To ask the First Minister what the potential implications are for Scotland’s economy of the United Kingdom Government’s immigration policy changes for graduates. (S6F-03158)

I am deeply concerned at reports that the United Kingdom Government is considering introducing further measures to restrict the graduate visa route. I have written to the Prime Minister to emphasise that there is no economic or educational argument for such a proposal. Any restrictions to international students’ ability to stay and work in Scotland after graduation would damage the higher education sector and our wider economy.

Sixty per cent of the Scottish public support a graduate visa, while the UK Government’s own Migration Advisory Committee has recommended retaining the graduate route “in its current form”. Scotland’s distinct demographic challenge means that it is crucial that we have the tools to attract people to, and retain them in, Scotland. That should be our focus, not turning people away.

Universities Scotland has written to the UK Government, stating:

“Further restrictions to the graduate route would benefit literally no one”

and pointing out that

“international students make a net positive contribution of at least £4.75 bn to the Scottish economy.”

Does the First Minister agree that even the threat of changes to the graduate route could damage our international reputation and that that shows us why decisions about immigration should be made in Scotland, to allow us to put Scotland first and make decisions in our economic interest?

I agree with Mr MacDonald. It is clear that the graduate visa route has resulted in significant economic benefit to our communities, because it has, in essence, anchored the educational achievements of some of the brightest people in the world, contributing to the Scottish economy through our universities and the further activity that flows from that.

It is a very short-sighted proposal. I am uncertain as to whether the Prime Minister will take a decision in the context of an imminent election to change the graduate visa route. However, I assure our university community of the Scottish Government’s steadfast support and assistance in doing all that we can to avoid the graduate visa route being in any way altered, because it benefits Scotland and our institutions.

The Migration Advisory Committee, which was mentioned earlier, stated:

“it is the failure to properly fund the sector that has led to an increasing overreliance on immigration.”

It went on to say that it has

“had no indication in ... discussion with Ministers ... that there is any plan in place to address this structural under-funding.”

Does the First Minister have any plan in place to address the structural underfunding of Scottish universities by the Scottish National Party Government?

The Scottish Government gives significant financial support to the university sector, but, of course, the Scottish Government has to live within the resources that are made available to us through the Barnett formula and the funding of the public purse.

People such as Liam Kerr have to wake up and realise that there is a consequence of 14 years of austerity. That has put insufferable pressure on our public finances, and the people who are responsible for those 14 years of austerity are Liam Kerr and his Conservative colleagues. As a Government, we will do all that we can to support the university sector, but people such as Liam Kerr need to face up to the implications of the damaging decisions of the United Kingdom Conservative Government.

For the first time, the income from international students has surpassed that from domestic students. That is because of the excellent reputation of Scottish universities. However, that also poses a risk, because it involves being heavily dependent on funding that is subject to global volatility.

The First Minister will know about the financial difficulties that have been reported at the University of Aberdeen, where there is “significant doubt” about its ability to continue. The situation is very stark. There have been similar reports about other universities and four colleges. What are the First Minister’s thoughts on how to address that situation, which is not going away and will only get worse?

I take seriously the point that Mr Rennie raises, but it relates directly to the public finances, on which the Government has taken a stance. We have been prepared to increase tax to increase the resources that we have available to invest in key sectors such as the university sector and the college sector.

The Scottish Funding Council engages directly with institutions to support them with the challenges that they face, but I make the point that the continuation of austerity, which is now having such a punishing effect on our public finances, is a material factor that we have to address. The opportunity to do that is in front of the country in the forthcoming election.