Salaries at the top

On the salaries paid to university heads:

But is the comparison with the private sector reasonable?

While vice-chancellors might increasingly need to act like CEOs, captains of industry would surely claim that their business models – and levels of risk – are nothing like the work of politically protected institutions largely reliant on public funds (regardless of whether that money flows through research and teaching grants or state-subsidised student loans).

The lack of mobility between the worlds of big business and higher education also makes the executive pay comparison unwise, argues Roger Brown, professor of higher education policy at Liverpool Hope University. Universities tend to hire from within their own ranks and few vice- chancellors have left the sector to assume big roles in business, he observes.

As most universities are charities, institutions might think about the third sector. Barbara Stocking, Oxfam’s chief executive, was paid £109,100 in 2011-12 to run an organisation with 5,000 paid staff, 22,000 volunteers and a £385 million turnover. No vice-chancellor earned such a “low” salary that year.

The classic comparison is with the prime minister’s remuneration. However, in the Hutton Review of Fair Pay in the Public Sector, a report published in March 2011, Will Hutton, former Observer editor and former head of the Work Foundation, dismissed such “simplistic benchmarks” (David Cameron is paid £142,500 a year, although he is entitled to about £193,000). Instead, Hutton, who is now principal of Hertford College, Oxford, compared vice- chancellors’ salaries to those received by NHS chief executives, local government heads, four-star generals and permanent secretaries in the Civil Service.

Average pay for vice-chancellors was substantially higher than that for any of those public sector roles, having risen at a faster rate since 2000, the report found.

From Jack Grove, “The annual pay review: are v-cs worth every penny?” Times Higher Education (March 28, 2013).

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