School teachers to receive 2.75% pay increase – more budget pressures for schools

Published by Phil Reynolds on 23 July 2019

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This week the Education Secretary, Damian Hinds, announced that he has accepted all recommendations from the independent School Teachers’ Review Body (STRB), to raise both the upper and lower boundaries of all pay ranges for teachers by 2.75%.

Whilst schools can continue to determine how their staff are paid, the increase will be supported by an additional teachers’ pay grant of £105 million on top of the existing £321 million committed for 2019-20. The additional £105 million is deemed to cover the 0.75% over the level the Department of Education (DfE) assessed as affordable, based upon STRB evidence, earlier this year
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The press release from the DfE mentions that the average gross pay for classroom teachers in November 2018 was £36,200 and for leadership teachers it was £58,900. The 2.75% pay increase will increase these averages, before any promotion or responsibility allowances, to £37,195 and £60,520 respectively. These increases essentially are equivalent to an increase of £1,000 for classroom teachers and £1,620 for leadership teachers.

The timing of the announcement is unfortunate as the majority of academy trusts will have already agreed and approved their 3-year budget forecasts for ESFA submission and there will be little time to amend these. Therefore, is the budget and forecast data the ESFA are going to receive actually of any use to them for planning ahead? In addition, schools will have already committed to staffing structures for September and will have no room to manoeuvre.

From comments made by clients and others in the sector, it would appear this announcement will have minimal impact in year 1 with the net effect expected to be low. The 2% increase was expected and many trusts have budgeted for this increase. This leaves the 0.75% which will be funded by the government in year 1. It will be year 2 and beyond where problems will arise unless additional funding is provided.

Of course, all of the above only mentions gross pay and therefore the “on costs” will also have to be considered by schools.

With this news, we would recommend that trusts revisit their 3 year forecasts and look at the impact this announcement will have. Trusts should then look to adapt their model to see what they can do to accommodate the pay increase – if this is at all possible.

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