Scottish universities have been promised more public funding and less regulation - if they play a more direct role in boosting the economy, a report into the future of higher education north of the border has said.
The interim report of the Joint Future Thinking Taskforce on Universities has also shut the door on any possible Scottish Government funding for university mergers, stating explicitly that collaboration between institutions is a more cost-effective means of achieving efficiency.
The task force was set up in November last year to look at how universities could contribute to Scotland's economy, culture and society in the next 20 years, and to help deliver the political priorities of the Scottish National Party Government, which came to power in May 2007.
The SNP made increasing economic growth and improving the nation's skill levels its key priorities as part of its bid to convince Scottish voters that independence is the pathway to greater prosperity.
The task force is made up of representatives of Universities Scotland and the Scottish Funding Council along with university principals and Scottish Government officials. At the heart of its report is a realignment of the relationship between higher education, the Scottish Government and the SFC that promises universities "lighter touch" regulation as well as more public funding.
The three groups would form a Tripartite Advisory Body that would act as the forum through which the sector offers its views on the mechanics of new funding arrangements.
As long as they align their institutions with national objectives, university heads will be given more autonomy over the funding given to them by the Government, what the report describes as a "something for something" deal.
The report says: "The Scottish Government's funding is targeted at activity that will deliver against the National Outcomes, thereby aligning publicly funded activity against the Scottish Government's Purpose and Strategic Objectives - that is its 'something'.
"The universities, by demonstrating that they are delivering relevant to this agenda, strengthen their case for increasing levels of public investment - that increase in public investment is their 'something'."
Fiona Hyslop, the Scottish Education Secretary, told Times Higher Education: "Universities are clearly autonomous institutions, but for the scale of public investment it's not unreasonable for Government to make sure that the things they are doing contribute that overarching economic purpose.
"Part of that will be showing a greater alignment with business and showing that they (the institutions) are stimulating business to use universities."
She said there would be two funds from which the government allocated money to universities - a general fund for mainstream activity and a horizon fund to target new opportunities for applied research.
"We expect to see more collaboration and co-operation," she added.
But Claire Baker, Labour's Higher Education Spokeswoman, pointed out that in the SNP budget universities received an increase of £30 million over three years - £138 million short of what they asked for.
She said: "The fact is that the SNP is failing to fund our universities properly and for all their vague promises of 'jam tomorrow' there is still no more money on the table for the vital work our universities do."
The task force report will now go out for consultation.
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