Alberta universities, colleges and polytechnics will be bound by new provincial limits on pay and benefits they can offer their senior leaders.
On Thursday, 425 vice-presidents and deans at Alberta post-secondary institutions will have their total compensation capped according to a new grid set by the government. The rules apply at 20 of the province’s 26 schools.
Leaders who report to a president can earn no more than $391,125 a year at large schools like the University of Alberta and a maximum of $205,713 at a smaller institution, such as Olds College.
Executives two tiers down from a president are limited to a maximum of $312,900 at Alberta’s largest institutions.
Some deans earn substantially more than these limits, according to institutions’ public salary disclosure lists.
For example, the University of Alberta’s dean of business received $477,157 in base pay and benefits in 2019.
Charlotte Taillon, press secretary to Finance Minister Travis Toews, said the new limits will apply to new hires immediately. Institutions have up to two years to transition current leaders onto new contracts.
“This helps to bring Alberta’s post-secondary executive compensation in line with other provinces to ensure tax dollars are spent as effectively as possible and benefit all Albertans,” Taillon said in an email last week.
By 2023-24, the caps are expected to save institutions around $3.7 million a year, she said.
In 2018, the former NDP government introduced salary caps for 20 post-secondary presidents, saying their salaries and perks were becoming exorbitant.
The UCP government updated that regulation to keep those caps and will also require that presidents’ benefits be worth no more than 35 per cent of their base salaries.
The government has also added new limits on administrative leaves, which were already capped at one year.
Although the top executives at other provincial agencies, boards, and commissions have been subject to compensation caps and limits on perks since 2017, middle managers at organizations like the Workers’ Compensation Board or the Alberta Energy Regulator are not subject to salary caps.
Critics say government meddling in university business
CBC News contacted several institutions’ administrations for their reaction last week. Only the University of Calgary responded, saying in a written statement the minister of advanced education gave them one day of warning about the changes.
The statement says the university prides itself on its low administrative costs compared to similar institutions.
“We support the goal of reduced administrative costs at Alberta post-secondary institutions but have concerns that, in some limited circumstances, these limits could affect our ability to attract talent in a competitive marketplace,” the statement said.
“We are also concerned that this regulation could, in some cases, change contracts recently agreed to in good faith, and thus damage the reputation of the University of Calgary and Alberta as a place to do business.”
The statement said university administrators hope to discuss with the government whether the caps will have unintended negative consequences, and whether there are other ways to trim costs.
The Council of Post-secondary Presidents of Alberta and Universities Canada also declined requests for comment.
Brenda Austin-Smith, president of the Canadian Association of University Teachers, said any kind of government interference in public university operations is inappropriate, and disrespectful to the autonomy of the institutions.
She said cracking down on administrative salaries is an attempt to mask the much larger issue of chronic underfunding.
“The real issue is a provincial government that has taken so many millions of dollars out of a world-class post-secondary education system in the province at precisely the moment when people need their public institutions to be supported,” Austin-Smith said.
David Eggen, the NDP’s advanced education critic, said the savings from the move will be a pittance compared to the hundreds of millions of dollars in funding the provincial government has cut from post-secondary grants.
“They’re heaping piles of red tape onto our universities, colleges, trade polytechnics,” Eggen said. “It’s clear the UCP is trying to micromanage and trying to divert attention from the fundamental cuts they’ve made to our universities.”
The government denies the move will add red tape, saying the caps remove the need for contract alignment reviews.
Eggen said applying the new standards only to the post-secondary sector reveals a vindictiveness by the government toward higher education.
Government extends public sector wage freezes
In another cost-controlling step, the government has also extended a salary freeze for post-secondary leaders for another year until March 31, 2022.
And 6,234 public managers and opted-out or non-unionized workers will also have their wages frozen for another year.
Employees for the Alberta government and public agencies, boards and commissions who are not union members have had no new pay raises since January 2016, when the NDP government first imposed the salary freeze.
Taillon said extending the freeze is a responsible measure given the province’s accumulating debt. It should save the government nearly $18 million this year, she said.
“Containing public sector compensation helps to bring spending in line with other provinces and is respectful to the economic reality facing many Albertans who have seen their wages reduced or lost their jobs,” she said in an email.