Opinion: Iain Macwhirter: Our universities will learn that they’re not too big to fail

Actually, that figure of £500 million is on the optimistic side. Reform Scotland estimates that Scotland’s universities are in the hole for around £1bn, more than a quarter of their annual income. Vice-chancellors are said to be trying to downplay the truth of their finances so as not to frighten the politicians. Unlike big American universities, Scottish academic institutions do not have wealthy endowments to fall back on.

This Covid crisis could not come at a worse time. University bosses have been awarding themselves telephone salaries. The Office for National Statistics said recently that half of Scottish graduates are working in jobs that do not require university degrees. Josephine Public just hears stories of students and staff stamping out freedom of speech and ostracising academics who still think biological sex exists.

This is unfair, of course. Universities do a lot of valuable research, as the Covid-19 crisis has confirmed. But Scotland’s universities have done a poor job in recent years of demonstrating their relevance. As a former Rector of Edinburgh University, I am only too aware of how insular many academics have become.

But that experience also made clear to me just how valuable our universities are. Higher education is one of the few things Scotland still does very well. We have at least five world-class universities that produce some of the best academic research in the world. Scotland’s 19 universities are an £11 billion chunk of the Scottish economy and employ 140,000 people.

But St Andrews University says it is facing a £25m black hole. At least six others are running out of cash. This comes at a time when all sectors of the economy are requiring bail-outs at the same time. The Treasury is spending hundreds of billions on replacing lost incomes and trying to save small businesses.

Westminster has told the universities that they’re on their own. The Scottish Government is trying to put together a package of support, but it faces an unprecedented funding crisis of its own, post-pandemic. Tax revenues are shredded, public services are impoverished following a decade of austerity, the Barnett Formula is being squeezed. Are universities going to be saved at the expense of social care, hospitals or schools?

Universities are clearly better able to cope than primary and secondary schools with social distancing. The Open University showed the way to distance learning half a century ago, and universities have managed to move relatively seamlessly to internet learning during the current crisis.

Truth be told, there’s not much formal teaching going on in humanities departments at the best of times. A handful of lectures and seminars a week is all the actual contact time that many students receive. Students do most of their work in libraries, and while that is problem right now, it should be possible to put a lot of course material online very soon.

There is of course a lot more to universities than lectures. Higher learning is a collective activity, and there is no substitute for face-to-face encounters with leading academics. Isolation was a problem for students before coronavirus came a long, and now it threatens to seriously damage their mental health.

Anyway, putting lectures online isn’t going to address the funding crisis. Staff still have to be paid and science and medical degrees are very costly because of the advanced equipment they need. Teaching is a relatively small part of a modern university’s work. Over the last couple of decades, they’ve have been judged largely on their research.

So what is to be done? Most vice-chancellors opposed the abolition of tuition fees, and there are many who believe free higher education is now a luxury Scotland cannot afford. But restoration is not on the cards for two reasons.

Free tuition is one of the SNP’s signature policies and helped it win the 2011 landslide. More importantly, fees would not stave off the financial crisis. Students don’t start paying fees until they graduate, and only then when they are earning over £25,000. The universities need cash now, not in four or five years.

There will likely be mergers, redundancies, the loss of some departments. Universities specialising in what they do best rather than offering the whole nine yards. They’ve been doing this anyway over the past few years. Many temporary staff will be quietly sacked.

Eventually someone is going to ask if a small country like Scotland can justify 19 universities, twice as many as comparable countries like Denmark and Norway. Moreover, it has become increasingly clear that the higher education sector in Scotland has neglected vocational education.

Germany, which has demonstrated its strengths during the Covid crisis, doesn’t generally rate elite higher education. It focuses much more on jobs-led science and technical colleges and has a much more diverse and less centralised educational landscape. It has also phased out tuition fees

But whatever happens, it seems likely that universities will lose much of their autonomy as a consequence of whatever bailout is arranged. The Scottish Government will want assurances on equal access for less-well-off students, more courses that lead to proper jobs and the retention of graduates in Scotland. Many leave Scotland as soon as they graduate because the pay is better in the south or abroad.

In recent years, universities have liked to style themselves as private companies, even calling vice-chancellors “CEOs”. They’ve been paying themselves private sector salaries too. Well, they are about to discover that, unlike the banks, they are not too big to fail.

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