Scottish universities in worse financial position than year ago, MSPs told

Scotland’s universities have warned they are in a “far more precarious financial position” than a year ago, with a sharp drop in international students being the primary reason.

Universities Scotland, which represents the sector, gave a stark assessment of their funding in a submission to a Holyrood committee – highlighting that almost 92,000 fewer applications for taught postgraduate study are forecast for the next academic year.

Overall, the Education Committee was told that universities’ income would be about £100 million less than expected due to the “widespread” fall in international demand.

Changes in immigration policy by the UK Government were said to be a significant factor, including the removal of the dependents’ visa for international students.

Uncertainty over the graduate route visa also contributed to the fall in applications, according to Universities Scotland’s submission.

The organisation said: “Universities are in a fundamentally different and far more precarious financial position in spring/summer 2024 compared to a year ago.

“Government cuts to public funding, particularly for teaching, are getting deeper, and international recruitment has plummeted across two recruitment cycles, undermining the model of cross-subsidy that the Scottish Government funding model relies upon.

“At least 10 (of 19) institutions are expected to be in deficit in 2023-24. This is forcing institutions into inescapably hard choices.”

Education Secretary Jenny Gilruth was asked about the issue at Holyrood on Tuesday.

She said: “International students play a crucial role socially, culturally and economically in Scotland and it’s important that we continue to do everything that we can to welcome them to live, study and to work in Scotland.

“Instead, UK immigration policies are attempting to turn them away, which is hurting our higher education sector and demonstrating once again that UK immigration policies simply do not address Scotland’s distinct demographic and economic needs.”

Conservative MSP Liam Kerr referred to recent evidence from Dr Gavan Conlon, a partner with economics consultancy London Economics, who said there was a “very significant risk” a university in Scotland could have to close.

He asked Ms Gilruth if she was happy to risk an institution collapsing due to Scottish Government underfunding.

The Education Secretary said the Scottish Government was facing “one of the most challenging financial situations since devolution” due to cuts from Westminster.