New universities review mired in controversy from Day One

Education Secretary Mike Russell said the inquiry was not about wresting control from independent institutions but making how they use their funds more transparent.

He said: "There should be accountability for public funding. University funding varies, with from 30 to 70 per cent coming from the public purse."

Mr Russell told the Scottish Parliament yesterday that the panel will publish its remit before the summer recess and will invite opinion over the summer. The panel is expected to report back its findings by the end of the year.

Lecturers criticised the appointment of the review's chairman Professor Ferdinand von Prondzynski, whose own university, where he is principal, does not recognise groups representing staff.

Mr Russell defended the appointment of the Robert Gordon University Principal and said the Scottish Trades Unions Congress (STUC), would be consulted on who should represent unions.

The panel will have four other members, including a union representative and a chair of a university court.

The review comes after a green paper by the Scottish Government into the future of universities in Scotland. A gap in funding between Scottish and English universities will emerge when institutions in England start charging fees of up to 9,000.

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Mr Russell has said the net funding gap in Scotland would be 93 million in 2014-15. However, university groups and opposition leaders have put the figure at around 200m.

The education secretary said: "The figures are based on those agreed by the Scottish Government and Scottish universities through a range of figures which are possible. The 93m is more likely as a figure."

Although the University and College Union (UCU) Scotland welcomed the review it accused Prof von Prondzynski of not being independent given his derecognition of trade unions which, it claims, was against Robert Gordon's own governance procedures.

Mary Senior, UCU Scottish official, said: "We are concerned about taking part in a review at national level while the chair refuses UCU and UNITE participation at his own university.

"We find the appointment of Prof von Prondzynski extraordinary and a cause for serious concern.

"We call on Mike Russell to continue with this review which has the welcome involvement of unions and students but to urgently reconsider the choice of chair who should be truly independent."Grahame Smith, general secretary of the STUC, said: "The STUC has long been concerned about governance structures in both the university and college sectors, the weakness of which means there is often little scrutiny of how public money is spent by individual institutions.

"We are pleased that the Scottish Government is now looking into this issue in higher education and look forward to playing an active part in this review."

Claire Baker, Labour higher education spokeswoman, said: "It appears that the SNP government's review of university governance is in trouble only hours after it was announced.

"We must get university governance right. Mike Russell needs to address this situation so that we can all have confidence in what is such an important review for the future of the sector." Liz Smith, Conservative education spokeswoman, said the sector was in "troubled times" with several problems.

She said: "It is increasingly a reflection of some of the wrong-headed policies of the SNP and an increasing perceptions that in some quarters the cabinet secretary is trying to perhaps spin a line that is a little different from reality."

She said Mr Russell's refusal to accept the extent of the university funding gap was "extraordinary" and said the minister must not use the funding issue to attack their autonomy.

She added: "There is a funding crisis, there are no two ways about that. We need to resolve it."

David Belsey, national officer on higher education for Scotland's biggest teaching union, the EIS, said: "The EIS has campaigned for more open and effective governance at Sottish universities for some time.

"It has become clear to the EIS that the model of university courts self-selecting unpaid amateur volunteers does not provide effective nor transparent governance at universities; this has resulted in poor governance and a growing disconnect between some Scottish universities and their stakeholders.

"Universities are often large institutions run for the public good and largely funded by the public purse, indeed to a tune of over a billion pounds in Scotland last year."

Liam Burns, NUS Scotland president, said called for students to be represented on the review panel.

He said: "We should talk about co-ownership of financial decisions, what subjects are taught and creating a culture of students as partners, not just structures that give the impression of involvement.

"Of course, this work should not come at the expense of the real crisis students face in not having enough money in their pockets while they study."

Mr Russell also acknowledged that recent legislation on preventing the closure of rural schools had not been as effective as he would have liked.

However, he said eight councils have now agreed to delay closures for a year, in line with his moratorium on rural school closures.