Majority of Scottish colleges hit with another real-terms funding cut as investment plea issued

It follows a 17 per cent real terms cut in funding for Scotland's colleges since 2021/22

The majority of colleges in Scotland have been told they will face real-terms funding cuts for this year, it has emerged.

Institutions have heard from the Scottish Funding Council (SFC) how they will be impacted by the latest spending decisions taken by SNP ministers.

Sector leaders were left disappointed in December last year after it was announced that funding for 2025/26 would not even match inflation, representing yet another real-terms cut.

Fife College's Kirkcaldy campus. Picture: Fife Free Press

Funding for teaching is now to increase by 2.6 per cent from last year, but the Consumer Prices Index (CPI) inflation rate is 2.8 per cent. It comes in the wake of a 17 per cent real-terms cut in funding for Scotland's colleges since 2021/22, which has left some in a perilous position.

The budget for college capital maintenance, which helps to maintain and improve buildings and infrastructure, has however been increased by almost 5 per cent this year.

The funding allocations for teaching show eight colleges are getting above the 2.8 per cent inflation rate, with ten below.

Figures for several colleges associated with the University of the Highlands and Islands are still to be confirmed, although their overall uplift is of 2.37 per cent.

Dumfries and Galloway College | Dumfries and Galloway College

Sabhal Mór Ostaig, the Gaelic college in Skye, has the lowest increase in Scotland of 1 per cent, followed by a 1.04 per cent uplift for Ayrshire College, 1.26 per cent for Fife College, and 1.31 per cent for Dumfries and Galloway College.

Dr Graeme Jackson, interim chief executive at umbrella body Colleges Scotland, said: “The allocations announced today confirm that eight colleges will receive funding which is above inflation. The remaining colleges and college region will receive funding which is at or below inflation.

“We appreciate the effort that the Scottish Funding Council has gone to in terms of revising the model, which decides the funding for each college. Unfortunately, the mitigations on offer to transition to the revised model haven’t been explained in full to the sector as yet.

“Increased employer National Insurance (NI) contribution costs for colleges are also incredibly concerning and will cost colleges millions of pounds. Colleges Scotland will continue to raise this issue with the Scottish Government – in England, colleges are receiving 100 per cent of additional NI costs.

“College funding overall has dropped 17 per cent since 2021/22 and more investment is badly needed to provide students with the right skills to help critical sectors of the economy grow.

“Colleges also have a major and under recognised role in alleviating and preventing poverty, so it is critical that the overall funding picture starts to improve, and soon.”

Scottish Labour education spokesperson Pam Duncan-Glancy said: “Colleges have yet again been let down by the SNP.

“Colleges are engines of skills and anchors in their communities – it is socially and economically incompetent for the SNP to inflict these cuts.

“Our economy is being held back by skills shortages, Scottish students are missing out on opportunities, and college staff need support, but the SNP continues to undervalue the sector.

“The SNP cannot keep paying lip service to colleges and skills whilst raiding the sector’s budget year after year.”

SFC chief executive Francesca Osowska said: “In a difficult financial environment, we have worked hard to balance out sometimes competing priorities and put students’ learning at the forefront of our considerations.

“Changes announced today follow discussions with key groups within the sector and are accompanied by measures to mitigate any adverse impact on individual colleges. The announcement looks towards safeguarding college education in the long term as well as supporting next year’s college students by investing in the opportunities they deserve.”

Further Education Minister Graeme Dey said: “Our colleges have an important role in providing those who have the greatest barriers to learning with the opportunity to fulfil their potential, whether by upskilling for future careers or providing strong pathways to higher levels of study at college and university.

“That’s why in the budget we provided a 2.1 per cent uplift for colleges, and an additional £3.5 million to support colleges to create a pipeline of skilled workers in offshore wind and social care.

“Individual colleges are best placed to respond flexibly to emerging trends at local and regional level, and the indicative allocations published by SFC will enable colleges to move forward with planning for academic year 2025/26.

“The 2.6 per cent increase in teaching funding compared with last year includes an additional £4.5m for lecturer's pay and £8.3m for pensions, while an increase of almost 5 per cent in capital maintenance funding will help colleges further invest in student’s learning experiences. The student support budget has been maintained at the same level as last year, despite pressures on the public purse.

“The college sector called for greater transparency and the ability to compare funding for students on similar courses across institutions, and the SFC has been able to meet that ask.”