Is running a university worth such huge salaries?

To The Times

From Louise Richardson’s complaint that her salary as Vice Chancellor of Oxford (£350,000 a year) is not in the same league as footballers and bankers, to the yacht-owning George Holmes at Bolton (£222,120 a year and a £1m loan to buy a house) saying he is underpaid compared with top US institutions, our university leaders have continually embarrassed the education sector with the arrangements for their pay. In the past five years, Vice Chancellors have enjoyed an average pay increase of 22%, despite pleading poverty every time it came to staff pay. More than two-thirds of VCs either sit on the committee that sets their pay or can attend its meetings. It is time to lift the lid on these secretive university remuneration committees, irrespective of how much charity work VCs may do. (An edited version of a letter from Sally Hunt, general secretary, University and College Union).

Young people are incurring sizeable debt in order to go to university, only to be taught, in many cases, by graduate lecturers who are paid a pittance. Some don’t encounter a proper professor face to face in the three (or four) years they are at the institution. The increase in the number of people going into further education has happened at a time when government has adopted a hands-off policy to funding, and the administrators have taken advantage of it all to pad their salaries, getting up to little tricks like accepting full-paying Chinese students at the expense of British citizens, or so it seems.

Justified criticism or no it is time to reform university administration and restore more realistic incomes and better teaching and services for those who pay – that is, the students. After all, universities and colleges are non-profit organizations, not tax-payimg corporations. If they have the cash to pay six figure salaries they should be paying tax. And I will refrain from commenting on the tired old cliche along the lines “my salary doesn’t match American pay”. I had this all the time at business school, where one was told that high top management salaries reflected the need to recruit the best people world-wide. Self-serving nonsense.


  1. 67% of millennials who went to university think they didn’t benefit from their studies. 35% wish they hadn’t gone to university while 48% believe they would now be earning more had they not done so. (Able Skills/Forbes)

  2. Part of the problem in both America and Britain is that universities are so heavily subsidised by the government. Universities are under little pressure to improve standards, knowing that government subsidies guarantee a minimum income and artificially increase demand for what would otherwise be classed as worthless degrees. If universities were ran like ordinary companies, they would be accountable to their shareholders to deliver high standards. This is similar to the banking sector, where government bailouts resulted in higher salaries for mediocre bankers than what would otherwise be the case.
    If governments want to subsidise higher education, then they ought to take control of how much university staff are paid, so as not to waste taxpayers’ money. In most institutions under public influence (education, the military etc), the government sets the wage rates. The exception to this is American healthcare, where a lot of government spending goes towards paying doctors and insurance companies huge salaries, resulting in an extraordinarily expensive system.
    Ideally, the government would subsidise the best universities and impose wage levels on them, to make sure poor students have access to the most lucrative courses. But degrees in less important subjects at less prestigious universities should not be subsidised or regulated. Universities would have to demonstrate the value of these degrees, or else no one would pay market rates to study them.

    • A related influence has to be the availability of low cost government backed loans in America which of course is a kind of subsidy. This perversely ensures that demand will far outstrip supply which boosts salaries and recreational activities like the building of sports stadiums, since higher education institutions can keep raising tuition well in excess of the general growth rate

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