HUNDREDS of extra post- graduate places are to be created at Scottish universities under a £30 million scheme.

The Scottish Funding Council (SFC) will target part of its funding for higher education over the next five years at creating an additional 850 taught postgraduate places in 18 universities.

The places are focused on courses that support industry and meet skills demands from key sectors such as energy, financial and business services, food and drink, life sciences, tourism and creative industries.

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Last year, a leading university figure warned the nation's economic future depended on an expansion in the number of Scottish postgraduate students.

Professor Sir Timothy O'Shea, principal of Edinburgh University, said creating a larger pool of more skilled workers was vital to allow Scotland to compete globally. His call followed the publication of a major independent inquiry into postgraduate education across the UK which also called for urgent reform.

The inquiry by the Higher Education Commission warned the postgraduate system excluded poorer students and failed to produce sufficient numbers of highly trained workers. Unless action is taken, the report warned UK firms will need to recruit foreign workers, or move their offices overseas, at huge cost to the economy.

However, earlier this month The Herald revealed that the number of Scots studying postgraduate courses declined by nearly 2% in 2011/12 from 9570 to 9395, sparking fears for the future economy.

Education Secretary Michael Russell said: "This significant investment is a further sign of our commitment to providing exceptional education that meets the demands of our industry and economy and gives our students unprecedented opportunities.

"Scotland's highly skilled workforce is an important factor in attracting inward investment and boosting our indigenous industries."

Mark Batho, chief executive of the SFC, added: "Scottish employers are increasingly looking to recruit people with postgraduate qualifications and this initiative responds positively to that demand.

"The additional places we are funding will provide students with greater opportunities for postgraduate study in Scotland and deliver courses that are directly relevant to the country's future economic needs."

To support this programme the SFC is making an additional investment of more than £6.2m in academic year 2013/14.