VC enjoys 450% increase in pension contributions
The VC at the University of Leeds has seen a 453% increase in employer contributions to his pension since 2004, according to information in the public domain. This is on top of, and due to, a 149% salary increase in the same period (by which we mean – to make it clear – he received a 49% increase in his salary, bringing it to 149% of what it was). According to documents published online (http://www.leeds.ac.uk/downloads/), the University paid £13,000 of pension contributions for our VC in 2004/05 and £59,000 in 2009/10.
Last week we discovered that, rather than us all being “in it together”, salaries for Britain top paid jobs had increased disproportionately against those of the lowest paid. The High Pay Commission described top salaries as ‘corrosive’ (source) and the Institute of Directors described them as ‘unsustainable’ (source). The argument that these salaries are in some way connected to rewarding performance has long been exploded as something of a convenient myth.
Even Vince Cable was ‘taken aback’ by the rate of increase of VC’s pay in the UK, saying last year that it bore ‘no relation’ to the economic situation the country finds itself in. ‘There is some gap between reality and expectations in some of those institutions and […] we want to signal to them that there has got to be some restraint’ he told VCs (source). Their pay increases seem to suggest they took scant attention, whilst together (with some noble exceptions) they agreed on huge levels of debts for future generations of students.
Some still argue that, for fear of a brain drain of University leaders abroad, we need to sustain high salaries at the top of Universities, including salaries of over three times the Prime Minister’s, as we do here at Leeds. Some would however argue that leading the march on the massive increase in students’ fees, decreasing student numbers, and the disenfranchisement of many hopeful students from lower income backgrounds is very poor performance indeed. UK students who will now have to pay the highest public University fees in the world (source), and spend a lifetime paying back up to £130,000 in debt, including interest (source: Martin Lewis), might hopefully begin to question the wisdom of such high salaries (currently £50 per student pays for just the VC’s salary, before we consider the cost of other top table salaries. As student numbers decrease, as is planned at Leeds, that per-student figure will soar).
Our VC has been at the forefront of arguing that we deserve to pay more, gain less and work longer for our USS pensions. But, if you had seen a 450% increase in your contributions before the cut-off date when future contributions would begin to be capped, would you be concerned?
And remember, just like public sector pensions, ours will now be calculated using the CPI measure instead of RPI; just like the public sector pensions, we are paying more each month, like the public sector, we are working longer for those pensions (default retirement at Leeds used to be 60, it is now 65) but unlike public sector pensions, our increases are not going to continue to rise in line with CPI (ours get capped once CPI reaches 5% – it is currently 5.2%).
Download our pensions calculator if you want to work out exactly what your own personal loss in retirement might be (note, this calculator does not even include the loss due to the switch to RPI. But be prepared to be shocked – this is not a generic loss, but this calculates the loss you yourself stand to lose based on the information you input).
When you strike on Wednesday, you are not only supporting the union in trying to get a decent negotiation in progress over your pension arrangements, but you are adding your voice to members of 27 other unions.