Downturn sees senior management reject pay rises

16 April 2009

The first voluntary pay freeze was announced by Michael Arthur, vice-chancellor of the University of Leeds, who said last month that he and his senior executives had taken the decision in light of the "seriousness of the current financial situation we are facing".

Research by Times Higher Education found that seven other institutions were following suit: Manchester Metropolitan University, University College London, and the universities of Chichester, Exeter, Newcastle, Warwick and York St John.

Several other universities indicated that they would make a decision on executive salaries after national negotiations on staff pay later this spring.

The move mirrors pay freezes imposed by several US institutions and does not bode well for rank-and-file staff hoping for a sizeable pay rise in the near future.

At Manchester Met, all staff at the dean or pro-chancellor level and above have agreed not to take a pay rise; Queen Margaret University said there was a "strong likelihood" that senior management salaries would remain static; and the University of the West of England said: "It is anticipated that the cost of the senior staff salary bill will not increase."

Most of the other universities contacted by Times Higher Education said decisions on their vice-chancellors' pay had not yet been taken, although the Royal College of Art said that its senior management team did not plan to forgo rises.

Cardiff University said its board had discussed abstaining from "performance bonuses" this year and would recommend this to its remuneration committee.

The decision follows a memo to staff from David Boucher, acting head of the School of European Studies at Cardiff, which indicated that a freeze on professorial and equivalent salaries was also likely, as the university needed to cut its costs by 5 per cent.

The leaked memo of a meeting between David Grant, vice-chancellor of Cardiff, and the heads of school, adds that staff recruitment would be driven by the demands of the research excellence framework in the future, "not teaching".

"V-c left us with this message: a) we may be over-teaching in some areas; b) we may be teaching in areas that we shouldn't be," it says.

The University of Warwick is also aiming to cut its spending by 5 per cent. Nigel Thrift, its vice-chancellor, wrote to staff this month to say that cost-saving measures had made a "significant contribution" to "efforts to prevent the deficit anticipated during the current financial year rising above £3 million".

Professor Thrift also announced plans to save £12 million a year from 2009-10. "Under these circumstances, a number of senior colleagues have raised the question of whether it is appropriate for staff to receive increases in pay in the year ahead," he writes.

"It is obviously our intention to participate in the national pay negotiations for 2009, and we are committed to pay whatever salary increase is negotiated nationally for 2009-10.

"However, as part of taking action to control our costs, there will be no payments made under the senior staff salary review or staff merit pay review processes this year, saving about £750,000 in next year's budget."

At King's College London, Rick Trainor, its principal and the outgoing president of Universities UK, warned that redundancies were likely this year. "If we do not act decisively now, the result ... will be a recurrent deficit of approximately £14 million, against annual revenues of £450 million," he said this month.

King's declined to say whether Professor Trainor's pay would be frozen.

melanie.newman@tsleducation.com.