Coronavirus: Scottish universities 'could lose £500m' next year

Edinburgh University was founded in 1582 and is the sixth oldest university in the English-speaking world.

Scottish universities are warning they could lose more than £500m between them next year due to the coronavirus crisis.

It is feared the pandemic will result in a massive drop in the number of students from outside Europe, who pay large tuition fees.

And the sector has warned it needs support from Westminster and Holyrood.

Scottish Secretary Alister Jack said the UK government was working to provide as much stability as possible.

But without help, some universities fear they could be in a critical situation by the end of this year.

'Very exposed'

Prof Andrea Nolan, convenor of Universities Scotland, said: "Scotland's universities are taking all the steps they can to mitigate the financial impact of Covid-19 and are exploring the appropriate use of existing government support schemes.

"However, our higher education sector is very exposed to the impact of Covid-19 because of the extent to which funding structures have necessitated a reliance on international tuition fee income.

"Financial support from both governments, over and above the existing UK schemes... will be necessary to ensure the quality of education delivered to a generation, protect jobs and the sector's sustained contribution to the common good."

Glasgow University is among the Scottish higher education institutions which face a funding shortfall.

Scotland's 19 higher education institutions are independent of each other and get their income from a number of sources. The financial situation at each university will be different.

The main sources include:

• Income from the Scottish Funding Council which pays the tuition fees of Scottish and EU students.

• The tuition fees of up to £9,000 a year paid by students from other parts of the UK.

• Uncapped tuition fees paid by students from outside Europe, including those from North America and the Far East. They sometimes reach about £30k a year.

• Income for research work. Sources include businesses and government. There was already a concern about the effect of Brexit on EU-wide funding.

Some institutions - generally those which were universities before the 1990s - have far larger numbers of international students than others or attract significantly more research funding.

Universities Scotland, which represents the sector's collective interests, says the sector is facing £78m of losses this year.

But if the number of international students halves that figure will soar to £500m next year.

In practice, it says, institutions are working on scenarios based on a drop which could range from a 100% drop to a fall of a quarter.

At the weekend the UK government announced a series of measures to try to help universities across Britain. It includes a Research Sustainability Taskforce which will work with the devolved administrations to look at how best to continue with research work.

Scottish Secretary Alister Jack said the government is working with the sector to provide stability

Research funding for universities south of the border, totalling £100m, is also being brought forward but Universities Scotland says it's not clear what consequentials, if any, there will be for Scotland.

Scottish Higher Education Minister Richard Lochhead said: "We are keen to work with the UK government to support our world leading universities through this unprecedented situation and to help Scotland and the rest of the UK recover.

"In our discussions with UK ministers we have made a strong case for central support to the sector.

"However, this package is disappointing and a missed opportunity to send a more powerful signal, that the UK government recognises the importance of our universities and the scale of the challenge they face."

Mr Lochhead said the Scottish government was working closely with Universities Scotland and other stakeholders and would continue to argue for a more substantive response from HM Treasury."

'World-leading research'

Scottish Secretary Alister Jack said the UK government recognised the difficulties being faced by students, staff and institutions in every part of the UK.

He said: "We're working closely with the Scottish government and institutions in Scotland to provide as much stability as possible.

"I am particularly pleased that a ministerial taskforce on research sustainability is being set up as it's vital we work together to protect our world-leading research at this time.

"I also welcome the commitment to making sure that Scotland and the whole of the UK remains open to international students, and the confirmation that universities are eligible to apply for the UK government's business support schemes."