University leaders land big pay rises despite government cuts

A dozen university vice-chancellors earned more than £300,000 last year, it was revealed today in a study by accountants that shows big rises in the pay of senior academics. University leaders were awarded a 10.6% increase last year, raising their average annual pay and benefits package to £219,156. The head of London Business School, Professor Sir Andrew Likierman, was paid the most at £427,000. Others, such as University College London's Professor Malcolm Grant and the University of Surrey's Chris Snowden, took home £376,190 and £327,000 respectively. The package paid to Likierman, a former director of the Bank of England, is 17.3% up on the previous year, while Grant and Snowden's pay are 27.3% and 14.7% rises. The prime minister, Gordon Brown, earns £197,000. In the previous year – 2007-08 – five universities paid their vice-chancellors £300,000 or more. The salaries, compiled by accountants Grant Thornton on behalf of Times Higher Education magazine, are more than four times the £46,607 the average academic earned last year. Earlier this month a Guardian inquiry revealed that the income of thousands of the most senior British academics had soared in the past decade , far outstripping growth in average lecturers' pay. It showed more than 80 university heads now earn more than the prime minister, and some have seen their annual earnings double or even triple in 10 years. Some got 15% or 20% pay rises last year alone, compared with a 45.7% rise over 10 years for average higher education teaching professionals. The Grant Thornton figures were released as universities grapple with stinging government cuts of nearly £1bn and just days after the academics' trade union, the University and College Union (UCU), was told lecturers could expect a pay freeze next year with rises below inflation. Universities' governing bodies decide how much to spend on their vice-chancellors. In total, the 152 universities that handed over their accounts shelled out £33.3m in salaries and benefits on the heads of their institutions. Outgoing vice-chancellors were paid princely sums, the figures reveal. The former vice-chancellor of City University, Professor Malcolm Gillies, was paid £393,000 as part of a "compromise agreement" after he resigned over a dispute with the board over governance. This was in addition to his £258,000 salary. [See footnote] Professor Martin Everett, the former vice-chancellor of the University of East London, was paid £250,000 after he resigned following an internal investigation into his leadership. The University of East Anglia paid £265,000 to Professor Bill Macmillan when he took early retirement, and University College Falmouth gave Professor Alan Livingston a £188,000 "pension enhancement" in the year of his retirement. In some cases there were two people sharing the role of institution head. UCEA, the university employers' organisation, said the salary increase for vice-chancellors had been 8.9%, "broadly in line with the more than 8% received by the majority of higher education staff for that same period". Its spokesperson said: "Nearly two years have passed since these 2008/09 increases and it is no surprise that the 2009/10 remuneration figures for staff and early information on heads of institutions reflect extremely tight budgets and financial constraints." The general secretary of UCU, Sally Hunt, said university staff were tired of vice-chancellors' hypocrisy and lack of self-awareness when it came to their pay. She said: "I am sure that the thousands of staff at risk of losing their jobs will be delighted to learn that six-figure pay-offs are considered the norm by those at the top. Similar settlements and the assurance that there is not one rule for them and one for the rest will soften the crushing blow of redundancy." Aaron Porter, the vice-president (higher education) of the National Union of Students, described the salaries as "obscene" when some vice-chancellors were calling for students to be charged higher fees of £5,000 or more. He said: "With their six-figure salaries, many vice-chancellors are obviously divorced from the stark reality that faces most of us in this country, not to mention the significant funding cuts and belt-tightening exercises that universities are currently undergoing." Ninety-nine of England's 130 universities face real-terms cuts to their funding in 2010/11. • This footnote was added on 9 April 2010: After this article appeared, City University London contacted the Guardian to say that it expected the £393,000 element in its agreement with Malcolm Gillies to be less, in practice. This is because the agreement included a duty on Professor Gillies to mitigate this payment, and since he went on to take up the vice-chancellorship at London Metropolitan University from 23 January 2010, "a significant part of the provision will not be required" and the 2009-10 accounts will be adjusted accordingly in due course.