Higher Education Funding

– in the Scottish Parliament on 16th March 2011.

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Photo of Alex Fergusson Alex Fergusson None

Good afternoon. The first item of business this afternoon is a statement by Michael Russell on higher education funding. The cabinet secretary will take questions at the end of his statement; therefore there should be no interruptions or interventions during the 10-minute statement.

Photo of Michael Russell Michael Russell Scottish National Party

In December, I launched the higher education green paper, “Building a Smarter Future”. The debate that followed has attracted interest from almost 2,000 people; however, it was simply a staging post in a longer process. I would like to thank everyone who has taken part since we began our discussions on the sustainable long-term future of higher education at the National Union of Students Scotland conference last March. The input and participation of more than 80 organisations have fully justified our approach. Contributions have been both thoughtful and radical.

By any measure, this has been a comprehensive examination of the issues. Rather than merely reviewing the challenges, we have been working with the sector to tackle them. This is action, not words. So today I set out my intentions for how this Government will respond to those challenges if successfully returned in May.

When I began this process, my aim was to find a uniquely Scottish solution that embraces Scotland’s best traditions as a learning nation. It must also sit with our proud history of the democratic intellect, which has underpinned the global success of this sector for centuries. The foundations for the future must be built on four key principles: excellence, inclusiveness, collaboration and investment—investment for the benefit of society as well as the economy. The overarching philosophy remains that education must be based on ability, not ability to pay.

The tradition of free education in Scotland has, of course, been under threat from successive decisions taken in London over the past 15 years. The Labour Government began the move to shift responsibility for funding universities from the state to the student by introducing fees. The Conservative and Liberal Democrat coalition at Westminster embraced that approach and has taken it further.

This year, we in Scotland will invest a record £1.1 billion in our university and college sector. Over the past few months, we have worked closely with Universities Scotland to establish what level of investment might be required to keep the sector competitive in future. I can confirm today that this Government—if returned—will ensure that the gap required to maintain our competitive position within the United Kingdom is closed. And I can confirm that we will not introduce tuition fees, up front or backdoor, or any form of graduate contribution.

I want to turn now to how we will fill the gap. As I have often said, there is no silver bullet, so instead we will fill any gap through a number of initiatives. The first of those is what we charge students from the rest of the UK. In an ideal world, no student attending a Scottish university would pay fees. However, the rest of the UK has fees, and its politicians have the right to make that choice. My main priority is to protect opportunities for Scottish students to study at Scottish institutions. I make no apologies for that.

It has been said by some that increasing fees for students coming from elsewhere in the UK is a move to subsidise Scottish education. It is not. Those students are already required by their home nations to contribute to the costs of their higher education. We are simply putting in place a mechanism in Scotland that allows such policies to be implemented irrespective of where people study. That is the reality of devolution.

The technical working group that I established with Universities Scotland did, however, identify up to £62 million in additional income from students from the rest of the UK. So I can today confirm that we will increase fees paid by students from the rest of the UK. We will announce the detail in due course.

I have long had concerns about the subsidy that we pay for European Union students. The numbers have almost doubled over the past decade—the cost to the Scottish taxpayer stands at £75 million. So I also intend to explore further, within the boundaries of European law, the possibility of reducing that. The respected economists Jim and Margaret Cuthbert have highlighted the system that operates in Ireland, where a student service charge is levelled on all undergraduates—though the Irish Government offers means-tested support to Irish students to cover the costs. I believe that we should investigate that, and any similar schemes elsewhere, in more detail. In doing so, I make it clear that we would support such an arrangement only if we could pay the charge for all Scottish students. If a scheme similar to the one that we understand operates in Ireland were possible, it could generate up to £22 million.

We will be looking to universities to make significant, sustained and measurable progress in a number of areas, including philanthropic giving, increased engagement with business, greater efficiencies and more shared services. Those measures could close the gap further still. Universities have accepted that, by applying the same efficiency levels as the public sector, they can achieve savings of £26 million next year. It is true that universities elsewhere will also be pursuing efficiencies, but we expect Scottish institutions to pursue theirs aggressively.

My analysis of the technical working group’s figures suggests that a net funding gap of about £93 million could emerge with the rest of the UK in 2014-15. If we take into account the additional measures on UK and—if possible—EU students, without factoring in the £26 million efficiencies, the gap could fall to about £70 million.

Let me repeat unequivocally the assurances that the First Minister has given in relation to our commitment on public funding. Any funding gap will be closed. Indeed, to quote the First Minister directly:

“The rocks will melt wi the sun before I allow tuition fees to be imposed on Scottish students—upfront or backdoor.”

