Australia’s education minister has expressed concern about the salaries paid to vice-chancellors at the country’s universities, in the wake of the debate in the UK over executive pay.

Asked about university leaders’ pay on Sydney radio station 2GB, Simon Birmingham said it was a “very good question” as to why levels of remuneration had risen significantly in recent years.

“My message to vice-chancellors, university administrators is: don’t talk about whether you have to find savings in terms of things that impact on students and their education,” Mr Birmingham said.

“Start first and foremost by looking at your administration budgets, at your marketing budgets. Do the types of things to find efficiencies that ought to be necessary, and ought to be found.”

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The minister's comments come after global media coverage of the retirement of Dame Glynis Breakwell, the vice-chancellor of the University of Bath, amid criticism of her £468,000 pay package.

However, 2GB listeners were told that Dame Glynis’ salary – equivalent to about A$812,000 – would make her only the 28th highest-paid university leader in Australia.

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In 2016, 12 vice-chancellors of Australian universities earned in excess of A$1 million, according to , with Michael Spence, head of the University of Sydney, earning A$1.4 million, up 56 per cent in five years. The average vice-chancellor’s salary stood at A$890,000, the newspaper said.

Mr Birmingham’s warning comes after the Australian government announced a two-year freeze on undergraduate teaching funding.

The government’s mid-year budget update, published on 18 December, said that funding from the Commonwealth Grant Scheme for bachelor’s degrees would be kept at 2017 levels for 2018 and 2019, and that increases beyond that would be linked to performance and demographic data.

Although university admissions will not be capped, and student loans will still be available to students who win a place, sector leaders have highlighted that the fact that government funding makes up 58 per cent of funding per place on average means that institutions looking to expand or even maintain their undergraduate numbers faced a real-terms cut in funding.

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Modelling released by Universities Australia estimated that the freeze would be the equivalent of losing 9,500 funded places for new students this year.

Belinda Robinson, chief executive of Universities Australia, has described the freeze as “unsustainable”.

“As government funding recedes, universities will also be under pressure to enrol fewer students in expensive but crucial courses such as nursing, IT, science and engineering,” she said.

But in an interview with , Mr Birmingham said he believed universities could bridge the funding gap by improving productivity.  

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“I’ve long held the view that universities can find efficiencies,” he said. “This is obviously an incentive for them to get on and find those efficiencies to facilitate further opportunity for more students, if that’s warranted, in their communities.” 

sophie.inge@timeshighereducation.com