• Home
• News and Updates
• Vice-Chancellors Pay – response to HEPI debate paper 33

Vice-Chancellors Pay – response to HEPI debate paper 33

31^st August 2023

John Rushforth offers some thoughts and reflections

Discussions on Vice Chancellors pay are not something I particularly enjoy. They tend to generate lots of emotion, be relatively short of facts, and often turn unpleasant. So, when the HEPI report on VC pay landed on my desk, my reaction was not unalloyed joy. However, what I read was an interesting and thoughtful contribution to the debate, and of course, I welcomed the report’s positive references to the CUC Remuneration Code. The Code draws on good practice across a range of sectors, is regularly updated and has been endorsed and implemented by the sector. I was particularly pleased with the Report’s call for less divisive rhetoric.

It was disappointing that the UCU response almost immediately ignored that call – with phrases like “exorbitant rate of pay”, “spiralling vice-chancellor pay”, and “leaders “drinking it up”.

UK universities are world-leading and recognise that a fair, transparent, and accountable reward system is vital to the trust required for the long-term success of our sector. The people who lead universities are responsible for significant institutions of learning, which are major regional employers and value creators for the local and UK economy. They play no role in setting their salary.

Remuneration must be sufficient to recruit, retain and motivate staff of appropriate calibre in the context of the market that universities operate within; it needs to take into account the enormous size and complexity of the operations senior staff manage – I was pleased to see that even UCU recognised “the job of the vice chancellor is demanding and complex”.

What really dismayed me about the UCU response was that nowhere was there an acknowledgement of the sector’s core problem, namely the massive reduction in government funding by not increasing student fee rates. One estimate I saw suggested that nearly £3 bn had been removed from sector finances, yet UCU does not suggest this is a factor.

In response to that reduction in real terms of government funding available, the sector remuneration committees have exercised restraint, with the average basic salary of a substantive Vice-Chancellor on 1 January 2023 being £267,969, an increase of 3.5% compared to an inflation figure of 10.1%. Of course, there may well be individual cases where there have been significant awards, but there are several unreported cases where Vice-Chancellors surrender a significant amount of their salary to support student welfare; I know of one VC that gave £38,400.

I also took issue with the comment” that Remuneration Committee remain largely opaque and many continue to make outrageous awards”. Their membership is not secret; they are listed on University websites. They report to their governing bodies – all of which have staff and student members. CUC has recognised the importance of the work of Remuneration Committees and has established a specialist forum for Remuneration Chairs, ensuring that they are given expert advice from within and outside the HE sector.

CUC members are independent and see their key role as protecting the long-term sustainability of their institutions – they know and accept that they must be transparent in their dealings about pay and that they have to continue to make that difficult balance between attracting and retaining talent and the need to demonstrate the achievement of value for money in the use of resources given that government funding has reduced in real terms over the last few years. The HEPI paper will help to develop thinking on VC pay, and CUC will consider it in more depth and advise our members. My main hope, however, is that we can focus on the key issues that face our sector in terms of real terms reductions in funding rather than be distracted by discussing VC pay again.