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Higher Education Governance (Scotland) Bill: Stage 1

– in the Scottish Parliament on 14th January 2016.

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Photo of Elaine Smith Elaine Smith Labour

Good afternoon. The first item of business this afternoon is a debate on motion S4M-15304, in the name of Angela Constance, on the Higher Education Governance (Scotland) Bill.

Photo of Angela Constance Angela Constance Scottish National Party

I am delighted to open the debate. I start by thanking the Education and Culture Committee for its stage 1 report, and also the Finance Committee and the Delegated Powers and Law Reform Committee for their contributions to the lead committee’s work.

I want to do three things in my opening remarks—first, to emphasise why the Scottish Government believes that the Higher Education Governance (Scotland) Bill will enable more modern, inclusive and transparent governance in our higher education institutions; secondly, to highlight the constructive engagement that we have had with stakeholders; and finally, to provide a summary of the amendments that we intend to lodge at stage 2 should Parliament vote for the bill to pass stage 1.

I consider the bill to be focused and discrete, with provisions that are informed by the review of higher education governance that was chaired by Professor Ferdinand von Prondzynski, whose report was published in 2012. Ministers commissioned that report to obtain evidence on how higher education governance could be refined as we move further into the 21st century.

Higher education institutions are autonomous—I am crystal clear on that. However, in tough economic times, the Scottish Government has again identified in its draft budget more than £1 billion of investment in our higher education sector, which will be provided next year. As part of the return on that investment, we expect institutions to adhere to the highest standards of governance.

Our higher education institutions are a great source of pride to Scotland and enjoy a worldwide reputation for excellent teaching and research. However, like any other group of high-performing organisations, they are capable of change and improvement. I want our institutions to embrace the changes that the bill will introduce. At its heart, the bill is about ensuring that all voices on campus are heard and empowered to contribute to decision making.

Photo of Jim Eadie Jim Eadie Scottish National Party

I welcome the thrust of the bill, which seeks to make our universities’ governance arrangements more inclusive and accountable. The cabinet secretary will be aware of the evidence that was given by Tim O’Shea, who stated:

“the success of UK universities in comparison with universities in other parts of Europe is put down to our autonomy and our ability to operate.”—[Official Report, Education and Culture Committee, 6 October 2015; c 25.]

What further assurances can she provide that the wide scope of the proposed secondary legislative powers will not undermine the independence of our world-leading universities?

Photo of Angela Constance Angela Constance Scottish National Party

As I have said to people repeatedly, our universities are and will remain autonomous. There is nothing in the bill as introduced, nor will there be anything in the bill after stage 2, that will advance ministerial control in any way. As I proceed with my opening remarks, I hope to outline fully to the Parliament how the Government will remove or reduce any regulatory powers that are deemed to be no longer necessary.

As is noted in the Education and Culture Committee’s stage 1 report, the bill

“contains relatively few provisions but has generated ... considerable ... comment”.

Our response to that has been to listen to those who support the bill and those who do not. I am grateful to all stakeholders for the views that they have offered and their participation in the meetings and workshops that we have hosted.

I welcome the committee’s support for the bill’s general principles. On Monday, I wrote to the committee to respond to its report and to set out the Scottish Government’s full analysis of any risk that the bill could present to the status of our higher education institutions as private not-for-profit bodies, as classified by the Office for National Statistics. The Scottish Government does not hold the view that the bill adds to any existing risk of reclassification of HEIs as public bodies.

Photo of Elizabeth Smith Elizabeth Smith Conservative

Will the cabinet secretary tell us where the mathematics or arithmetic is to back up that point?

Photo of Angela Constance Angela Constance Scottish National Party

We can all have a good, robust debate about mathematics. I could take issue with some of the arithmetic and the evidence that was presented to the committee. If we look at the evidence from Universities Scotland and the action that it called for to reassure it that nothing in the bill will increase the risk of ONS reclassification, we find that—importantly—the Government is responding to those requests for reassurance, even though we do not think that reassurance is required. We are taking clear action to ensure that the sector can go forward collegiately and as one where possible.

In line with the substantive view that the Office of the Scottish Charity Regulator offered, the Scottish Government does not believe that the charitable status of Scotland’s HEIs is in any way jeopardised. However, we have considered whether amending the bill at stage 2 would assist in addressing concerns that stakeholders have expressed. I will summarise our plans for potential stage 2 Government amendments in a moment, but I will repeat what the Scottish Government has made clear on many occasions: reclassification of Scottish HEIs is an outcome that we would never want.

I turn to planning for stage 2. Although the Scottish Government is clear in its view that the bill does not advance any risk of reclassification by the ONS, I will lodge amendments to remove sections 8 and 13 of the bill, which give ministers the power to make regulations to alter provisions on the composition of governing bodies and academic boards.

The Scottish Government intends to lodge a stage 2 amendment to replace section 1 with full provision for a model for the operation of elected chairs.

Photo of Angela Constance Angela Constance Scottish National Party

Perhaps I will if there is time later, Mr Brodie. I am keen to make more progress.

In summary, we will require HEIs to advertise those positions. Interested applicants will be selected for an interview on the basis of their ability to carry out the duties that are associated with leading a modern Scottish HEI. If successful at an interview process that is managed by a nomination committee, which will feature staff and student representatives, candidates would then participate in an election, in which all staff and students in an institution would be able to vote.

I can confirm that plans for elected chairs, who will be the senior lay members of all governing bodies and are often called senior governors or vice conveners at present, will result in no alteration of the statutory underpinning of existing rectors in our ancient universities. As is the case now, the way in which rectors dovetail with the new elected senior governors will be a matter for each autonomous institution.

We plan to lodge an amendment concerning the remuneration of chairs, which will alter section 2 to provide only that HEIs must offer reasonable remuneration to an elected chair in connection with carrying out that role, on request by the chair. On balance, I do not consider that retention of a power for ministers to set levels of remuneration or to delegate that role to other persons is necessary.

Having scrutinised all the evidence provided by the committee and stakeholders on the composition of governing bodies, I intend to lodge an amendment to remove the obligation for HEIs to have two alumni on each governing body. That will assist institutions to accommodate staff, students and trade union members more easily on bodies on which the maximum number of members is set at 25 in the Scottish code of good higher education governance.

I am minded to lodge an amendment to remove section 9, which will mean that HEIs need not be obliged to limit the number on their academic boards or senates to 120. To ensure that institutions with larger academic boards have a fair representation of students, without being obliged to ensure that 10 per cent of the body comprises elected students, the Scottish Government favours a ceiling of 30 elected student members.

We have taken careful note of all the evidence that has been presented on academic freedom. In light of that, we are considering the final form of the relevant provisions. I have been struck by the importance of ensuring that academic freedom cannot be cited as a cover for any views that are offensive or, indeed, criminal.

All those potential amendments have been influenced by dialogue with stakeholders. Although stakeholders will be familiar with them, not all will support each proposed amendment. However, I am confident that broad support for a number of them will be evident.

In drawing to a close, I emphasise three key points. The Scottish Government values on equal terms Scotland’s higher education institutions, the staff who work in them and the students who attend them. I believe that this modest and focused bill can enable more modern, transparent and inclusive governance practice. I have been listening and I will continue to do so. I want to work with our universities in partnership in the years ahead.

I move,

That the Parliament agrees to the general principles of the Higher Education Governance (Scotland) Bill.

Photo of Stewart Maxwell Stewart Maxwell Scottish National Party

There is a strong consensus that our higher education institutions should uphold the highest standards of governance. However, there are differences of opinion about the Scottish Government’s role, about current standards of governance in the sector and about some of the measures that are proposed in the bill.

As we are aware from the debate that was held in the chamber during our stage 1 scrutiny, there has been extensive discussion of an issue that is not even mentioned in the bill—namely, the possible risk of our universities being reclassified. According to many voices, higher education governance is in a good state. Certainly, universities were keen to point out the link between their international success and their existing governance arrangements, while highlighting their continuing work to make further improvements.

