Ministers in Edinburgh have cut spending on free university places for Scottish students, forcing universities to pare back on loss-making courses and reduce costs.
Universities Scotland, the umbrella body for the sector, said the proposed cuts of £48.5m in funding for teaching Scottish students would lead to “inescapably hard choices” next year, likely to include leaving teaching vacancies unfilled.
Scottish local authorities and the legal profession were also furious about Tuesday’s budget announcement, which introduced a new “advanced” rate of income tax of 45p for anyone earning above £75,000 to partly fund a freeze in council tax rates.
Council leaders calculate their funding has been cut by £350m, while the Law Society of Scotland said another real terms cut to legal aid embedded a “distorted and shortsighted” approach to criminal justice.
The cuts in university teaching of 6%, which exclude the effects of inflation, will raise fresh questions about the sustainability of Scotland’s policy of giving free tuition to all Scotland-domiciled students, which is not fully funded by the government.
A number of university finance directors privately believe it is too costly, and argue some form of tuition fee, potentially means-tested, could be required to help the sector cope with soaring costs and intense competition to attract the overseas students whose fees subsidise Scottish student places.
Prof Iain Gillespie, the principal of the University of Dundee and the convenrr of Universities Scotland, said: “Universities are facing serious headwinds in international student recruitment, which means the assumed reliance on cross-subsidy from international fees to compensate for cuts to public funding is likely to leave universities exposed on multiple fronts.”
While Scottish ministers repeatedly boast about the global reputation of Scotland’s universities, higher and further education funding was cut on Tuesday by 5.4%. While capital spending for colleges rose by 14%, spending on college teaching fell by 6.6%.
Gillespie said a 4.75% increase in capital spending for universities would help invest in research and innovation. Even so, overall the budget “means some inescapably hard choices for universities, with the challenge made all the harder by continuing high inflationary pressures on our costs.
“We will do our best for learners and the vast array of stakeholders in business and civic society, who rely on universities, but the overall settlement makes it more difficult to make our full contribution to the nation’s success.”
The financial crisis has led Aberdeen University to significantly cut its languages degrees, including Gaelic, despite protests from musicians, academics, diplomats and poets.
The university, which has taught Gaelic since 1495, decided earlier this month to axe its single language degrees and instead offer languages as joint degrees with other subjects after the department lost £1.5m this year. Critics said this “cruel” decision would lead to 50% job losses in the department, and the University and Colleges Union is balloting on strike action.
The Convention of Scottish Local Authorities said the government’s offer of £144m extra to cover the costs of an across-the-board freeze in council tax rates was grossly inadequate. Cosla members estimate they will lose nearer £300m due to the freeze, excluding inflation, and still have to fund significant pay awards for council staff.
Paul Johnson, the director of the Institute for Fiscal Studies, said that the income tax increase for the better off would raise a little over half the cost of funding the council tax freeze, which itself would disproportionately benefit wealthier people.
Also worth saying that Scottish government spent 50% more on freezing (i.e. real terms cut) council tax than it will raise from the new higher rates of income tax it announced.
— Paul Johnson (@PJTheEconomist) December 20, 2023
Council tax freeze, of course, is worth most to those in most valuable properties. https://t.co/VTEEOdtZ0t
