Further education colleges have once again emerged as major beneficiaries of the recession.
The Government has found an additional 4.5 per cent real-terms increase for colleges in 2010-11, principally to help them cope with demand from students left behind in the economic downturn. The universities are being given a lesser increase of 2 per cent.
The allocations, which represent an extra pound;44.8 million for colleges and pound;42.9 million for universities, bring the total expenditure for the sectors to pound;1.76 billion in the next academic session. They were revealed in the annual letter of guidance from the Education Secretary to the Scottish Funding Council.
Michael Russell told John McClelland, chair of the funding council: "You will doubtless agree that this award is a very positive one for both sectors and underlines the crucial importance this government attaches to further and higher education at a time of real-terms reductions to the Scottish Government's budget."
The additional sums follow a pound;28 million package for FE last year to create 3,000 more college places and improve facilities; emergency injections of pound;21.9 million for student support; pound;7 million to help colleges retrain redundant employees; and pound;20.5 million in accelerated capital spending for colleges and universities to bring forward building projects for 2008-10.
Universities and colleges will now have to wait until March 25 and April 16 respectively to find out how the extra cash will be distributed to individual institutions by the funding council.
Despite the apparent largesse, FE and HE are still expecting a tough year ahead as alternative income from returns on investment and commercial contracts is hit by the recession, and funding from European sources dries up.
The funding council will also be constrained on how much it can provide for ongoing teaching, because of conditions which the Government has attached to the extra resources.
Mr Russell says he wants priority given to 16- to 24-year-olds wishing to study at college, school-college activities involving youngsters from S3 upwards, student support including the waiving of fees, the role of rural colleges in helping small businesses, and the training element of the young persons' guarantee.
His letter also stresses the importance of encouraging colleges and universities to make efficiencies and achieve "transformational change" in response to the major restrictions on public spending. And it calls for a review of the balance between what the SFC allocates to recurrent spending on day-to-day activities, and to "major strategic change" such as research pooling in HE and mergers in FE.
But the Educational Institute of Scotland, while welcoming the broad budget allocation, warned that "transformational change" and mergers must be driven by educational benefits, not by the need to make financial savings. Any switch of funds from mainstream activities to strategic priorities should be done with trade union involvement, the EIS added.
Mr Russell's announcement was welcomed by Scotland's Colleges. "The Scottish Government is choosing to invest more in tertiary education at the same time as funding for higher education in England is being cut by almost 5 per cent," Linda McTavish, convener of the college principals' convention, pointed out.