Neither the review that led to the bill, which Ferdinand von Prondzynski chaired, nor the cabinet secretary provided specific examples of deficiencies in the sector. Even some unions—the strongest proponents of change—acknowledged that the bill would not be starting from a position of real weakness. For example, the University and College Union Scotland said:

“No one is questioning that Scottish universities are good—they are good.”

Crucially, however, it added:

“What we are saying is that they could be so much better if staff, students and trade unions were fully involved in how they operate.”—[Official Report, Education and Culture Committee, 6 October 2015; c 11.]

That appears to us to be the nub of the bill. Will it help to make a good system even better? Will it help to reduce the risk of some of the poor instances of governance that were highlighted to us recurring?

Overall—with the exception of two members—the committee supported the bill’s general principles of strengthening governance in higher education. However, we were clear that the Scottish Government needed to provide further information on various issues to fully inform the debate. That demand reflected the fact that much of the bill’s detail was still under active consideration when we published our report.

I thank the Scottish Government for responding to our report in good time for the debate. It is clear from that response that, should the bill progress to stage 2, there will be a significant number of amendments for us to consider. Many of the proposed changes reflect the recommendations from our stage 1 report, and it is welcome that the Scottish Government has responded positively to our concerns.

The Scottish Government has taken into account our view that it should have provided more justification for some of the provisions contained in the bill. For example, we queried the rationale for universities’ academic boards being limited to 120 members. The Scottish Government’s response says that it engaged with Professor von Prondzynski during stage 1 and subsequently came to the view that it might be better to remove the cap.

The Scottish Government has clarified another key provision of the bill, which is that the Scottish ministers are to determine a process by which institutions appoint the chairing member of their governing bodies. Our report expressed support for measures that could increase the pool of suitable candidates for the post of chair. We also agreed that openness, transparency and consistency in the appointment process are desirable.

However, we noted a lack of detail on how the chair is to be appointed, so I welcome the fact that the Scottish Government’s response provides more information on the steps involved. On the specific issue of possible remuneration for governing body chairs, I appreciate the fact that the Scottish Government has responded to our concerns by flagging up relevant amendments for stage 2.

We said that the role of rector—a historic and often high-profile figure in Scotland’s ancient universities—should be clarified. If there are to be elected chairs and elected rectors, there should be no ambiguity about their respective roles, and both figures should be able to work together for the good of the institution.

Photo of Chic Brodie Chic Brodie Scottish National Party

Is it not conceivable that the rector, having been elected by the wider franchise, could take a co-chair’s role in looking at the policy of the university? The chair, who must be elected by the court, would then be responsible for chairing items of operational performance. Would that be a suitable way to achieve the objectives of widening the franchise, making sure that the rector is where he or she should be and allowing the elected chair of the court to participate fully?

Photo of Stewart Maxwell Stewart Maxwell Scottish National Party

That is one of the possible models that could arise from the Scottish Government’s suggestions and the work that the Government and the sector will take on. Given that I am speaking as convener of the committee, I will not give a view on whether that model should be chosen. I will say only that there should be flexibility across the sector to allow it to figure out the best way of going forward along with the Government in subsequent discussions. I note that there will be amendments in this area and that the Scottish Government’s view is that it will be up to institutions to ensure that rectors and elected chairs work effectively together.

The bill proposes the inclusion of new members on the governing bodies of institutions, including trade union representatives. Higher education institutions stressed that union representatives on governing bodies should be there in a representative capacity for all staff, to avoid the possible accusation of a conflict of interest.

We were not persuaded by such arguments and we noted that all members of a governing body must act in its best interest. We also agreed with the principle that a diverse group of people should be included on the governing body and recognised that the bill’s proposals would make governance more inclusive. However, we recognised that such changes would not in and of themselves guarantee improved governance.

HEIs were concerned about how they would accommodate the changes to governing body membership, given that such bodies are not supposed to have more than 25 members. Concerns about changes to the governing body were just one of the reasons that the Royal Conservatoire of Scotland cited in its recent letter to the Scottish Government to ask to be excluded from the bill. I am sure that we would all very much welcome the cabinet secretary’s views on that request.

I would like to know whether institutions are likely to be reassured by the Scottish Government’s suggestion that governing bodies are not now to include two graduate members. That did not seem to be a major concern in our evidence taking. They might be more comforted by the Scottish Further and Higher Education Funding Council’s response to our report, which in summary said that it would not be concerned by a short-term increase in governing-body membership.

I have already touched on reclassification. There is no specific reference to Scottish HEIs being included in the relevant work that the ONS is carrying out. Nonetheless, we appreciate that reclassification would be in no one’s interest and recommended that all reasonable measures be taken to minimise any risk of it occurring.

In part, the HE sector’s concerns stem from the sections of the bill that would give the Scottish ministers the power to make regulations about governing bodies and academic boards. We therefore welcome the cabinet secretary’s commitment to amend or remove sections 8 and 13.

However, despite what the cabinet secretary said a moment ago, I remain disappointed that the Scottish Government has still not adequately addressed our request for further information on academic freedom and specifically on students’ freedom. I expect a response to the committee on that issue as soon as possible.

A key consideration when scrutinising any bill is the improvement that it is likely to deliver. Such a judgment may be particularly difficult with this bill, as separate efforts by HEIs are also under way to improve governance. We therefore asked the cabinet secretary how she would evaluate the bill’s success and were pleased when she confirmed that the sector would play a role in monitoring the bill’s impact. We expect that to be a fully inclusive exercise that involves all the relevant bodies in the higher education community. That would be consistent with the bill’s aims and would encourage everyone to continue to focus on improving our already world-class higher education sector.

Photo of Iain Gray Iain Gray Labour

It seems to me that we have debated the bill and its measures a number of times, so it is quite hard to believe that we are just at the stage 1 debate. Nonetheless, that is the case, and there is therefore some value in turning back to the bill’s first principles and to why, throughout the process, Labour has taken the position that it has taken.

We support democratic and transparent governance in our higher education institutions. It is our view that, as they are the recipients of more than £1 billion of public funding every year and are central to the future of Scotland, it is reasonable that we ensure that their governance is modern, transparent and fit for purpose.

We also support trade union and student representation on the council. That should be no surprise: we are the Labour Party and of course we support trade union representation. We have never accepted the argument mounted by some that trade union representatives on a body such as the council will face conflicts of interests and sometimes difficult situations when they are part of making collective decisions that those who they represent might find hard to understand. Those of us who have been trade union activists in other lives know that wherever trade unions have representation that is the sort of difficulty and contradiction that representatives have to deal with every day.

As a principle, we support the autonomy and academic freedom of our universities. Over centuries that has been one of their greatest strengths and it must be preserved.

Finally, we have been at pains to be clear that we do not support measures that pose a risk to the fiscal basis of the higher education sector through jeopardising either the institutions’ charitable status or their ONS classification.

Underpinning all that is our acceptance that the legislation is needed, largely because, we would argue, the voluntary code has failed. There has been a serious question around transparency of governance in the sector over recent years, which is perhaps most dramatically characterised by pay settlements for senior staff and particular principals. Although some have argued that the voluntary code developed by the principal of one of our universities would be enough, we are not convinced, because the voluntary code is in place but the transparency is not.

The University and College Union Scotland, in the helpful briefing that it provided for today’s debate, points out that after the voluntary code was put in place, it submitted freedom of information requests to try to ascertain how principals’ pay had been determined in remuneration committees. Only a handful of the 19 higher education institutions in Scottish were willing to provide that information, and many of those that were provided it in a form so redacted as to be completely useless. Therefore it is not the case that the voluntary code is enough.

Given that we are at stage 1 of the bill, we are entitled to consider the bill as introduced. Although we support the principle of the bill, we have been very clear that the bill as introduced fails on many counts. It fails to describe in detail the process of the election of chairs—a measure that we support—and includes sweeping discretionary ministerial powers that could be used to change the governance of higher education institutions in the future without reference to Parliament. The bill veers into areas that seem to us to be completely unnecessary, such as the size of the academic court, and it has ignored the historical position of rectors.

