High salaries, bonuses and perks paid to some college and university presidents will be trimmed or eliminated under a new compensation plan unveiled Tuesday by the Alberta government.
Annual salaries paid to 20 of the province's post-secondary presidents will have to fall within five pay grids, which range from $184,000 to $447,000.
The new pay bands will take effect April 15, 2018, for new hires or contract renewals. Existing contracts will have to be in line with the new guidelines by April 14, 2020.
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Once the pay bands are fully in place, the government estimates annual savings of $4 million to $5 million. The advanced education ministry is projected to spend $6.1 billion in the 2018-19 fiscal year.
"Institutions will be able to allocate the savings internally to benefit students and their campus," said Advanced Education Minister Marlin Schmidt.
Base salary isn't the only factor driving compensation for Alberta college presidents to the highest levels in Canada. The government is also cracking down on bonuses and perks.
The practice of paying bonuses will end, as will benefits such as free sports club memberships, signing bonuses and executive allowances.
Termination pay can be no more than four weeks of salary for each year of service, capped at a maximum of 52 weeks.
Pay decreases
Housing can only be provided if the university owns or rents the residence, and the president must pay rent at full market value.
The government is also prohibiting colleges and universities from providing executive or private health benefits.
Any vehicle provided to a president cannot cost more than $39,000.
The government is also putting limits on paid holidays, leave, parking and relocation expenses.
The changes mean college and university presidents will see their pay drop, though some will see a decrease of only about one per cent. The biggest cut will hit the president of Grande Prairie Regional College, whose salary will drop by 31 per cent.
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The pay grids will not apply to six institutions that do not fall under the Alberta Public Agencies and Governance Act: The Banff Centre, Concordia University and King's University in Edmonton, St, Mary's University and Ambrose University in Calgary, and Burman University in Lacombe.
The new compensation system is a result of the government's review of salaries paid to executives at Alberta's agencies, boards and commissions that started in the fall of 2015.
Last month, Schmidt attacked David Turpin, president of the University of Alberta, for earning $824,000 in total compensation while the institution hiked fees for residence and meal plans and tuition for international students.
In 2016, University of Calgary president Elizabeth Cannon earned $631,042 in total compensation. Cannon announced she is stepping down this year and a search is underway for her replacement, whose pay will be subject to the government's new pay grid system.
Mount Royal University's board of governors said in a statement it would comply with the government's new regulations.
"At the same time, the board of governors must balance the need to attract qualified leadership in an increasingly competitive and global academic sector," said board chairwoman Sue Mallon.