If you think the finance minister’s gig is more important, and that this should be reflected in the pay for the job, then you are in for a shock.
The remuneration of the vice-chancellor, at $629,000 a year, is more than twice the current pay for a cabinet minister: $304,300.
Perhaps the VC position attracts a higher class of candidate?
But, of course, we are talking about the same person here: Grant Robertson — latterly our minister of finance; now segueing smoothly into the vice-chancellor’s seat at the University of Otago, on double the salary.
Could it be that Robertson’s qualifications are better suited to the university position? Actually, he wasn’t — strictly speaking — qualified for either job: he isn’t an economist, and he isn’t an academic.
So why now paid so much?
There is absolutely no discernible link here between pay and personal productivity. I’ve worked under about a dozen VCs or university presidents, in three countries, and I’d say that the best of them was Sir Colin Maiden, who was vice-chancellor of Auckland University when I signed on there in 1992. Then, Sir Colin’s total remuneration package was, in today’s dollars, about $400,000 — half what the current incumbent receives at Auckland. He didn’t need an $800,000 pay packet to incentivise him to do his job well, and nor does anyone else need this much money, or the somewhat smaller sum due to the head of the somewhat smaller university in Dunedin.
So why then are they paid so much, and with them the phalanx of deans and pro- and assistant- and deputy vice-chancellors whose pay packets are lower but linked to that of the boss? Because others are paid so much. Top pay for managers in both private and public sectors is set in a process that I call benchmarking-plus. You pay your CEO what other comparable CEOs are getting, plus a little extra to stop them whining. Over 30 years, this insidious upward spiral has doubled or more managerial pay and greatly increased the size of the management bureaucracy.
It has certainly happened at Auckland. Over the past two decades, our academic staff numbers have risen at about the same rate as our student roll — 40% — but general staff numbers have doubled, and most of this not useful front-line support workers — secretaries, IT, cleaners — but back- and head-office bureaucrats, making a nuisance of themselves to the folk who actually produce the teaching, research and community services that are our core job. I believe it is the same story at Otago, though without the academic staff growth, because of lower student numbers.
Why should I care? Because I am a local: you can take the boy out of Dunedin, but you can’t take Dunedin out of the boy, and as an Otago alumnus and former faculty member I am upset by this university’s current travails — yet more job cuts foreshadowed just last Saturday — and its managerial response to those problems.
The University of Otago is very special. It has a powerful, proud, bond with current and past students. It is our only major university with a predominantly "export" focus — that is, to serve out-of-town students from the rest of the country and the world. That was always its strength, but it has now recently become its weakness, with Covid and cost-of-living pressures keeping students at home.
Management’s response? Panic: cut programmes and departments and academic staff to try to cover financial deficits. But this just makes things worse: demand follows supply downwards in an insidious spiral to the floor.
Instead, Otago should, in particular, strengthen the core science and arts disciplines that are the academic bedrock of every great university. It could leverage the potentially huge attraction of its hinterland: Central Otago and the Queenstown Lakes district. Residential Wānaka campus? Yes, please!
A vigorous growth-oriented strategy would eventually be financially self-sustaining. But there would be a budgetary shortfall at first.
How to fund this?
Wouldn’t it be lovely if Grant Robertson told the university council that he couldn’t in good conscience accept a salary higher than a cabinet minister’s, and could they also cut the salaries and numbers of all the under-managers to finance the Great Leap Forward?
Not going to happen quite like that, I suppose, but the point is that there are resources right inside the university that could be mobilised to kick-start a turnaround. Inevitably, Robertson’s public record as a politician is mixed, able though he was. He could leave a more widely celebrated legacy if he can get his (and my) alma mater up and moving again. Sapere Aude!
• Tim Hazledine is Emeritus Prof of economics at the University of Auckland. He lives in Auckland and Wānaka.
