vice chancellor salary australia 2020 vice chancellor salary australia 2020

First, principals may institute costly governance systems that delimit, control and monitor agents actions. This article critically considers the determination of vice-chancellors remuneration as a governance issue. Copyright (c) 2021 The author(s). Governments could, for instance, set fixed ratios between VCs remuneration and mean academic salaries. Table 2 indicates the increases between 2007 and 2015 which included the Global Financial Crisis and UK austerity policies. As such, they dont have controlling owners/shareholders. /Filter /FlateDecode Economics identifies four ideal types of remuneration: salaries/wages, stipends, profits and rent. Uu:4g#A(sp 6;NKFwVafKqr8BM|~+aZ (A1XK;R`v0)|L&bf~f4cdnJpN" -^q_#(=Ci[]nXy2cvAaL)j2 M8@ CV,Vju! Julie's exceptional leadership, unique perspectives and range of experiences have been invaluable In 1983, the Hawke governments education minister, John Dawkins, commenced reduction of direct [state] control of the internal business of higher education institutions (Wells & Martin, Citation2013, p. 203, emphasis original). SolenSoftware Actavia 3.4 (Journal system) "Chief executives are paid for their business acumen. If they lose confidence in you, its game over. Its just not that important to me. For instance, a vice-chancellor may start in May and have eight months of remuneration recorded. Congratulations again and a sincere thank you to all the award winners for their contributions and to everyone who nominated them! It's not their job. /R14 61 0 R The era of ever rising pay packets for Australian university leaders has come to a halt, another casualty of COVID-19 and an estimated $1.8 billion downturn in higher education revenue. There were 22 changes to vice-chancellor appointments in these three years. << When very small institutions with an income of less than 30 million a year [AUD $54,442,074] are excluded, the ratio of total mean VC remuneration to total other mean staff remuneration in the English universities was 8.2 (data for Scotland and Wales is not available for this year) (OfS, Citation2020). 130-141 And I can honestly say I got a better education at Bartlett than any of those guys did. /Rotate 0 It was outstanding., Schmidt with his wife Jenny Gordon, who is the chief economist at the Department of Foreign Affairs and Trade. In their comprehensive analysis over 10 years involving performance indicators relating to student numbers, student evaluations, research and financial performance, Gschwandtner and McManus (Citation2018) found neither VCs nor universities performance can explain the increases in VCs salaries, and that higher pay does not lead to higher performance. /Parent 2 0 R It executes this duty in part via market means, recently requiring and publishing specified information on staff pay, and the disclosure of VC remuneration information in the universities audited financial statements. Contemporary stewardship theory posits that individual behaviour can be ordered such that pro-organisational, collectivistic behaviours have higher utility than individualistic, self-serving behaviours and that even where the interests of the steward and the principal are not aligned, the steward places a higher value on co-operation than defection (Davis et al., Citation1997, p. 24). >> /Font 26 0 R The Australian Universities Vice-Chancellor and Senior Staff Remuneration Code 2021 states that: It is recognised that transparency is an important part of good practice remuneration ensuring that decision bodies, processes and outcomes are openly explained and presented to all stakeholders.. Insiders are also questioning the perverse situation where university bosses cried financial penury during 2021 while racking up the biggest surpluses ever recorded, including an astronomical $1 billion at the University of Sydney. 13(3), 130-141. Australia's population as at 20 September 2020 was 25,693,059 people (Australian Bureau of Statistics, 2021), with 39 public and four private universities in the nation. They found: that VCs are rewarded according to internal pay structures as predicted by tournament theory. University councils are de jure endogenous principals, but are weak in agency terms because they are not legal owners, are financially disinterested (i.e., they are not shareholders), and have empowered VCs to act entrepreneurially. This number represents the median, which is the midpoint of the ranges from our proprietary Total Pay Estimate model and based on salaries collected from our users. << 6 0 obj Seventeen have given up 20 per cent of their earnings, with four ceding 25 per cent or more. Turning to the highest paid vice-chancellor in Australia, The University of Melbournes Professor Duncan Maskells salary is $1,469,999, a pay cut of $44,000 from 