SCOTTISH universities have seen a sharp rise in the amount of money they generate through philanthropic giving from graduates and business.

New figures show the sector's endowment income topped £46 million last year after rising by a quarter since 2012/13. In 2009/10 the amount raised was just £26m.

However, the funding - which is small in comparison with the £3.2 billion overall income Scottish universities receive - is concentrated in a handful of institutions.

Edinburgh University accounts for nearly half of the total, followed by Glasgow University with some £10m and St Andrews University raising £4m.

Some universities even saw their endowment and investment income fall in 2013/14 with Aberdeen and Dundee both seeing a reduction. But there was also welcome increases for Stirling, Glasgow Caledonian and Edinburgh Napier.

At a time of uncertainty around future public funding, as well as rising costs, the overall increase was welcomed by Universities Scotland, which represents university principals.

A spokeswoman said: "While development is already well established in some universities, other institutions have invested a lot of energy building this up and this seems to be paying off.

"Donations are usually put towards student scholarships, chairs and lectureships, but where this income can be spent on capital projects this will be helping to alleviate the huge pressure that the sector is facing as a result of having next to no capital funding for the last few years."

Gordon Maloney, president of NUS Scotland, which represents students, said the increase was "great news" for universities, but stressed the money should be invested on tangible improvements.

He said: "Universities need to be much more transparent about where this money is coming from and how it's being spent.

"It's clear that there's significant sums being invested in our universities through endowments and investments for the benefit of students, and students would expect to see the results of that much more clearly and an opportunity to shape those decisions."

He added: "Not all universities can, rely on courting wealthy benefactors and we would not want to see any university being disadvantaged because of it."

The figures, from the Higher Education Statistics Agency, also show that tuition fees and education contracts to Scottish universities rose from £557m to £627m after a rise of 12 per cent.

Research grants and contracts increased by more than five per cent from £571m to £601m. Meanwhile, total expenditure rose by four per cent from £2.9 billion to £3.1 billion.

In America, it is routine for former students to give money to their universities after they have graduated in recognition of the benefits of their education, but the practice is far less popular in the UK.

Nonetheless, leading Scottish universities such as Aberdeen, St Andrews and Edinburgh have all embarked on major international campaigns to raise money through donations in recent years.

Figures published in 2012/13 showed the number of donors to higher education institutions was almost 22,850, up 15 per cent on the previous year.

Philanthropic donations are often given in support of specific projects, such as author JK Rowling's £10m donation to a Regenerative Neurology Clinic at Edinburgh University and Ann Gloag's donation to a Glasgow Caledonian University foundation supporting female entrepreneurs from disadvantaged communities.