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THE NASUWT SUBMISSION

TO THE SCHOOL TEACHERS’ REVIEW BODY JANUARY 2019

The NASUWT – the teachers’ union

If you require further information about this submission, please contact: Ms Chris Keates General Secretary NASUWT Hillscourt Education Centre Rose Hill Rednal Birmingham B45 8RS 0121 453 6150 www.nasuwt.org.uk nasuwt@mail.nasuwt.org.uk

EVIDENCE SUBMISSION

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CONTENTS

Page

1. INTRODUCTION 3

2. THE POSITION ON TEACHERS’ PAY 5

3. TRENDS IN TEACHER SUPPLY 19 4. THE WIDER STATE OF THE LABOUR MARKET 30 5. AFFORDABILITY 33 6. OTHER ISSUES 46

7. MATTERS FOR RECOMMENDATION 48

8. APPENDICES 49

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1. INTRODUCTION

1.1 The NASUWT welcomes the opportunity to submit evidence to the Review Body in connection with its 29th Remit. The NASUWT has regularly observed, when submitting evidence since 2010 in particular, that there has been a serious deterioration to teachers’ pay and working conditions.

1.2 Successive Review Body reports have noted the contributory causes of this

deterioration and in its 27th and 28th Reports the Review Body stated that these matters needed to be attended to with urgency.

1.3 It is therefore of considerable concern to the NASUWT that the Review Body’s

processes have been delayed by the Department for Education (DfE’s) decision not to submit Evidence by the deadline originally set for the 29th Report’s processes.

1.4 This is yet another example of the approach by the Government which has

become all too familiar since 2015, that of delaying the Review Body’s processes. Since 2015, teachers have had to endure Review Body Reports being published at the end of the summer term, with inadequate consultation over the Secretary of State’s response to the recommendations and the consequential changes to the School Teachers’ Pay and Conditions Document (STPCD).

1.5 These delays were worse in 2018 than they had been previously and led to

the 2018 STPCD eventually being published on 14 September 2018. The DfE’s update of its non-statutory pay guidance, Implementing your school’s approach to pay, was published two months afterwards.

1.6 The 2019/20 pay award is likely to be delayed again this year by the failure of

the DfE to make a submission by the deadlines set by the Review Body for its 29th Report. The Government’s actions can only be viewed as contempt towards teachers and indeed towards the Review Body process itself. The NASUWT believes that this must be addressed by the Review Body in the recommendations in its 29th Report.

1.7 In this context, the NASUWT congratulates the Review Body for the

conclusions it drew, and the recommendations it made, in its 28th Report. 1.8 The Review Body process is both independent and evidence based. The 28th

Report was the culmination of the Review Body’s detailed consideration of written and oral submissions and evidence from statutory consultees, including the Secretary of State, and the Review Body’s own research and evidence, including visits to schools and discussions with teachers and headteachers.

1.9 It is, therefore, disgraceful that the Secretary of State disregarded the

independent Review Body process, swept aside the body of evidence it produced and imposed a targeted award despite the Review Body providing a clear rationale against this. It is also disgraceful that the Secretary of State has continued to seek to disregard the independence of the Review Body by constraining its ability to reach conclusions based on an objective and rational assessment of the available evidence.

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1.10 In particular, the NASUWT condemns the constraints which the Secretary of State has sought to place on the Review Body for its 29th Report in respect of affordability. The effect of this is to seek to continue the era of austerity for teachers.

1.11 The Secretary of State has referred to the Review Body the need to ensure

that its recommendations are affordable. However, education spending for 2020/21, which includes part of the 2019/20 teachers’ pay year is completely unknown – in fact, the Government’s consultation on the next Spending Review has not even begun. Statutory consultees are unable to comment fully on this area of the Review Body’s report and, in respect of school funding in 2020/21, the Secretary of State has placed statutory consultees and the Review Body in an impossible position.

1.12 The Secretary of State’s rejections of the Review Body’s recommendations in

it its 28th Report have led to deepening anger and demoralisation across the teaching profession. Teachers will expect the Review Body to exercise fully its independence in its 29th Report and to act in the interests of the teaching profession.

