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The suitability of "profit-related pay" to higher education is extremely dubious. What effect would the notion of "profit" have on activities such as counselling students, collaboration between institutions, or academic independence and quality?

This form of tax-free pay is unlikely to survive a general election. Lecturers risk losing their national pay scales to a scheme which depends on institutions' ability to generate a surplus, and, in schemes we have seen, replaces a part of current pay. Using tax relief to provide increased income reduces pressure for secure annual pay awards.

There is already concern at institutional attempts to generate surpluses at the expense of spending on the delivery of education. Up to 20 per cent of a workforce may opt out of or be excluded from membership of a profit-related pay scheme, due to poor performance, sickness, absence etc. Times are very hard, but this is not the answer.

Jill Jones Chair, higher education, Natfhe