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University vice-chancellors are paid far more than public sector peers

University vice-chancellors are paid far more than public sector peers
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Vice-chancellors’ pay at British universities has far outstripped that of their peers in senior leadership roles elsewhere across the public sector, according to research conducted by the Guardian.

Analysis of the salaries of vice-chancellors at leading universities shows they are paid well above the chief executives of NHS hospital trusts and local authorities in a number of cities in England.

The £185,000 pay of the chief executive of Birmingham city council – the largest local authority in Europe, with gross annual expenditure of £3bn – was less than half that of the University of Birmingham’s vice-chancellor, Sir David Eastwood, on £378,000.

Eastwood also chairs the Universities Superannuation Scheme – for which he earns an additional £90,000 – and is a board member of the Universities UK group, at the heart of the bitter dispute over staff pensions that has provoked strikes in more than 60 universities in recent weeks.

The issue of high pay for university vice-chancellors has come under intense scrutiny in recent months, with members of the government from the prime minister downwards expressing their concern, but so far there have been few signs of change.

VCs’ pay

Sam Gyimah, the universities minister, told the Guardian: “Vice-chancellor salaries must be justifiable and should not be excessive.‎ Universities are autonomous institutions but they receive significant amounts of public funding, so are rightly subject to public scrutiny.‎

“That’s why we have taken concrete action to address this. Our new regulator, the Office for Students, will require universities to publish the justification for salaries of their most senior staff – and we have given it powers to tackle this issue if universities do not take action.”

In London, the £300,000 salary of the chief executive of the Imperial College Healthcare NHS trust was outstripped by the £353,000 earned by the president of Imperial College, Alice Gast.

Gast’s salary was also close to double that of the chief executive of the Royal Borough of Kensington and Chelsea, on £186,000.

The shadow education secretary, Angela Rayner, on Sunday pledged that the party’s policy of setting a ratio of 20:1 between the highest and the lowest-paid in the public sector would also apply to universities.

Gordon Marsden, the shadow higher education minister, said fixed pay ratios and greater transparency would help end the “rampant inequality” in universities.

“Vice-chancellors simply cannot justify the fact they are paid many times more than their local council and NHS trust chief executives, at a time when their own staff have been fighting for their pensions,” Marsden said.

The pay gap is particularly acute outside London, with the local council, NHS trust and university being the three largest employers in most cities.

In the cases of Southampton and Bath universities, both vice-chancellors were paid more than twice the salaries of the chief executives running NHS trusts in the same cities, while the pay of Bath University’s Glynnis Breakwell was nearly three times more than that of the chief executive of the region’s local authority.

Breakwell received £434,000 in 2015-16 – not including pension – while the chief executive of the Royal United hospitals Bath NHS foundation trust was paid up to £195,000, and the chief executive of Bath and North East Somerset council received £150,000.

The Bath-based NHS trust was both the largest employer and the biggest spending institution, with around 4,500 full-time staff compared with the university’s 2,800. While the university’s spending in 2015-16 amounted to £268m, the NHS trust’s operating expenses were £312m in the same year.

Breakwell became the focus of criticism both outside and inside Bath University for the size of her salary. Following campus protests by staff and students, Breakwell announced she would step down this year.

Data on gender pay gaps shows both Bath and Southampton universities pay men 17% more than women on their staff by median hourly pay rates. That is wider than the 14.8% gap in median pay seen across the higher education sector.

Sally Hunt, the general secretary of the University and College Union, which represents many university staff, said: “It is time for proper scrutiny of vice-chancellors’ pay and perks, and some explanation for why there are such huge differences in the salaries and pay rises they are awarded.

“The current set up is clearly not fit for purpose and the onus is now on the Office for Students to deliver on proper regulation.”

The Office for Students has said it will ask universities to justify pay higher than £150,000 for individual staff, although it remains unclear exactly what sanctions the new regulator will be able to use.

In January the Committee of University Chairs proposed a new voluntary code that would link vice-chancellors’ salaries to a maximum of eight and a half times their institution’s annual salary, and prevent vice-chancellors from sitting on the remuneration committees that sets their pay.

Vice-chancellors’ pay appears to have risen sharply following the introduction of £9,000 tuition fees in England since 2012, at a time when pay has remained relatively flat for local authority and NHS senior managers.

Additional reporting Caelainn Barr and Pamela Duncan



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