Top tal­ent won’t come here be­cause taxes are too high, says TCD dean

Irish Independent - Business Week - - FRONT PAGE - Colm Kelpie

IN­TER­NA­TIONAL aca­demics have ex­pressed in­ter­est in join­ing the fac­ulty at Trin­ity’s new busi­ness school, but have been put off by the ceil­ing on pro­fes­sors’ salar­ies and the high rate of per­sonal in­come tax, the school’s dean has said.

In an in­ter­view with the Ir­ish In­de­pen­dent, Andrew Burke said the Govern­ment mi­cro­man­ages too much in the third level sec­tor, with reg­u­la­tion “con­strain­ing what you can and can’t do”.

Trin­ity was given the green light from the plan­ners last year for its new €70m busi­ness school de­vel­op­ment, which is due to open for stu­dents in 2018.

Mr Burke said the school has man­aged to get around the salary ceil­ings for pro­fes­sors by ap­point­ing at as­so­ci­ate pro­fes­sor grade.

But he added: “I’ve had a num­ber of con­ver­sa­tions where re­ally top pro­file pro­fes­sors have heard about what’s hap­pen­ing in Trin­ity and have ex­pressed an in­ter­est in join­ing us, and when I’ve men­tioned the pay cap, they’ve al­ready worked out the tax­a­tion, so they’re al­ready primed to ask the ques­tion, how are you go­ing to com­pen­sate for the tax­a­tion?

“I’ve said we have a cap, and I can prob­a­bly make a case for x per­cent, but I’m not sure how far it will go. A lot of those con­ver­sa­tions just ended on the spot.”

Pro­fes­sors at TCD can earn up to €136,276, while the ceil­ing for as­so­ci­ate pro­fes­sors is €103,261.

“If we talked about set­ting up a world class sports team in Dublin, and we pro­vided that team with a world class sta­dium, a world class back­room staff, all the tech­nol­ogy, but we placed one con­straint. We said ‘you can­not pay more than half of what your in­ter­na­tional com­peti­tors are do­ing’. We all know that it will be an ab­so­lute non-starter,” he said.

“And yet, that’s the sit­u­a­tion that busi­ness schools in Ire­land find them­selves, par­tic­u­larly at the pro­fes­so­rial level. We’re not com­pet­i­tive at the top level.”

Mr Burke said that af­ter tax, busi­ness school As­so­ci­ate Pro­fes­sors’ salar­ies out­side of Ire­land are higher than salar­ies for full (chaired) pro­fes­sors here.

“So if we are to at­tract top in­ter­na­tional tal­ent to Ire­land in or­der to gen­er­ate ex­port earn­ings to fund our busi­ness schools, bear­ing in mind that in seven years time around just 10pc of our busi­ness School in­come will come from the tax­payer - then we need to be able to com­pete in the in­ter­na­tional labour mar­ket,” he added.

“The irony is that re­mov­ing the wage cap would en­able Ir­ish busi­ness schools to at­tract more top in­ter­na­tional tal­ent to cap­ture more global mar­ket share which gen­er­ates ex­tra pri­vate in­come to both fund their own ac­tiv­i­ties and make an ad­di­tional sur­plus which could help plug the fund­ing short­age in other parts of uni­ver­si­ties, ie save the tax­payer money.”

With years of ex­pe­ri­ence in the UK, Andrew Burke tells Colm Kelpie he put his money where his mouth was to put Ire­land on the aca­demic map in the busi­ness world

WHEN the op­por­tu­nity came to head up Trin­ity’s school of busi­ness, Andrew Burke thought he should ef­fec­tively put up, or shut up. From his van­tage point in Britain, the Dubliner had been harp­ing on that Ire­land lacked a truly world­class busi­ness school.

The UK is “leagues ahead of Ire­land” in this re­gard, he says. Friends would ask him on trips home if he would con­sider re­lo­cat­ing to an Ir­ish univer­sity, hav­ing worked at both War­wick and the Cran­field School of Man­age­ment, where he es­tab­lished the Bet­tany Cen­tre of En­trepreneur­ship. That would be like play­ing for Southamp­ton, and de­cid­ing to come back home and play for Sham­rock Rovers, he would tell them.

