University bosses face curbs under fair-pay rules

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University heads will be barred from being involved in setting their own salaries, under a new fair-pay code announced in the wake of claims of excessive pay for vice-chancellors.

Senior pay would also be expected not to rise more quickly than the average for other academic staff.

The voluntary code has been drawn up by the Committee of University Chairs.

But the chief executive of the new Office for Students, Nicola Dandridge, said the proposals were “insufficient”.

She said that “people are rightly concerned by the level of pay”, and not just the “process” by which it was decided.

University heads’ pay was put under intense scrutiny last year, with accusations of “fat cat” salaries and claims that some university leaders were overpaid and out of touch.

The vice-chancellor of the University of Bath stepped down amid the protests.

‘Fair but not excessive’

After a meeting last month with the then universities minister, Jo Johnson, university leaders agreed to produce new guidelines on pay.

Mr Johnson had called for restraint and had threatened the intervention of a new regulator.

University leaders have now produced details of self-regulated rules, promising more transparency and a commitment that “no-one can have any part in deciding their own remuneration”.

“Society has a right to know that taxpayers’ funds are being properly used and that the institution is being managed in the interest of students, the economy and society,” say the new rules.

“Senior post-holders must be fairly – but not excessively – rewarded for their work.”

Pay multiples

The proposals, out for consultation within the higher-education sector until March, emphasise the need for independence and expertise in the committees deciding senior pay.

Universities will be expected to show how this pay relates to other staff.

They will have to publish the “pay multiples” between the vice-chancellors’ earnings and average salaries.

If that multiple changes, the rules say that universities will have to publish an explanation.

And vice-chancellors’ earnings will have to include the value of any other benefits and bonuses.

Chris Sayers, chair of the Committee of University Chairs, said the regulations would help to “justify our decisions” over pay.

“We need to keep senior post-holders’ pay under review, and be able to justify our decisions.

“We must enshrine the values of transparency, fairness and accountability at the heart of our procedures to ensure we maintain the trust required for the long-term success of our world-leading sector.”

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