Photo of Jim Eadie Jim Eadie Scottish National Party

The member will be aware that the University of Edinburgh has very strong and inclusive governance arrangements, which include the election of the rector by both students and staff. Does he agree that the bill provides an opportunity to roll out that exemplar of good practice across our higher education institutions?

Photo of Iain Gray Iain Gray Labour

In light of the amendments that the Cabinet Secretary for Education and Lifelong Learning has promised to lodge, the bill may at least recognise the strength of the model that is already in place in Edinburgh.

After many months of what the education secretary called “constructive engagement”, which was really much angst, she has finally explained to us how she intends to improve the bill. She says that she will do that by removing sections 8 and 13, which contain discretionary ministerial powers; detailing the elections and removing discretionary powers in that respect—that is all helpful in terms of the ONS point; and removing the cap on the size of the academic court. She also says that she recognises, and will ensure that the bill does not in any way inadvertently end, the system of rectors in the ancients where it exists.

Of course, not all of that has been done with good grace. The education secretary continues to argue that there is no ONS reclassification risk. As I have pointed out before, that is not good enough. We have been here before: we were promised that the ONS issue with colleges would be resolved. However, it never has been, and as a result colleges have had to resort to arm’s-length trust funds, which is an extremely unsatisfactory position. I would argue that all that angst has been unnecessary and all those things could have been avoided if only the bill had been properly drafted in the first instance.

From the word go, the education secretary said that ministers have no desire to use discretionary powers to change the governance of institutions in the future. That begs the question as to why they were in the bill in the first place. The truth is that we—not us in particular, but the sector itself—have lost a lot of time over the bill. That time would have been better spent on what the sector does best, which is to educate our young people, carry out world-class research and make an enormous contribution to our economy. The process has been far more of a diversion than it would have been had the bill been delivered properly.

This evening we will give the bill the nod because we support the principle of it, but we will also be shaking our heads at the incompetent shambles of its handling.

Photo of Elizabeth Smith Elizabeth Smith Conservative

When the bill was first mooted, the Scottish Government made it very clear that its only intention was to make some minor amendments to allow greater transparency when it came to the governance and management of universities and their accountability for large sums of public money. That public money sits alongside lots of other income streams and lines of accountability about which there seem to be no concerns in relation to university governance.

Something very different has transpired, as is clearly set out in the Education and Culture Committee’s report and as the convener set out in his speech. Notwithstanding the strong support from the UCU and the NUS, the bill met with an exceptionally hostile reaction within the university sector, which is a sector that in my opinion has always bent over backwards to work with the Government. The committee’s report states that the bill also met with a hostile reaction from groups such as the Scottish Council for Development and Industry and the Institute of Directors, and from many in civic Scotland.

There are several reasons for that reaction, but, as the committee’s report makes clear, one of the most important is the stark lack of good-quality data and analysis to demonstrate why the Scottish Government considered the bill necessary and its failure to provide bona fide evidence to support the key assertions in the bill. Education and Culture Committee members castigated the Scottish Government no fewer than six times for that lack of evidence and the lack of clarity in the proposals. Therefore, for many people the main issue remains the utter failure to demonstrate that there is a problem with the existing system of governance that somehow acts to the detriment of higher education.

Photo of Elizabeth Smith Elizabeth Smith Conservative

I will not, if the member does not mind.

It became increasingly evident that there was some seriously flawed thinking in the bill when it came to the question of ministerial powers, ONS reclassification and democratic accountability in governance. The whole sector, including the unions, was crystal clear that several key aspects of the bill, most of which related to sections 8 and 13, would change the very nature of our higher education institutions, specifically by increasing ministerial powers and making universities public sector bodies. The Scottish Government denied that that was its intention but that was indeed the interpretation of the wording in the bill.

Universities Scotland had, and still has, substantive reasons for being concerned about the prospect of ONS reclassification of universities. When the Government persisted in its claims that reclassification presented zero additional risk, there was no detailed independent advice—and there still is none. Indeed, there were no estimates of the costs that universities might face—

Photo of Elizabeth Smith Elizabeth Smith Conservative

If the member does not mind, I will not as I am very short of time.

That crucial point was very clearly expressed by Alastair Sim, Professor Anton Muscatelli and Garry Coutts at the Finance Committee. We still do not have that information.

Another crucial point relates to the section whose wording expressly gives ministers the power to amend universities’ constitutions by altering the composition of their governing bodies—

The Deputy Presiding Officer:

Ms Smith, can I stop you for just a second? I am afraid that we had a slight problem with the clock, so please do not think that you are at 10 minutes. I have a little bit of extra time in hand. It is your choice how to proceed.

Photo of Elizabeth Smith Elizabeth Smith Conservative

I will take 20 minutes, Presiding Officer, if you so wish. [Laughter.] How long do I have?

The Deputy Presiding Officer:

I can give you another two or three minutes.

Photo of Elizabeth Smith Elizabeth Smith Conservative

Thank you very much.

The third issue, which is crucial, is about governance and democratic accountability. Some commentators seem to argue that the universities criticise the relevant part of the bill because they cannot see beyond their ivory towers and are choosing to hide behind the convenient protection of autonomy because they do not want any change. Nothing could be further from the truth.

Indeed, universities have gone to great lengths to demonstrate why the bill would actually diminish rather than enhance democratic accountability, and to argue for the benefits of the code, which was designed by all stakeholders. They have explained to the Scottish Government many times why the crucial trust between a chair and the board might be compromised by the system of elected chairs that the Government is proposing. They ask why on earth a Government would want to legislate on the size of academic boards and the definition of academic freedom. They ask why there is a complete lack of clarity about how the post of rector fits into the new proposals. They ask about the nonsensical commitments to the stipulations about the size of governing bodies, which would mean that certain posts, which are elected by staff, would disappear. They have asked the Government to address concerns about whether a good range of candidates will come forward, given the experiences that have been flagged up by the NUS. Finally, they have asked, yet again, the Scottish Government to answer—with evidence—the Education and Culture Committee’s 17 concerns. To date, there has been an entirely unsatisfactory response. Indeed, with regard to the question about maintaining the strong link between chair and board, the Scottish Government woefully admits that it has

“not undertaken specific research in this area”,

and it seems that the Scottish Government thought to consult Ferdinand von Prondzynski on the academic boards only after the bill had been published and the stage 1 evidence sessions had taken place.

Photo of Elizabeth Smith Elizabeth Smith Conservative

I am in my last minute.

Governance arrangements that minimise the likelihood of serious conflict in the governing body are those that are most likely to promote good governance. The bill, however, does not do that.

There are some who believe that the bill as introduced would pave the way for a sector that would be bound by a new and, in their eyes, better approach to governance, making the 19 higher education institutions much more uniform in their structures, much easier to control and therefore better able to deliver best value for students and staff. However, the evidence for that is simply not there, which is why there is such strong public outcry at what the bill could do—wittingly or unwittingly—to one of the jewels in the crown of Scottish life. The bill could undermine the very foundations and principles on which the sector has survived and thrived for hundreds of years. On that basis, we cannot support it at stage 1.

Photo of George Adam George Adam Scottish National Party

I welcome this stage 1 debate although, like Iain Gray, I feel as if we have had this debate already on a number of occasions.

I want to raise a couple of issues. The first is that the Scottish Government is clear that our successful and internationally renowned universities are, and will remain, autonomous bodies. That is only right; the important point for me is how we can help them to grow to become even better than they are at the moment.

I do not think that the Scottish Government is being unreasonable when it asks for the very highest standards of governance, considering that it invests more than £1 billion every year in the sector. It is only right that it would expect those high standards—surely that is not too much to ask.

I could stop at that, Presiding Officer—some in the chamber of might think that that is a good idea—but I will not, as I have much more to say.

