Pay award: This ‘landmark’ settlement lands wide of the mark

On 19 July the government announced ‘landmark rises to teacher salaries’. The long-awaited 32^nd report of the School Teacher Review Body (STRB) and the government’s own evidence towards this settlement talked of an aspiration to raise teacher starting salaries to £30,000 by September 2023.

School business professionals had welcomed the government’s evidence to the STRB when it was was published in March. There was a proposed pay structure for a multi-year pay deal, with salaries increasing by 8.9 per cent for a teacher on the first main pay point and larger increases for those on the second to fourth main pay points, as well as a 3 per cent rise for all other pay grades.

Setting out the detail in this way meant we could model our budgets quite accurately, as the overall cost of the pay award at school and trust level would vary depending on the profile of the teacher workforce in our settings. The funding settlement and the supplementary grant also made the pay award look affordable within existing budgets.

What was announced this week, however, increased the total cost of the award. The recommended main scale points on to five remain the same as the proposals with an increase of between 8.9 per cent for early career teachers and 5.5 per cent for teachers in their fifth year of experience. But all other grades are awarded 5 per cent rather than the recommended 3 per cent from 2022. Further increases of 7.5 to 3.6 per cent for the first five main scale points in 2023 and 3 per cent for all others are 1 per cent higher than the original evidence.

This pay award also has to be set against the backdrop of rising inflation. In September 2021 the rate of inflation (Consumer Price Index) stood at 2.9 per cent and teachers received no inflation-based pay rise at all. By March, when the secretary of state submitted his evidence, inflation stood at 6.2 per cent. By June, it was 9.4 per cent. The result is that this ‘landmark’ rise in teacher salaries doesn’t even meet inflationary pressures at any point on the pay scale.

So it looks likely that the proposals will fail to deliver the ambition to position a career in teaching among the most competitive in the labour market. While graduate salaries have increased in other sectors, teacher salaries have fallen in real terms since 2010, with 3 years of pay freezes between 2011 and 2021. It is difficult to imagine that a starting salary of £30,000 out of London will feel competitive, and it should be noted that the increases proposed to the pay ranges in London yield even lower percentage rises.

And while pay for more established teachers and leaders is comparatively more competitive, raging inflation and a widespread feeling of being under-valued mean a differentiated pay rise – particularly one that is below inflation – is going to feel particularly unfair.

The award, which is subject to consultation and approval, will mean that teachers at least have certainty about their salaries for the next two years. But unless inflation is brought under control very swiftly, this will be cold comfort as the costs of commuting, eating and heating increase.

From a budget perspective, this certainty is welcome. But there is currently an unfunded 2 per cent rise on most pay points in 2022 and 1 per cent in 2023. The treasury will not fund the difference, so either the DfE – or schools – will have to make up the shortfall from existing resources.

All of which leaves school business professionals at best unsure of the overall affordability of the settlement. Our budget plans are long-since approved, and we will have to deal with this through our re-forecasting process.

We knew there was a risk, so we were prepared for this eventuality. But the government have managed to add to the cost pressures bearing down on school and trust budgets while doing little to mitigate overall uncertainty and effectively leaving teachers at all pay grades with another real-terms cut.

All things considered, what was meant to be a landmark pay award has landed wide of the mark.