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2. THE POSITION ON TEACHERS’ PAY

2.1 It is clear that the Review Body understands the inadequacy of teachers’ pay and the pay system. However, it is important that the Review Body also understands how chaotic the pay system is in practice. For example:

the removal of national pay scales in 2013 has led to the majority of teachers facing a pay award lottery;

multiplication of pay points between the maxima and the minima is used by schools deliberately to devalue and slow pay progression; and

pay policies are frequently designed to pay teachers as little as employers believe they can get away with, rather than to pay good teachers more (examples of such policies are set out in Annexes 1 and 2).

2.2 It is now rare to find a pay system predicated on the need to reward teachers as highly trained and skilled professionals. Key to addressing the recruitment and retention crisis in teaching is the need to ensure an across-the-board pay increase for all teachers and the return of national pay scales in the School Teachers’ Pay and Conditions Document (STPCD) uprated in line with future Review Body’s recommendations. The NASUWT notes that pay scales have been retained across the rest of the public sector. Their removal from the pay framework for teachers is inconsistent, wholly unjustified and is a major contributory factor not only to the pay chaos in the school system but also to the recruitment and retention crisis.

2.3 In this Evidence, the NASUWT focuses on the pattern of implementation of

the September 2018 pay award. The NASUWT has provided comprehensive evidence to the Review Body, since 2014, of the discriminatory, punitive, workload-intensive and demotivating nature of performance-pay processes which have been adopted by schools. The NASUWT will focus further on these issues when submitting Evidence in connection with a future Remit, which the Secretary of State has indicated will consider the establishment of a clear career pathway for classroom teachers.

2.4 The NASUWT carried out a pay survey in December 2018/January 2019,

which examined the implementation of the September 2018 pay award and performance management decisions. This survey found that teachers frequently do not receive timely pay decisions, that the timing of pay progression decision making operates in breach of statutory requirements and that teachers are routinely denied the payments and progression to which they are entitled.

2.5 The Department for Education (DfE) announced the establishment of the

teachers’ pay grant to support schools in the payment of the September 2018 pay award, on 14 September 2018. The NASUWT’s pay survey closed on 14 January 2019. The responses received indicated that:

41% of teachers on the minimum of the main pay range had not received the pay award in the STPCD and 11% of eligible teachers on the minimum of the main pay range had been told specifically that they would not receive the award;

42% of teachers on the minimum of the upper pay range had not received the pay award in the STPCD and 11% of eligible teachers had been told specifically that they would not receive the award;

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45% of teachers had not received the increase in the STPCD on the Teaching and Learning Responsibilities (TLR) and Special Education Needs (SEN) allowances which they hold and 13% of eligible teachers had been told specifically that they would not receive these.

2.6 The central concern here is that, for all of these teachers employed in the

maintained sector, these pay increases are statutory entitlements. For the overwhelming majority of teachers employed in the academy sector, they are contractual entitlements. Yet these statutory and contractual requirements are being denied to teachers as a result of unrestrained school and academy freedoms.

2.7 There are patterns of discrimination within the application of the pay award to

teachers who have a statutory or a contractual entitlement to it. The Review Body will be concerned that:

teachers over 50 are significantly more likely not to receive a pay award;

the majority of disabled teachers have been told that they will not receive the pay award.

2.8 The annual teachers’ pay award, which until recently was an entitlement for

teachers, has now become the same lottery for teachers as performance pay progression. Full details of the Teachers’ Pay Survey are attached at Annex 3.

2.9 The NASUWT believes that the Review Body must be extremely concerned

by the extent of the chaos in the teachers’ pay system, which has limited the impact of its recommendations so significantly. The Review Body should not underestimate how strong the culture of withholding pay from teachers has become within the school system. It is indeed now endemic. The failure to provide teachers with their statutory pay entitlements is a manifestation of this.

2.10 The problems associated with the failure to pay the 2018 pay award have

been exacerbated by the late publication of the Review Body’s 28th Report and the publication of the 2018 STPCD half way through September.

2.11 The NASUWT will address the issues relating to claims of unaffordability

frequently made by schools later in this Evidence Submission. However, it has increasingly become the case that claims of unaffordability have become the catch-all justification for imposing adverse changes to terms and conditions on the workforce. This extends to the pay decisions which schools implement.

