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Highest university executive pay packets revealed as crackdown looms
Scores of public university executives are taking home pay packets of more than half-a-million dollars as the sector’s spending on key management staff exceeds $220 million a year.
Analysis of financial statements by this masthead reveals Australian universities have increased their spending on key management personnel by about 7 per cent, and more staff are taking home salaries of $500,000 or more.
The federal government is preparing to announce a taskforce that will advise education ministers on how executive salaries should be set.
In 2023, public universities spent almost $240 million on their key executive salaries, up from $224 million the year prior.
There was a 14 per cent increase in the number of key executives on salaries above half-a-million dollars in the same period, totalling 198 in 2023 across 37 public universities.
Victoria and NSW had a larger increase in overall spending than the national average, with an 11 per cent and 9 per cent rise respectively.
Monash University has the most “key” executives on $500,000-plus pay packets in the country (16), while the University of Melbourne had the country’s largest overall bill for executives at $13.7 million in 2023.
A spokesman for Monash noted it was one of the largest universities in the country, and said it had a wider definition of reported executive officers than some universities.
The University of Melbourne also said its definition of “key” executive officer extended beyond just the direct reports of the vice chancellor.
“To ensure we continue to attract and retain the best candidates, we provide competitive salary packages to our employees who provide expertise and leadership across the university,” she said.
In the same year, the University of NSW spent $10.3 million and the University of Sydney spent $7.6 million on key executives’ salaries. The University of Sydney does not classify many of its highly paid senior leaders, including some deputy vice chancellors, as key management in financial disclosures.
Key management personnel in accounting standards are those with “authority and responsibility for planning, directing and controlling the activities” of an organisation, which at universities can include the vice chancellor, deputy vice chancellors, provosts and vice presidents. Some universities also include deans of schools and other C-suite executives in their disclosures.
The federal government is expected to finalise the membership of an expert council, designed to crack down on university governance, by the end of this month.
Education Minister Jason Clare said the independent body would focus on governance issues, including how universities set pay for senior staff.
Universities would be required to demonstrate a “rigorous and transparent process for developing remuneration policies and settings for senior university staff” with consideration given to the pay rates of comparable public sector departments.
“It is clear that we need to strengthen governance arrangements at our universities and that’s what we’re doing,” Clare said.
The council’s recommendations and advice will be provided to the country’s education ministers in June.
About half of the nation’s vice chancellors at public universities are paid more than $1 million and there have been calls to cap their wages at public service levels, including from Western Sydney University vice chancellor George Williams.
He revealed he asked for a pay cut when he was appointed vice chancellor last year, saying the sector needed to regain the public’s trust.
Others have defended vice chancellor and executive pay as justified given their mammoth remit: running complex institutions the size of ASX top 10 companies, with more staff and huge numbers of enrolments, yet operating with less research funding than many comparable universities overseas.
Newcastle University education researcher, associate professor Jess Harris, said high executive pay was a source of frustration for academic staff.
“There’s a high level of uncertainty around job security at the moment and the workload for those who have ongoing jobs is increasing,” she said.
“No one likes to hear that other people are doing well in the system that they’re struggling in.
“We have gotten to the point where we need to have a conversation about whether unis can be run as businesses. I don’t think they can be.”
The National Tertiary Education Union has been rallying against high spending on vice chancellor and executive staff salaries.
“University councils stacked with corporate appointees have failed to justify these salaries, undermining the credibility of our institutions,” president Alison Barnes said.
“Australia urgently needs a federal parliamentary inquiry into university governance and workforce planning.”
A union report last year also found that universities were spending $734 million on consultants and professional services, further fuelling the debate over financial priorities in the sector.
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