Many who provided evidence to the committee agreed that the debate and the bill are about ensuring that our universities continue to succeed. Stewart Maxwell, the convener of the committee, has already quoted Mary Senior, of UCU Scotland, but I think that it is a very important quote. She said:

“No one is questioning that Scottish universities are good—they are good. What we are saying is that they could be so much better if staff, students and trade unions were fully involved in how they operate.”—[Official Report, Education and Culture Committee, 6 October 2015; c 11.]

That shows the enthusiasm for the bill that exists in the sector, and the enthusiasm of the sector to work to make the bill even better. We also heard from Professor Von Prondzynski, the principal and vice-chancellor of Robert Gordon University. He said:

“Universities are autonomous bodies, and should be. But their autonomy should not shield them from legitimate expectations that they engage with staff, students and external partners, or from the need to behave in an accountable manner.”

Those quotes explain the position perfectly. Here are two individuals who work in different parts of the sector, both coming to the conclusion that we must move forward. We cannot allow these world-renowned universities to be left behind. The world continues to spin, time moves on and we all need to move forward and progress.

That brings me to the ONS question. In all honesty, I believe that the argument has been used in order to keep us from talking about the many positives of the bill. That in no way means that I take the threat of ONS reclassification lightly, and nor does the Scottish Government, which has stated continually that it does not believe that the bill would lead to reclassification and that, if universities were to be reclassified, it would do all in its power to fight against that. I agree with the cabinet secretary, who states in her letter of 11 January to the committee that

“the Scottish Government concluded that the Bill did not propose any additional risk of re-classification, with specific reference to these secondary indicators of control ... we do not agree with the conclusions reached in the advice provided by Anderson Strathern on what is primarily a matter of statistical classification. However, we have taken careful note of all evidence shared with both the Finance Committee and the Education and Culture Committee. In light of this, I plan to lodge a number of Scottish Government amendments at Stage 2 of the Bill’s consideration. A number of these are relevant to the points made in the Committee’s Stage 1 report. Specifically, the Scottish Government will consider removal of sections 8 and 13 in the Bill.”

That is welcome, because it gives us the opportunity to discuss the important parts of the bill. Too much time has been spent on what could have happened or should have happened—

Photo of Sandra White Sandra White Scottish National Party

George Adam has mentioned the amendments that will be lodged at stage 2. Will they be effective in the case of the Royal Conservatoire of Scotland and Glasgow School of Art, which have made representations to the committee?

Photo of George Adam George Adam Scottish National Party

I remember their evidence well. I will need to wait and see what is proposed at stage 2 in order to discuss where we might go with that.

A lot of our discussions have been about what might have happened, could have happened or should have happened with the Higher Education Governance (Scotland) Bill, and we have not said enough about what it actually delivers. It will deliver a democratic structure of accountability for all our institutions, whether they are relatively new institutions or one of the ancient establishments. It will bring all their governance structures into the modern era. There is not only a need for accountability for the money invested by the taxpayer, but a need for a more diverse governance model.

That for me is the prize. We can make a difference and move our institutions forwards, away from what appears to be a Victorian gentlemen’s club. The bill gives us an opportunity to take our successful universities and not only make them more transparent but ensure that they are fit for purpose in the current century. I hope that we can all agree that the bill is a starting point for the future of our higher education sector, and I encourage my fellow MSPs to work together to make that vision a workable reality.

Photo of Cara Hilton Cara Hilton Labour

I am pleased to follow George Adam. I think that that was the first time that he did not mention Paisley in a speech—very novel. It is pleasing, too, to have an opportunity to speak in today’s debate.

Our universities make an outstanding contribution to the academic, economic, social and cultural life of our country, and Scottish Labour welcomes their continued success in the face of budget pressures, in attracting high-quality staff and students from right across the world and producing groundbreaking research. We also value the vital role that our universities play in the economy by employing more than 42,000 people and supporting more than 144,000 jobs across Scotland.

However, there is no doubt that our higher education institutions could benefit from being a lot more open and accountable. Although universities rightly value their academic freedom, which must be protected, that does not exempt them from the need to be governed properly and run effectively. The bill provides real opportunities to address the shortfalls in university governance.

Photo of Elizabeth Smith Elizabeth Smith Conservative

Universities Scotland is adamant that there are about 500 lines of accountability with bodies other than the Scottish Government. None of them seems to have any problem with that. What is Cara Hilton’s comment?

Photo of Cara Hilton Cara Hilton Labour

If Liz Smith waits until I am further into my speech, she will hear why I think that the issue needs to be addressed. She should just be a wee bit patient.

I welcome the measures in the bill to improve accountability and transparency in decision-making structures, which will give staff, students and trade unions a real voice and a real say in the future of the universities in which they learn, teach and work.

It is only right that public institutions that receive many millions of pounds from the taxpayer are run openly, democratically and transparently. When we consider some of the issues that have hit the headlines in recent months and years—notably universities’ investment decisions, job losses and senior management pay—we get a flavour of why more democracy and transparency are so important. I have no doubt that governing boards would make better decisions if they better reflected the student and staff body, so the proposed changes are welcome. However, we can do more to make university governance better and more representative and inclusive.

In its briefing for the debate, NUS Scotland highlights the fact that although women make up more than half the student population, only a third of governing board members are women. I would like to see the bill go further by introducing quotas on university boards in order to ensure fair representation. That was recommended in the 2012 review—not including that measure in the bill would be a missed opportunity.

Iain Gray highlighted senior management pay. Although I hope that that issue will come under much greater scrutiny with student and trade union involvement on governing bodies, that alone is not enough to tackle the unreasonable pay increases in the sector. Research by NUS Scotland found that 88 individuals at Scottish universities earn more than the First Minister and that only one principal earns less than £140,000 a year. It cannot be right that university principals on six-figure salaries are taking huge pay increases of up to 13 per cent, along with expenses allowances that are often worth tens of thousands of pounds, while their staff are told year in and year out to accept pay increases that are below inflation and represent real-terms pay cuts.

Iain Gray also highlighted the secrecy that surrounds such pay decisions. That secrecy cannot be right, either. The University and College Union highlighted in its briefing that more than two thirds of higher education institutions failed to respond to its FOI request on the rationale behind those out -of-touch pay rises for university principals.

Given that every year more than a billion pounds of public money—quite rightly—goes to support our universities, it is only right that there should be public scrutiny of the excessive wages that many people at the top in our universities receive while staff at the lower end of the scale struggle to get by. I hope that we can look at strengthening the bill at stage 2—or at least produce guidance—to ensure fairness in pay structures.

The bill is not perfect by any stretch of the imagination, and its limitations have been raised by members today and in our previous debates, but it is a welcome step forward. It provides an opportunity to make university governance better, so I am pleased that the cabinet secretary and the Scottish Government have listened to Scottish Labour and others’ concerns about the more controversial aspects, such as the election of chairs and ministerial powers. There are issues in relation to Office of National Statistics classification that I hope can be resolved before the bill is passed. I also hope that we will see progress on gender balance and fair pay, and that we can work together to ensure the best possible outcomes for staff and students and for the higher education sector.

Photo of Clare Adamson Clare Adamson Scottish National Party

As a member of the Education and Culture Committee at the start of the process who left some months ago, I was glad to see in the stage 1 report and the Government’s response to it the progress that has been made, which displays an open and inclusive process in which stakeholders have been able to make their concerns known and their voices heard throughout. That reflects a collegiate approach to where the bill will go as it progresses through stages 2 and 3.

The process began with the commissioning of Professor von Prondzynski’s review, which was published in January 2012. We have had one quotation from the professor: I want to share another. In March 2015, he said:

“None of this is about government control. None of our recommendations, and indeed none of the proposed elements of the government’s planned legislation, would give any power to ministers to interfere in the running of institutions. Indeed the government has made it clear that it has no wish to exercise any such power.”

It is an important principal to have been established as we progress the bill that the academic freedom of the universities and the higher education institutions will not be compromised by the proposed governance changes.

Nonetheless, we have to make progress: this is the 21st century. I agree with some of Cara Hilton’s comments about diversity in our universities. The UCU, in its briefing for the debate, states that it can

“welcome the decision of the Education and Culture Committee to support the bill at stage one.”

