Schools will have to meet the cost of all teacher pay rises over the next three years from their core budgets, the schools minister has confirmed.
But in an exclusive interview with Schools Week, Robin Walker said the extra £4.7 billion cash allocated at least week’s spending review would make such pressures affordable.
The admission is likely to heighten concerns from sector leaders who say school budgets have been “hammered” over the past ten years.
Association of School and College Leaders general secretary Geoff Barton previously warned the extra money could “very quickly evaporate under the weight of extra cost pressures”.
The extra funding will also have to cover a £300 million national insurance contribution rise and a “substantial uplift” for high needs funding – marking a triple whammy of pressures.
It was announced last week around £1.6 billion is set to be added to school budgets in 2022-23, on top of £2.4 billion extra allocated in the 2019 spending review.
A further £1.5 billion a year will be added in 2023-24 and 2024-25.
Analysis by Luke Sibieta, from the Institute for Fiscal Studies, shows that even a one per cent rise for all teachers would cost the sector between £270 million and £280 million a year.
But inflation is currently around 2.9 per cent, meaning a real-terms pay rise for all teachers would cost over £800 million.
Government ‘recognises pressures’
Treasury documents published last week showed the settlement for schools would also “support delivery” of the government’s pledge to raise teachers’ starting salaries to £30,000.
It is not straightforward to work out how much this would cost, but it is expected to also run into the hundreds of millions.
A rise in employer national insurance contributions, which will come into effect next year to fund health and social care reforms, is expected to cost schools around £300 million – swallowing up another chunk of the new money.
Walker said: “We recognise there are pressures and there are funding pressures coming through the system which we need to meet. I think this settlement allows us to go above and beyond that.
“I think if this literally had brought us up to a kind of flat real-terms delivery it would have been a struggle to meet those pressures, but the fact that it goes above and beyond that.
“The fact that we have annual growth in each year of about two per cent above inflationary pressures, gives us the headroom to take on some of these further costs and deliver a real uplift in per pupil funding.”
‘Substantial uplift’ for high needs planned
However, Walker did also reveal the increase in revenue funding included a “substantial uplift” for high needs, though how much will not be confirmed until more detailed allocations are announced.
The spending review also committed to £2.6 billion over the next three years to create school places for pupils with special educational needs and disabilities.
“In a perfect world, of course, I might have liked even more capital to deliver more schools across the system,” said Walker.
“I think the fact that high needs has been prioritised is completely rational and sensible. And of course, that is where the bulk of the extra capital from the spending review is going.”