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I have only two other questions; lots of members want to come in.

I go back to the points that were made about the licence commitment. Do you understand that the licensing process is there to protect the public interest? People looking at what is happening here will have seen you agreeing to a licence that started this year and then trying to dramatically reduce the licensing commitments while making commitments that are not licence requirements. That just makes a mockery of the licensing process. Will you comment on that?

Sorry—I have a further question on gallery production and the facility in Aberdeen, which is to become what is called, I think, a reserve facility. Half a million pounds was spent on that. Are you honestly saying that it is a reasonable to have that as a reserve facility, and that you will ship people up to Aberdeen at short notice if there is a problem in Glasgow? Is that a sham to cover for the fact that you should not have invested that money if you were not going to use that facility?

From a layperson’s point of view, though, an unqualified opinion would give a level of reassurance that would be completely unjustified in this instance. They failed to set a budget; they failed to show why they had not set a budget; they were not able to provide evidence of any discussion as to why they had not set a budget, which is a breach of the financial regulations; and they were also making substantial errors in what they were doing. An unqualified opinion is surprising to me, as a layperson.

Deloitte was the auditor for the college.

It was then appointed as the external auditor—or am I getting that wrong?

I was not so much saying whether it was a good or a bad thing but, looking at my own area, we have Forth Valley College, and there is this potential dog-eat-dog approach where people are chasing student numbers because that is the basis of much of the income of both further and higher education institutions. Within a board area that has three different campuses, even if the two larger campuses decide that they want to be the ones to get the lion’s share of the numbers, it strikes me as odd that there seems to be substantial unmet demand. For example, lots of students want to go to the Forth Valley College Alloa campus in Clackmannanshire, yet it cannot afford to fulfil those places because of the grant that it gets. It seems to me that there is more of a general dog-eat-dog approach between the different institutions. I have not finished reading your previous report so I do not know whether you have covered that, but it would have important implications and lessons around the direction for the sector more generally if that was the case. Are we looking at fewer students? What is the effect of the income that has been lost from overseas students in particular, and how do we get a more equitable distribution?

I have only a couple of questions. Looking at the data that you provided for the validation that you might get from media reach—I think that that might be the way to describe it—do you see dangers in that? Some people say that there is a formulaic approach whereby reports are produced that are relatively straightforward and discuss the pros and cons of an issue, but contain a soundbite quote at the end that, if you publish it on the right day, is guaranteed to stir up a good amount of parliamentary discussion and media coverage. Is there a danger that you might be seen to be chasing headlines and adding to a preponderance of negative stories, given that the media will always prefer those to positive ones? Do you recognise that danger if you are looking to that metric for validation?

Another one for which I was responsible—thank you for that.

That last point is of interest to me. I am aware of some organisations—one in particular—that customarily receive lots of small donations of £10 or £15 but are not able to show receipts for those or individual accounts, and, for that reason, their accounts have been qualified. Here we have an organisation that failed to set a budget—which, as you have just said, is a breach of the financial regulations—yet got a clean bill of health from the auditor. How does that work?

I agree that independence is a good thing.

I was not aware of the extent to which deficit budgets are used in the further education sector or the frequency with which they are used. I realise that I am asking you to make a bit of a subjective judgment here, but is there a possibility that a culture might start to develop such that people are thinking to themselves, “Well, there is always the option of a deficit budget”? Could that have been part of the reason why, in this case, they got a bit more lax about even setting a budget at all?

It is a bit like the difference between a tightrope walker knowing that there is a safety net or that there is no safety net and how that might impact on their decisions.

Can you say anything more about the impact? Jamie Greene mentioned three factors but the factor that I am interested in is the pensions estimates and the extent to which they are quoted as an influence. My experience is that the actuarial evidence or guidance can oscillate hugely from one year to another, which can create huge problems for organisations. Is that the case here or was the impact fairly minimal?