Chamber and committees

The main item on our agenda is further consideration of the Auditor General for Scotland’s briefing, “Scotland’s colleges 2023”. I welcome our witnesses, who have all joined us in Parliament. First, I welcome Neil Rennick, who is the director general for education and justice, and Stuart Greig, who is the deputy director of governance and assurance for post-school education in the Scottish Government.

We are also joined by the chief executive of the Scottish Funding Council, Karen Watt. You are very welcome. Also joining us from the Scottish Funding Council is Lynne Raeside, who is the deputy director of external affairs.

We have a number of questions to put to you this morning, but before we get to those, I invite Neil Rennick, then Karen Watt, to make short opening statements.

No, that is your prerogative.

I will go back to an earlier line of questioning. There is something that I want to understand. I have correspondence in front of me from 2018 when the then Public Audit and Post-Legislative Scrutiny Committee wrote to the then Minister for Further Education, Higher Education and Science to seek clarity about the respective role of the Government, the Scottish Funding Council and the colleges. In the minister’s reply, one of the turns of phrase that were used in reference to the financial memorandum at the time struck me. The letter said:

“Importantly, the FM”—

the financial memorandum—

“recognises that colleges are autonomous bodies”.

What happens if a college runs out of money before the end of the year? I think that Karen Watt said that the Scottish Funding Council is in a much tougher financial position and that it maybe does not have the strategic funds that it would have had a few years ago to help a college to get over that. What would happen? Would the college become technically insolvent?

The question of the infrastructure of the college estate has been an issue for quite some time. I think that the Auditor General brought out a report on it in 2018, and I certainly remember raising it in Parliament with the then First Minister as a matter of public interest and concern. Why has it taken so long to address the issue?

Graham Simpson has a very short question.

Thank you very much, indeed.

One of the themes that we will pick up this morning is financial sustainability. By way of opening up on that, I note that the evidence that we have taken—both from the Auditor General and from witnesses at a round-table meeting to which we invited the key stakeholders in the sector to give us their perspectives—put across some fairly clear points.

The Audit Scotland report identifies that 8.5 per cent of real-terms cuts have been imposed on the sector over the past two years. A pre-budget submission from Colleges Scotland described the sector as being “on a burning platform”—echoing the words that James Withers had used.

Colleges Scotland’s post-budget analysis suggests that, in its view, revenue funding for Scotland’s colleges is to be cut by 8.4 per cent year on year—in cash terms, not in real terms. It is estimated that the capital budget will rise by 3 per cent in cash terms.

Karen Watt’s note to the committee says that

“The financial position of colleges continues to deteriorate”.

What is the financial position of colleges, Mr Rennick?

We have spoken about a student-centred approach and the importance of the outcomes. It is not just about the inputs, financial and otherwise, is it? Is it not the case that your changes to the rules about the thresholds for non-retention or drop-out rates of students disincentivise attempts by colleges to retain students? If somebody drops out in week 6, as long as they have been there for five weeks, the college still gets the financial payment as if they were there for the whole of that academic year. Will that not lead to an increased level of student drop-out or non-retention?

The committee would certainly expect that to be carefully scrutinised, because the change could have a negative rather than a positive effect from the student perspective. We may come back to you on that at some point.

I will move on to another element of the report, which is the college estate. I have a topical question on reinforced autoclaved aerated concrete. Do we know the extent of RAAC in Scotland’s colleges?

Will it be done by the end of the year, say?

Thanks. That is helpful.

Mr Rennick, when do you expect a decision to be made?

Okay. Thank you for your time and the evidence that you have given us this morning, which has been very helpful.

As Willie Coffey reminded us, there is no such thing as a job for life any more. Retraining and reskilling are hugely important roles that are fulfilled very well by the college sector in Scotland. I suspect that, in this era of the just transition, they will become even more acutely important.

I note that a paper that we were given in advance of the meeting pointed out the finding from the Sutton Trust that 90 per cent of learners from the most socially deprived backgrounds who went to university did so through colleges. That is not the only thing that colleges do, but it is a really important thing.

I thank Neil Rennick , Stuart Greig, Karen Watt and Lynne Raeside for their input this morning. As I said, it has been very useful to us.