Universities: Vice-Chancellors’ Pay

Lord Hunt of Kings Heath Excerpts

Tuesday 12th September 2017 Lords Chamber

[Viscount Younger of Leckie]

There is a mood in the country, and there has been a lot of interest in the press, about vice-chancellors’ pay. That is an obvious point to make. However, as a result of the work that we did on the Higher Education and Research Bill, particularly in this House, we are empowering the new Office for Students to act to ensure value for money in focusing on senior staff pay. This is happening in a number of ways. We are introducing a new condition of registration, requiring the governing bodies of approved fee cap providers to publish key figures so that in future the number of staff paid more than £100,000 per year will be published, broken down into pay bands of £5,000. Also, the names of staff paid more than £150,000 per year, along with the justification for those salaries, will be produced by the OfS, and I think that that is a good step.

[Lord Hunt of Kings Heath (Lab)]

My Lords, is the noble Viscount confident that that will be effective? My understanding is that just a handful of current vice-chancellors earn less than the £150,000 threshold that he has referred to. Can he confirm that the Government have had a similar scheme in operation for civil servants, whereby Her Majesty’s Treasury has to give approval to any salary above a £150,000 threshold? The figures published by the Government in December 2016 show hundreds of civil servants earning above the threshold. Can the Minister really be certain that the measures announced will be effective?

[Viscount Younger of Leckie]

We believe that it is absolutely the right course to take. I say again that universities need to be good stewards of their resources: they need to manage in a responsible manner, there needs to be strong leadership, and it is important that vice-chancellors’ pay is restrained. I understand that the average salary for 2015-16 was £234,000. Of course, the salary depends on the size of the institution and the responsibilities. At the end of the day, what counts is whether the pay is right for the responsibilities of the role and the size of the institution. That is one thing that has to be focused on by providers and universities.