Learning, teaching and access prompted almost the same level of response to the green paper as funding did. I reaffirm my commitment to our four-year degree, although we need greater flexibility in how it is delivered. Learners must have more control over their own learning, choosing whether they want to study over three, four, five or even more years. We must encourage more part-time learning and support better articulation between school, college and university. As part of that, we will continue to develop the Scottish baccalaureate, expanding it into more subject areas and promoting its use to gain advanced entry to university.

More specifically, I have asked the Scottish Further and Higher Education Funding Council to take forward a project on advanced entry and articulation. It will report this summer, with recommendations on how further to reduce the length of time that learners spend achieving a degree. It will also consider increasing the role that colleges play in delivering higher education. The conclusions of the study will underpin a new commitment to flexible access and study, and a firmer adherence to the Scottish credit and qualifications framework—the SCQF. We will legislate where necessary.

I place on record how much I have appreciated the pragmatic way in which university principals have responded to the funding pressures next year and their participation in discussions. We have learned much from each other. I want to support them in their work and to ensure that that work is supported from within their institutions.

The historic success of our sector has been built on such an exemplar of democratic intellect, and it is essential that it is protected. If returned, I intend to explore the issue of accountability, specifically the balance between accounting for public funds and preserving the benefits of an autonomous sector—and to examine that issue more fully with university principals, chairs of court, staff and students. As part of that, I will seek to remove the functions of the Privy Council in relation to the governance of Scottish institutions where we can, replacing it with a modern and transparent process.

This Government has a strong track record in improving student support. Since 2007, we have reintroduced free education, preserved the education maintenance allowance—the EMA—and increased grants by 25 per cent, but we still have more to do. Therefore, we are working closely with NUS Scotland to develop a simpler, clearer system that moves towards our ambition of a £7,000 minimum income entitlement, starting with the poorest students. We will also seek to establish a binding set of goals for access and drop-out rates.

On developing our international position, we will exploit the newly developed branding messages to promote Scottish universities. We will support collaboration across the sector through a fresh round of projects under our innovative strategic investment fund.

I intend to strengthen our partnerships with China, India and North America—specifically, I intend to sign a new memorandum of understanding with China’s ministry of education. This Government, which delivered the year of homecoming, will now promote a year of mobility to forge stronger links between Scottish academics and students across Europe and beyond.

Scotland is not just a world leader in terms of the quality of its university research; it is a world beater. Our research pooling programme is recognised globally and it is time to take it to the next level by introducing an international dimension to the best pools.

The consultation responses supported Scotland maximising the amount of research funding that is won from European sources. We are already engaged with the Commission in influencing the shape of the next framework programme. A priority will be to improve links between business and universities.

The final issue that I want to cover is how the sector is shaped to deliver that. The tripartite relationship between Government, the Scottish funding council and Universities Scotland is strong and has allowed us to deliver much—most notably a deal that will mean that student numbers are held steady next year. I confirm our commitment to the relationship, but it will evolve and I will seek reforms to streamline the SFC’s operations in future.

On our plans for colleges, I know that there is an appetite for change. Our work will take account of the thinking of all stakeholders, and learners will be at its heart. We will look at matters such as funding and outcomes, collaboration between colleges and other partners, creativity and the role of business.

The green paper covered many subjects and I have been able to touch on only a few. If we are returned, we will publish a comprehensive and conclusive set of proposals on all areas before the end of the summer and we will legislate before the end of the year. That honours the commitment that I made to the sector when it agreed to find a way to cope with the budget reductions next year.

In his inaugural speech as rector of the University of St Andrews on 19 March 1869, the historian James Anthony Froude said:

“There is no occasion to tell a Scotchman to value education ... It is fair all round to poor and rich alike. You have broken down, or you never permitted to rise, the enormous barrier of expense which makes the highest education in England a privilege of the wealthy.”

That was true in the mid 19th century. It must remain true in the 21st century. There must be—there will be—no barriers to education in Scotland.

Photo of Alex Fergusson Alex Fergusson None

The cabinet secretary will take questions on issues raised in his statement. We have just under 20 minutes for questions, after which we must move on to the next item of business. All business is tight this afternoon, so it would be helpful if questions and answers were kept relatively brief.

Photo of Des McNulty Des McNulty Labour

I am pleased that the cabinet secretary now recognises that there is a funding gap as a result of the actions of the Con-Dem Government at Westminster in raising tuition fees to £9,000 and reducing teaching grant. His earlier stance, which was that there might not be a funding gap, was clearly delusional. I am also pleased that the Scottish National Party is following Labour in making a commitment to fill the gap and ensure the competitiveness of Scottish universities in teaching and research.