“I worked at War­wick and Cran­field and both of those in­sti­tu­tions achieved a world-class po­si­tion within a sin­gle gen­er­a­tion of fac­ulty and nei­ther had a great univer­sity to feed back on in terms of a plat­form to work with,” Burke (51) says. “Nei­ther of them was lo­cated in a par­tic­u­larly ad­van­ta­geous place, and they cer­tainly couldn’t piggy back on the back of a fa­mous city.

“One of the things that used to frus­trate me quite a bit, was I thought why on earth are the Ir­ish busi­ness schools and the Ir­ish uni­ver­si­ties not hav­ing a greater pres­ence in the mar­ket?”

Look at Barcelona, he tells me, as we sit in his of­fice in the bow­els of Trin­ity’s cam­pus.

“If we went back 20 years ago and said which city is likely to have a world class busi­ness school, Dublin or Barcelona, you’d put your money on Dublin. And yet over that pe­riod, Barcelona has not only pro­duced one world class, but pro­duced two. And when I say world class, I mean one top ten and one top 20. The high­est an Ir­ish busi­ness school has ever been is in the top 50.”

And so, when Trin­ity came call­ing with the aim of grow­ing its busi­ness school, Burke said he felt com­pelled to take the chal­lenge. “I could hear my­self say­ing, put your money where your mouth is.”

Trin­ity, Burke be­lieves, has al­ways had an im­pres­sive of­fer­ing in terms of its busi­ness school. The un­der­grad­u­ate busi­ness de­gree con­tin­ues to be among the strong­est in the coun­try and is com­ple­mented by the MBA pro­grammes, spe­cial­ist MScs, Phds, and Ex­ec­u­tive Ed­u­ca­tion pro­grammes.

But it’s al­ways been quite “niche”, he adds. The aim now is to broaden its ap­peal fur­ther.

And Burke doesn’t seem all that both­ered about the com­pe­ti­tion from the other school down the road, UCD’s Smur­fit Grad­u­ate School, which has a higher pro­file. The real com­pe­ti­tion is from out­side the State, he feels.

“We’re now com­pet­ing in an in­ter­na­tional mar­ket. The con­sumer doesn’t care about the dif­fer­ences; they’re weigh­ing up UCD, Trin­ity, against the War­wicks, the Cran­fields, the Manch­esters. If we both go in­ter­na­tional, to our full po­ten­tial, there’s plenty of room in that mar­ket. So I see the way for­ward in the Barcelona ex­am­ple. As we up our game, sure it will put pres­sure on them to up their game, but it will en­hance the over­all brand of Dublin.”

And Trin­ity is cer­tainly up­ping its game, at least in terms of in­fras­truc­ture. Last sum­mer, the univer­sity was given the green light for a €70m new busi­ness school de­vel­op­ment on the Pearse Street side of the cam­pus, funded in part through a com­bi­na­tion of a Euro­pean In­vest­ment Bank loan and do­na­tions from wealthy en­trepreneurs. It will be the cen­tre piece of a re­launched busi­ness cur­ricu­lum at the univer­sity, which, ac­cord­ing to Sean Melly, the chair­man of the board of the univer­sity’s busi­ness school, in a 2014 ‘Fi­nan­cial Times’ ar­ti­cle, was “no longer fit for pur­pose”. The build­ing is to be ready for 2018 en­trants. At­tract­ing stu­dents is the top pri­or­ity. But at­tract­ing top-class staff is also vi­tal, and at times, that has proven dif­fi­cult thanks to pay caps for pro­fes­sors (in the­ory, they can only earn a max­i­mum of €137,000), cou­pled with the high lev­els of per­sonal in­come tax here.