2020. /Parent 2 0 R However, there is evidence from the estimated year effects that even after controlling forobservable and unobservable factors, there have been sizeable annual increases in real VC pay in the years covered by our analysis that are not readily explainable. In salary tournaments, pay levels reflect the hierarchy of organisational roles. >> /Type /Page The union said that a typical university chief would earn the equivalent of a professional employees annual pay rise by lunchtime in a single day, and a senior lecturers salary increase by afternoon tea. Its clear there is a governance dynamic that is driving the pay escalation. The pay of Australias top-earning university leader the University of Sydneys Michael Spence, who is on A$1.4 million was nearly twice that of the UKs best-remunerated vice-chancellor last year, Bath Spa Universitys Christina Slade, ironically an Australian whose 808,000 package included a 429,000 exit payment. Annual condemnations of remuneration levels (Langford, Citation2018) are countered with mantras that VCs lead large and complex businesses within which they work hard for objectively set pay (Blanchflower, Citation2017). This arrangement came to an abrupt end in the 1980s under Margaret Thatchers governments (Shattock, Citation2006). When challenged, they maintain the vice-chancellor leaves the room when their pay is decided. Further self-imposed reductions during last year have almost certainly made him the lowest-paid, with a base salary of $484,000. Indeed, some of Australias most highly paid vice-chancellors are attached to universities with relatively small budgets and well outside the worlds top-ranked institutions. However, the demise of the Academic Salaries Tribunal in the late 1980s marked the end of this central oversight. These posts are also variously named president, principal or rector. $100 million a year, still wouldnt do it. Institutional accounts released so far show that 11 vice-chancellors earned more than A$1 million last year, down from 15 in 2019. /Contents 43 0 R On the basis of the data presented in this article, we argue that it may also explain, at least in part, the escalation of VC remuneration in Australia and the UK. Australian Public Universities Vice-Chancellor Salaries and Workforce Casualisation: Ethical Tension? /R8 58 0 R Similar trends are evident elsewhere, including Denmark (Boden & Wright, Citation2010) and Canada (Essaji & Horton, Citation2009). . In the UK, VCs remuneration has had to be disclosed in universities annual reports and accounts since 1994, and is collated annually by The Times Higher. He donated $100,000 of his share in the 10 million Swedish krona (roughly $1.5 million in todays money) Nobel Prize money to a primary school science program the federal government had just defunded. /Contents 33 0 R There is evidence from Australia and from the UK, that the coronavirus pandemic has drawn attention to and exerted some mitigating effects on vice-chancellors remuneration in 2020, with some having taken remuneration cuts in the face of financial exigencies facing their universities (Ross, Citation2020a). Do not underestimate the halo effect of having smart people around you, Schmidt says. Professor Schmidt earned $560,000 in 2020 after giving himself a $90,000 pay cut on 2019, according to information obtained by The Australian Financial Review. New governance arrangements triggered the trend and might be needed to rein it in. Dr Spence has since taken up the role of of vice-chancellor at University College London where his earnings are about half the previous figure. A$1=0.57. >> It will be hard for an incoming Labor government not to put the screws on those universities that made money while laying off staff.. Performance objectives and targets are not further identified. /Title (Australian Public Universities Vice-Chancellor Salaries and Workforce Casualisation: Ethical Tension?) Walking through Kambri, the reinvigorated heart of Australian National University with its long, gracious avenue linking the campus to the city, I see photocopied black-and-white posters taped to noticeboards that suggest all is not well at ANU. Young man, what are you doing? she asked me. I ask Schmidt why relations are so strained. Publicity around increased disclosure has so far done little to rein in salary increases. Mark Scott, who picked up the reins at Sydney University last July and delivered Australias largest-ever university surplus, earns a base salary of $982,800 a year, with a potential 20 per cent bonus increasing it to $1.15 million. /MediaBox [0 0 595 842] /Type /Page >> Instead, we show that neither nation is an outlier. Follow the topics, people and companies that matter to you. I have everything I want in life, says Schmidt. It was a sophisticated city in the middle of nowhere.. But just keeping the water and the power on requires a six-week horizon.. Performance objectives and targets are not further identified. /ProcSet [/PDF /Text] But, in Australia and the UK, governments have opted for a hands-off approach, urging universities to behave like free-market organisations and not interfering in their internal affairs. My big problem is that this is the government of the day, he says. Im just not interested.. 