Vice chancellor pay soars

Universities must become more transparent if they are to win people’s trust. That is the view of Martyn Moss, North West official with the University and College Union, who says executive salaries, pay disparities and staff lay-offs are among the issues facing higher education in the north.

Moss said: “We have great concerns about transparency regarding information about how top salaries are determined. Universities have shadowy remuneration committees, on which vice chancellors themselves often sit and which publish no minutes. We would very much like to see this end.”

With undergraduates in England now paying annual tuition fees of £9,000 and leaving with the highest debts in the developed world, there is widespread concern about the salaries of vice chancellors. Since universities are independent entities, government has no direct influence on pay, and while universities minister Jo Johnson has voiced concerns he is opposed to any form of cap.

Bentleys and yachts

The UCU says average vice chancellor pay has leapt by 17.4 per cent in four years, to £257,904. Academic pay rose by just 1 per cent last year to an average of £49,408 and many are employed on insecure contracts. At Lancaster University, 51 per cent of academics are employed on fixed term contracts.

The north is home to some of the UK’s most highly paid vice chancellors. Last year, Sheffield University boss Sir Keith Burnett was the sixth-best earner, with £422,700 including pension – up
9.7 per cent on the previous year. Liverpool University’s vice chancellor earned £341,600, while Manchester University paid £304,000.

Newer universities are not exempt. The vice chancellors at Liverpool Hope University and Edge Hill University earned £313,500 and £334,000; Manchester Metropolitan paid £313,000 and Bolton’s George Holmes – whose pay rose by 11.5 per cent to £260,500 – boasts of driving a Bentley and owning a yacht.

Tuition fees pay

In an awkward juxtaposition with spiralling executive pay, several universities have axed academic jobs over the past year. Manchester University recently made 171 lecturers and support staff redundant, while at neighbouring MMU, there was industrial action to protect 160 jobs. Posts have also been threatened at the universities of Chester and Huddersfield.

The issue of tuition fees dominated the headlines after Labour pledged to axe them entirely and Theresa May promised a review to consider cutting them and bringing back maintenance grants, abolished in 2015.

The UCU wants fees abolished and universities funded through a partial increase in corporation tax, which has been slashed from 28 per cent to 19 per cent since 2010.

Value for money?

Moss said: “The current system makes little sense. The loans take a long time to be repaid, if they are ever repaid at all. And the actual money for loans – which go to the universities as fees – comes out of the public purse anyway.

“To pay university tuition fees it would require a rise of 3.6 per cent in corporation tax. Our corporation tax is the lowest of the G20 countries – in France it’s 33 per cent and even in the US it’s 35 per cent.”

The House of Commons education committee has launched an inquiry into value for money within the sector and, from January, universities will be regulated by the new Office for Students. The OFS has vowed to force universities to publish the gap between their highest and average salaries, with chairman Sir Michael Barber saying: “Exceptional pay should be for exceptional performance… where you haven’t got the track record and where your pay sticks out like a sore thumb, then you should be asking yourselves questions and we will regulate that.”

Dr Diana Beech, director of policy and advocacy at the think tank Higher Education Policy Institute, said: “Commentators have been calling for this kind of culture change for a long time. Up to now there has been no regulation within the sector at all.

“The OFS wants to clampdown on vice chancellor pay but it’s very hard to put a limit on these things as universities are so varied in size. I think universities really need to ask themselves what they are doing – they need to look at pay differentials down to the most junior researcher. The culture of university would be greatly strengthened if everyone working there could see that pay was fair.”