The financing of the national educational system is almost entirely through public funding from the Scottish Government.
Pre-school and schools
Local authorities carry out almost all (around 97%) of school education expenditure in Scotland. In addition there is a proportion of expenditure undertaken by central government - the Scottish Government budget delivers national challenge and improvement support for school education.
It is the responsibility of local authorities to set budgets for education, within the overall resources provided to them, on the basis of local needs and priorities, having first fulfilled their statutory obligations and the jointly agreed set of national and local priorities including the Scottish Government’s key strategic objectives. Total net expenditure on education by local authorities in Scotland was just over £4.7 billion in 2015-16.
The table below shows total local authority spending on education in Scotland over the last four years available:
Year | Net spend | % increase/decrease |
2012-13 | £4.57 billion | |
2013-14 | £4.58 billion | +0.2% |
2014-15 | £4.61 billion | +0.7% |
2015-16 | £4.74 billion | +2.7% |
Source: Scottish LG Finance Statistics, Scottish Government (2017)
Central government expenditure on school education is undertaken through the Scottish Government Learning Directorate budget. The Learning Directorate has responsibility for Scottish Government policy on school based learning and national qualifications and assists the national support, challenge and improvement elements of policy on school education.
The Learning Directorate budget includes funding for the Scottish Qualifications Authority (SQA) and Education Scotland. The capital element of the budget funds improvements to the school estate.
Private financing of pre-school and school education accounts for a small proportion of provision. In September 2016 4.1% of children attended independent (private) schools - 29,647 pupils. Local authorities often buy some pre-school education provision from private or voluntary providers in meeting their legal obligation relating to pre-school education.
Higher and Further Education
The government funds higher and adult education principally through grants from the Scottish Funding Council (SFC). SFC invests around £1.6 billion in Scotland’s colleges and universities for teaching and learning, research and other activities in support of Scottish Government priorities.
There is little private funding of higher or further education outside the higher education institutions and colleges, though some private training providers exist. Moreover, higher education institutions receive a good deal of income from sources other than government, including fees from foreign students and research grants.