Ministers said universities received a fair settlement

Leader Nicol Stephen claimed the SNP's budget proposals would see Scotland's universities fall behind.

Ministers said there would be funding increases in real terms for the country's universities and colleges.

Education Secretary Fiona Hyslop challenged Mr Stephen to outline how increased funding could be paid for.

Mr Stephen told BBC Scotland's Politics Show that his party intended to bring forward an amendment to the yet-to-be-approved Scottish budget which would maintain the level of university funding to "keep Scotland competitive internationally".

I recognise we have to have investment in universities but, within a tight settlement, we gave them a very fair settlement indeed Fiona Hyslop Education secretary

"That is not a cut - and a cut is what is being delivered by the SNP in terms of this budget," he added.

Mr Stephen went on: "I do believe on this issue, we could build a consensus with the other parties, perhaps with Labour and the Conservatives, because investment in the future of our universities really is vital."

When challenged to say which other budgets would be cut to deliver the funding request by higher education body Universities Scotland, Mr Stephen suggested there may be other ways to find efficiency savings.

University leaders said they had requested a �168m increase in 2007-08 but received �30m.

'Big ask'

Scottish ministers have pledged overall funding of �5.24bn to higher and further education over three years.

Mr Stephen said: "We had a range of different proposals for more efficient government. Part of that was to do with the future ownership and the mutualisation of Scottish Water."

But Ms Hyslop denied that the competitive edge of Scotland's universities would be eroded, adding that the issue was a priority for the SNP administration.

She said: "The universities budget request was for inflation plus 15%. We had a settlement from Westminster which was inflation plus 1.4%. It was a big ask.