Responding to the Scottish Government’s settlement for university resource and capital budgets for 2025/26, Claire McPherson, Director of Universities Scotland has said:
“The Scottish Government has responded to the sector’s request to re-direct £14million of existing spend, from covid-era student places, to increase the amount which can be spent on each student place. We welcome that. When combined with new investment of £12.9 million, this could mean a 3.5% increase in the investment made in each Scottish student. However, the overall resource budget for universities is not rising by 3.5%. Today’s outcome represents a 0.7% real terms cut in HE resource.
“The backdrop to today’s budget is significantly rising costs and job losses at several institutions. Universities won’t have enough resource to cover increases to national insurance, but our 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. 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.”
“We welcome the 3% cash increase in university capital. This supports university research and innovation and is the second year in a row the Scottish Government has protected this budget in cash terms, as part of driving purposeful economic growth.”
Notes:
- The increased cost of the employers’ national insurance is estimated to cost the sector upwards of £45m in FY 2025/26. After the cash increase to the HE resource budget, universities will still need to find over £32 million to stand still.
- During the pandemic, the Scottish Government increased the number of funded places at university to avoid disadvantage to school-leavers in light of higher than anticipated SQA grades. Those students are now graduating so there is scope to remove 2,500 funded places in academic year 2025/26. The withdrawal of these places is supported by the sector if that money is redirected into the spend per student, which is the basis of today’s announcement.
- A 3.5% increase in the spend per Scottish student place is possible if the full £14 million redirect from covid-era “SQA places” is spent on the unit of teaching resource. We expect to see this direction outlined in the Letter of Guidance from the Scottish Government to the Funding Council in the coming weeks.