England’s biggest academy trust has vowed to press ahead with plans to let teachers opt into a less generous pension scheme to boost their pay, despite what it called “threats from government officials”.
The i paper reported the Department for Education had told United Learning Trust that it opposed the move – thought to be a first for state schools – to offer workers the teachers’ pension scheme (TPS) alternative.
But Sir Jon Coles, the academy chain’s CEO, has hit out the government, stating he remains “confident in our legal position”.
“Although we are not able to go ahead in April as planned, we do still plan to go ahead with the scheme, despite threats from government officials.”
The i said government informed ULT that part of its funding would not be able to be accessed unless it was being used to pay for membership of the TPS pension scheme.
It was also reported that officials told the trust it faced the threat of a financial notice to improve.
Despite stressing it does not comment on “speculation”, the DfE confirmed it had requested a business case so it could be “appropriately considered in the context of teachers and the impact on public finances”.
Schools Week previously revealed ULT, which runs 90 schools, was planning to offer teachers the choice of an alternative pension scheme from 2025, alongside the TPS.
Currently, teachers have to pay between 7.4 and 11.7 per cent in contributions, with employers stumping up 28.6 per cent of the worker’s salary.
Under the plan, teachers who wanted to opt out of the TPS would be able to contribute either 0, 5 or 10 per cent of their salary in a new defined contribution scheme.
The trust would contribute at least 10 or 20 per cent. The money saved by United Learning on employer contributions would go towards bumping up pay for teachers on the alternative scheme.
Union calls to ‘close pension loopholes’
For teachers contributing nothing towards their pension and getting 10 per cent from their employer, this would equate to a 15 per cent salary uplift.
This would mean starting salaries rising across its schools outside London from £32,850 to almost £38,000, and from £39,000 in inner London to £45,000.
Unions previously slammed the “alarming” proposals, adding “tampering with statutory public sector pensions is dangerous and unwelcome”.
Today, NASUWT general secretary Dr Patrick Roach argued employers “are being disingenuous in claiming that they want to boost pay if the price to be paid by teachers means sacrificing their future incomes in retirement”.
He “will now be seeking assurances from ministers that any such loopholes will be closed”.
Association of School and College Leaders general secretary Pepe Di’Iasio noted “teachers should not have to choose between an adequate pension and adequate pay”.
But Coles has accused unions of “not representing their members” for opposing the scheme, citing the results of an internal survey showing “some 25 per cent of staff” had “expressed interest” in it.
An Education Policy Institute study last week also found one in six teachers would prioritise an immediate pay increase over a higher pension.
“Our original aim was to attract new entrants rather than appeal to existing teachers so this is remarkably high,” Coles added.
“We will always offer TPS to all teachers. Teachers will be able to move freely between the two schemes annually… [and] be offered free independent financial advice.”
Other MATS are already doing this!