Recommendation 27

In the early months of the covid-19 pandemic there was a great deal of concern around the financial impact it would have on university finances. Concern was not only confined to the universities already struggling and with deficits and low levels of reserves pre- pandemic, but was also for the traditionally more financially secure ‘ancient’ universities, due to their reliance on overseas students. Whilst a fall in international student tuition fee income would have a significant effect longer term, Universities Scotland identified that refunds given to students leaving university-owned accommodation in March 2020 was the most immediate cause of financial pressure.50 Although the outlook now looks stronger (as outlined in paragraph 32), a deficit of between £450 million and £500 million was initially expected for the higher education sector in Scotland in 2020–21.51 Financial interventions made by the UK and Scottish Governments in response to the pandemic