Public Audit Committee
Scotland's colleges 2020
Letter from Convener to Joe Griffin, Director-General Education and Justice, Scottish Government, 1 October 2021
Dear Joe,
Scotland’s colleges 2020
At its meeting on 23 September 2021, the Public Audit Committee took evidence in a round table format from a range of witnesses on Scotland’s colleges. The evidence session was prompted by the publication of the Auditor General for Scotland’s blog on Scotland’s Colleges 2020, which was referred to the Committee for consideration.
During the session, the Committee also drew on other relevant reports including the Auditor General’s previous report on Scotland's colleges 2019 as well as the Scottish Funding Council’s (SFC) report on Coherence and Sustainability: A Review of Tertiary Education.
Following the session, the Committee agreed to write to you seeking further information resulting from the evidence heard.
Financial health and sustainability
Firstly, it was clear to the Committee that while the college sector had a surplus of approximately £7.6 million for the academic year 2020-21, longer-term financial stability is a significant concern. The Committee understands that a wide range of
factors are all contributing to a high level of financial uncertainty including the impact of the end of furlough, the forthcoming increases in national insurance contributions, and the remaining uncertainty about the inflationary environment that we are in and what that may mean for future costs and pay awards. Uncertainty also exists with regard to successor funding to European Union Structural and Investment Funds.
During the meeting, the Committee heard strong evidence about the positive impact Covid consequential additional moneys has made to the sector. Indeed, it was explained that the flexibility of this funding gave colleges the freedom to adopt new ways of working to respond quickly to immediate and local needs. The Committee welcomes these new and innovative practices.
It was repeatedly highlighted to the Committee however that further uncertainty exists in terms of whether this additional funding will continue. The Committee heard that the very real impact of this short-term funding is the sector’s inability to undertake long term strategic planning as well as a risk to the continuation of programmes and services. Shona Struthers, representing Colleges Scotland stated during the meeting—
“…colleges make lots of short-term decisions, which are often not the best financial decisions. If the sector could be afforded a multiyear funding settlement, that would go a long way to allowing us to be much more strategic and would be better use of the public purse”.
The Committee understands that the SFC’s review of tertiary education calls for “a clear strategic, longer term vision and intent for the future of tertiary education and research undertaken by colleges and universities in Scotland, that incorporates multi-year funding assumptions and commitments”.
As regards funding, it was explained to the Committee that colleges receive on average £4,000 per student, compared to £8,000 per high school student. It was further highlighted to the Committee that if investment in colleges were to be “levelled up”, this would address many of the financial challenges the college sector is facing.
The Committee welcomes your views on the long-term financial planning issues raised during the evidence session, including the inequity of funding per student as abovementioned, and what action the Scottish Government is taking to address them.
We note that the Scottish Government intends to respond to the wide range of recommendations in the SFC’s report imminently. As such, we recognise your response will take cognisance of the Government’s response to the SFC’s review.
Skills and workforce planning
The Auditor General’s blog highlights that colleges make significant contributions in supporting the country’s social and economic recovery from Covid-19.
The Committee was encouraged by the examples it heard of new and innovative ways in which colleges have been filling job vacancies, re-designing college curriculums and creating dual qualifications to equip students to meet skill shortages.
We are concerned however that these new ways of working are not being consistently applied across Scotland. Further concerns also exist with regard to the speed in which some colleges have been able to adapt to meet skills shortages as well as whether the skills being taught are the right ones to meet the needs of employers.
The Committee therefore seeks to understand what work the Scottish Government is undertaking, alongside Skills Development Scotland, to ensure the college sector, and by association its students, are well placed to meet the needs of businesses to support Scotland’s economic recovery.
I would be grateful if you would provide a response to this letter by 29 October 2021.
Yours sincerely,
Richard Leonard MSP
Convener
PS Thanks for your first attendance at the Committee yesterday. We look forward to working with you during this session of Parliament