What Privatisation Means

Privatisation means the new college is not subject to the same level of governmental oversight as the vast majority of other colleges in Scotland, and it won’t be accountable in law to the democratically elected Scottish Parliament. It also means board members will only be liable up to the financial ceiling set when the company is formed (as little as £1 per member), meaning they can all walk away if their company—our college—isn’t financially viable.

Although it will be run not-for-profit, the private limited company can build up unlimited financial reserves, unlike incorporated public colleges, meaning money does not have to be re-invested into teaching and learning; it can be hoarded instead. This is despite the majority of funding continuing to come via the Scottish Funding Council (SFC). The new college will not be subject to full reporting by Audit Scotland on their financial stability, and the Board of Management cannot be withdrawn by Scottish Ministers if necessary.

In short, this privatisation is an affront to democracy itself.

Who Makes the Decisions?

Our union has a history of opposing this privatisation. Union life in Shetland is perhaps different from that in the central belt—political activism is less obvious, campaigns are less frequent, and folk are less inclined to ‘put their head above the parapet’—but the level and extent of opposition to privatising Shetland College from both members and the public is telling. It’s clear that there is a real depth of commitment to ensuring further education remains public in Shetland.

It was the Scottish Government’s non-department body, which funds Further and Higher Education, that originally recommended that privatisation of the new College would allow for more ‘flexibility’ in managing finances. It was also the SFC who advised all stakeholders, including Shetland Islands Council, of the process for merger, indicating a twelve-week consultation period carried out by the Scottish Government prior to the new College’s ‘vesting day’. This would have given the government had some oversight of the process, including the business case.

But this consultation period did not take place. The SFC had apparently ‘assumed’ ministerial approval would be required, and then, somewhere along the line, changed its mind. The College passed from public ownership and control into private hands, despite remaining publicly funded, without any scrutiny over the governance arrangements.

So while it was ultimately Shetland Islands Council that took the decision to merge and to proceed with the option of ‘outsourcing’ the College to a private limited company, it did so on the basis of advice from the the SFC, which is accountable to Scottish ministers, to the Scottish Parliament, and to voters.

Privatisation as an Ideology

The SFC is governed by a Board of Management containing people with a wide variety of business interests—from family businesses through to consultancies—and professional Public Board members from the Law Society of Scotland, the Police Authority Board, other educational institutes and organisations, and looser networks. The Chief Executive was formally Alex Salmond’s Principal Private Secretary, and worked with the Scottish Government in a variety of roles until 2019. It’s a veritable Who’s Who of public appointments in Scotland.

It seems not one of them actually made the case against using public money to privatise a college. The union has been accused of being ‘ideologically opposed’ to privatisation—which it is—but the same can be said for those in charge of our public money. They are ideologically supportive of accumulating surpluses in an opaque manner, away from public scrutiny and public accountability.

The Scottish Government, for all its rhetoric about inclusive growth, fair work, collective bargaining, and lowering the attainment gap, seemed content to stand back and claim this was an ‘operational matter’ for Shetland Islands Council and the new Shetland College Board. They said they have no locus in the governance of Further Education colleges, despite the SFC’s misleading advice being pointed out.

The SFC published a ‘Review of Coherent Provision and Sustainability’ in June. Its recommendations included that the Scottish Government review colleges in line with English classification by re-classifying them as private sector bodies in order to remove Scottish ministers’ powers ‘of direction and consent, their role in the governance of individual colleges, and college requirements relating to the Scottish Public Finance Manual and national bargaining.’ The Scottish Government has since provided assurances that FE will remain classified as public sector—but this doesn’t help Shetland.

Why We Oppose Privatisation

There needs to be a look beyond current economic trends to provide long-term quality education for students in Shetland, and across Scotland, too. Education is a key human right, and privatisation is a threat to that right. This was noted by Philip Alston, UN Special Rapporteur on extreme poverty and human rights, in September 2018 when he highlighted the inequality in the UK caused, in part, by being wedded to a neoliberal agenda that includes the privatisation of public services.

Public services should remain in public hands. From energy to transport, we know that privatisation increases costs on the consumer and worsens service quality, harming those who rely on public services the most. The never-ending drive for competition puts profit before people: we see it now with our NHS. Where once it was straightforward to get tests and treatment, a slow creep of other companies are now arriving to offer false choice by shoring up the gaps.

For us, it’s about democracy, transparency, and accountability. We don’t want to work, to educate, while being dictated to by the whims and business interests of others. We are committed inclusive and accessible teaching and learning for its own sake, as a principle.

What Next for Shetland

The College is now open as a private limited company. That doesn’t mean we give up. Transport workers and their unions have fought tooth and nail to have our railways and buses re-nationalised, and not just for themselves and their terms and conditions, but for the public service—and that fight is beginning to pay off.

The ability of unions to take industrial action over privatisation are stymied by anti-trade union laws. But staff are concerned about any future changes to terms and conditions, and should they arise, we would need to consider all options—including industrial action. Our initial campaign was supported by Scottish Labour and the Scottish Greens, and we can only hope this support continues.

We will continue to argue for Shetland College to be nationalised. We will keep a close eye on the upcoming mergers of Lews Castle, North Highland College, and West Highland College to ensure there is no further privatisation in Scottish FE. Privatisation must become a dirty word again in our public services—and it will, if we continue to highlight its negative impact on students, our staff, and our communities.