Russell: colleges' surplus cash can fund regional plan

26th October 2012 at 01:00
Colleges will be expected to use their reserves to help fund regionalisation, the education secretary has told MSPs.

An Audit Scotland report on the finances of Scotland's colleges, published last week, questioned the financial stability of some colleges, while highlighting the surpluses accumulated by others. These totalled pound;206 million at the end of 2010-11, it said, ranging from pound;0.3 million in Inverness College to pound;33 million in Edinburgh's Telford College.

It was not the first time college reserves had been highlighted, Michael Russell said in his evidence to the Scottish Parliament's education committee this week on the 2013-14 draft budget.

Russel Griggs, the architect of the regionalisation of Scotland's colleges, had suggested in his 2011 review of college governance that they hand all reserves over 10 per cent of annual revenue to a national pot.

Mr Russell said: "I'm of the view colleges could be encouraged to invest. in the new (regionalisation) proposals to claw back the reserves that have grown and grown in recent years and come from public money. I think the time for that investment is now."

Chairs and principals saw it the same way, he said, and he had "no difficulty" with them on this issue. The Edinburgh colleges had funded 40 per cent of the cost of their merger, he pointed out.

A "conservative estimate" was that regionalisation would save pound;52 million in 2014-15, Mr Russell told the committee.

The cabinet secretary was criticised by MSPs for presiding over a 24 per cent reduction in college funding, the loss of 1,300 staff and 70,000 fewer students.

There had been staff reductions, he said, but he could not confirm the figure.

The 24.1 per cent "real terms" fall in Scottish government funding, from pound;544.7 million in 2011-12 to pound;470.7 million in 2014-15 in the Audit Scotland report, was no longer accurate as a further pound;67.5 million had been added to the pot, he said.

The student headcount changed year-on-year depending on the number of full- and part-time courses, Mr Russell said, but the number of full-time equivalent places had been constant.

SNP MSP Joan McAlpine said the students being lost included women like herself taking flower-arranging classes.

That was one of the issues, said Mr Russell.

But "notable cuts" to adult learning were criticised by charity Age Scotland in written evidence to the committee, stating that adult education brought considerable benefits to physical and mental health and helped to prevent social exclusion and isolation.

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