Iain McMillan: Graduates must pay to improve our universities

Central to this aim is the need for our higher education sector to be well funded and internationally competitive. Universities are a vital part of what Scotland needs to build economic prosperity and long-term success.

Whatever the outcome of this year's elections to the Scottish Parliament, the maintenance of high standards and quality of teaching and research undertaken by our universities is essential. We must also protect our universities' autonomy and ensure that their international competitiveness is developed further and not adversely affected by inadequate levels of financial support.

To do this, our universities need to have access to new revenue streams. And while CBI Scotland believes that higher education is a public good, in the sense that it brings broad benefits to society, it is also a private good because graduates generally benefit from earning higher salaries than non-graduates.

While we maintain that a university education should be "free at the point of entry" and reject the levying of a "graduate tax" on those who obtain an ordinary degree, we believe some form of graduate contribution will be required in order to help deliver the funding that our universities need. We favour a fee that is advertised upfront but which graduates pay back once they are earning 21,000 a year or more. We think this is a fair way of raising a contribution from those who benefit.

Scotland's world-class higher education sector faces urgent challenges, including the need to remain internationally competitive in the face of severe pressures on public funding. It is crucial that measures taken do not jeopardise the high-quality teaching and research of our universities and their ability to deliver long-term economic prosperity in a highly competitive world.

l Iain McMillan is director of CBI Scotland.