Scotland's universities and colleges have called for tens of millions of pounds in additional funding as they battle to plug yawning deficits and what has been branded an “existential crisis” for the sector.
Financial pressures are so acute that six universities now anticipate having less than two months of cash reserves by the end of July next year.
Colleges are also facing severe liquidity problems, with projections that a third of institutions north of the Border will be operating with less than five days’ cash by the close of 2020-21.
According to estimates from the Scottish Funding Council (SFC), universities are on course to record an underlying operating deficit of £176.1 million in 2020-21 as public spending on teaching and research activity fails to keep up with costs.
- READ MORE: Plea for 'reliable' funding in budget
Meanwhile, projections for colleges indicate a sector deficit of £9.2m in the 2019-20 academic year.
The operational shortfall for 2020-21 is calculated to be £15.3m, which increases to £20.7m if there is no SFC funding available for transformation costs.
Calls for additional support come as the Scottish Government finalises its next budget and with institutions struggling against the combined effect of the coronavirus pandemic and Brexit.
Commenting on the latest indicators, Iain Gray, education spokesperson for Scottish Labour, told yesterday’s meeting of the Education and Skills Committee at Holyrood: “This is really an existential crisis for some parts of our tertiary education sector.”
Education Secretary John Swinney said that the focus was on ensuring the sustainability of Scotland’s further and higher education institutions.
Ahead of the budget’s publication next month, Universities Scotland has asked for an additional £205.9m to move the 19 higher education institutions which it represents into a sustainable position.
It also wants to see a package worth £56-64m to deliver new skills and innovation-focused policies which would support individuals and businesses as they recover from the economic impact of Covid-19.
And, while welcoming the provision of direct support for students in the form of hardship money, help to alleviate digital poverty and research funding of £75m, its submission to the committee said there had been no financial measures to support “the many and intense pressures on the higher education teaching grant which is heavily cross-subsidised, in normal times, from international student fees and revenue from events, conferences and accommodation”.
Alastair Sim, director at Universities Scotland, said: “We are delighted that the Cabinet Secretary shares our ambition of a sustainable higher education sector and recognises it is critical.
“That requires an investment in teaching and research in next month’s budget to help Scotland recover from the pandemic.”
Meanwhile, Colleges Scotland is asking for the Scottish Government to commit to an increase in revenue and capital investment over and above the current baseline.
This would cost an additional £71.2m in revenue and £84.5m in capital during the 2021-22 academic year.
Responding to the mounting concerns, Mr Swinney told the Education and Skills Committee: “We are working with the university sector on ensuring that there is sustainable funding in place for the future.
“That’s a clear policy priority of the government to make sure that is the case.”
He also said the Government was putting additional resources into the college sector, including the young person’s guarantee and flexible workforce development fund, “to make sure that there are the educational opportunities for students”.
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