It goes on to state:

“The measures contained in this bill, particularly those to introduce elected chairs of governing bodies and for trade union and students nominees to have places on the governing body are areas where UCU have campaigned over many years. We are also supportive of the limited proposal to extend the 2005 definition of academic freedom contained in the bill.”

Such a response to the proposals and the stage 1 report shows that we are moving in the right direction in respect of diversity, transparency and openness in the governance of our HE bodies.

The question has been asked, and there has been some comment, about why the legislation is necessary and whether such a way forward should have been adopted at any stage. NUS Scotland, in its briefing for the debate—which has already been quoted—states:

“We believe that an inclusive governing body can only be so when it accurately represents the community it governs and as the HE Governance bill currently stands it would fall short of its desired benefits. NUS Scotland would welcome the opportunity to work with MSPs to explore amendments at Stage 2 concerning fairer representation on governing bodies.”

I am not sure that such amendments are needed at stage 2, because there will be a lot of guidance associated with the bill that could address some of the equalities issues in the way that NUS Scotland is looking for. However, that comment from the NUS shows that our universities do not reflect our communities or their own university communities. The move to include trade unions and students in the governance and on the academic boards of the universities is a positive measure for the future. I hope that the guidance and the organisations that will contribute and nominate people to the boards and governing bodies will consider all aspects of diversity and equality.

Photo of Liam McArthur Liam McArthur Liberal Democrat

I start by echoing the convener’s thanks to all those who helped the committee in its stage 1 scrutiny of the bill.

Earlier this week we debated how to create a world-class education system. I said then that there are examples of where that is already the case in Scotland, and nowhere is it more evident than in our university sector, where the figures—I believe—speak for themselves. I accept that constant improvement is essential, and that adapting to changing needs, expectations and circumstances is the only way of safeguarding and enhancing standards and reputation. However, we have something to celebrate, value and respect—unfortunately the bill fails to do any of those things.

George Adam’s description of our universities as being akin to “a Victorian gentlemen’s club” is one that the sector would fiercely reject, and one that I think Mr Adam may come to regret. One of the sector’s great strengths is its differences—from the variety of its institutions to the diversity of staff and student populations. The governance of our universities should reflect that diversity. Given the significant public investment, Parliament and Government also have a legitimate interest in that respect. However, ministers—indeed, all politicians—should tread with care. In the bill, sadly, care has been abandoned as ministers appear to be intent on putting into statute things that do not belong there.

The Government is legislating not because it should or because it needs to, but because it can. Time and again—as the convener fairly pointed out—our committee sought evidence for why ministers are acting in that way. What governance models elsewhere in the world are we trying to emulate, and how can we be assured that ministerial meddling will make things better and not worse? None of those questions has been answered to any satisfactory extent.

On the up side, I note that the education secretary is minded to remove from the bill sections 8 and 13, which run the risk of leading to universities being reclassified. Whatever the scale of that risk, ministers should not, given the serious financial consequences for our HE sector, be playing a game of chicken with the ONS. Likewise, it is good to see that the Government does not now plan to legislate on the size of university senates—but why on earth was it meddling there in the first place?

As for elected chairs of governing bodies, the plans that have been arrived at look like the dog’s breakfast that many people predicted. During stage 1 evidence taking, the committee convener expressed his curiosity about how the Government would “square the circle” of having elected chairs on the one hand and the minister’s commitment not to diminish the role of rectors on the other hand. Frankly, that still looks pretty circley to me. We now have a mix of legislating for what happens already with a potential arm-wrestle between chairs and rectors over whose democratic mandate is bigger.

Even on union and student representation, given the funding levers that are at ministers’ disposal and the direction in which the existing code of governance is going, it is not clear why legislation is seen as being essential.

Photo of Alasdair Allan Alasdair Allan Scottish National Party

Will Liam McArthur concede that, even under the bill, the roles of rectors and chairs in terms of their day-to-day functions are so distinctive that any confusion about their jobs is unlikely?

Photo of Liam McArthur Liam McArthur Liberal Democrat

As I said, what we appear to have in the bill is a pre-selection process for candidates that is very much in line with what happens already. It is not clear how that will expand the pool of applicants, although I am fairly sure that students and, indeed, unions will be alive to the opportunities there. In terms of the role of rectors, it is not clear to me how to settle the question who has the democratic mandate to do what in our universities.

The staff, students, management and stakeholders of the Royal Conservatoire of Scotland have all made clear their outright opposition to what is proposed. They have demanded, as others have mentioned, an exemption from the legislation, which the Glasgow School of Art, Scotland’s Rural College and even the University of the Highlands and Islands might feel should apply to them as well.

All the evidence shows that, as Jim Eadie rightly indicated earlier, the best-performing universities worldwide are those that exercise the greatest responsible autonomy. They should be accountable and transparent and they should reflect the diversity of the communities that they serve. How that is best achieved, though, should not be second-guessed by ministers, using the blunt instrument of legislation. Previously, Stewart Maxwell described the bill as “thin”; the minister plans to make it thinner still. Given the complete absence of any evidence to justify the bill and the potential for it to harm rather than help our world-class universities, I respectfully suggest that it is time to make the bill vanish completely.

Photo of Joan McAlpine Joan McAlpine Scottish National Party

I start by declaring an interest in that my former partner and the father of my children is a former rector of the University of Glasgow.

I welcome the chance to speak in today’s debate and I am proud of Scotland’s reputation for providing accessible world-leading education. I support the bill’s aim to make our institutions more effective, inclusive and transparent by creating a framework to strengthen the practice of governance in universities and other higher education institutions. It seems to me that the bill seeks to safeguard the autonomy of institutions while ensuring their accountability to the key stakeholders whom they serve—namely, their staff and students. I am pleased to note that the bill has the backing of the Scottish Trades Union Congress, the UCU and the student body NUS Scotland.

Although it is right that we also listen to the concerns of those at the top of our HE institutions, it is vital that we assert from the outset the point that self-regulation has been shown to be somewhat insufficient on many issues. I take this opportunity to highlight a fundamental aspect of accountability: the question of remuneration. I previously raised that issue when I was a member of the Education and Culture Committee in 2013 and we were taking evidence on the draft Scottish code for good higher education governance. At that time I asked the vice-convener of the court of the University of Edinburgh—Professor Stuart Munro—whether it was right that a university principal was paid more than the Prime Minister, and he told us that he had “concerns” about having to cap the principal’s salary at £227,000.

Professor Munro was one of three senior university figures to address the committee at that evidence session. He made the comments about the principal’s salary after that group had caused controversy by suggesting that it was unnecessary to introduce legislation to cap tuition fees at £9,000 for rest-of-UK students. At that meeting, Professor Munro said that he did not think that he could recruit a principal on the same salary as the Prime Minister’s. Perhaps that reflects his view of the Prime Minister; I do not know. He might well be right, but the point is that such things must be discussed in an accountable manner.

Introducing trade union members and students on to the boards will allow more discussion of how decisions on salaries are reached. The salary of £227,000 for the principal of the University of Edinburgh is not the highest salary: Scotland’s Rural College has been mentioned: its principal’s salary is £290,000, which many people will blink at.

Photo of Mary Scanlon Mary Scanlon Conservative

Many of our senior national health service managers and other people in councils and right across the public sector are paid more than the Prime Minister. Should we bring in legislation to make sure that that does not happen?

Photo of Joan McAlpine Joan McAlpine Scottish National Party

Such decisions should be reached using democratic accountability. Maybe the amounts are correct, but the way in which they are decided on leaves a lot of people questioning them. The measures that the bill will put in place will allow university governing bodies to come to those decisions in a more democratic manner. I am not saying that the people who work at the top of universities and colleges should not be well paid: far from it. They make a vital contribution to the success of our universities.

