Report exposes ‘inflation-busting’ pay rises of VCs

University bosses received an average salary of £272,432 (US$395,130) for the academic year 2014-15, which is an inflation-busting increase of 3% on the previous year and 6.7 times the average pay of their staff, according to a report released by the University and College Union, or UCU.

The highest paid vice-chancellor was Professor Andrew Hamilton, then vice-chancellor of Oxford University, with £462,000.

During the same period, staff received a pay increase of just 2%. Over the past five years vice-chancellors have seen their salaries rise by 14%, while in comparison staff received just a 5% increase.

The report released on 11 February also lays bare heads of institutions' spending on flights, hotels and expenses. It also looks at accommodation that vice-chancellors use at universities' expense and explores institutions' spending on management consultants.

UCU general secretary, Sally Hunt, said: “The time has finally come for a frank and open discussion about pay and transparency in higher education. The huge disparities in the levels of pay and pay rises at the top expose the arbitrary nature of senior pay in our universities.”

However, a spokesperson for Universities UK, the vice-chancellors’ body, said: “The remuneration packages of vice-chancellors are determined by independent remuneration committees at each individual institution and are publicly available in universities’ annual reports and accounts.

“The salaries of university leaders in the UK are in line with those in competitor countries and comparable to similarly-sized public and private organisations.”

Key findings for 2014-15 include:
  • • The average salary for a vice-chancellor was £272,432.
  • • The University of Salford splashed out £516,000 on vice-chancellors' pay, for two incumbents during the year.
  • • The highest single earner was Professor Andrew Hamilton, then vice-chancellor of the University of Oxford who received £462,000.
  • • The average pay increase for vice-chancellors between 2013-14 and 2014-15 was 3%.
  • • The largest single pay increase was 57%, compared to 70.2% in 2013-14.
The survey found that, unchanged from last year, 20 institutions had more than 100 members of staff earning over £100,000 a year.

Freedom of Information request

UCU submitted a wide-ranging Freedom of Information request to 159 higher education institutions in autumn 2015. This followed a similar request submitted in autumn 2014. Both requests were designed to shine a light on the arbitrary nature of senior pay and perks in universities, and support the union’s call for reform.
The survey looked at various types of expenses incurred by university leaders.

Among 125 institutions responding, vice-chancellors spent an average of £8,560 on flights, with Professor Sir Jim McDonald at the University of Strathclyde the highest spender (£41,891). Almost half (49.6%) of all flights were in first or business class and 21 vice-chancellors flew exclusively in first class or business class.

Among 121 institutions, vice-chancellors spent an average of £2,990 on hotel rooms, with Professor Pamela Gillies of Glasgow Caledonian University the highest spender (£19,865), and on average £163 per night on hotel rooms. However, Middlesex University’s vice-chancellors spent an average of £448 a night.

The average market sale value of residential accommodation provided to heads of institutions, among 24 who responded on this, was £1,159,825, with the most valuable property inhabited by the vice-chancellor of the University of Cambridge, Professor Leszek Borysiewicz, valued at just over £4.5 million. The total market sale value of property provided to head of institutions as residential accommodation provided by the 24 responders was nearly £28 million (£27,835,800).

On average, among 85 responders, universities spent £499,360 on management consultancy, but the University of Reading topped the list, spending a hefty £4.4 million or 1.69% of its budget.

Universities UK pointed out that university heads act as ambassadors for their universities and are expected to travel extensively to forge international links with overseas universities and to promote the university internationally.

The Universities UK spokesperson added that vice-chancellors who are provided with accommodation on campus while they hold their posts do not own these properties. “They are an asset of the university and living in the residence is often a condition of contract. These properties are also used for public events on behalf of the university, as well as hosting guests and supporters from home and overseas.”

However, Sorana Vieru, the National Union of Students' vice-president, described the pay figures as “obscene”. She told the Guardian: “When university finances are being stretched to breaking point, and are over-reliant on ever-rising tuition fees, it is almost immoral to see the generous expense policies afforded to already extremely well-paid vice-chancellors.

“We are told there are no funds for improving teaching and learning, for more staff, or for better mental health support for students, but there seems to be money for first-class flights for university senior management.”

Failure to respond

Some universities were guarded or failed to respond to requests for information. UCU said 18 universities (11%) did not respond to the union's Freedom of Information request. Three used exemptions to refuse to answer all questions and a further four answered just one question.

Only 22% (35 of 159) provided unredacted minutes from their most recent remuneration committee meeting – where the pay of the vice-chancellor is decided.

The union said greater sanctions were needed to ensure universities justified some of the largesse that has embarrassed higher education in recent years.

The report has been released as ministers in the Department for Business, Innovation and Skills are consulting on whether universities, which receive nearly £4 billion a year in taxpayers’ money, should be exempted from the Freedom of Information, or FoI, Act, and the scrutiny of senior pay in universities is back in the spotlight.

The Daily Mail reported last week that the head of Universities UK, Nicola Dandridge, told the Freedom of Information Commission that universities should be exempt from the legislation because disclosing university leaders’ salaries could be “damaging” and make it harder to recruit staff from around the world.

An investigation by the Daily Mail found that her salary had risen by almost 6% last year but this fact was not openly disclosed in the body’s annual report.

In a recent blog she said that universities are estimated to spend £10 million a year to comply with all elements of the FoI act and there is concern that there is not a level playing field because new providers of higher education are not subject to the same regulations. Therefore the FoI needs amending.

But Hunt said: “It is deeply worrying that ministers are considering relaxing FoI rules for universities, when they are the one measure we have to hold them to account. Our report highlights the need for a strengthening of the current FoI legislation.

“While some continue to enjoy inflation-busting pay hikes and all the trimmings of first-class flights and luxury hotels, staff pay continues to be held down. We will continue to campaign for a proper register of pay and perks at the top of our universities. This information must be made readily available and no university should be allowed to get away with not responding to an FoI request.”

Back in January 2014, UCU wrote to the then business secretary of state Vince Cable and then universities and science minister David Willetts to highlight the escalation of vice-chancellors’ salaries for the academic year of 2012-13 and reminded them of the government’s strong words on excessive senior pay at UK universities.

In response to the letter, Willetts said universities should be free to set the operation of their remuneration committee as they see fit, and that there were already lists of vice-chancellors’ pay in the public domain. However, he did suggest universities may be required to provide a remuneration report as is now the norm in many public and private sector companies.