2.12 In terms of the pay policies which schools adopt, teachers have essentially

become prisoners of historical decisions in previous pay rounds, or legacy pay policies from 2013 onwards, meaning that they can be the subject of pay decisions which were frequently taken before they even began teaching in their school.

2.13 The position of those teachers who received no pay award at all in September

2018 cannot be ignored by the Review Body, as these will be the teachers who are most disillusioned by the treatment of the teaching profession.

2.14 In addition, the Secretary of State’s ill-considered response to the Review

Body’s 28th Report, which eroded pay differentials between the main pay

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range and the upper pay range, have angered upper pay range teachers. Intentional or not, the Secretary of State’s decision and its consequences need to be taken into account by the Review Body.

2.15 It appeared to the NASUWT that the Review Body attempted to ensure that

the 2018/19 pay increase was widely applied, by recommending the same increase to all teachers’ and school leaders’ pay ranges and allowances. This recommendation has been frustrated by the combination of the Secretary of State’s response to the recommendations and the dysfunctional and chaotic nature of the teachers’ pay framework. The inevitable conclusion is that the only means by which it is possible to ensure that a recommendation for a pay increase for all teachers in the 29th Report is implemented is for national pay scales for teachers to be restored to the STPCD.

2.16 On 21 November 2018, the DfE published research by the Institute for

Employment Studies (IES) into teachers’, leaders’ and governors’ views on the [teachers’] pay framework.1 Key findings of the research included the extent to which the pay framework remains a ‘secret garden’ for teachers. The NASUWT has brought this to the attention of the Review Body in previous years and the IES research shows the extent to which there has been no progress in addressing this.

2.17 IES found that the teachers’ pay framework has ceased to be motivational for

teachers and has become a source of either confusion or frustration: ‘Teachers reported that pay ranges and the framework are not being discussed very much in schools and that they found out about them through their own research.’ 2

2.18 It also found that, ‘teachers are largely left to find out information for

themselves.’ However, in terms of recruitment and retention, ‘when pay is regarded by teachers as unfairly awarded, or unequal to the task, it has a profound impact on their motivation.’ 3

2.19 The research shows that only three fifths of teachers (63%) agreed with the

statement, ‘I am clear about the maximum I can earn in my current role.’ 4 However, the overwhelming majority of teachers felt that the pay framework in their school did not help them build their career. Only 36% of teachers agreed with the statement, ‘I think the current teacher pay range helps me build my career as a teacher.’ Headteachers and deputy headteachers, however, were more likely to agree with this statement than classroom teachers.5

2.20 The research notes that only about a third of teachers agreed that the pay

policy had resulted in a fair allocation of pay within their school and some two thirds felt that it added to their workload.6

2.21 The NASUWT believes that the DfE must be held responsible for the

development and growth of the culture of pay chaos. The wording of the

1 Dawson et al, ‘Teachers’, leaders’ and governors’ views on the pay framework, November 2018.

2 Ibid, page 8.

3 Ibid, page 9.

4 Ibid, page 21

5 Ibid, page 22

6 Ibid, page 13.

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STPCD in respect of the annual pay award, the absence of national pay scales in the STPCD, the lack of clear and detailed statutory guidance and the failure to monitor patterns of pay implementation, or even provide expectations to schools about how they should focus their budgets on teachers’ pay, have led to this situation. All of this should be addressed by the Review Body.

Inflation and pay erosion 2.22 The charts and tables below show the impact of inflation on the real terms pay

of teachers, by identifying the disparities between inflation since 2010 and teachers’ pay awards and by calculating the cumulative loss in pay which teachers have suffered.

2.23 The Review Body will appreciate that, given the pay chaos in the system, and

the widely differing pay trajectories for individual teachers and groups of teachers, the following tables and charts may understate the real terms loss for every teacher. In fact, they represent the best case scenario for individual teachers and make the assumption that teachers on the pay levels in question have received the maximum pay increases in the STPCD for that pay level since 2013.

2.24 The Office for National Statistics (ONS) publishes inflation statistics using a

variety of inflation indices. Out of a range of inflation indices, Review Bodies are obliged to select the one which is most appropriate to their workforce. Out of the ONS’s inflation indices, the NASUWT continues to ask the Review Body to have regard to the Retail Prices Index (RPI) when considering the impact of inflation on teachers.