I want to say a word about rectors. At the beginning of my speech, I declared an interest. I have watched closely the job of a working rector. We have seen the recent example of Mr Iain Macwhirter, the journalist, at the University of Edinburgh, which includes staff in electing the rector. Mr Macwhirter did a fantastic job in campaigning for staff and students on issues including fees.

Mr Patrick Kane, who was Lord Rector of the University of Glasgow in the 1990s, has recently written about his experiences as rector. When he campaigned for the post, he did so on the basis of, for example, introducing crèches and more access for disabled people, which was quite revolutionary at the time. He and other working rectors have showed how important it is to hear other voices and have other influences.

Patrick Kane wrote recently that the bill contains the spirit of rectorship and the democratic nature of Scottish education going back many centuries, and that it avoids universities becoming “Knowledge plc” rather than being communities.

Photo of John Mason John Mason Scottish National Party

I will speak mainly from the angle of the Finance Committee, which spent a fair bit of time looking at the bill and its financial memorandum, and came up with a fairly serious report as a result.

A number of points of a financial nature arose. First, there was the cost of the universities amending their governing instruments, which was not included in the financial memorandum; I refer to page 14 of our report. Secondly, there was the cost of recruiting a chair, on which a commitment was given to undertake further work; we welcomed that on page 16 of our report. There was also the time commitment, and therefore the costs, for a chair. There seemed to be quite a lot of disparity between the Government’s view of that time commitment and the view of the HEIs; that is referred to on page 17 of our report and, again, further work was promised on that.

However, the main concerns and focus for the Finance Committee were on two other areas—the potential loss of charitable status and the potential reclassification of HEIs as public sector bodies by the ONS. One of the main challenges for me and the Finance Committee was the question whether those financial concerns were real or whether they were a just a smokescreen and had been raised because people did not want there to be any interference or for the universities to have any accountability to wider society.

On the charity point, OSCR had responded by the time that the committee met, which seemed to offer the reassurance that there would not be a problem with charitable status. We concluded:

The Committee notes that a number of concerns were raised in written evidence in relation to HEIs’ charitable status but is satisfied that these were addressed in OSCR’s submission to the lead committee.”

Given that the charitable status point seemed to have been overstated, the question for us was whether the ONS reclassification point had also been overstated. There was a lot of talk of ministerial control, but to me the control seemed to be in the wider sense, in that Government would be able to set out the structure. Of course, the reality is that Governments set out the structures of and get involved in many organisations, be they commercial businesses, third sector organisations or whatever. That is a crucial difference between such Government involvement and ministers actually appointing Mr or Ms Jones to a university board.

The question of what the ONS thought was a difficult one for the committee, because the ONS does not give its opinion on something before it happens. Even asking the ONS for its opinion, as some suggested that we should do, could have raised the risk of reclassification by putting doubt in its mind. It would be like going to the police when one has been driving at 32mph and asking whether one has broken the speed limit.

There were also vague suggestions that the Government or the Parliament should take advice from hypothetical experts on reclassification. Liz Smith mentioned that today, although she would not take an intervention from me on that point.

Photo of John Mason John Mason Scottish National Party

Let me finish. It also became apparent that even the ONS considered the Scottish Government to be one of the main experts in the field. At the time, no one could suggest to the committee an expert to whom we should speak. Liz Smith will tell us who the expert is.

Photo of Elizabeth Smith Elizabeth Smith Conservative

I will be very happy to do that, but first I praise John Mason for his assiduous scrutiny in the Finance Committee, to which I listened carefully. When it comes to the debate that he has just outlined and the challenges of who is right and who is not right, would it not have been helpful if the Government could have come forward with evidence that backed up or contradicted the Anderson Strathern evidence on university reclassification? Does he accept that?

Photo of John Mason John Mason Scottish National Party

That is the point that I was trying to make. I have not heard who these great experts in the field are, who know more about the issue than the Scottish Government does. The bill team was good at explaining the issue and we took detailed evidence on how much study had taken place. It had met the ONS frequently, which is unusual—I suspect that not many Joe Bloggs meet the ONS regularly. It went through how the ONS thinks and how it looks at things. It seems to me that the Government has a pretty good understanding of the issue. The point is that the Government does not want reclassification. It has been perfectly clear about that, as has our committee and everyone else.

Another key point that came up was that if reclassification was proposed, it would not have immediate effect. There would be an opportunity to look at the proposal and change how things were being done. The committee noted, in its conclusion on this topic on pages 9 and 10 of its report, the financial concerns regarding reclassification and the Government’s clear desire not to see reclassification happen.

At paragraph 47 of its report, the committee made the point that primary legislation is seen to be safer than legislating by statutory instrument, because it gives less scope to ministers. I am happy to welcome the minister’s proposal. On behalf of the Delegated Powers and Law Reform Committee, on which I also sit, I say that we are happy that more is in primary legislation and less will be in secondary legislation.

Photo of Hanzala Malik Hanzala Malik Labour

It is an honour to speak in the debate on the Higher Education Governance (Scotland) Bill. There is widespread agreement in the chamber and outside it that Scotland’s universities punch above their weight. They make a major contribution to our economy directly and indirectly, through the human capital that they help to develop.

I believe that every organisation, however successful, needs to review and reform to ensure that it is fit for purpose. Organisations in the higher education sector are no different. We need to get a balance between reforms that increase transparency and accountability, and the maintaining of autonomy. Now that the Scottish Government’s proposed changes at stage 2 will remove the ministerial powers and, therefore, the threat of ONS reclassification of universities that would lead to the loss of funding routes, I do not feel that the Higher Education Governance (Scotland) Bill compromises academic autonomy.

With regard to financial decisions, higher education institutions that receive higher amounts of public funds should be open to greater financial accountability. Their lack of accountability has been symbolised by reports of high levels of pay and bonuses for principals, while junior staff suffer low pay and insecurity as a result of zero-hours contracts. Zero-hours contracts are the scourge of our industry just now. Education in particular suffers very badly in that area because of its importance not only to our country and to our academic teaching staff, but, more important, to the future students who will play the role of running our country and taking us forward.

I do not believe that the voluntary introduction of a governance review will automatically provide the required transparency and accountability. As each university is different, we should not assume that one size fits all. We need reforms that provide basic and clear governance structures that have the means to balance and correct themselves. The election of chairs could probably help to provide checks and balances, as would greater diversity on ruling bodies. I welcome the Government’s clarification of the process of election of chairs and its preservation of the post of rector for our older institutions.

As with any stage 1 debate, we can agree on general principles, but the details are important. There is still more clarification and tidying up to be done before we can be clear that the Higher Education Governance (Scotland) Bill will deliver the desired improvements in accountability.

Many of us have felt, particularly since the Government first interfered—if I can use that phrase—in the education sector, that many principals and boards had been gagged. They had been put in a position where they could not speak freely. They felt trapped, and they felt that they were unable to speak up about the realities of the conditions that faced them. The fact that the powers of hiring and firing laid with the minister meant that the universities, in particular, were in danger of losing the possibility of some very highly educated academics joining them, because they felt insecure about what was happening.

However, the new Government proposals are very welcome. We are going in the right direction, although a lot of work is still to be done. We must ensure that we are in a position to demonstrate to our universities that we will take their interests to heart and deliver a workable programme for them so that they are able to be transparent and to be more accountable than they are now.

Photo of Colin Beattie Colin Beattie Scottish National Party

The SNP’s continuous commitment to higher education has proven to be extremely effective in advancing Scotland’s students and society as a whole. For example, in the past four years the Scottish Government has invested more than £4 billion in the higher education sector. That, in part, has resulted in Scotland’s students having the lowest average student loan debt in the United Kingdom, which ensures that university education is based on the ability to learn rather than the ability to pay.

The Scottish Government’s commitment to higher education has strengthened the reputation of our universities. Government funding has helped to sustain Scotland’s position of having five universities in the top 200 in the world—the University of Edinburgh is number 24. In academic research, Scotland’s universities are outperforming those in the rest of the United Kingdom and competing globally at an extremely high level.

