Teacher pay increases are likely to dampen funding increases and will be felt unequally across the education system, writes Jon Andrews

This week, education returned to the House of Commons with Gavin Williamson given his first opportunity since the election to set out his agenda for schools.

There were few surprises in the Conservative manifesto. The government had already announced additional funding for schools in last autumn’s spending round, and also proposed significant increases in starting salaries for teachers. So, while many of the contributors were new, most of this week’s debate was very familiar: on one side, ‘the biggest increases in a decade and levelling up funding’, and ‘too little and not directed where it is needed most’ on the other.

Department for Education ministers now need to move on from debates about funding and pay to the detail of implementation. Unfortunately, the debate about funding is likely to be far from over. According to the government’s own data, a quarter of schools are set to get only inflation-level increases in their per-pupil funding next year. And, while increases have been welcomed by the profession following a decade in which average teacher salaries have been falling in real terms, they are also going to cause fresh pressure on school budgets and eat into some of the funding increases.

The way that those pressures are felt and managed are likely to vary considerably between schools too. That’s illustrated in new analysis from the Education Policy Institute published this week which examines trends in expenditure on teachers between 2003 and 2017.

Schools in London, and those with the highest proportions of disadvantaged pupils typically saw the largest increases in that time, though even these schools have seen falls since 2010. Special schools have also seen big falls in the last decade as teacher numbers have not kept pace with the surge in pupil numbers, which have increased by a quarter in the last five years.

But it is the largest multi-academy trusts that provide some of the most striking findings.

Large trusts employ teachers that are ‘less expensive’

When people talk about pay in multi-academy trusts it tends to be centred on the high pay of some MAT CEOs, to the point that ministers have demanded that individual trusts justify high remuneration of senior leaders.

But high pay appears to be less of an issue in the classroom. These schools have seen some of the largest falls in per pupil expenditure on teaching staff since 2010 – double the rate of local authority schools. That is not to say that these schools are now particularly low spenders, in fact the decreases have largely just been about reversing previous, pre-academisation, increases. And their pupil teacher-ratios are about average.

So what is driving these particularly large reductions?

We do know that the teaching workforce in large trusts is often different from other schools. They tend to employ more new entrant teachers and tend to have younger middle and senior leaders. In other words, they employ teachers that are ‘less expensive’. For now at least. With large increases in starting salaries on the way, schools may be less inclined to employ new entrants if there is not much by way of savings in comparison to more experienced teachers.

Some of these trusts have also been at the forefront of the government’s push for curriculum-based financial planning, taking an analytical approach to deploy staff to deliver the curriculum most efficiently. Some report making significant savings.

Or is spending less on teachers a case of necessity rather than workforce design? Analysis by academics at the University of Birmingham suggests that academies are spending more than other schools on so-called back office functions and have not yet managed to realise the long-promised economies of scale.

Whatever the reasons, schools are likely to need to continue to look for savings as they face increases in teacher pay, particularly those that are not big winners under Gavin Williamson’s spending plans. The crucial question is, will those that have been finding savings for a decade continue to be able to find more?