.

The report states: “Replacing experienced and trained staff from a range of critical industries from a contracted pool of talent will present a unique test of the college sector’s ability to adapt and flex its offer in order to continue meeting the needs of individuals, communities and businesses throughout and beyond the transition process.”

It continues: “Whilst the current funding system does not prevent colleges from offering shorter courses which are linked to industry needs to help people to reskill and upskill, it does not actively incentivise this type of provision.”

The report indicates a system is needed to enable new qualifications to be designed swiftly to respond to student demand.

It continues: “Alongside this, a more flexible student support offer, which funds those who wish to retrain or upskill in key areas, could help stimulate student demand.”

Mr Lochhead said: “We know Scotland faces challenging demographics and skills gaps in the existing workforce that will be exacerbated by leaving the EU, particularly in sectors where there is a high percentage of EU nationals in the workforce.

“We have already seen how the continued uncertainty around the UK’s relationship with the EU has led to the employment of EU nationals falling in the past year.

“Addressing these challenges and maintaining our strong research and teaching links with Europe will require our colleges and universities to work closer together to shape an education landscape that can continue to re-tool today’s workforce and train tomorrow’s.

“That’s why I have called this week’s Brexit Summit, to bring Scotland’s Further and Higher Education sectors together to discuss how we respond to these additional challenges that leaving the EU would bring.”

Richard LochheadRichard Lochhead will host the summit in Edinburgh on Thursday (Danny Lawson/PA)

Shona Struthers, Colleges Scotland’s chief executive, said: “The college sector in Scotland has consistently enunciated concerns over the implications of Brexit on our society and economy, however, we also recognise that colleges’ agility and capacity to respond quickly and nimbly to difficult situations can be used to fill the anticipated skills shortages many sectors are facing.”

Scottish Funding Council chief executive Karen Watt said Brexit will test the sector, adding meetings had been held with colleges to discuss their concerns and response plans.