Given that taxpayers invest £1 billion every year in higher education, and given that enrolment and acceptance of young Scottish adults in our universities is on the rise, with university applications up 50 per cent since 2006, the SNP expects the highest standards of governance in our institutions.

Although the previous agenda has proved successful in many ways, there is more that we can do for our youth, through the Higher Education Governance (Scotland) Bill. The Scottish code of good higher education governance has failed to address the need for a modern, democratic culture in governing bodies, transparency in who makes decisions and how, and fair representation and diversity in governance. The SNP argues that further legislation is required, to provide for places on governing bodies for staff and student unions and to support the principle of elected chairs.

The bill will give students and staff a genuine, democratic say in the leadership of universities. It will provide the transparency that our higher education system requires if it is to maintain its global reputation and its effectiveness for our youth.

Professor von Prondzynski’s “Report of the Review of Higher Education Governance in Scotland”, which was published in 2012, made recommendations about how to strengthen Scotland’s higher education system. As principal and vice-chancellor of Robert Gordon University in Aberdeen, Professor von Prondzynski has a considerable understanding of the needs of students and faculty in higher education institutions. He began his review by addressing the necessity for autonomy, democracy and transparency in higher education, all of which I support.

Photo of Liam McArthur Liam McArthur Liberal Democrat

Colin Beattie will be aware that there are questions about the evidence base on which Professor von Prondzynski drew and about the international comparators to which we aspire. Neither Professor von Prondzynski nor the minister has been able to point to those international comparators and give us confidence that what we aspire to do has been working in practice—and working better than the approach that is currently in place.

Photo of Colin Beattie Colin Beattie Scottish National Party

Professor von Prondzynski’s reputation in the sphere of higher education is pretty much undoubted and I accept his approach and his review.

The bill used Professor von Prondzynski’s review as an outline and has the goal of modernising and strengthening governance, to instil principles of democracy and accountability in the higher education sector.

First, a greater democratic culture in governing bodies will be emphasised, by giving staff and students the right to elect a single voice to advocate for their interests on the governing body. That feature complements the democratic approach that the bill proposes. Secondly, greater transparency in decision making will be ensured through greater involvement of stakeholders across the board.

Finally, the bill will establish fair representation and diversity in governing bodies. According to research that NUS Scotland conducted in 2014, university courts are overwhelmingly dominated by men. The code of good governance recommended change in that regard, but there is no evidence that such changes have been made. Professor von Prondzynski’s report made clear that quotas should be utilised to enhance diversity, given that women make up the majority of our university population but are exceedingly underrepresented in governing bodies.

Despite the benefits that the bill will bring, many people have criticised it, citing the potential for reclassification and other governance issues that might arise. Some critics go as far as to suggest that the bill will remove rectors and sever the historic ties between students and their primary advocate by eliminating the rector’s right to chair court. Autonomy in Scotland’s higher education institutions is a central factor in the success of our universities and should be explicit in the bill.

The bill’s principal objective is to establish a high-level framework in Scottish universities that is more modern, inclusive and transparent. Such an approach is in line with the SNP’s commitment to a fairer Scotland and it is right to take it.

Photo of Mary Scanlon Mary Scanlon Conservative

Like you, Presiding Officer, since 1999 I have scrutinised many bills that have gone through the Parliament on issues such as free personal care, mental health, antisocial behaviour and the Office of the Scottish Charity Regulator, and we are now looking at the attainment gap in schools. Although, across the parties, members have always had differing views on how to address the problems, at least we have all known what the problems were. However, the bill that we are debating today is a solution looking for a problem. It is not just me saying that; that is acknowledged by the principal and vice-chancellor of the University of Edinburgh, who has stated:

“We do not think that there has been any compelling explanation of what the problem is that needs to be fixed here.”

Of course, our universities should uphold the highest standards of accountability, transparency and inclusion in their governance, which at all times should be “modern, inclusive and accountable”. If the Scottish universities were the worst offenders on those issues and principles, and if nothing was happening to address the deficit, I could and probably would support legislation. However, the code of governance that was introduced in the summer of 2013, which is due to be reviewed this year, has brought changes. According to a Universities Scotland briefing paper, the code has delivered 350 positive changes to enhance higher education governance and it has been adopted by the Scottish funding council as encapsulating the standards of good higher education governance.

The following are examples of that progress. Every Scottish higher education institution has staff and students as full members of court, with 72 per cent of institutions having two or more student governors and 94 per cent having two or more staff governors. Despite what was said by Colin Beattie, for whom I have great respect as I sit on two committees with him, on the issue of gender balance, eight out of the past 10 appointments to the role of chair have been women, which brings the percentage of women chairs to 44 per cent. Many organisations—including the Scottish Parliament—would be very proud to have a 44 per cent representation of women, so I do not think that we should be too critical of that. Even the cabinet secretary has acknowledged:

“The premise that I am starting from is not the premise that there is a deficit. I am not for a minute saying that governance in our university sector is poor,”—[Official Report, Education and Culture Committee, 10 November 2015; c 4.]

which gives rise to the question: why are we here, and why do we have the legislation?

The Education and Culture Committee’s report is 27 pages long compared to a bill of 10 pages, but that was necessary because of the lack of clarity and reasoning on so many issues. There are 17 separate issues on which the committee reasonably sought more information. I read the Scottish Government’s response three times—I think that it is trying to be helpful, but I am not sure—and the promise of further amendments to address the concerns is, in my book, a worrying feature given what we have seen so far.

Today, the SNP back benchers would have been wise to listen to the SNP convener of the committee instead of being fed the party line. I commend Jim Eadie and Sandra White, who have obviously talked to the University of Edinburgh and the Royal Conservatoire of Scotland and are listening to the reasonable concerns of those higher education institutions.

Photo of Mary Scanlon Mary Scanlon Conservative

I am sorry, but I have less than 30 seconds left.

Stewart Maxwell has to be commended for steering the committee this far. His speech was a fair reflection of the cross-party concerns about the bill. Chic Brodie has to be commended, too, because his scrutiny of the bill has been first class. In raising concerns on behalf of the committee today, Stewart Maxwell acknowledged that the cabinet secretary had not provided specific examples of deficiencies in the sector, that much of the detail of the bill is still under consideration and that amendments are needed.

It is quite incredible that every higher education institution in Scotland is against the bill. We should be listening more carefully to what they are saying.

Photo of Mark Griffin Mark Griffin Labour

As Iain Gray set out at the start of the debate, Labour supports the general principles of the bill, which has the laudable aim of ensuring that the structure of our universities’ governance continues to develop and adapt in order to maintain our first-class university provision, in which we should all take pride.

From the start of this process, we have offered support for the inclusion of trade union reps and student reps on governing bodies as part of the democratisation of higher education institutions’ governing bodies. That support has been echoed by all my Labour colleagues who have spoken in the debate.

All parties today have recognised the importance of the higher education sector to Scotland’s economy and our international standing, so we should listen to the sector’s views and respond to its concerns.

The value that we place on our higher education system in Scotland is part of our cultural DNA. We extol the virtues of our historic and new universities and talk with great pride about their contribution to the world, not just in educating our own young people but in undertaking world-leading research and dynamic entrepreneurship that is recognised across the globe. We must view the bill in that context—a context that has seen our universities continue to succeed in an increasingly competitive international climate.

We must be cautious that in attempting to improve the way that our esteemed institutions operate we avoid diminishing or restricting the freedom that has contributed to that success. Scottish higher education has a long history of having staff and students at the heart of its mechanisms of governance. Staff and students are full members of a university’s governing body—the court—at every institution. According to Universities Scotland, 94 per cent of institutions have two or more staff members of court and 72 per cent have two or more student members of court. We all recognise that we should seek to build on that record, rather than suggest that there is a problem with university governance that requires a top-down overhaul.

A significant number of unintended consequences and unanswered questions were identified in respect of the bill, many of which were highlighted through the committee’s scrutiny and the evidence with which we were provided.