2729). Evaluation Activities - Generally encompass . I am still an academic here., Vice-chancellors earn their high pay because the jobs are horrific, says Brian Schmidt. If winning the Nobel has not changed him as a person, has being a vice-chancellor? When universities are challenged about these salary packages, they say vice-chancellors run complex businesses in competitive global markets, and their salaries reflect the work done and results achieved. Decisive steps to limit VC remuneration would assist in restoring faith in the university sector at a time when this is arguably most needed. It will be hard for an incoming Labor government not to put the screws on those universities that made money while laying off staff. But what is the incentive for me to do this? Another emerging trend is the removal of annual incentives, Ms Anderson said. 19 0 obj Help using this website - Accessibility statement, earnings are about half the previous figure. /Resources << Jenny Anderson, reward lead Education & Research, at Mercer said there was a noticeable trend of restraint in the remuneration packages of new vice-chancellors compared to their predecessors. Those at prestigious Group of Eight universities were paid more than A$1.2 million on average. Data on academic staff salaries were sourced from Academic Salaries Tribunal reports, union archives, from Marginson (Citation1989) and from published university financial statements. << Vice-Chancellor agrees to unlock salary increases to ease COVID-19 financial impact on staff. (Citation1997) differentiate agency and stewardship using six psychological and situational vectors. SolenSoftware Actavia 3.4 (Journal system) * report annually (Q2) each year on adoption of the UCC code. Credit: Photo: Chris Hopkins. endobj In Canada between 1996 and 2006, increases in VC salaries exceeded both productivity and performance gains (Essaji & Horton, Citation2009). DETUROPE - The Central European Journal of Tourism and Regional Development But the comparison is wrong because vice-chancellors run public institutions, students are different to employees and there is little evidence any VCs have created new strategic directions in the face of the hit to their income during COVID-19. The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment. Bachan and Reilly (Citation2015, p. 53) detail the remarkable 59% remuneration growth (in real terms) enjoyed across the sector between 1997 and 2009. But unfortunately as weve seen in this crisis, the vice-chancellors have really come up with nothing. 2. The only disclosure of vice-chancellors remuneration I found that was not in the financial statements and bands was that of Western Sydney University as follows: Professor Barney Glover AO, Position: Vice-Chancellor and President Total Remuneration Package: $988,380 Period in Position: Full Year, Results: Met all objectives. Australian vice-chancellors are among the highest paid globally, to such an extent it has become a political football. 1 By vice-chancellor we mean the chief executive officer of universities. Our analysis has found that 60 per cent of uni . ANU started racking up a $160 million deficit the second-largest deficit in Australian higher education history but $50 million less than predicted. Rent-seeking points to a significant breakdown in university governance. Print headline: Reeling it in: average Australian v-cs pay edges towards A$1m, Already registered or a current subscriber? Professionals were seen as unaccountable and self-serving, making the self-governing universities with significant public funding an obvious target (McNay, Citation1999). Figures are just starting to be published showing the ratio of VC-to-staff average pay at each UK institution. The Morning Edition newsletter is our guide to the days most important and interesting stories, analysis and insights. Johnes and Virmani (Citation2020) also note this rise, which accelerated when full student fees were introduced in 2011 as part of the further marketisation of universities. Turning to the highest paid vice-chancellor in Australia, The University of Melbourne's Professor Duncan Maskell's salary is $1,469,999, a pay cut of $44,000 from 2020. Fourth, stewardship is marked by high commitment and trust, but agency seeks to minimise risk through control systems that cast individuals as economically self-interested actors (Davis et al., Citation1997, pp. 