Top University staff could fall foul of new pay guidelines
New guidelines on pay for vice-chancellors could place Toope’s wage in an ‘unacceptable’ range, in comparison with the average employee salary
Vice-chancellors paid significantly more than other staff at their university are to face heightened scrutiny, under new guidelines proposed by a committee of university leaders.
The plans, currently out for consultation, oblige universities to annually publish details of how much their vice-chancellor is paid compared to the median pay of the overall workforce.
They identify an acceptable multiple range of 4.5 to 8.5 between leaders of universities and their median-paid employee, meaning that any university paying their vice chancellor more than 8.5 times the overall median salary will “need to be prepared to justify to stakeholders and their regulator why this is desirable”. Currently, 80% of higher education institutions lie inside of this range – Cambridge, where vice-chancellors’ salaries have escalated in recent years, does not.
The guidance follows escalating criticism of remuneration for top figures at universities across the UK. Last year, reports that Bath University’s outgoing vice chancellor, Dame Glynis Breakwell, had received a £468,000 pay packet – making her the highest-paid university leader in the UK – provoked national controversy.
The stringency of these new criteria could prove problematic for Cambridge. Following his installation last month, Varsity reported that Vice-Chancellor Stephen Toope’s salary for the year 2017-18 would be £365,000. His predecessor, Professor Sir Leszek Borysiewicz, earned a salary of £345,000 in 2015-16.
Data on the median salary for employees at Cambridge is not currently available. However, figures released under an FOI request show that, in the year 2016-17, the highest-paid employee had a salary 13.12 times higher than the median-paid employee. The figure places the University significantly above the threshold deemed acceptable under the new guidance.
How many staff are paid above CUC’s threshold?
There were 11 staff whose pay should undergo scrutiny according the latest figures. (Chart shows median pay vs pay for those staff who earned over £200,000 in salary in 2015/16. All figures show top end of a £10,000 band)
Despite rapidly escalating salaries, vice-chancellors are not the most highly-paid figures at the institution. Figures released under the same FOI show that, in the same year, the largest salary paid by the University was £440,344. Overall, 123 members of the University were paid £140,000 or more, suggesting that large paypackets are not only distributed to a select few at the institution. A second FOI request revealed that the majority of these were academic staff.
The guidelines also issue a warning about extravagant spending on expenses, placing responsibility for monitoring expenses claims on remuneration committees, and suggesting that “senior post holders could be encouraged not to claim for minor items”. Last year, Varsity reported that Borysiewicz recorded the second highest expenditure on flights of any Head of a Higher Education Institution in 2015/16.
Concerns are also raised in the plans about vice-chancellors sitting on the remuneration committees that decide their own pay. The code is unequivocal in stating that heads of institutions may not be included in the membership of remuneration committees, in order to ensure the committees are “as independent and expert as possible”.
VC pay on a steady climb
VC pay has increased rapidly over the last seven years. (Data for 2016–17 has not yet been released)
When Varsity asked the University whether Toope sat on its Remuneration Committee, they declined to offer comment.
In response to our enquiries, the University said they “welcomed the call for higher education institutions to demonstrate value,” but defended the salary it paid to the vice-chancellor: “The University’s Vice-Chancellor is held to account every year for what he delivers in the course of supporting Cambridge to make the discoveries that will change the world, in the way we have done consistently for 800 years.”
The University also stated that the size of the salary had been determined by a “global search,” referencing the pressure they face to compete with universities abroad, particularly in the US, where salaries offered to vice-chancellors far exceed those offered to their UK counterparts. Even at home, after a series of headlines criticising rapidly increasing vice-chancellor pay, vice-chancellors themselves have avoided widespread public reprobation.
Senior staff at the University are not unaware of the growing pay gap at their institution. A report submitted by the University’s Board of Scrutiny submitted last October noted that, while there had been a “sharp rise” in the number of staff earning over £100,000, core academic and academic-related staff were being offered pay increases that fell below levels of inflation.
Although an attempt to assuage a long-running debate, the plans in themselves are likely to prove controversial. The body responsible for their establishment, the Committee of University Chairs (CUC), which represents the non-executive chairs of universities’ governing councils, is regarded as too close to vice-chancellors. Furthermore, compliance with the guidance is optional, and the Committee has little power to punish those universities who opt out.
Launching the consultation, the CUC chair, Chris Sayers, said: “We must enshrine the values of transparency, fairness and accountability at the heart of our procedures to ensure we maintain the trust required for the long-term success of our world-leading sector. The draft guidance, launched today, balances these values with our sector’s need to be able to continue to recruit and retain the best talent.”
The University and College Union (UCU), which represents university staff and publishes an annual survey of vice-chancellor pay, cast doubt on the ability of the committee to police vice-chancellors’ pay. General Secretary of the UCU Sally Hunt said: “If we are serious about tackling the problems of senior pay and perks in our universities, then we need a body not so closely linked to vice-chancellors to look at it.”
She continued: “The time has come for vice-chancellors and their supporters to be removed from the setting of their pay and a national register of senior pay and perks.”
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