In committee, I said that ONS reclassification was quickly becoming a key issue for the Scottish Government, which was understandable, given its potential impact on the sector. It is rare in politics these days for someone to take responsibility and stand up and say that they have got it wrong, so I commend the cabinet secretary for doing just that today.

Universities Scotland suggested that if the ONS was to reclassify Scotland’s universities as public bodies, the sector would stand to lose competitively-won income from charities and philanthropy and income earned by the universities through entrepreneurial activity and that institutions’ capacity to borrow would be reduced or removed. That could have cost the sector well in excess of £400 million per year at a conservative estimate.

I note from the Scottish Government’s response that it is minded to lodge amendments at stage 2 to remove sections 8 and 13 of the bill. In addition, the Government is minded to lodge amendments that would reduce or remove the need for regulation-making powers in sections 1 and 2 of the bill. It is fundamental to the sector that the Scottish Government takes that action. The consequences of it not doing so are stark.

Removing sections 8 and 13 of the bill would alleviate another concern that was raised in committee and by the sector more widely. The fact that the Scottish Government had to state explicitly that it did not want to advance ministerial control over universities is an indication of the worry and concern in the sector about the direction that the bill was taking. Our universities must remain independent and autonomous bodies, free from ministerial pressure and control.

I am also pleased about the amendment that is scheduled to be lodged on the removal of the limit on the academic boards. A number of speakers have talked about the situations in universities throughout Scotland, particularly the University of Edinburgh.

Photo of Elizabeth Smith Elizabeth Smith Conservative

Why does Mark Griffin feel that legislation is necessary on academic boards?

Photo of Mark Griffin Mark Griffin Labour

I do not feel that the cap of 120 members was necessary. I am glad that the Government proposes to remove that measure. However, we should still have the option of legislating for the composition of student membership of academic boards. We would support that.

We offer our conditional support for the bill at this stage. The amendments that the Scottish Government has suggested that it will lodge appear at first glance to address the issues that were raised in committee. The cabinet secretary is to be commended for the changes that she has made after listening to the committee, the sector and members. The repercussions of the Government getting it wrong on higher education governance are so serious that we will watch carefully and scrutinise every amendment at stage 2. We will ensure that our world-class universities are supported with the freedom and framework to continue to provide a first-class education and the ground-breaking research for which they are well known.

Photo of Angela Constance Angela Constance Scottish National Party

I thank members for their contributions to the debate. I am glad that, in considered tones, Mark Griffin and Cara Hilton, although outlining their views on the bill and how it could be improved further, acknowledged that the Government had listened and worked with a range of stakeholders.

Cara Hilton spoke about the importance of improving the representation of women within governing bodies. Mary Scanlon pointed to the progress that has recently been made. It is important that we maintain the progress that has been made in a wide range of areas of governance following the von Prondzynski review and the introduction of the code of good governance.

The principles of the bill are consistent with where modern Scotland sits. Stewart Maxwell and others recognised that the fundamental question is how the bill helps to make a good system better. In the modern day, most people accept that the greater participation of a greater diversity of people who have a shared interest in improving the institution and acting in the interests of staff and students improves governance.

Participation and diversity improve governance, and the Government has set participation as one of its three key priorities. We have set ourselves the challenge of finding ways of handing decision-making powers back to communities.

Photo of Angela Constance Angela Constance Scottish National Party

Not just now.

Therefore, the bill is very much aligned with our commitment to a fairer, more inclusive Scotland that better reflects the diversity of our society and where everyone gets to have their say. The bill aims to reflect those priorities and values by strengthening community—in this case, staff and students—participation in decision making. At its heart, the bill seeks to enable every voice on campus to be heard, and I hope that that is a principle that we can all endorse.

Photo of Sandra White Sandra White Scottish National Party

The cabinet secretary mentioned staff and students being involved in decision making. That already happens at the Royal Conservatoire. I hope that she will reflect on that and perhaps answer the questions that Stewart Maxwell asked about the Royal Conservatoire. Can she give us an update on the position with the conservatoire and the Glasgow School of Art?

Photo of Angela Constance Angela Constance Scottish National Party

The reality is that the vast majority of institutions in Scotland already have five of the statutory members that are required. If the bill proceeds from stage 1 to stage 2 and is amended in the way that is proposed, it will specify that there must be seven statutory members on a board. Most institutions, including the Royal Conservatoire, are well on their way to achieving that.

I want to say a little about ONS reclassification, although it is an issue on which we have been around the houses in a variety of forums. I want to strike a consensual note. John Mason helpfully identified that it is an issue of statistical classification rather than, say, a legal issue. Like John Mason, Liz Smith and Universities Scotland—although I admit that they see things from a different side of the mountain—both acknowledge that, in many ways, this is a matter of interpretation and difference of opinion. I and the Government have our opinion.

In its briefing, Universities Scotland says that it believes that the only complete way to address the risk of reclassification is to remove sections 8 and 13 from the bill. I have made my intentions on the matter crystal clear, although there has never been anything in the bill that would advance ministerial control.

Photo of Elizabeth Smith Elizabeth Smith Conservative

I made it very clear that we are delighted that those two sections, which should never have been in the bill in the first place, are to be removed, but why is it that the Government can seek information and evidence about ONS reclassification for other projects in Scotland, such as the Aberdeen western peripheral route—I think that it sought such evidence on four different occasions—yet we have not had definitive information in this case?

Photo of Angela Constance Angela Constance Scottish National Party

I beg to differ on that point. I have written to the respective committees twice on this matter and have identified that not just education officials but officials across Government have looked very closely at the European system of accounts 2010 and the indicators of Government control and, in our view, there has never been anything in the bill that increased the risk of ONS reclassification, because there has never been anything in the bill that required autonomous institutions to ask for Government permission to conduct their day-to-day business.

I turn to the issue of elected rectors, which Stewart Maxwell, Chic Brodie, Jim Eadie and Liam McArthur all raised. I emphasise that the Government is not altering rectors’ existing statutory rights. Rectors have the right to chair court, should they choose to exercise it. As things stand, it is up to the ancient universities how they dovetail the role of senior governor, who will now be elected, with that of an elected rector. It is extremely important to remember that the role of rector and that of an elected chair, who is otherwise known as the senior governor, are very distinct. Rectors are part of the democratic tradition of our ancient universities. They have an ambassadorial role, they raise the profile of the sector and they have the role of representing staff and students. The role of rector is a very influential one. The role of elected chair or senior governor or vice-convener is to oversee governance. They are steeped in day-to-day governance. Crucially, they appraise the principal’s performance, and they often serve on many of the working groups and sub-committees. Theirs is a very powerful role, so it is correct that they are elected in a transparent and modern process.

Photo of Angela Constance Angela Constance Scottish National Party

No. I am running out of time.

Elected chairs would allow all staff and students to choose the candidate who can lead the entire campus community in a common purpose, but they must also be equipped to perform the duties associated with a modern Scottish higher education institution. For that reason, there must be appropriate candidate selection.

I note what has been said about the link between the chair and the institution’s governing body. Other members have raised that issue. However, the selection phase should ensure that every electoral candidate has the necessary leadership skills and qualities. I very much note the representations and views of NUS Scotland and the UCU, which say that that should be about ensuring capacity and skills, and it should not be used as a bar on suitable candidates.

The convener of the committee, Stewart Maxwell, raised a number of other issues. As time is short, I will write to him.

We continue to work through the issues around academic freedom. We removed the requirement to have alumni and graduate members on governing bodies. That was very much at the request of post-1992 institutions.

On the issue of evidence, the von Prondzynski review took evidence from a range of stakeholders at the United Kingdom and European levels and from Scotland.

With the best will in the world, I have to accept that, on some occasions, nothing will satisfy those who are determined to oppose the bill. Liam McArthur said that the Government is legislating because we can. I would not have invested the time, energy and engagement that are acknowledged in the briefings from the UCU, the NUS and Universities Scotland if I was merely going to rely on the size of my parliamentary group in comparison with his parliamentary group.

I hope that members can move forward and support this very important bill at stage 1.