7 0 obj The changing landscape of VCs remuneration in Australia and the UK, https://doi.org/10.1080/07294360.2020.1841741, https://www.theguardian.com/education/2019/jun/20/vice-chancellors-still-attend-pay-meetings-despite-outcry, https://www.theguardian.com/education/2018/mar/11/university-vice-chancellors-are-paid-far-more-than-public-sector-peers, https://doi.org/10.1111/j.1475-5890.2015.12045.x, https://doi.org/10.1080/13583883.2006.9967175, https://doi.org/10.5923/j.ijfa.20140304.04, http://www.ecgi.org/codes/documents/cadbury.pdf, https://doi.org/10.1007/s11162-014-9328-9, https://www.universitychairs.ac.uk/higher-education-remuneration-code-2/, http://www.educationengland.org.uk/documents/jarratt1985/index.html, https://doi.org/10.5465/amr.1997.9707180258, https://www.afr.com/news/policy/budget/simon-birmingham-attacks-university-vicechancellors-1m-salaries-20170501-gvw3lg, https://doi.org/10.1177/031289629101600103, https://doi.org/10.1007/s10734-009-9249-2, https://doi.org/10.4284/0038-4038-2011.215, https://www.timeshighereducation.com/features/chalk-it-oversight, https://blogs.kent.ac.uk/economics/2018/05/24/university-vice-chancellor-pay-performance-and-asymmetric-benchmarking/, https://doi.org/10.1080/07294360601166786, https://doi.org/10.1080/13603124.2019.1631387, https://www.hesa.ac.uk/data-and-analysis/finances/table-11, https://doi.org/10.1016/0304-405X(76)90026-X, https://doi.org/10.1007/s10479-019-03275-2, https://doi.org/10.1080/13600800802383018, https://junkee.com/university-vice-chancellor-salary/143593, https://www.smh.com.au/politics/federal/the-nation-s-highest-paid-university-leaders-20180826-p4zztd.html, https://www.msci.com/documents/1296102/7330587/Research_Insight_Out_of_Whack.pdf/46baa603-a503-42c1-91c0-d0ef19b754b2, https://www.officeforstudents.org.uk/advice-and-guidance/regulation/senior-staff-pay/, https://www.academia.edu/4029657/Determination_of_academic_pay_in_universities_and_colleges_in_UK_under_the_new_pay_framework_the_policy_and_practice, https://www.timeshighereducation.com/news/three-four-australian-v-cs-take-pay-cuts, https://www.timeshighereducation.com/news/average-australian-v-c-pay-packet-may-top-a1m, https://doi.org/10.1111/j.1468-2273.2008.00384.x, https://www.theguardian.com/education/2018/feb/15/majority-of-university-leaders-involved-in-setting-their-own-pay, Mid-level teaching and research university, New dual sector (established mid-1990s) university. Professor Schmidt, who negotiated a salary package of just two-thirds of his predecessor, Ian Young, said the university council had been concerned about what such a low salary would flag about the institution. Source: public Australian universities 2017 annual reports, using mid-points of published remuneration ranges unless precise figures were disclosed. /Contents 39 0 R >> The extent to which these have been effective remains moot. Professor Gardner donated her pay rise to a student hardship fund, Monash Universitys annual report states. To unpick that, we explored the governance structures of universities. Australian universities The econometric literature also explores the role of remuneration setting tools. He is poised to potentially receive the largest remuneration package in the country from next month when former ABC managing director Mark Scott begins at the University of Sydney on $500,000 less than his predecessor, Michael Spence, who was paid $1.53 million last year. The Australian historical example outlined in this article demonstrates this. Schmidt calculated his initial vice-chancellor's salary - which was $150,000 more than his 2020 pay packet - by benchmarking himself against international equivalents and the professoriate . We then review the existing literature on VCs remuneration, and describe the techniques utilised that drive increases. That is, something ending with 999 or 000 would usually be a band. /XObject 25 0 R (Bachan & Reilly, Citation2015, p. 69). /Type /Page The role of the Academic Salaries Tribunal means that Australia has a relatively well-defined point at which VC salaries were deregulated and the effect of this can be demonstrated empirically. In both Australia and the UK, VCs remuneration is determined by a remuneration committee of the council for each university. >> >> Julie Hare is the Education editor. Alex Ellinghausen. Yet, despite the eye-watering sums, executive pay remains less of a hot . In 1987, the first of a series of federal industrial pay awards was introduced, continuing the centralised setting of employment conditions and salaries. >> Award winners will be celebrated during a reception at the UC Tech. Second, principals can align agents interests to their own using remuneration managers will seek to maximise shareholder wealth if they share in it (Jensen & Meckling, Citation1976). (Grove, Citation2018). Governance