Universities warned not to expect bailout as extra places are created for students
SCOTLAND’S Universities Minister has warned he doesn’t have the cash needed to bail out the sector and has instead suggested institutions will need to empty their reserves to stay afloat and also rely on support from Westminster.
Richard Lochhead gave the warning to MSPS as he confirmed that Scottish universities will receive up to 3,000 extra students as a result of the school exam grades fiasco.
Mr Lochhead told Holyrood’s education committee that in order to stop applicants from being “crowded out” following a U-turn by his government leading to pupils’ results reverting back to teacher estimated grades, between 2,000 and 3,000 additional places will be needed at universities.
MSPS heard that estimated costs for the extra places are between £16 million and £24 million but Universities Scotland have welcomed the move.
Mr Lochhead told MSPS that projected deficits by Scottish universities in this academic year have fallen from an initial £651 million to £191 million – but that is reliant on overseas students who have agreed places at institutions actually turning up for their studies.
Mr Lochhead said UCAS figures showed there was an overall five per cent increase of places being accepted by overseas students at Scottish universities but warned the situation was complex.
He stressed there is a “difference between acceptance of places and who actually arrives to take up their place at university”.
He added: “Some international students are not due to come until January. Others may take a decision that they may not come for various reasons.
“Literally, until we get nearer the time, the universities don’t know the exact numbers.
“The Scottish Funding Council has said that the latest forecast for the deficit for the coming academic year for universities is now £191 million. That’s down from an initial £651 million.
“That’s a much healthier place – still challenging, but it does give an indication that the international situation is improving.”
Labour MSP Daniel Johnson asked Mr Lochhead about the remaining funding gap of at least £191 million.
He said: “There is at least the possibility there could be a £200 million shortfall, indeed it could be greater than that.
“Are you saying the Scottish Government has made no contingency funding available and that it would be wholly reliant on the UK Government stepping in to provide all of that figure?
“Is there any contingency planning going in in terms of making funds available?”
Mr Lochhead said that “universities will have a reasonable amount of ability to work their way through” the £191 million.
He added: “We will look for maximum support from the UK Government if we do find ourselves in that position and it does have an impact in the operations of universities.
“A lot of our universities have significant reserves and we would have to manage our way through that as best as possible.
“I do not have £191 million.”
Scottish Conservative education spokesperson Jamie Greene highlighted a submission from Universities Scotland which discussed long-term funding challenges.
The university umbrella group said the extra places “further exacerbate the funding problem in higher education as every Scottish and Eu-domiciled student is under-funded by £700 in real terms relative to 2014/15 levels”.
The Universities Minister said the Scottish Funding Council would conduct a “major review” of further and higher education funding to look at the issues.
Universities Scotland has warned that “if we do see a fall in international
Freshers’ week may be more of an online experience this time around
student numbers, as expected, the financial impact on the sector will make a very difficult situation worse”.
In its latest submission to MSPS, Universities Scotland said: “Only circa 60 per cent of international undergraduate students apply via
UCAS and it does not capture postgraduates, who represent the majority of international students.
“This year, data on international placed applicants is no guarantee of the ability of international students’ intent to enrol or ability to travel to get here.”
It added: “The potential loss of international student fees for academic year 2020/21 was the single biggest factor influencing the serious financial situation facing universities as a result of the pandemic.
“As a sector, this remains a major concern.”
Mr Lochhead also told the committee that students’ experiences of freshers’ week would be different this year due to the Covid-19 restrictions.
He said: “Freshers’ week may be more of an online experience this time around and more of a sober affair than the usual jam-packed freshers’ fairs when you first arrive at college or university.”