Scottish university investigation to probe whether anyone 'sought to suppress' scale of crisis

Inquiry will consider why ‘key signs of distress’ were not reported

An investigation into the crisis at Dundee University will seek to establish whether anyone “sought to suppress information” about the scale of the institution’s financial woes.

The Scottish Funding Council (SFC) today published the terms of reference for the inquiry, which will be led by Professor Pamela Gillies, former principal at Glasgow Caledonian University.

A member of the public walks past a University of Dundee promotional poster | Lisa Ferguson

The SFC will ask Prof Gillies to complete the investigation and submit a final report within two months of her team being appointed.

It emerged last week at a “jaw-dropping” evidence session at Holyrood’s education committee that senior figures at the university had not been aware of the scale of the financial problems at the university until a key court meeting in November.

MSPs were told by the interim chair of the university’s court, Tricia Bey, that she did not know whether financial information had been “deliberately” withheld from her and others.

The committee heard that some had been under the impression the university was in a break even position in its 2023/24 accounts, before being told in November it had a deficit of £12.3m in 2023/24, and was heading towards a loss of £30m in 2024/25.

The Scotsman revealed last week how former principal, Iain Gillespie, broke the news to stunned members of the court.

The SFC’s terms of reference outline 16 aspects the investigation will seek to understand, including the causes of the worsening financial situation, and why the university failed to “manage its cash prudently”, allowing it to “deteriorate to critically low levels”.

The effectiveness of internal systems and controls will also be probed, as will the reasons why “key signs of distress” were not reported to the executive group and court in “a timely fashion”.

The University of Dundee | Lisa Ferguson

The “quality, credibility and accuracy” of the information provided will also be considered, along with the extent to which the executive group and court were left with “a false impression of the university’s financial health”.

Meanwhile, the terms of reference will consider “the extent to which any current or former member of the executive or governance structures sought to suppress information about the magnitude of the financial situation”, and the extent to which “any member of staff felt unable to raise concerns of the magnitude of the financial situation”.

And it is investigating whether the executives or court “failed in their executive or governance responsibilities to act soon enough to respond to the worsening situation”, and whether any executive or governance failures since the court meeting in November have “inhibited the ability to address the financial situation and work towards recovery”.

SFC chief executive Francesca Osowska said: “The University of Dundee is one of Scotland’s world-leading institutions and we are committed to working alongside its senior team as it finalises and delivers a financial recovery plan that will see it return to a position of financial health.

“Alongside this work, it’s vital that the circumstances surrounding the financial challenges at the university are fully investigated, with rigour and transparency, and that lessons are learned to minimise the risk of this situation arising again.

“The appointment of an independent team will ensure a robust process. We will share the findings once this work has concluded and expect the university to act on those findings.”

A spokesperson for Dundee University said: “We welcome the publication of the terms of reference for the investigation and are committed to engaging fully with it and acting on its findings.”

Meanwhile, Higher Education Minister Graeme Dey faced questions at Holyrood on Tuesday over the wider funding model for Scottish universities.

The number of Scottish universities reporting an operating deficit for 2023/24 has doubled from four in the previous year to eight, with a drop in international students combining with below inflation funding from the Scottish Government.

Mr Dey said: “I don’t accept that the current model is broken, but I do accept that it under severe pressure largely because of circumstances outwith our control.”