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Payout reasoning has to be clear

Is too much money out of Scotland's overstretched colleges budget being spent on severance payments?

That is the question that inevitably arises from news that the cost of such payments to senior managers has risen to more than £5 million and is likely to rise much higher.

The figure of £5m relates to payments made in respect of eight college mergers; details of a further six mergers are still to come. It does not indicate what each individual principal, deputy principal or senior member of staff is getting, but it comes just a few weeks after news emerged that the former principal and vice-principal of North Glasgow College had between them been awarded severance packages worth nearly £500,000.

Principal Ronnie Knox, who had a salary of about £120,000, was given a payout of more than £310,000, while vice-principal John Gray, who earned £80,000, received more than £160,000. The Auditor General for Scotland has stressed there is no evidence the payments were wrongly calculated, or illegal or fraudulent, but they are now being reviewed, following a report by Audit Scotland that raised concerns about how transparent the process was, stating there was no evidence they were subjected to "appropriate approval" or assessed as providing value for money.

The rising overall costs of severance packages in colleges has understandably caused concern at a time when college finances are under such strain. Further education funding was slashed by £56m in 2011/12. Student numbers and lecturer posts have been falling following the decision to merge Scotland's colleges.

Departing staff should of course get fair redundancy deals, but students and remaining members of staff have a right to know exactly how those deals have been arrived at, and should be satisfied that they are indeed fair.

The Scottish Funding Council, which hands out public money to colleges, says that paying out sums on severance packages now as part of the merger process will save money in the long run.

That is the justification for redundancies in most sectors, but it will be important they they have got their sums right. Officials predict the merger process will realise £50m of efficiency savings by 2015-16 and £107m by 2016. Students and lecturers who feel their sector has suffered disproportionately from Government belt-tightening will be waiting to see if that is true.

Scotland's colleges have certainly had a tough time. There are legitimate, concerns, for instance, about the extent to which budget restrictions have resulted in cuts in part-time, weekend and evening courses, causing student numbers to fall by more than half in some colleges. This is an unhappy state of affairs given that it disadvantages some of the most hard-to-reach would-be students from deprived communities and vulnerable groups.

Every penny counts, and therefore the process by which severance packages are agreed should always be fully transparent, and college staff and students must be reassured that they represent value for money.

Contextual targeting label: 
Education

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