Office for Students applauds ‘pay restraint’ by universities

First annual pay report from OfS found ‘variation between providers’. By Kevin O’Malley

Over a third of universities have recorded a decrease in senior staff being paid a salary in excess of £100,000.

The drop comes against a sector-wide increase in the number of six-figure paycheques to 1.5%, up from 1.3% in 2016–2017.

The findings come as the Office for Students releases its first annual analysis of senior staff pay. The report is to serve as a benchmark for university staff to evaluate industry-standard earnings for management positions in higher education and to gauge restraint demonstrated by institutions across the UK. The data shows that the proportion of staff receiving a basic salary of greater than £100,000 fell at 48 providers (36%). A further three institutions (2%) report no change.

Some institutions reported a pay increase for top management personnel of as much as 22.4% (De Montfort University, compared with 3% staff average). However, 13 providers (10%) reported paying a reduced basic salary to their head of provider in 2017–18 compared with 2016–17, and a further 18 (14%) paid no increase in basic salary for the same period.

It is not for the Office for Students to set a vice-chancellor’s pay

Nicola Dandridge, chief executive of the Office for Students, said: “This important data sets out how English universities and other higher education providers remunerated their senior staff in 2017–18. While the Office for Students was not fully operational during much of the year in question, the data helps us understand more about pay for senior staff in higher education.

“It is not for the Office for Students to set a vice-chancellor’s pay. We understand that running a university is a significant and complex task, and it is right that those who excel in their roles should be well rewarded. Despite this, where pay is out of kilter, or salary increases at the top outstrip pay awards to other staff, vice-chancellors should be prepared to answer tough questions from their staff, student bodies and the public.

“It is good to see signs of pay restraint at some universities, with some vice-chancellors refusing a salary increase. 

A number of governing bodies have reduced the basic pay of their vice-chancellor, though we acknowledge that it can be difficult to revisit contractual obligations while a vice-chancellor is in post. We expect to see further progress next year.

“Universities receive significant funding, both in the form of direct grant drawn from public taxation as well as funding from student loans. 

It is important that both students and the public can be assured that they are receiving value for money for this funding, and restraining excessive senior pay is part of this. Universities – and individual vice-chancellors – need to be confident that they can justify the pay that they receive. They should, as a minimum, be following the Committee of University Chairs’ senior staff remuneration code and be prepared to respond decisively where an individual’s pay is excessive.”

The report said there was considerable variation between institutions: “There is no discernible pattern in terms of the type of provider who has reported increases or decreases on this measure. It simply reflects variation between providers.”

Universities were evaluated in terms of basic pay, full remuneration and taxable and non-taxable benefits such as pension contributions, subsidised accommodation and travel. The report also gives pay ratios between head of provider and all staff.

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