By Mark Smulian | 29 August 2013
Scotland’s colleges should think hard before seeking easy savings by sacking teaching staff, Audit Scotland has warned.
The watchdog today said shedding the wrong staff might damage colleges’ ability to offer courses that would attract students.
Its Scotland’s colleges 2013 report found that colleges’ finances were generally sound but further savings were needed as further cuts and a major reorganisation loomed.
‘Staff costs typically account for about 60% of a college’s costs. It is therefore understandable that colleges consider reducing staff numbers as a key way to deliver cost savings,’ the report stated.
‘However, concentrating savings on staff costs creates risks that need to be managed.
‘In particular, colleges need to strike a balance between reducing staff numbers further and maintaining the quality of education they provide.’
Colleges cut total staff from 12,800 full-time equivalents to 11,600 last year, with most reductions falling on teaching staff.
Scotland at present has 37 incorporated colleges with 258,000 students in all.
They collectively had a surplus of £2.2m and their income fell by 9% in the last year.
Financial pressures included a £56m real-terms cut in Scottish Funding Council grants, which will continue to drop over the next two years.
Restructuring will create 13 regions with colleges merged to cut their total number from 37 to 21 by the end of this year.
Colleges will from April 2014 be classified as public bodies, a move Audit Scotland said could restrict their ability build up financial surpluses.
Auditor General for Scotland Caroline Gardner said: ‘The finances of Scotland's colleges are generally sound.
‘However, income has fallen significantly and this will continue for the foreseeable future.
‘Colleges will have to manage these funding reductions and changes in structure and status while meeting local communities’ demands for further education.’
The report is based on the audited accounts of colleges for their 1 August 2011 to 31 July 2012 financial year.