During the past four years, why has the cabinet secretary’s Government not introduced changes to entry with advanced standing and articulation, modernised student support arrangements or fostered shared services between institutional partners? The Government could and should have done those things but it did not do them, which leaves our universities unprepared and playing catch-up with their rivals. For the Government, colleges are always an afterthought.

We are hearing promises that echo the promises that were made on student debt in 2007 and then dropped within a month. The reality is that for the cabinet secretary and the SNP Government it is politics first, second and third, and never mind the consequences for students or for universities and colleges.

Can the cabinet secretary tell us how many redundancies in further and higher education will result from the Government cut in funding of 10 per cent for colleges and an equivalent cut for universities? Why did his Government not heed warnings that cuts in university and college funding would cause job losses and threaten courses throughout the sector? How does he intend to remedy the consequences of SNP budget decisions, which are the most immediate and urgent issue that the sector faces?

Photo of Michael Russell Michael Russell Scottish National Party

It is almost impossible to deal with a question of that nature, which has no basis in fact. The world in which Mr McNulty lives is entirely mythical.

Let me ground Mr McNulty in some facts, which he needs to remember. Why have there been so many difficulties in the sector? There are two reasons. One is the bankruptcy of the national finances, which was supervised—indeed, caused—by Labour. There is also a particular difficulty in the sector. A minister commissioned a study of the sector from someone south of the border, Lord Browne. That is the study that came up with the proposal for fees of £9,000. Who was that minister? I would love to be able to blame the Tories and the Liberals, but on that occasion it was a Labour minister. It was the Labour Party that introduced fees and has gone on doing so.

What we have seen is a wrecking of higher education, on the initiative of the Labour Party—

Photo of Des McNulty Des McNulty Labour

Answer the question, cabinet secretary.

Photo of Michael Russell Michael Russell Scottish National Party

Given those circumstances, it would be better if there was a moment of silence from Mr McNulty, rather than the smokescreen that we have had.

Let me deal with what Mr McNulty said about redundancies. If he is prepared to stand with me to recommend to the college sector that there be no compulsory redundancies, let him do so. Unfortunately, he has been silent on that. If he will stand up for the further education sector and recommend that there be no redundancies, not only would I think better of him but so would the people whom he is already betraying.

Photo of Elizabeth Smith Elizabeth Smith Conservative

The cabinet secretary has been at great pains to say that the SNP’s policy is based on the ability to learn rather than the ability to pay. In his announcement, he said that the £62 million—which is 40 per cent of the £155 million that he claims must be found for the university sector for 2014-15—must come from non-Scottish students. What will happen if he finds that Universities Scotland and many other expert commentators are correct in saying that the funding gap is much bigger than his estimate? Will that not simply mean that EU students and students from the rest of the UK will end up having to pay even higher fees and, therefore, completely destroy his claims about the policy’s being based on the ability to learn as opposed to the ability to pay, or will it mean that the Scottish taxpayer is saddled with increasing student debt?

Photo of Michael Russell Michael Russell Scottish National Party

It is up to the Conservatives to justify their policy of imposing student fees. If they wish to do so, they must do that.

Last night, on the BBC television programme “The Big Debate: Education”, the Tory spokesperson explained it as requiring 15 or 20 per cent more resource for Scottish universities. That figure was plucked out of the air and not based on any of the figures that were jointly drawn up by us and Universities Scotland.

If the Conservatives wish Scottish students to pay large sums of money and believe that that is the right thing, they must go into the election arguing for it. In so doing, they are likely to breach the great traditions of Scottish education and damage universities. What they should do is join the Scottish consensus—even the late consensus to which Mr McNulty’s shadow cabinet dragged him kicking and screaming—and argue for the strong traditions of Scottish higher education. They should also base that argument on the figures that were drawn up by Universities Scotland and us, which have been made available to all the parties. Unfortunately, the Tories just do not want to read them.

Photo of Margaret Smith Margaret Smith Liberal Democrat

I welcome and share the cabinet secretary’s commitment to free education with no fees and no graduate contribution. Our position builds on our record of scrapping Labour’s fees in government and the graduate endowment in opposition. We share, too, a commitment to fund the gap.

Therefore, we welcome the announcement on fees for students from the rest of the United Kingdom, which is necessary and sensible. Will the cabinet secretary absolutely guarantee that his proposed service charge for EU students will not be paid by Scottish students in any circumstances?

Does he also agree that there is a need for a review of student support that will tackle the complexity of the student support system and the diversity of need for part-time, poorer or articulating students to give our students the support that they need to concentrate on learning?

