Chamber and committees

Is there time for a response on reserves from Ellie Gomersall?

I have one final question for Professor Boyne. You will have heard in the previous evidence session discussion around my questions to the panel about working conditions in universities, so it is only fair that you have the opportunity to lay out Universities Scotland’s position on that issue. Why is there a relatively high prevalence of casualisation, zero-hours contracts, short-term contracts and so on in the sector?

I have a final question for both of you. Do you think that we have the right funding model? Essentially, we fund all universities on the same basis—on a per student basis. The University of Glasgow has around £1 billion in its reserves while the University of Edinburgh has around £1.8 billion in its unrestricted reserves and about £2.8 billion in total. A number of other universities, such as Glasgow Caledonian University, Abertay University and Edinburgh Napier University, do not have those amounts. Given the monumental pressure on Scottish Government finances at the moment, is it right that all universities are funded on the same basis, or should we expect institutions that have larger reserves than the Scottish Government has to take a bit of money out of their own pockets to help through what will be a very difficult couple of years?

You mentioned that flat cash is unsustainable. The Scottish Government’s settlement for the next couple of years is also a flat cash one. Therefore, it is a question of priorities for the Government.

That is a perfectly compelling case, and you are right in saying that, in the overall picture, substantial sections of those reserves are restricted. The University of Edinburgh has £1 billion of restricted reserve. It has £1.8 billion of unrestricted reserve, though.

Do you accept the principle of what I am saying? When the Scottish Government is under so much financial pressure across the board, particularly given the cost of living pressure on families at the moment, it is a big ask for the university sector to be given a substantial amount of additional money when some organisations in the sector hold in their bank accounts far more than what is available to the Scottish Government in terms of discretionary spend.

Karen, does the SFC do any monitoring of university reserves? Does that come under your remit at all?

I will continue the line of questioning around finances. I accept absolutely the economic and social return on investment in universities. The Scottish Government is currently—quite rightly—under pressure to expand the provision of free school meals, to increase devolved social security payments to something approaching the level of inflation and to keep public sector pay in line with inflation. The Scottish Government is experiencing all those pressures while its settlement is a flat cash settlement for the coming years. At the Finance and Public Administration Committee yesterday, we had eight organisations around the table that collectively asked for billions of pounds in spending, and all of them had good cases to make.

Going back to the questions that I asked the previous panel, how can we justify giving Glasgow and Edinburgh universities large sums of public money when their reserves are considerably larger even than that which the Scottish Government is allowed to hold? The University of Glasgow has £1 billion in its reserve, whereas the Scottish Government’s reserve is capped at £700 million—not that there is anything in it at the moment—and the University of Edinburgh has £1.8 billion in its unrestricted reserve and £2.8 billion in total reserves. The University of Glasgow’s reserve has gone up by about £150 million, according to the latest report, and the University of Edinburgh’s has gone up by about £240 million.

Why should we give Glasgow and Edinburgh universities the same amount of money per student in the period of the spending review? I accept that, in the long term, it is not sustainable or fair to give them less than other universities, but for the period of the spending review, while the Government has flat cash, should we be giving every university the same amount of money per student when some universities have so much down the backs of their own sofas?

I am conscious of the time, so I will be brief. You mentioned the Scottish Government sending a signal to universities about fair work. Are you talking about a soft power, lobbying approach or using SFC conditionality to take a harder approach to forcing change? I am interested in identifying what specific steps the UCU would like to see us try to take.

I am interested in following up on what Stephen Smellie said. I found Unison’s submission really helpful, in that the committee has a whole range of organisations that come to us wanting more spending in the areas that they prioritise, but very few folk are willing to come with proposals on how to raise additional money to pay for that or what to cut from elsewhere to do that.

That said, as much as I think that Unison’s revenue-raising proposals are deliverable and could produce tangible results, even if they were collectively maximised, they would not raise enough money to match the spending commitments that Unison is looking for. Therefore, I am interested in the union’s view on prioritisation. Is the priority free school meals? Is it increasing NHS funding? Is it keeping public sector pay in line with inflation? How should Parliament prioritise spending in a context in which, at least in the short term—over the next two to three years—we certainly cannot do everything on your spending list all at once.

Yes. The national care service is a good example. I would maybe not share Unison’s view on that, but it is a tangible example. However, there is a lot of other stuff in the submission that ticks the boxes that Stephen Smellie outlined as priorities, such as free school meals. I presume that Unison has a main focus on increasing funding for further and higher education not just in the interest of equity for students, but because there are substantial numbers of low-paid workers in those sectors.

How can we prioritise between different areas of spending that would all raise the wages of low-paid workers, lift children out of poverty and so on? We cannot do all the things at once. That is the issue that we have. Should free school meals, public sector pay, more funding for colleges or more funding for universities be prioritised? I realise that, in principle, in a utopian world, it should not be a matter of choosing between those things, but it will certainly be a matter of choices in the next few years. We will have to make the choices, but I am keen to know what the trade union movement’s priorities would be.