Academy heads warned over pay after top executive took home £420,000 last year

Academy heads have been warned by the government over pay, after the top earning school executive took home £420,000 last year - nearly three times the Prime Minister’s salary.

In new guidance issued this week, the Department of Education has told executives that they will be required to justify any increases in salary through a transparent, “robust evidence-based process”, in a bid to ensure value for the taxpayer.

It is the latest development in the Government’s offensive against the “ratcheting up” of top-level pay in schools and universities, with ministers concerned that executives are enjoying huge increases against a backdrop of cuts and real-terms wage stagnation for their staff.

It comes a week after Jo Johnson challenged university vice chancellors over excessive pay, warning that any individual earning more than Theresa May will be made to publicly justify any increases they are awarded.

Whilst university vice chancellors’ pay - now £275,000 on average - has been a long-standing controversy, increasingly, salaries paid to multi-academy trust executives are mirroring those in higher education.

They include Sir Dan Moynihan, chief executive of the Harris Federation, who was  paid £420,000 in 2016, whilst Toby Salt, of Ormiston Academies Trust, was paid £205,000.

Meanwhile, more than 20 academy trusts refused to comply with the Government’s transparency rules earlier this year, which requires them to disclose the salaries of directors and other top earners.

Writing to heads in the foreword of the Academies Financial Handbook 2017, Lord Nash, a minister for schools, warned: “It is essential that every pound is used efficiently for maximum impact on young people’s education.

“Good financial stewardship depends upon everyone involved in the oversight, governance and management of trusts understanding their roles, promoting the right principles and acting when they recognise circumstances where things might go wrong.”

The document adds: “We are emphasising that decisions about levels of executive pay must follow a robust evidence-based process. The board of trustees must ensure that their decisions about levels of executive pay follow [the] process and are reflective of the individual’s role and responsibilities.”

The DfE has also cautioned that staff severance pay should only be granted if a claim at an employment tribunal would likely be upheld - and that any payment above £50,000 should be referred to the Treasury.

The National Government Association said that whilst it welcomed the move, it was disappointed that the Government had not provided a benchmark to compare and scrutinise academy bosses’ pay with.

A spokesman for DfE said: “Academy trusts and governing bodies are responsible for setting executive pay levels and are able to use that autonomy to recruit and reward exceptional leaders.

“We expect them to use that freedom in a responsible manner and have updated our guidance for trusts to make that clear. Executive pay must reflect performance, the individual’s ability to offer all pupils an excellent education and there must be clear evidence to demonstrate this.”