Burke says they’ve man­aged to get around the pay cap prob­lems by ap­point­ing at as­so­ci­ate pro­fes­sor level and talk­ing up the chances of pro­mot­ing over time.

But at­tract­ing top-level pro­fes­sors hasn’t proved as easy to over­come, with some con­ver­sa­tions end­ing when the is­sue of pay comes up, he says.

Burke’s own ap­point­ment in 2014 was some­what con­tro­ver­sial be­cause of his own pay packet. He ar­gues that when Trin­ity came call­ing, he al­ready had a “sub­stan­tially” greater of­fer on the ta­ble from an­other univer­sity. So he ne­go­ti­ated with Trin­ity to close the gap, al­though the fi­nal of­fer (less than the €185,000 re­ported in the me­dia at the time, he says) still re­mained some way off the other univer­sity’s, he stresses.

But he said he also pushed it be­cause he be­lieved that if they weren’t go­ing to make a spe­cial case for a dean to breach the Hadding­ton Road con­straints, they would never ul­ti­mately do so to get a top pro­fes­sor. “I was quite sur­prised that Ire­land Inc thought it was go­ing to be able to com­pete in an in­ter­na­tional busi­ness school in­dus­try and not pay com­pet­i­tive salar­ies. That was a bit of a wake-up call,” he says.

Pay, he says, is a bat­tle for a later date with the Govern­ment. For now, his fo­cus is on de­vel­op­ing the school, and boost­ing its pres­ence. And a fea­ture of that is the in­au­gu­ral Trin­ity Global Busi­ness Fo­rum, which takes place today. Its aim is to al­low the en­tire Trin­ity busi­ness com­mu­nity to en­gage with is­sues fac­ing the busi­ness com­mu­nity, and to net­work with in­dus­try rep­re­sen­ta­tives.

Panel dis­cus­sions in­clude the fu­ture of work in the 21st cen­tury, so­cial en­trepreneur­ship, the ac­com­mo­da­tion short­age and the fu­ture of Ir­ish man­u­fac­tur­ing. Key­note ad­dresses with be given by Paul Drech­sler, pres­i­dent of the Con­fed­er­a­tion of Bri­tish In­dus­try, and Frank Mur­ray, the for­mer man­ager of The Pogues, a throw­back to the days when Burke was a young Ents Of­fi­cer at UCD.

There’ll also be panel dis­cus­sions on ethics and lead­er­ship, and whether we’ve done enough to pre­vent an­other fi­nan­cial cri­sis - top­ics of par­tic­u­lar in­ter­est to Burke and his staff.

“When I joined Trin­ity, the first thing I did was I ar­ranged to meet ev­ery­one who works in the school for a cof­fee for an hour. What be­came re­ally clear to me was that ev­ery­one had a strong view that we should have ethics and val­ues [en­grained in the cur­ricu­lum],” he says. “We want our stu­dents to have a moral com­pass leav­ing Trin­ity.”

The busi­ness school has a strong eth­i­cal fo­cus, with plans for stu­dents to sign a char­ter at the out­set of their course. Fo­cus will also be placed on the well-be­ing of grad­u­ates. The in­dus­try is fail­ing to speak about stress in the work­place, he adds.

At the cen­tre of any busi­ness ed­u­ca­tion, he says, should be aca­demic rigour. “The fi­nan­cial cri­sis wasn’t just about a lack of val­ues, it was also about a lack of rigour in ed­u­ca­tion. A lot of busi­ness schools had drifted into the zone where they were try­ing to please the cus­tomer too much, par­tic­u­larly on MBA pro­grammes.

“If you look at the MBA mar­ket glob­ally, I think the MBA mar­ket had been dumbed down in­cred­i­bly, to the point that a lot of de­ci­sion mak­ing had been made on rules of thumb and trust, not trust in terms of per­sonal trust, but trust [in the sys­tem], that it works.”

TCD busi­ness dean Andrew Burke

‘Glob­ally, I think that the MBA mar­ket had been dumbed down in­cred­i­bly,’ ar­gues Andrew Burke

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