Hansard

The Convener Lab

Agenda item 2 is consideration of the section 23 report “Scotland’s colleges 2013”. Obviously, this issue has been of considerable interest over the past yea...

Caroline Gardner (Auditor General for Scotland)

As the committee is aware, we published a report in October last year that assessed the financial standing of Scotland’s colleges immediately before the stru...

The Convener Lab

Thank you. That is helpful. It is also helpful to know that there will a regular look at such a significant issue.Could you clarify a couple of figures? You ...

Caroline Gardner

I will ask my colleagues to clarify that for you, convener. You are right; the picture is complex and there have been a number of shifts in the past couple o...

Phil Grigor (Audit Scotland)

The 9 per cent is the one-year difference between the 2010-11 and 2011-12 figures. The 11 per cent reduction is the difference between 2009-10 and 2011-12. T...

The Convener Lab

Paragraph 25 of the report says:“A lack of cash can be an indicator that an organisation has financial problems. We therefore asked the auditors of Reid Kerr...

Caroline Gardner

I will ask Graeme Greenhill to pick up on the specific of the question, but it is important to be clear what the cash equivalents figure means. It is only a ...

Graeme Greenhill (Audit Scotland)

I do not think that we have had any indication that any one college is in significant financial trouble.

The Convener Lab

My question was not about significant trouble. I asked whether you had received any expressions of concern at all from any colleges.

Graeme Greenhill

No.

The Convener Lab

On the same page of the report, paragraph 24 talks about“the SFC’s ‘good practice’ minimum of 60 days’ cash”and Reid Kerr and Barony colleges are again menti...

Graeme Greenhill

The 60 days’ cash minimum is intended to give colleges a certain amount of leeway in managing their cash and in the timing for income and paying their bills....

The Convener Lab

We can ask the Scottish funding council why it has a 60 days’ cash minimum good practice standard. From your perspective, given that the standard has clearly...

Graeme Greenhill

It is guidance. Some colleges, because of the way that they operate, are unable to generate cash.

The Convener Lab

I know that it is guidance, but I am asking you whether there is any point to it.

Caroline Gardner

As accountants and auditors, we all feel that any public body needs to manage its liquidity—the amount of cash that it has available to meet outgoings as the...

Mary Scanlon (Highlands and Islands) (Con) Con

I have a supplementary question on the point that the convener made about the 11 per cent fall in funding between 2010 and 2012. I am looking at exhibit 8 an...

Caroline Gardner

We say in paragraph 31, which is above the exhibit that you referred to, that the teaching staff costs reduced by 16 per cent. I do not have the figure to ha...

Mary Scanlon Con

That is significant compared with 11 per cent.I have some further short questions. Before I became a member of Parliament, I was a lecturer in further and hi...

Caroline Gardner

I am afraid that we cannot help you with that. The focus of the report is on the colleges’ annual accounts as they stand and progress on the reform and regio...

Mary Scanlon Con

I understand that lecturers in UHI colleges are paid £5,000 less than those at Reid Kerr College, and many people are concerned about that. I am not a trade ...

The Convener Lab

To be fair, I do not think that that is a question for Audit Scotland, although it is clear that implementing national pay bargaining will have financial imp...

Mary Scanlon Con

Yes, that is my point.

The Convener Lab

I do not know whether the Scottish Government has a role in that or whether it is the funding council’s responsibility. We can perhaps find out exactly who i...

Mary Scanlon Con

Okay. You will understand that people are concerned about the issue.It feels like only yesterday since we looked at the previous Audit Scotland report on col...

Caroline Gardner

It is still a concern and we have addressed it in the current report. It is a long and complex report, so do not worry that you missed it. In paragraph 19 an...

Mary Scanlon Con

Oh gosh—it is even worse than I anticipated.

Caroline Gardner

I can talk you through what is behind that. Two things that have affected the valuation are, in effect, prudent accounting adjustments that reflect the curre...

Mary Scanlon Con

Okay. Sorry that I missed that one.My final—

The Convener Lab

Sorry, but before we move on from pensions, I ask the Auditor General to clarify something. Paragraph 19 states that teaching staff are usually members of th...