Universities as drivers of Scotland’s recovery & future success
The Scottish Government’s 2021/22 budget is critical for Scottish HE
The level of public funding invested in teaching and research in Scotland’s universities has been unsustainable for a number of years.
The Coronavirus pandemic has both exposed and exacerbated this financial vulnerability which has been quantified as follows:
- the Scottish Funding Council (SFC) estimate that public funding of university teaching in 2018-19 was £157 million per year below the full cost of provision.
- in the same year research was funded at 80% of cost, a deficit of £340 million.
- the SFC’s latest (October 2020) estimates project that universities will record an underlying operating deficit of £176.1 million in 2020/21, that six universities will have less than 2 months of cash reserves by the end of the year and that the rate of borrowing will have increased to £1.735 billion, almost triple the level in 2014/15.
The Scottish Government’s budget for 2021/22 will be of critical importance to supporting institutions through what the Scottish Funding Councils has called the “emergency years” of 2020-2022. As a nation, Scotland faces a really challenging few years ahead as we work to recover from the social, cultural and economic impact of the pandemic. Universities’ aspire to be a strong partner in that recovery and that commitment to helping Scotland rebuild is unconditional. Universities can support:
- economic progress and prosperity through our development of the people and ideas to drive productivity and growth (set out further in Biggar Economics’ analysis paper: ‘Universities in advanced economies’).
- inclusion through engagement with our communities and our committed work to open higher education to people from disadvantaged backgrounds.
- resilience through the development of people with the ability to succeed in multiple careers and adapt to changed economic circumstances, and through the agility of our response to the crisis and recovery.
- sustainability through research, innovation, education, and the transformation of our own operations towards net-zero carbon.
How far we can deliver on that commitment depends on decisions by the Scottish Government in this budget.
Our ask of the Scottish Government
Universities ask for an additional £205.9 million to move universities into a sustainable funding position and a further £56-64 million to deliver new skills and innovation focused policies to support Scotland’s people and businesses recover from the economic impact of the pandemic.
Our universities in the time of COVID
Since the pandemic hit, the Scottish Government has responded with welcome support targeted directly at students in the form of hardship funding and support to alleviate digital poverty, and research funding of £75 million. There has been no funding 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.
- We are asking for £205.9 million to move universities into a sustainable funding position.
- A further £56-64 million to deliver new skills and innovation as a result of the pandemic.
- The SFC estimate that public funding of university teaching in 2018-19 was £157 million per year below the full cost of provision.