2.25 The Government switches between different inflation indices for different

purposes. For example, the Consumer Prices Index (CPI) measure is the Government’s preferred inflation measure for the purposes of public sector pay and both public and state pension increases. However, rail fares increase every year by an RPI inflation measure and the ONS also publishes inflation data using the CPI (H) index.

2.26 On 17 January 2019, the House of Lords Economic Affairs Committee Inquiry

published a report into the use of RPI.7 The Committee raised concerns that over recent years, the Government has intentionally side-lined RPI, in favour of methods that show lower headline inflation. The Committee cited concerns with rail fares and student loans interest rates increasing by RPI whilst public expenditure is uprated by the lower CPI rate.

2.27 The Review Body should be aware that, for teachers early in their careers,

student loan repayments are a significant item of expenditure and that interest on these increases by RPI, not CPI.

2.28 Incomes Data Research (IDR) indicates that two thirds of employers use the

RPI inflation index when calculating pay awards for their workforces, because the range of prices which are included in the index makes this a much more reliable indicator of the increases in prices which impact on their workforce.

7 House of Lords Economic Affairs Committee, Measuring Inflation, January 2019.

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This also makes the RPI index the one which is most directly relevant to teachers, although for other social or even occupational groups an alternative inflation index may be more relevant.

2.29 In November 2018, twelve month RPI inflation reached 3.2%.8 Inflation is

forecast to remain at its current level through 2019/20.9 However, the crucial issue when considering the impact of inflation on teachers’ pay is the cut in real terms pay since 2010.

Indexed price increases compared to teachers' pay increases 2010 to 2018 2.30 The chart below shows the extent to which the pay of teachers on the main

pay range (MPR) has fallen behind price increases, measured by both the Retail Prices Index (RPI) and Consumer Prices Index (CPI), since 2010. The chart illustrates pay increases in the best-case scenario where a teacher on the MPR has received the maximum pay award each year since 2010 (Max Main Pay Range) and the worst-case scenario, where a teacher on the MPR has received no cost of living award since 2014.

2.31 In both the best and worst-case scenarios, teachers’ pay has failed to keep

pace with price increases as measured by both RPI and CPI inflation

measures. Teachers in 2018 are significantly poorer in real terms than they

were in 2010.

2.32 The following chart illustrates the percentage increase in MPR pay in both pay scenarios since 2010, as set out above, together with the 12 month percentage change in inflation for both RPI and CPI in September of each year.

8 Office for National Statistics, UK Consumer Price Inflation November 2018, December 2018.

9 Bank of England Inflation Report, Section 5, page 31, August 2018.

100

105

110

115

120

125

130

2010 2011 2012 2013 2014 2015 2016 2017 2018

Indexed price increases compared to teachers' main pay range increases 2010 to 2018

RPI

CPI

Max Main PayRange

Pay increase(No cost ofliving awardfrom 2014)

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Teacher salary increases compared to inflation, 2010 to 2018

Cumulative shortfall in salary in 2018/19

2.33 The table below shows the extent to which teachers’ salaries have reduced in

real terms, as measured by RPI, since 2010. The values of teachers’ pay on the main pay range (MPR) are between £3,529 (14.9%) and £4,818 (13.8%) lower in 2018/19 than if teachers’ salaries had increased to keep pace with RPI inflation since 2010.

2.34 The NASUWT has only illustrated the impact of inflation on teachers’ pay for

the minima and maxima of the pay ranges. Given that it is impossible to quantify the extent to which teachers on points in the pay range above the minima have received any pay increase, the intermediate pay points have not been included.

2.35 The salaries of upper pay range (UPR) teachers are between £6,499 (17.7%)

and £6,989 (17.7%) lower in 2018/19 than if teachers’ salaries had increased to keep pace with RPI inflation since 2010. Leadership pay range (LPR) teachers’ salaries are between £8,280 (18.3%) and £21,651 (19.5%) lower by the same measure.

2.36 The impact of the public sector pay freeze, 1% pay cap and below-RPI

inflation pay increases have had a significant detrimental impact on the salary levels of teachers and their finances. The table above also shows the cumulative impact on the pay range values since 2010 as a result of below-inflation salary increases. Teachers who have remained in the profession since 2010 are in effect between £20,575 and £109,013 worse off in real terms since 2010 due to the cumulative shortfall in pay.

