Fears for universities as funds from overseas students dry up
pens next, they have to be actively involved in the process. With that in mind, I’ve outlined some principles that should guide a safe resumption of economic life.
We’ve been crystal clear this is a public health crisis first, but one that requires a “lives and livelihoods” response. With daily reminders of the physical and mental toll the virus has taken, we know that prolonged economic stagnation would only exacerbate these problems as mounting business closures, unemployment and debt begin to bite. Confidence is key.
What breaks confidence is fragmentation. Government, health experts, businesses, unions and civic society must work together to develop the plan.
We need to be clear about the dangers of false starts.
As one company told me recently, “knock me down once and I’ll get up; knock me down twice and I might not”. A slow restart is far preferable to shutting down the economy twice. While resilience has been impressive to date, helped by government support, two shocks in quick succession would have deep, long-lasting implications for Scotland’s already fragile economy.
Loosening restrictions on those companies and public bodies that enable economic activity, like schools, nurseries and transport operators, needs to happen before others can return to work. Businesses need clear timetables to inform decision-making. Capacity to cope should be the key driver of implementation – with targeted support measures remaining in place throughout, flexing as firms move at different speeds. Getting valued sectors like construction back to work can only speed up recovery.
A “one-size fits all” approach won’t work. Government can’t control everything. Businesses come in all shapes and sizes. Clear guidance and proportionate enforcement would allow firms to press ahead where safe to do so, or slowdown if necessary. We should also do whatever we can to learn lessons from countries, while recognising the unique characteristics of our economy.
The final piece of the jigsaw is ambition. We must build back better than before. This crisis has given us the opportunity to look at the economy through fresh eyes. From tackling inequality to investing in innovation, digitising the economy to recalibrating education to meet future needs, progress has been far too slow. Revamping our tax and regulatory system to make it more competitive, setting clear goals to drive productivity gains.
I assure you the ambition of Scottish business is anything but diminished. Ensuring a safe restart for the economy will be difficult, but guided by the best advice around.
Let’s also remember companies that navigate this critical period by showing kindness, consideration and humility will be long remembered by the people they serve and have a brighter future as a result. To do that we must leverage the restlessness of business to power our recovery, while putting recklessness aside.
● Tracy Black is director of CBI Scotland
The survival of Scotland’s oldest and most prestigious universities is at risk as they face a massive economic blow from the loss of overseas students due to the coronavirus pandemic, ministers have been warned.
Universities Scotland estimates the sector could lose more than £500 million next year, while research by Holyrood’s education committee indicates a third of Scottish universities could run out of cash by Christmas.
In an email sent to more than 15,000 members of staff yesterday, University of Edinburgh principal Peter Mathieson warned the institution would need to undergo an aggressive cost-cutting programme simply to survive. The university predicts a loss of income of between £70m and £150m next year alone, with losses to continue for at least the next four to five years.
The UK Government has pledged a series of measures to help universities, including a Research Sustainability Taskforce.
Daniel Johnson MSP, vice convener of the Scottish Parliament’s education committee, said: “Universities have become dependent on overseas students fee income as a direct result of SNP Scottish Government policy and the letter sent to staff at Edinburgh University underlines this. However, staff and academics should not be footing the bill in pay cuts.
“The Scottish Government must create a fund to bridge this immediate cash flow issue that will be felt in the coming months. This situation arises as a result of their decision and therefore they must take responsibility. The sector needs assistance now and ensure institutions can survive for the period where students are prevented from travelling to Scotland.”
Scottish Conservative shadow education secretary Jamie Greene said: “The entire university sector in Scotland is facing grave challenges that will, for some, test their very existence and survival.”
Mr Mathieson said he would end all pay increments due in August this year for staff currently on salaries of £100,000 and above, with promotions to continue in title only. Internally funded new staff recruitment will be limited to mission-critical posts only, and all construction projects have been suspended, saving the university £92m.
At the University of St Andrews around 500 professional services staff will be placed on furlough and the 2020 academic promotions round has been cancelled. Recruitment will be largely suspended across the institution.
Professor George Boyne, principal of the University of Aberdeen, is in talks with unions about possibly implementing a university-wide staff pay freeze next academic year.
The university, which is facing a £39m shortfall in revenue, has already frozen recruitment on all but essential jobs.
Higher education minister Richard Lochhead said: “We will do everything we can to help Scotland’s institutions remain as world leaders and key drivers of the economy in response to the impact of the Covid-19 crisis. We are working closely with Universities Scotland, Colleges Scotland and other stakeholders on how the sector can remain at the forefront of global education when we emerge from this crisis.”
“We will do everything we can to help Scotland’s institutions remain as world leaders and key drivers of the economy”
RICHARD LOCHHEAD