By Tom Gordon

Political Editor

MPS are to consider new ways of funding Scotland’s universities as vital fee income from overseas students dries up because of the coronavirus crisis.

The Commons Scottish Affairs Committee launched an inquiry into the future of Scotland’s 19 universities and related institutions, which it said faced a “perfect storm” of challenges.

It comes shortly after the Scottish Government and the Scottish Funding Council (SFC) began their own consultation on how to cope with a sector-wide deficit of up to £400m.

The SFC described Covid-19 as a “significant external shock to the further and higher education sectors, to learners, business, researchers, funders, and government”.

It warned: “It brings huge uncertainty. Universities, and some colleges, face substantial financial losses from international fees and other sources of income. All institutions will need to consider the impact for their current business models.”

Universities were already facing

long-term budget pressures before the pandemic arrived, relying on SFC research grants, Scottish budget funding, and income from tuition fees.

However the disease has added massively to their financial woes, with international students staying away, resulting in the loss of hundreds of millions of pounds in fees.

Although Scottish and EU students do not pay tuition fees in Scotland, those from the rest of the UK pay up to £9,250 a year, while those from other countries pay up to £40,000 a year.

The Scottish Affairs Committee said there were questions over whether UK and Scottish Government support for universities, research and students would be enough to off-set the losses.

The cross-party group plans to look

at the “challenges and opportunities in funding models for Scottish universities and for student support in the country”.

It will also look at the impact policies made in Whitehall will have on Scottish Universities, their students, their employees and on research.

SNP MP Pete Wishart, the committee chairman, said: “Education is going to be a critical part of the economic recovery as the country pulls itself out of the coronavirus crisis but universities in Scotland, their staff and their students are anxious.

“The pandemic has helped create a perfect storm that could see universities in Scotland pushed to the brink, some may even fall, without careful consideration of policies that help to re-establish their foundations.

“The consequences of not doing so risks derailing the Government’s ambition to level up the UK, could deny a new generation of young people

the opportunity to get on in life, and would hamper the quality of research on the international stage.

“Our inquiry will explore the challenges and opportunities facing Scottish universities by looking at funding models for higher education and the role UK Government policies play in making a vibrant higher education sector post-Covid.

“We will examine how Scottish university research sits within UK university research. We want to hear from the establishments, their staff, students and research bodies to get a better picture of the entire system and offer recommendations to improve it.

“Scotland universities rank amongst the world’s leading institutions. It’s important we explore policies that will keep them there following the crisis.”

It emerged yesterday that Dundee University has asked all its 3,000 staff to consider unpaid career breaks, shorter hours and early retirement as it wrestles with a £15.6m black hole this year.

The university, which has furloughed 600 staff, had already suffered six consecutive years of losses totalling £36m before Covid led to a slump in fees from overseas students.