£200m university funding crisis requires serious solutions, not kneejerk responses – Professor James A Miller
Some will argue for and against university tuition fees but Scotland should beware overly simplistic approaches to a complex problem
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In public policy, evidence should come before solutions. That is why a new report, called A Funding Gap Analysis of Scotland's University Sector, matters.
For the first time in many years, Scotland has a shared, independently informed assessment of the financial sustainability of its university system, developed through the collaborative Future Framework process involving government, universities, students, trade unions and sector experts. It found there is already a £200 million gap between all sources of funding and what it costs universities’ to deliver their core activities. The gap will almost certainly have widened again by the next release of data.
The report was published before the Scottish Government’s Programme for Government 2026-31, but its central message has only become more relevant. The ambitions now set out by the First Minister will be realised only if there is a successful, sustainable university sector.
Universities’ essential roles
Universities are woven into every aspect of Scotland’s national life. They educate the graduates on whom our public services, businesses and third-sector organisations depend; they generate the research and innovation that drive productivity, competitiveness and economic growth; and they enrich the cultural and civic fabric of our communities.
From advancing healthcare and supporting the transition to net zero, to attracting international investment and talent, universities help underpin Scotland’s prosperity and global reputation. If the Programme for Government is to succeed in delivering long-term economic, social and environmental outcomes, universities must be recognised not simply as stakeholders, but as essential partners in delivery.
The significance of the report lies not simply in its findings, but in what it enables. It provides a common evidence base from which informed decisions can be made. The temptation for some will be to move immediately to solutions. That would be a mistake.
Some will argue for tuition fees, some against. Many will call for increased public investment. Others will demand employers pay more for the benefits they reap. There will be voices advocating fewer universities, fewer students, fewer and shorter programmes or greater consolidation across the sector. Many will be sincere. Most will start from long-held positions.
That is precisely why caution is needed. The report was diagnostic, not prescriptive. Its purpose was to establish the nature and scale of the challenge, not determine the answer. The challenge it describes is far more complex than many of the emerging narratives suggest.
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In search of evidence
Universities are not single-purpose organisations. They educate students, undertake research, support innovation, contribute to public services, drive regional economic development, widen educational opportunity and drive social change. These activities are interconnected. Funding, policy and operational decisions in one area inevitably affect outcomes, not just in universities but across the entire education ecosystem.
The report reminds us that Scotland's universities are highly diverse institutions with different missions, geographies, student populations and research profiles. The challenges facing a large research-intensive university are not necessarily the same as those facing a modern university with a strong regional mission or the small specialist institutions with international competitors. It follows that simplistic, system-wide solutions should be treated with considerable caution.
The next stages of the Future Framework will therefore focus not on advocating preferred outcomes, but on building the evidence needed to assess potential future options.
Lessons from other countries
What does Scotland need from its universities? What can Scotland learn from countries facing similar pressures? Which approaches have improved long-term sustainability while maintaining access, quality and international competitiveness? What unintended consequences emerged elsewhere? Which reforms proved durable and which merely shifted costs from one part of the system to another?
These are the important questions for the next stages of the Future Framework process, which will examine how to achieve a sustainable and successful future for Scotland's universities.
Around the world, higher education systems are grappling with many of the same challenges: demographic change, fiscal constraints, technological disruption, changing patterns of student demand and growing international competition. Valuable lessons exist, but they require careful analysis rather than selective borrowing. Solutions that work in one country are not automatically transferable to another. Context matters.
Part of that context, back here in Scotland, is the prominence the First Minister’s Programme for Government gives to public service reform. Universities aren’t in the public sector but our own agenda, responding to the major drivers of change and empowering the sector to be resilient for the next 20 years, will certainly be part of the way forward.
A better debate
This is where the discipline shown in the first phase of the Future Framework process becomes crucial. The work ahead should be characterised by rigorous analysis, openness to evidence and a willingness to challenge assumptions.
Options should be modelled and evaluated not only in terms of financial sustainability, but also their implications for students, research, skills, innovation, social mobility and economic growth. Above all, the debate should recognise that complex systems rarely yield simple answers.
The real achievement of this report is not that it has settled the debate. It has created the conditions for a better one. It has given policymakers, institutions and stakeholders a shared foundation from which serious options can be assessed.
Scotland's universities are too important to be shaped by instinct or false choices. The questions ahead are challenging, but for the first time in a long time, we are in a position to ask them properly. We have the evidence. The task now is to apply the same rigour to developing solutions.
Professor James A Miller FRSE is convener of Universities Scotland and co-commissioner of the Future Framework
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