University Vice-Chancellor gets controversial £250k salary ‘top-up’

Martin Shipton

Nation.Cymru has established that the President and Vice-Chancellor of Cardiff Metropolitan University has been paid more than a quarter of a million pounds in a manner that would not have been permitted for an employee of the Welsh Government.

Since joining the university in October 2016, Professor Cara Aitchison has received additions to her salary instead of employer contributions to her pension pot.

The university’s annual accounts show that in 2016-17, her salary was topped up in this way by £25,612. In 2017-18, the extra salary payment amounted to £32,677; in 2018-19, £33,330; in 2019-20, £41,786; in 2020-21, £46,108; and in 2021-22, £47,346. Over the six years, the amount paid to Prof Aitchison in this way totals £226,859. The accounts for 2022-23 have not yet been published, although it is known that the practice is continuing, putting the accumulated total well over £250,000.

In 2021-22, Prof Aitchison’s salary, including the top-up, was £304,846.

High earners

There is much financial advice available to high earners about how to manage the tax implications of their pension pots. The Chartered Institute of Personnel and Development has a statement on its website which says: “Employers could consider offering cash payments in lieu of pension contributions, which many high earners are now favouring.

“This could be a gross amount equal to the unpaid pension contribution with no adjustment, an amount netted down to reflect the additional cost of employer NICs [National Insurance Contributions], or an amount grossed up to reflect the cost to the employee of the income tax and national insurance incurred on the cash amount.”

However, the Welsh Government made it clear that it had a policy against such payments, saying in a statement: “The Welsh Government does not permit any of its employees to receive a cash alternative to pension contributions. Our devolved public sector bodies have responsibility for their own pension arrangements and any queries should be directed to them individually.”

Reward offering

A spokesperson for Cardiff Metropolitan University said: “Cardiff Metropolitan University’s pension schemes for senior staff are an important element of the reward offering, allowing the university to attract and retain the most talented employees. A policy of considering an offer to pay a salary in lieu of pension supplement for senior postholders in circumstances where the size of their existing pension pot exceeds their lifetime allowance has been an increasingly popular option adopted by organisations as part of their pay and reward strategy.

“Following the UK Government’s decision to abolish the lifetime allowance, the university has reviewed its policy and going forward, salary in lieu of pension will not be offered to new senior postholders.”

A briefing document about the issue published by the House of Commons Library on December 4 2023 states: “There is a limit on the amount people can build up in pension schemes over their lifetime and still receive tax relief. In 2023/24, the standard lifetime allowance for most people is £1,073,100.

“At the Spring Budget 2023, the government announced that it would abolish the lifetime allowance. It started this process by removing the tax charge for exceeding the lifetime allowance from 6 April 2023. The Finance Bill 2023/24 includes the remaining measures needed to abolish the lifetime allowance from 6 April 2024.”

Funding

An official of the University and College Union (UCU) close to Cardiff Metropolitan University said: “The actions the university has taken with Cara really undermine the case with the public for an increase in university funding.”

Before becoming President and Vice-Chancellor of Cardiff Metropolitan University, Prof Aitchison was Vice-Chancellor and Chief Executive at Plymouth Marjon University. Her CV on Cardiff Met’s website states: “Cara is committed to values-driven leadership that integrates the education agendas of widening participation, civic engagement and international diplomacy with sustainable and inclusive economic growth.

“Her leadership is informed by her research and she holds a Professorship in Geography and Cultural Economy and has published 10 books and 200+ research outputs, including 50+ international keynote papers. Cara has been Principal Investigator to 30+ funded research projects leading to new theoretical perspectives in leisure, tourism and gender studies and new policy impacts in rural planning, sustainable development, renewable energy, cultural strategy, tourism development and sport leadership.”