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That work is proceeding. Stuart Greig can give you more of an update, but my understanding is that we are in the phase of dotting the i’s and crossing the t’s. Is that accurate, Stuart?

Are you talking about the £6 million that was announced yesterday?

That is for higher education.

I go back to Pam Duncan-Glancy’s point about reducing credits. What we did was give the principals flexibility so that if they wanted to use that money for courses, they were able to do so, or they could use it for something else. That is the whole point of flexibility. There will be institutions that did not do something different with that money and maintained their credits; others chose to do otherwise. We entrusted institutions with making a judgment, based on demand and in the best interests of our colleges.

When a situation arises in which savings require to be made, my team will look in detail at the options—there will be a range of options—to enable us to arrive at where we need to be. Ultimately, to be blunt, we have to make some painful and difficult decisions—decisions that we would otherwise not wish to make. That is the situation. As you know, Mr Rennie, we have to produce a balanced budget.

Mr McMillan touched on the impact of austerity; there is no doubt that that has an impact. In the end, we have to reach a position where the budget balances. The process is one of identifying the number that has to be arrived at and then deciding how we arrive at that with the least pain, if you like.

From recollection, that was quite far into the year—I think that you would remember that. We had hoped to be able to protect that fund in some form, because of the value that we placed on it. However, as the financial year unfolded, it became apparent that we were not going to be able to do that, as we had no other option.

Forgive me, but I would need to go back and read over that evidence again before I could give you a detailed answer on that. I was half-expecting you to move on to the territory of tuition fees, Mr Kerr, but you are not going there, clearly. That is interesting—and a welcome change of position from the Conservatives.

I will answer the point this way. We have substantial dialogue with the universities on a number of fronts. Our position on tuition fees and the current situation is quite clear. Of course we have dialogue—that is not changing—and of course we have on-going discussions with our university colleagues about how we address funding.

Although I think that their comments were a bit misrepresented, a couple of principals have posed this question: if tuition is to remain free—as it will under this Government—how do we address our concerns about the funding model into the future? That is a perfectly reasonable question to pose, and we are open to having a discussion with principals about it—subject to the caveat around free tuition.

We have to be absolutely clear about this. If tuition fees were to be reintroduced or introduced in Scotland, as some people would wish, the impact on our students would be substantial. You referred to the UCU a moment ago. It carried out a survey in 2019, indicating that two thirds of individuals who were planning to go to university would be put off doing so if a tuition fee model were in place. That would unpick all of the progress that has been made on widening access, and it would go much further. It would have an impact on other individuals from non-deprived backgrounds, discouraging them from going to university. I do not think that that is in anyone’s interests—not the students’ interests, not in universities’ interests and not in the interests of the economy of Scotland.

I fully stand by the model that we have, although I recognise that we must find methods to improve the financing of our universities. I disagree slightly with Mr Kerr, as I think that the growth into international markets—if it is managed carefully and if the risk, if we want to call it that, is spread more evenly—is a road that we need to go down.

To be honest, if primary legislation is required, that is unlikely to happen in that timeframe. If we are in the process of providing colleges with more powers and freedom, we want the work on oversight powers to go in parallel with that. We need to see how we can align that with the legislative process.

I understand the unease—particularly when individuals in that position receive reportedly substantial increases in those packages at a time when the public finances and the finances of institutions are constrained.

Although, as I have articulated and you have repeated, we do not have a direct locus, I expect and look for a degree of self-awareness and collective awareness between the principals and boards, and the exercise of restraint in the uplifts that are to occur. That is a reasonable expectation.

I need to be clear: that is not the case. There were other conditions at play in the dispute—quite substantial things that were being sought and other things that people were not willing to concede, and the changes in relation to those are what enabled the welcome progress to be made.

Ms Duncan-Glancy will recognise that we are still working our way through this year’s budget, although I appreciate that the committee’s interest is in next year. We are looking actively at where the commitment will be funded from. However, I assure the committee that we have given a clear assurance to both parties that the £4.5 million will be clearly additional to the settlement that colleges would be receiving.