regimes play a central role in the distribution of organisational power and determine the approaches used for fixing remuneration. Im spinning out companies, but it takes time. He says winning the Nobel Prize has not changed him, although it is a wonderful door opener. The role of the Chair is to: Table 1 expresses the ratio of VCs salaries to the starting salary for the most junior level teaching and research academics at three Australian universities from 1975 to 2018. /Contents 56 0 R These reforms have since deepened and accelerated, especially in England where deregulation and student fees have heralded significant competition and marketisation. endobj Resentment against university management has always been part of university culture, but this exacerbates it.. Governance regimes determine remuneration forms and their allocation between potentially competing groups, reflecting organisational power dynamics (Neokleous, Citation2015). Professor Brian Schmidt tucks into a party poke bowl at Nosh on the ANU campus. DETUROPE - The Central European Journal of Regional Development and Tourism 2021, 13(3):130-141, doi: 10.32725/det.2021.023 People overseas are scrambling to come and run a university here. "Australia is not the colonies any more. /Parent 2 0 R /ProcSet [/PDF /Text] /ExtGState 34 0 R That is, Australian vice chancellor pay increases reflect increases in Australian business bosses' pay. I would have been a little asterisk on the side of other peoples work.. Australian universities, academic workforce casualization, vice-chancellor salaries, quality of education Salaries may play a part in motivating employees towards organisational aims, although usage varies (Tampu, Citation2015). 370,677 (2021-22) [1] Michael James Spence AC FRSN (born 10 January 1962) is an Australian university administrator who served as the Vice-Chancellor and Principal of the University of Sydney from 2008 to 2020. /ExtGState 21 0 R /Font 46 0 R /ExtGState 51 0 R Journal This includes South Australias three universities, none of which is in the world top 100. UK universities began as autonomous, self-governing communities of scholars endowed financially by the state, church or wealthy individuals (Moodie & Eustace, Citation1974). << I think a lot about how to get my meaning out without becoming a headline.. endobj "Dr Spence is going to get half of what he does now, in a far more prestigious university," says Tom Smith. Earlier, we noted that agency theory posits that principals and managerial agents both seek to maximise their own financial position at the expense of the other (Ross, Citation1973). To view the position description, please click Senior Advisor, Government Relations Final PD_2023.pdf. To request a reprint or commercial or derivative permissions for this article, please click on the relevant link below. << Copyright 20102023, The Conversation Media Group Ltd. An exception to the rule, Australian National Universitys Brian Schmidt is a Nobel laureate and vice-chancellor of one of the countrys most prestigious universities, but was the second-lowest-paid on about $650,000 in 2019. I have invested more in cybersecurity than any university on the planet. Professors Tom Smith and James Guthrie from Macquarie University Business School said the average pay of Australia's 39 vice-chancellors - the university equivalent of a chief executive - is $985,000, compared to just $670,000 in the US and $635,000 in the UK. /Rotate 0 Benchmarking is a technical exercise whereby universities pick comparator organisations and pitch senior staff salaries at similar levels. The salary of University of South Australia VC, David Lloyd, was $1.2 million in 2020 when his university was ranked a lowly 354. https://doi.org/10.32725/det.2021.023 Exogenously, university governance in England (Scotland, Wales and Northern Ireland have somewhat different systems) now consists of loose state regulation of the emerging competitive higher education market through the Office for Students. They just keep going for more contracts and more casualisation, she said. And it helps them have confidence, which makes my job just easier, he said. Lyn Mills. A significant uptick in VCs remuneration has occurred relative to other academic salaries. People also read lists articles that other readers of this article have read. From 1976 to 1986, the Australian government set recommended maximum salaries for vice-chancellors. For example, York, where an interim Vice Chancellor in the previous year and relocation costs for the new Vice Chancellor pushed the total pay for 2019-20 up by 64,771 on the year before. You might also be interested in the following pages: List of Vice-Chancellor Pay & Salary Packages, Revenues and Surpluses At Australian Universities, Historical Development of Australian University Sector, ERA 