Scottish university principals can afford a decent pay offer to staff thanks to an inflation-busting rise in higher education funding, according to the Association of University Teachers Scotland.
The AUTS and Universities Scotland have welcomed an 8.5 per cent rise from the Scottish Higher Education Funding Council, announced this week, that includes a 4 per cent rise for core teaching and research grants.
Of the money already allocated, institutions can expect an average 2.7 per cent real-terms increase in resources, assuming a 2.5 per cent inflation rate.
Out of Scotland's 18 higher education institutions, Aberdeen University has the lowest real-terms increase, 1.7 per cent, while Paisley University has the highest, 5.3 per cent.
Tony Axon, AUTS research officer, said: "The increase in funding will give an opportunity for universities to tackle the historical deficit in pay and begin to resolve the issues of pay discrimination and casualisation identified by the Bett report."
Sir Stewart Sutherland, convener of Universities Scotland, said the Scottish Executive had taken an important first step towards reversing the "serious under-investment" of the past 20 years.
He said: "For every penny we receive, we deliver real benefits for Scotland's economy, for Scotland's social and cultural vitality and for Scotland's people."
But Mr Axon warned that much of the potential good work would be undone if Shefc went ahead with controversial proposals on changing its teaching and research funding systems.
In the new funding round, Shefc had introduced many of the progressive elements proposed, such as a premium for students from non-traditional backgrounds and a recurrent funding stream to promote knowledge transfer. Mr Axon said there was now no need to rush through further proposed changes that could threaten institutional stability and the future of particular subjects.