Pensions

School pension contributions to rise – but government will fund (for now)

The rise of more than 20% for state schools will be funded by government, but private schools left out

The rise of more than 20% for state schools will be funded by government, but private schools left out

Contributions that schools pay towards teachers’ pensions will rise by more than 20 per cent from April.

Government has committed to funding the rise for state schools and colleges for one year, with any further commitments to be decided at future spending reviews.

But private schools have been left out – meaning they will have to soak up the extra costs.

Employer contributions will rise from 23.6 per cent to 28.6 per cent after a valuation to “ensure the scheme continues to meet present and future obligations”.

A statement announcing the changes read: “The Department for Education appreciates that the result means independent schools that participate in the scheme will be faced with additional costs that aren’t funded. 

“It’s hoped that the information shared previously, on the likely final result, will have helped them in planning for the change.”

However it comes alongside the commitment from the Labour Party to impose VAT on private schools should it form a government.

‘Private schools will drop out of scheme’

More than 300 private schools have already pulled out of the Teachers’ Pension Scheme since 2018, according to analysis this month.

The NEU said it anticipates more will now follow suit. 

Daniel Kebede, general secretary of the National Education Union, said private school teachers to “face the threat of losing a decent pension is unacceptable. It should set alarm bells ringing across society.

“The NEU is not prepared to sit back while our members see their contracts of employment ripped up and their pensions snatched away. The NEU will robustly support our members to take all necessary action to defend their terms and conditions.”

The NEU said the rise was down to a technical change imposed by government.

Julie Robinson, CEO of the Independent Schools Council, added that the change alongside Labour’s pledge means “difficult decisions will have to be made to ensure schools remain financially viable”.

Correction: We originally stated this was a five per cent rise, rather than five percentage points.

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