University of Edinburgh under 'serious threat' from pandemic

The financial health of one of Scotland's top universities is under "serious threat" from the coronavirus pandemic, according to its principal.

Prof Peter Mathieson, of the University of Edinburgh, told BBC Scotland annual income could drop by up to £150m.

He said the university may no longer need the scale of buildings and facilities it currently has.

The Scottish Parliament's education committee will hear evidence about college and university funding later.

It will hear from the chief executive of the Scottish Funding Council which pays for the places of Scottish students.

But this is only one source of income for universities. Other sources include the substantial tuition fees paid by students from outside Europe and commercial ventures.

Universities across Scotland fear they could lose out on £500m between them.

Edinburgh, which has an annual income of £1bn, has running costs, including wages, of around £90m a month.

The single biggest challenge for the university is the likelihood of a large drop in the number of students from outside Europe, some of whom pay tuition fees of around £30,000 a year.

The university still does not know how big the drop will be but there have been warnings it could range from a 25% fall to a complete collapse.

Prof Mathieson said: "We're trying to be honest and transparent with our staff, so we've said that at the moment we're looking at things like limiting pay rises and limiting promotions in the next academic year because that will save us money.

"We haven't started talking about redundancies but all universities are looking at their future size and their shape.

"Obviously, if we are receiving smaller number of students and many more of our staff are working from home, which I do anticipate will continue to be the case for some time to come, then we may not need the scale of buildings and facilities that we originally thought we needed."

The possible impact on staff and wages has already been announced.

The University of Edinburgh enjoys a strong international reputation and attracts thousands of fee-paying students from North America and the Far East.

There is a concern some new international students may not start courses this autumn and that those who are already studying may not return for now.

It may take three to four years for their numbers to recover once the crisis is over.

Generally speaking, the older universities in Scotland gain the most income from international students and other commercial ventures - these play a big part in ensuring the institutions are financially viable and help pay for the facilities also enjoyed by Scottish and UK students.

Prof Mathieson said: "Paradoxically the universities which are the most threatened by coronavirus are actually Edinburgh, Glasgow, St Andrews... The universities that have the highest proportion of international students.

"Going into all of this you might have said they were in strongest shape.

"Ironically, because our business model depends so much on international students and other events like conferences and catering, which we are able to put on because of our scale, we are seriously threatened."

Universities Scotland has already spelled out the scale of the challenge which faces the sector as a whole.

Prof Mathieson said the sector was hoping for further help from both the Scottish and UK governments.

He also spoke about some of the practical challenges which were facing students while the impact of the pandemic continues.

One possibility is that students later this year may be able to begin their studies remotely instead of attending lectures and tutorials as normal.

The university has also been talking to partner universities overseas. Some international students may be able to start their studies there and then move to Edinburgh once they are able to do so.

Like other universities, Edinburgh has cancelled traditional summer graduation ceremonies. Students will be offered the chance to take part in traditional ceremonies in the future.

But a special "online graduation ceremony" was held for some medical students before they went out to join the workforce.