Photo of Michael Russell Michael Russell Scottish National Party

I certainly agree that there is a need for a new system of student support and that we need to simplify the system. We have had many reviews over the past few years. It is important that we get on and take action. The type of policy that I am talking about—moving towards the minimum student income—is the right thing to do.

I welcome Margaret Smith’s support for the position of no fees. There is no joy greater than that when a sinner repenteth. It is delightful to see that the Liberal Democrats are on our side on the matter. It is always best to accept good news when it is offered, and I am happy to confirm that there is no intention of charging Scottish students a service charge. The idea that exists on a service charge is interesting. It has potential, but so do the other discussions that are taking place on EU students. I fully understand the concern that exists about EU students. We want them to be here, but we should find the best option not a cheap one and we must ensure that some resource is found.

Photo of Alasdair Allan Alasdair Allan Scottish National Party

The education secretary’s commitment to maintaining free higher education is to be warmly welcomed. Is he able to say what effect free education, compared with other funding models, is likely to have on widening access to social groups that have traditionally not participated in higher education?

Photo of Michael Russell Michael Russell Scottish National Party

Yes. I notice that the Conservatives south of the border—indeed, Elizabeth Smith mentioned it last night in her contribution to the TV debate—believe that, by raising fees, they will increase access, which is so extraordinary that it defies belief.

Photo of Murdo Fraser Murdo Fraser Conservative

The evidence shows it. Read the evidence.

Photo of Michael Russell Michael Russell Scottish National Party

The Conservative party has not tackled some interesting research from the other side of the Atlantic, which shows without doubt that part of the fragmentation of society in the United States is caused by the ever-increasing cost of education.

I am absolutely certain that the contribution that we need to make to increasing access is to remove financial barriers. That is axiomatic. However, we need to do other things, too. Members have heard me say before that the issue of access has to be tackled not at the university gate but at the primary school gate and the secondary school gate. A great deal more work needs to take place earlier in young people’s educational careers to ensure that access is built and sustained. The idea that by raising fees we would improve access is nonsense.

Photo of Claire Baker Claire Baker Labour

Universities agreed to compensate for a 10 per cent cut in funded places in 2011-12 with an increase in fees-only places. What discussions has the cabinet secretary had with university principals about their ability or willingness to continue that arrangement? If it is a one-year-only deal, how will it impact on the funding gap and university places in future years?

Photo of Michael Russell Michael Russell Scottish National Party

There is an agreement—it is a one-year-only deal. That is the agreement that we reached and which university principals are honouring. That is why we need to bring this issue to a conclusion within the next few months.

Very shortly, this Parliament will be dissolved and Claire Baker and her party will be able to offer a prescription for the future of higher education. I look forward to seeing what that prescription is in the next 12 months. If that prescription does not do what she wishes it to do, she will have to come back here—if she is re-elected—and apologise, from the Opposition benches.

Photo of Murdo Fraser Murdo Fraser Conservative

If fees are introduced for EU students studying at Scottish universities, as the cabinet secretary has proposed, what does that mean for Scottish students studying at EU institutions?

Photo of Michael Russell Michael Russell Scottish National Party

There is no proposal to introduce fees because we are not able to do that—I have made that absolutely clear. However, there is an issue about whether it is possible to institute a service charge, which is what I have explored. That is what my statement said, and that is what we will try to do.

Scottish students going elsewhere have to pay the going rate. We try to support them as much as we can through loans, but that is the reality. My responsibility and the responsibility of members in this chamber is to ensure that Scottish students accessing Scottish institutions are treated in the way that we think will best benefit the short, medium and long-term future of Scotland and those individuals. That is what I have laid out today.

Photo of Hugh O'Donnell Hugh O'Donnell Liberal Democrat

The cabinet secretary referred to articulation. Does he recognise that departments of adult education are critical to the prospect of articulation? How will decisions made recently at one of our major universities impact on articulation?

On the international role and mobility, what impact will changes to the languages departments at our higher education institutions have on delivering the promises that the cabinet secretary has made?

Photo of Michael Russell Michael Russell Scottish National Party

I indicated in my statement that there is a balance between autonomy of organisations and public funding. I discussed these matters with Professor Muscatelli recently. The University of Glasgow has assured me that what it is undertaking is consultation. I am entirely happy to accept that articulation is tied to the issues of wider access and adult education. That must be recognised. It must also be recognised that decisions taken by any university require to be accountable and transparent. The process that the university is going through at the moment—of considering matters—must be entirely open.

We need a major push on languages in Scotland. I hope that in the coming election, we will all debate how languages are provided in Scotland and what more we need to do. Certainly we need to ensure that language learning in Scotland rises to a higher plane.

