Office for Students publishes first annual analysis of senior staff pay

Newly published data and analysis around senior pay can act as a benchmark, helping universities to reduce senior pay where necessary.

The data, the first annual publication from the higher education regulator the Office for Students, looks at the pay of vice chancellors and other senior staff for 2017-18. The Office for Students became fully operational in April 2018.

The analysis shows that 1.5 per cent of staff in the sector received a basic salary of more than £100,000 a year in 2017-18 (up from 1.3 per cent in 2016-17). The proportion of staff receiving a basic salary of greater than £100,000 fell at 48 providers.

The report also sets out details of pay ratios between the heads of providers and all staff.

Commenting on the data, 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.’ 

Education Secretary Damian Hinds said:

“While universities are autonomous institutions, around 45% of English institutions’ income in 2016/17 came through upfront public funding, so they are rightly subject to public scrutiny.

“Of course salaries need to be competitive, but high pay must be justified by high performance on objectives such as widening participation for disadvantaged groups, low dropout rates, growing export earnings and pioneering innovative research.

“We set up the Office for Students to look out for students’ interests and it is absolutely right that the OfS demands greater transparency from universities by requiring them to justify the pay and benefits of their vice chancellors. We have given the OfS powers to take action if universities do not do this and we expect them to be used where necessary.”