Dundee University 'cannot be allowed to fail' in face of £30m deficit, MSP warns

A local MSP has said Dundee University is “too big to fail” amid concerns about its future.

In November, staff were told that job cuts were “inevitable” due to the institution’s £30m deficit.

Just weeks later, principal Professor Iain Gillespie stood down, while a ballot for potential strike action opened last week.

Speaking at the Education, Children and Young People Committee at Holyrood, Labour MSP Michael Marra stressed the university’s importance to the city as he sought assurance from ministers that it would not be allowed to collapse.

Higher education minister Graeme Dey told the committee that the Scottish government was “not in the business, as a government, of seeing institutions fail” but stressed the need for financial sustainability.

“Let me say it is too big to fail,” Mr Marra said.

“One in seven of the population of Dundee are students at that institution, 3,000 members of staff, an absolutely critical relationship with the NHS, whether it be joint contracts for the provision of oncology, all manner of areas.

“It cannot be allowed to fail and I would say that is a responsibility, in my view, of government.”

Mr Marra asked both Mr Dey and education secretary Jenny Gilruth – who also appeared at the committee on Wednesday – if they agreed the university could not be allowed to collapse.

“I agree very much with the importance of Dundee University,” Ms Gilruth said.

“We will do all that we can to facilitate that support via the auspices of the Scottish Funding Council (SFC),” she added.

The minister said: “My conversation with the Chair of Court… is that there is an optimism that they will get through this, there will be some pain attached to that, but they will get through it and it’s essential they do because they’re an important institution in the Scottish university landscape.”

Pushed on the issue by Labour MSP Pam Duncan-Glancy, Mr Dey said: “We’re not in the business, as a Government, of seeing institutions fail, but they do need to become sustainable. That’s in everyone’s interests.”

But Mr Dey stressed the need for clarity on the situation faced by the university and to avoid speculating over its future, saying: “I’m reluctant to speculate at this stage, and I think we should all desist from doing that because until we all understand exactly what happened, there is a risk that we just exacerbate the situation and the level of concern.”

Asked by Mr Marra if the funding council would consider providing a “bridging loan” to the university to help with its financial strife, the minister said: “The SFC would want to satisfy itself that the plan is robust and that it gets the university to a sustainable position.

“Part of sustainability is ensuring that it is a vibrant, viable concern going forward, there may be short-term pain but it is still a thriving university.”

He added that the funding council has a record of “engaging appropriately with institutions,” but he could not say what action it may take.