Standards and pay in public life

Scrutiny of vice-chancellors’ pay has been particularly intense this year.

The national press has talked of pigs and troughs – an analogy denounced in The Poppletonian as “personally offensive to Sir Hartley Grossman, the managing director of Poppleton Pork Products and head of our university’s Remuneration Committee”.

Universities UK’s response again focused on the need to pay salaries that secure talent in a global market (true or not, an unfortunate echo of the argument used by bankers).

As always, our annual survey of vice-chancellors’ pay reveals a varied picture.

The average rise across the sector is a relatively restrained 3.3 per cent, but within the group are the inevitable eyebrow-raisers: from straightforward pay hikes to pension-salary “flipping”, six-figure payoffs to generous “relocation packages”.

More than one vice-chancellor has said that the outlying salaries that attract opprobrium affect all university heads in their capacity as public intellectuals

Also to be found are examples of individuals forgoing pay rises or bonuses (and whatever the rights and wrongs of such hikes, refusing one must be tough).

The backdrop to all this is the harshest of recessions in which many people have had a terrible time, with those working for universities getting a series of below-inflation pay deals.

In our analysis of the pay tables, we focus on the people who set vice-chancellors’ pay.

University remuneration committees are heavily populated by high-flyers from industries in which even the largest vice-chancellorial salary might seem modest and incapable of attracting “top talent”.

No doubt their thinking is that the same rules that govern their sectors apply to universities, which are, after all, complex organisations and are competing with US institutions paying top dollar for the best leaders.

But are vice-chancellors – who are surely still “chief academic officers” as much as chief executive officers – really as price-sensitive as these committees seem to believe?

Considering the vast sums of money that flow through universities, it may be true that even a salary of £400,000 is a drop in the ocean, but more than one vice-chancellor has said privately that the outlying salaries that attract the most opprobrium are affecting all university heads in their capacity as public intellectuals and ambassadors for their institution and higher education in general.

The problem is exacerbated by the fact that so much of the public debate about higher education focuses on tuition fees and the costs and benefits of taking on large debts to study.

Amid all this, the government’s position is typically uneven: pushing universities to a market-driven future while simultaneously decrying executive pay in the grant letter smacks of having your cake and eating it.

As the leaders of some of the country’s most precious institutions, vice-chancellors are far more deserving of their salaries than bankers. But they are also held to a different standard, and the extended press coverage shows that their motivations are starting to be questioned.

The governance of our universities must continue to draw on the widest range of talent, including those who offer outside expertise and an alternative perspective.

But when it comes to setting executive pay, perhaps remuneration committees should give a greater role to staff and students, who are best placed to understand the sensitivities and balance them against the demands of the job.

john.gill@tsleducation.com