With a global recession hammering endowment funds and university budgets, we’ve been hearing a lot about how the coffers of institutions of higher education are bleeding money these days.
But to look at the rising paycheques of university leaders, it would be hard to tell how dire the situation in Canada’s post-secondary sector is becoming. In fact, some university presidents in Ontario are paid more than Stephen Harper or Barack Obama receive to run entire countries. On the other hand, university presidents (not to mention Harper and Obama) get paid less—a lot less—than today’s corporate CEOs.
At the top of the university presidential pay scale in Ontario, for the second year in a row, was McMaster president Peter George, who pulled in a total of $ $533,913 in salary and taxable benefits last year. At current exchange rates, that’s slightly more than President Barack Obama’s US$400,000. Although, to be fair, President Obama also gets a hefty expense account, $19,000 for “entertainment” and 10 years of personal security. Last year, Prime Minister Stephen Harper was paid $310,800 including a $2,000 car allowance. (Just to put that car allowance in perspective, that’s about how much I paid for my first car, a rickety 1992 Volkswagen Golf.)
The argument is that university president’s pay packages need to be big enough to attract educated, qualified candidates away from other sectors. And considering the paycheques earned by other bankable Canadians — corporate chief executive officers, for example —it could be argued that university presidents are underpaid. After all, Ed Clark, the CEO of Toronto Dominion Bank, made $8 million in 2008. The CEO of Imperial Oil brought home more than $9 million. (See salary chart at the end of this article.)
Then again, looking at our university presidents’ peers in the U.S. suggests that Canadian presidential salaries might be in the right ballpark. The median salary for the president of a public university in the United States is about $335,000, according to the U.S. College and University Professional Association for Human Resources. And while 10 presidents in Ontario received compensation above that benchmark, so did many presidents at American institutions. For example, according to the Chronicle of Higher Education, New York University president John Sexton made $1,324,874 in 2007, and also has the run of a downtown university-owned apartment. Although that’s chump change compared to the $4.4 million garnered by University of Southern California head football coach Pete Carroll.
Canada’s highest paid president appears to be in Alberta. University of Alberta president Indira Samarasekera received $627,000 in the 2007-2008 fiscal year, which includes house and car allowances, performance bonuses and deferred compensation. Her salary is up 6 per cent compared to the year before.
Some would argue that comparing university president salaries to corporate CEOs is unfair since taxpayers foot the bill for the former, and CEOs have a bottom line they have to meet. Just ask the departing CEOs of some bankrupt US investment banks: manage badly, and your stock price will go to zero.
Then again, CEOs at other public institutions are often earning decent coin, well above that of their Canadian university peers. In 2008, Laura Formusa, CEO of Hydro One, was paid $926,872. Bob Elton, President and CEO of BC Hydro, was paid $478,849. And Jim Hankinson, CEO of Ontario Power Generation, took home $2.5 million (or, according to a more complete accounting, $3.5 million.)
Until relatively recently, presidents didn’t get paid that much more than professors (although, last year, dozens of Ontario profs pocketed over $200,000). That began to change about a decade ago, and senior administrator salaries have climbed sharply since then. Interestingly, the highest paid university administrator in Ontario isn’t a president at all, but the University of Toronto’s John Lyon, the school’s managing director of investment strategy, who pulled in a total of $557,474 in salary and taxable benefits last year. (The same year the value of the university’s portfolio dropped by $1.3 billion.)
One group whose paychecks make university presidents look overpaid? Our elected officials.
Generally, university presidents are making a lot more than politicians. Canada’s prime minister earns less than the presidents of many universities, including Windsor, Trent and Lethbridge. The man whose job is funding and overseeing a third of the country’s public universities, Ontario Minister of Training, Colleges, and Universities John Milloy, made only $164,623 in 2008, less than the president of the province’s newest and smallest university, Algoma. Gordon Campbell, the premier of British Columbia, made $175,000, or about one-third the total compensation awarded the president of UBC. Dalton McGuinty, premier of a province of 13 million, earned just over $200,000—or about one quarter less than the president of Nipissing University, which has a full-time student population of 3,440.