We need a map of provision in Scotland. Just as we need a map of provision in the college sector, we need one in the university sector, too, because we need to take out duplication where it exists, if it is unhelpful or overexpensive.

We need to balance the debate very carefully. Universities are accountable; they spend public funds and, in those circumstances, must undertake decision making transparently and openly. I know that all those involved, including in Glasgow, will do so.

Photo of Jamie Hepburn Jamie Hepburn Scottish National Party

I welcome the reaffirmation of the Scottish Government’s support for free education, but I want to ask the cabinet secretary a question about governance. One group of people with whom the cabinet secretary said that he wanted to explore further the matters that he has raised are the chairs of the various university courts—a role traditionally filled by the democratically elected rector at our ancient universities. Does the cabinet secretary agree that the right of the rector to chair the court should be restored where it has been removed? Does he also agree that we should consider creating a rector at every single higher education institution in Scotland?

Photo of Michael Russell Michael Russell Scottish National Party

That is an interesting proposal. Among the many fascinating pieces of material that we received as part of the green paper process were the comprehensive and interesting submissions on the democratic intellect, accountability and governance. I am honour bound to consider those, just as I am honour bound to listen to ideas when they are proposed. If many people are concerned about such matters, we should think about them.

The member’s suggestion, which relates to the tradition of the rector of a university taking responsibility for the governing body and being involved in directing that governing body, is an interesting one and should be put into the mix. I hope that we would agree with the principals, the chairs of court, the students and the staff on the strengthening of democratic governance and on universities having the ability to run their own affairs effectively and efficiently in what is a difficult modern world.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

I was pleased to hear that the minister has had discussions with the principal of the University of Glasgow, but he did not say whether he believes that it is acceptable to lose the whole of the adult and continuing education department.

Photo of Michael Russell Michael Russell Scottish National Party

If there were a proposal so to do, quite clearly, I would comment on it. As I understand, there is a consultation going on. My concern is that those who, quite rightly, regard the university as their own—the community of the university, the community of the west of Scotland and, to some extent, the wider community in Scotland and beyond—have a voice and can influence that process.

I am not trying to avoid the member’s question; I am happy to say to him that continuing education is very valuable indeed. There is a long tradition of continuing education in each university. By definition, that tradition is longer in the ancient universities than it is in others. Ensuring that it continues to flourish is important. How that is done by each university will depend on its resourcing and its decision making. Each university must have a process of decision making that is clear, open, transparent and accountable.

Photo of Robin Harper Robin Harper Green

Given that the level of discontent is such that there are threats of strikes at two Edinburgh universities and there have been sit-ins in Glasgow, does the cabinet secretary consider that his advice to principals to be aggressive in pursuing efficiencies and to be pragmatic has been overenthusiastically interpreted?

Photo of Michael Russell Michael Russell Scottish National Party

We are dealing with intelligent, skilled and passionate people in every part of the university structure. It is clear that there will be contending ideas and disputes of various types. After all, that is, to an extent, the foundation of our higher education system, which lies in disputation.

I hope that two things will be borne in mind, the first of which is the great financial difficulties that exist right across the public sector. The wrecking of the public finances by Labour and the decision by the Tories and the Liberals to cut too far and too fast are causing huge difficulties in Scotland. Not having a normal Parliament with the normal financial powers adds to those difficulties. We must live with that situation. In an ideal—or even a normal—world, we would not have to do so.

In addition, there is the issue of autonomous bodies having to make decisions and their being allowed to do so in a responsible way. I hope that there will be discussion, negotiation and consideration, which might lead, in time, to the realisation that this Parliament needs full financial powers to make decisions about the resources of Scotland instead of being told what to do by failed parties elsewhere.

Photo of Bill Wilson Bill Wilson Scottish National Party

What lessons does the Scottish Government draw from the paper by Timothy Noah entitled “The Great Divergence”, in which he attributes 30 per cent of the rise in inequality in the United States to failures in the education system and, citing the Harvard economists Claudia Goldin and Lawrence Katz, explains it as being due, in large measure, to the increasingly prohibitive cost of a college education?

Photo of Michael Russell Michael Russell Scottish National Party

I have had that paper drawn to my attention this morning—not by Dr Wilson—and I will consider it with great interest. From what I have seen of the synopsis of the paper, it suggests to us that the effect of charging ever-higher sums for education is a considerable problem. Regrettably, that is where the Conservatives want to go, for which they must take responsibility. I suggest that we provide a copy to the Conservative spokesperson so that she might see the error of her ways.