COLLEGES have been handed a 9.4 per cent funding boost in the draft Scottish Budget.

Finance Secretary Derek Mackay insisted his proposals represented a “comprehensive package of measures” to improve attainment and job opportunities.

He said £664.9 million had now been invested in the sector, with an additional £107m set aside to support college bursaries, childcare and discretionary funds.

It comes after spending watchdogs said the financial health of the sector had deteriorated in the last few years.

The sector is also facing the prospect of funding a £99 million deal that will give lecturers pay rises of up to nine per cent.

Speaking as he met students and staff during a visit to North East College in Aberdeen, Mr Mackay said: “All children and young people, whatever their background or circumstances, deserve the same chance to reach their full potential.

“That is why improving outcomes for children, young people and their families is at the heart of this Government’s agenda and spending plans.

“In recognition of the important role our college sector plays in delivering these ambitions, our 2018/19 Draft Budget includes a 9.4 per cent real-terms increase in overall college funding, taking investment in the sector to £664.9 million."

He added that a "comprehensive" package of measure was being put in place to close the attainment gap and improve skills and employability.

He added: “This Budget also delivers record levels of financial support to students, with over £107m in college bursaries, childcare and discretionary funds provided in the 2017-18 Budget - a 32 per cent real-terms increase since 2006/07.”

His comments came after Scottish Labour said it would force a vote of “no confidence” in the draft Budget, insisting it would not protect public services in Scotland.

The party argues council cuts will slash local budgets by £700m, with any attempt to plug this gap by raising council tax only likely to stump up an extra £77m.

A spokesman for Mr Mackay branded the move a “pathetic stunt”, insisting voting against the Budget would be “a vote against investing in childcare, our schools, hospitals and other vital public services”.

Last year college lecturers threatened strike action amid a long-running dispute over pay and conditions.

It would have been the most serious strike in Scottish education since the teachers’ dispute in the 1980s, but was called off after a deal was reached with Colleges Scotland.

But fresh uncertainty emerged in December, when strike action loomed again, despite lecturers agreeing salaries of up to £40,000 a year and 62 days’ annual holidays.

It came as talks broke down over an extra £1,000 in "living costs" from next year.

Meanwhile, spending watchdogs warned colleges are already facing an uncertain financial future with growing deficits and a decline in student numbers.

A report by Audit Scotland found the financial health of the sector was “relatively stable”, but had deteriorated in the last few years with deficits of £19m in 2015/16.

Audit Scotland also said student numbers had decreased in 2015/16 with the student population at its lowest level since 2006/07 – when the SNP came to power.

Holyrood’s finance committee will meet businesses and third sector organisations in the north east today to discuss Scotland’s budget and the impact of Brexit, with Mr Mackay set to give evidence. The draft Budget will be finalised next month.