How much are you worth? The new University of Ulster Vice Chancellor gets a £250,000 salary.

I was reading today about how Yahoo ex-Chief Operations Officer Henrique de Castro got a $60 million payoff. Henrique was sacked after being with the company only 15 months. Nice work if you can get it.

On the local scene the University of Ulster has just appointed a new Vice Chancellor. Professor Paddy Nixon will get a £250,000 annual salary – £1000 more than the head of Queens, Professor Patrick Johnston. By comparison Birmingham University pay their vice-chancellor £400,000, Cambridge pay their chap £334,000. Universities have thousands of staff and turnovers in the tens of millions. So are these salaries fair? Do we need to pay this level to attract the highest quality of people? Or it is an obscenity when our local Universities are raising fees and cutting thousands of student places?

The ex CEO of Translink Ms Mason, got a £199,000 pay packet. More than Prime Minster David Cameron (at £142,000) and First Minister Peter Robinson (£114,000). The new chap David Strahan has to make do with only £156,000. Would someone have done the job for £90k?

The issue here is the growing income inequality in the UK. The UK now has more billionaires per head of population than any other country. There are 104 billionaires in the UK with a combined wealth of £301bn.

The Guardian reports:

The richest 1% of the population take about 6% of total incomes earned in Denmark or the Netherlands, according to the World Top Incomes Database, less than half the 13% taken by the richest 1% in the UK.

Should a UK CEO really earn 800 times more than his average worker? Public companies are free to do what they like but this idea that the public sector need to match the rates of the private sector is a dangerous road to go down. A lot of evidence now shows that high CEO pay can actually damage companies.

This is a tricky issue. The new boss of the University of Ulster could be a complete wizard. He could attract millions of pounds of research funding. He could attract thousands of high fee paying overseas students that boost the economy of NI. Or he could muddle along and retire on a humongous pension – we just don’t know.

It seems to me a more sensible solution is to offer a performance related package. A low base salary then bonuses based on actual performance.

  • chrisjones2

    For a Poly?

    Did the Minister sign that off? Was he aware?

  • Jag

    So, down south, the Shinners rail against public servants earning more than €100,000 (GBP 80,000) and want to tax the excess to oblivion or just cut those salaries to €100,000. Yet, in the six counties, where SF are in charge of the education ministry, they greenlight €320,000 salaries for the head of a university.

    Where’s all this joinedyuppness that GA was trumpeting last year?

  • barnshee

    Absolutely outrageous salaries– what do these people do to justify rewards at this level from the taxpayer ?

  • Old Mortality

    It’s clear that the income inequality in NI could be greatly diminished by the executive bearing down on public sector salaries and payments (notably to legal aid parasites). I’d be surprised if there are more than 100 people in the private sector in NI earning as much as £250,000.

  • Jag

    “Universities have thousands of staff and turnovers in the tens of millions.”

  • SeaanUiNeill

    The problem for me is that I occasionally meet people socially who earn these fees both here, in ROIU, in England and in the USA. “Do we need to pay this level to attract the highest quality of people?” Then why do we get the quality of person we do if this level of renumeration is tailored to attract “the highest quality of people.” Obviously the package either needs to be doubled, or those assessing candidates need to be rather more astute.

  • Superfluous

    It’s the exact same phenomenon we see in the likes of the Premier League – the supporters demand ‘stars’ and the clubs will break the bank to make their product competitive and premium. Tesco will pay millions to lure the likes of Matt Davies from Halfords because he is a star – under his guidance Halford’s share price increased 70% in two years. How much of this was actually down to him? Who knows… but investors like it anyway – investors like having a man with a good track record at the helm, so the share price of Tesco rises by a few percent, adding a billion to the value of the company – which is a lot of added investor value, for only a couple of million in fees for one guy – bargain! eh?

  • Old Mortality

    Jag
    To be fair to SF, the universities come under the Department of ‘Employment & Learning’ headed by Stephen Farry of Alliance. However, you’d expect some ritual foaming at the mouth from SF, unless he’s a potential donor, of course.

  • barnshee

    And what impact on “thousands of staff” has he ?
    Other than turning up in fancy dress at graduations what exactly dos he do?

    and “turnovers in the tens of millions.” I think not -charges students fees and gets taxpayer funding more likely.

    The private sector can pay whatever at likes –at the end of the day it generates the funds to pay whatever ludicrous salaries it likes. or fails and goes out of business.

  • Sergiogiorgio

    Barring the odd clown, you generally get what you pay for, in most walks of life.

  • mickfealty

    Brian, you are trying to take down to many problems at once.

    Most of us are getting over the idea that we have to pay high to get good talent, but picking on Paddy’s ‘wages’ alone is a bit harsh not least since local pay rates seem to be better value than over across.

    On SF’s “less than €100k salary” policy in the south, it’s simply not a policy. It’s just a slogan, which will remain in the field until such times as the party has to do something and then (like opposition to welfare reform) it will be replaced by a more meagre ‘making do’ approach.

    The trick is to find something meaningful that needs addressing along with something that might be actioned.

    You’ve blinded us somewhat by throwing in that ringer from Silicon Valley (where a lot of our untaxed revenue spend ends up), but private sector corporates do generally end up with several multiples of what even the best paid public servants get, some of them in publicly regulated industries.

  • Zeno

    Interesting question. If he didn’t sign it off, who did?

  • Apparently Barnett didn’t take a pay rise for a few years so the higher salary is explained – not necessarily justified. Thought someone might pay to get back from Tasmania. It does seem high. And when it says to attract the highest, compared to what/who. Not Oxford/Cambridge, and Barnett didn’t get his Knighthood for thrusting the UU into the top twenty UK Universities. The question is what was the comparable role against which this salary was judged, and then perhaps with some stretch to where the salary is set. What are the outcomes/expectations against which the new guy will be judged. Little by way of information is provided other than name and size of salary. Think the Stormont Committee should be asking questions.

  • Brian – you could have added that he’s managing a university on four very separate campuses, with a different set of problems to QUB, … and there are other benefits like a house to live in that come as part of the compensation package.

  • Jag
  • PS – UU rebranded to Ulster University!

  • Kevin Breslin

    May I correct you…
    “The new Ulster University Vice Chancellor gets a £250,000 salary.”

  • Kevin Breslin

    It will be near impossible for Ulster University to get Russell Group status, and most likely simply for overtaking a declining Queen’s University.

  • Kevin Breslin

    Our untaxed revenue spend went on Henrique and other ringers from Silicon Valley??

    Given that Yahoo are moving their offices from London to Dublin, surely they are evading taxes they should be paying in Silicon Valley in Britain and Ireland?

    What taxes are we owed from Silicon Valley, surely that’s a matter for the IRS?

    Even as consumers do we really spend our money on Yahoo products?

    Webcams?

    Adverts on Yahoo Answers?

    And even if we do indulge in washing these companies with cash for our must-have tech (Yahoo … really?) why are we owed anything for suffering buyer’s regret?

    And what evidence British and Irish tax evaders are investing in something mundane as high-tech manufacturing?

    Hasn’t Bono drained money from these high tech mugols, what stupid venture to match Turn off the Dark is he going to invest in next?

    Maybe here? 😀