2018 Outcomes Research Rankings List, University Bachelor Degree Completion Rates, QS Employability Rankings Australian Universities, ARWU World Rankings of Australian Universities. Core to that process has been the transition of vice-chancellors from being first among equals in academic communities to entrepreneurial chief executive officers of quasi-corporations. Benchmarking and pay tournaments explain the mechanics of how this is happening, but not why salary resources are allocated in this way. Were sorry, this feature is currently unavailable. [2] He is currently the President and Provost of University College London. This analysis only accounts for the earliest . << People forget that the private school phenomenon is very much an Australian thing. quality of education In private firms such disclosures are designed to discipline agents towards not exploiting information asymmetries by highlighting their share of finite organisational resources. Our universities were nowhere near as loud as Australian ones in claiming poverty during COVID-19 and did not resort to mass lay-offs either, Mr Usher said. The only thing on its research agenda is commercialisation, which, if we are honest, is never going to fill the coffers that have been emptied by absent international students. This has weakened collegiality and strengthened hierarchical managerial control by VCs and, to a lesser extent, university councils (governing bodies) (Trakman, Citation2008). 3536). It also gets him an invitation to Davos every year, which he accepts. My boss the people who hire and fire me is technically the council. /Count 12 7. Definitions, Terms, Acronyms. << By John Ross. Abstract . VCs were to serve as chief executive officers of universities that were, in turn, expected to be more business-like and entrepreneurial (Harman & Treadgold, Citation2007). Similar trends are emerging in some other European countries. Schmidt and Gordon have a pretty bush block near the small town of Sutton, a 30-minute drive from Canberra. Analysis by The Australian Financial Review reveals that in 2021 at least 11 vice-chancellors received $1 million-plus salaries while making huge cuts internally, slashing staff numbers and putting infrastructure projects on ice as closed borders threatened the international student market. /MediaBox [0 0 595 842] The Tribunal (Citation1974) found they were well paid in relation to equivalent roles elsewhere in society, a view unpopular with the then Australian Vice-Chancellors Committee and some individual VCs who protested that the tribunal risked undermining universities independence and should be abolished (Academic Salaries Tribunal, Citation1974). Three in four Australian v-cs take pay cuts . /ProcSet [/PDF /Text] Bill would bind vice-chancellors' salaries to state premier's pay . Accordingly, this article advances understanding of the issue by exploring the dynamics of VC remuneration in the context of governance changes in universities as they have become progressively marketised. The salary gap between Australia's university bosses and their staff has widened after solid pay rises launched more vice-chancellors into the million-dollar club. Australian universities are a millionaire factory for those who can scratch their way to the very top with the top 10 highest paid vice-chancellors all raking in million-dollar salary packages over the previous year. Follow the topics, people and companies that matter to you. They are attracted by the fantastic health system and fantastic services. 14 0 obj These are the worst of times. These universities are broadly representative of university types in the Australian sector.Footnote2 Data for this table were sourced variously from Academic Salaries Tribunal reports and from publicly available university annual reports. I know there are reasonable explanations for the size of some of these surpluses and people are saying it is a one-off and wont happen again. Further, there is a demonstrated link between these increases and formulaic pay-setting mechanisms such as benchmarking (Gschwandtner & McManus, Citation2018). Its a process that can take six hours or two, depending on the abundance of the harvest. /ExtGState 37 0 R It hasnt always been like this. #3 Submitted by T. on September 2, 2018 - 5:54pm, Here is the link to that article and analysis: http://www.modern-cynic.org/2013/05/08/university-leaders/, Copyright 2023 THE - Times Higher Education, Registration is free and only takes a moment, Once registered, you can read 3 articles a month, Unlimited access to news, views, insights & reviews. Copyright (c) 2021 The author(s). /Subtype /XML One of Victorian's lowest paid Vice-Chancellors, Professor Iain Martin at Deakin University, voluntarily took a substantial pay cut when he took the job, bringing his salary to $819,000 for 2020 .