Rich list lengthens: National pay deal 'reason' for rise in six-figure incomes

February 18, 2010

It used to be an exclusive group, but despite the recession and calls for wage restraint, membership of higher education's £100,000-a-year club is rapidly expanding.

Figures obtained from institutional accounts show that the number of staff earning six-figure incomes rose in all but a handful of universities between 2007-08 and 2008-09.

At the London School of Economics, 85 staff now earn at least £100,000, up from 41 the previous year; at the University of Oxford, the number rose from 88 to 135; and at the University of Cambridge, it increased from 89 to 122. These figures, which exclude staff part-paid by the National Health Service, include nine staff at the LSE, eight at Oxford and 19 at Cambridge who earn more than £150,000 a year.

In December 2009, Philip Hammond, the Conservative Shadow Chief Secretary to the Treasury, said a Tory government would publish the names and salaries of all public sector managers earning more than £150,000 a year, reflecting public anxieties over pay levels.

Some universities have attributed the rise in earnings to national pay deals.

The University of Bristol's 2008-09 financial statement lists 49 people earning at least £100,000 a year, excluding those on clinical contracts, up from 33 in 2007-08.

A Bristol spokeswoman said the national 5 per cent pay deal in 2008 was "the principal reason" for the increase, adding that the university's senior management team had asked its remuneration committee to freeze their pay from August 2010.

Loughborough University, which has seen the number of staff on six-figure incomes rise from four to 18, offered the same explanation.

At King's College London, where up to 205 jobs are being cut, 202 employees - 44 of them non-clinical staff - earn at least £100,000, up from 188 in 2007-08.

A spokesman for King's said its salaries were "internationally competitive" and necessary to attract and retain the best staff.

But a recent briefing from the Educational Competencies Consortium, Controlling the Pay Bill, warns universities against matching the "going rate".

"Often, pressure to increase pay is applied through assertions regarding other employers' pay rates. Changing a pay rate in response to such pressure should only be done if there is adequate and relevant evidence to justify the increase," it says.

"Failure to do so can result in wasting money and unsettling other existing employees."

A new analysis by the University and College Union shows that increases in the number of teaching staff did not keep pace with the rising number of highly paid employees between 2006-07 and 2007-08.

A motion to be debated at the UCU's annual congress in May will call on vice-chancellors and senior staff not to take greater percentage pay increases than the lowest-paid members of staff on a negotiated pay scale.

Some universities have bucked the trend by reducing the number of top earners.

Brunel University now has 16 staff taking home more than £100,000 a year, down from 22 in 2007-08.

A spokesman for the institution attributed this to "natural turnover", with retirees replaced by staff on lower pay scales.

melanie.newman@tsleducation.com.

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