2010 2011 2012 2013 2014 2015 2016 2017 2018

RPI 4.6 5.6 2.6 3.2 2.3 0.8 2.0 3.9 3.3

CPI 3.1 5.2 2.2 2.7 1.2 -0.1 1.0 3.0 2.4

MPR Pay Increase (3.5%) in 2018 2.3 0.0 0.0 1.0 1.0 1.0 1.0 2.0 3.5

No cost of living award from2014

2.3 0.0 0.0 1.0 0.0 0.0 0.0 0.0 0.0

-1

0

1

2

3

4

5

6

RPI

CPI

MPR Pay Increase(3.5%) in 2018

No cost of living awardfrom 2014

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England

Salary 2017/18 (Uplifted by 3.5% on all MPR, 2% UPR, 1.5% LPR)

Shortfall in 2018/19 (£)

% shortfall in 2018/19

2010/11-2018/19 Cumulative shortfall (£)

Main Pay Range

Minimum £23,720 -£3,529 14.9 -£20,575

Maximum £35,008 -£4,818 13.8 -£28,758

Upper Pay Range

UPS1 £36,646 -£6,499 17.7 -£33,850

UPS3 £39,406 -£6,989 17.7 -£36,401

Leadership Pay Range

L6 £45,213 -£8,280 18.3 -£42,190

L8 £47,501 -£8,700 18.3 -£44,329

L11 £51,234 -£9,384 18.3 -£47,813

L28 £77,613 -£14,218 18.3 -£72,439

L43 £111,007 -£21,651 19.5 -£109,013

2.37 As this table indicates, teachers who have received a pay increase of 3.5% in

2018/19 have still seen their salaries fall in real terms by between 13.8 and 14.9% since 2010/11.

2.38 A significant above-RPI inflation increase in salary values over a sustained

period is necessary to restore teachers’ salaries to a level commensurate to their skills and experience.

2.39 Teachers’ take-home pay has also been significantly reduced due to paying

increased pension contributions since 2012. The table below details the amount of additional pension contributions that teachers have paid in 2018/19 and cumulatively from 2012/13 to 2018/19, over and above the original 6.4% contribution rate as a result of the increased pension contribution rates introduced in 2012.

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Additional Pension Contributions (over 6.4%) paid between 2012/13- 2018/19

2.40 The following table shows the combined cumulative loss to teachers’ pay as a

consequence of both the real terms shortfall in teachers’ salaries resulting from below-RPI salary increases since 2010, and increased pension contributions over 6.4% since 2012. Teachers who have remained in the profession since 2010 are between £21,655 and £131,051 worse off in real terms as a result of the combined impact of increases to teachers’ pension contributions and the Government’s teachers’ pay policy, which have resulted in substantial real terms pay cuts at all salary levels.

Total increase in pension contributions

Salary at 1 September 2018 (3.5% increase to MPR, 2% UPR, 1.5% LPR)

% Increase (over 6.4% rate)

Additional Pension Contributions (over 6.4%) paid in 2018/19

Additional Pension Contributions (over 6.4%) paid between 2012/13-2018/19

£pa £pa with tax relief

£ £ with tax relief

Main Pay Range

Minimum £23,720 1.0 237.20 189.76 1,350.02 1,080.01

Maximum £35,008 2.2 770.18 616.14 4,725.89 3,780.71

Upper Pay Range

UPS1 £36,646 3.2 1,172.67 938.14 6,907.25 5,525.80

UPS3 £39,406 3.2 1,260.99 1,008.79 7,427.54 5,942.04

Leadership Pay Range

L6 £45,213 3.8 1,718.09 1,374.48 10,135.58 6,763.50

L8 £47,501 3.8 1,805.04 1,083.02 11,148.37 6,689.02

L11 £51,234 3.8 1,946.89 1,168.14 12,461.00 7,476.60

L28 £77,613 5.3 4,113.49 2,468.09 23,148.34 13,889.00

L43 £111,007 5.3 5,883.37 3,530.02 36,730.54 22,038.33

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"Combined Cumulative Loss" between 2010/11 - 2018/19

2.41 Changes to National Insurance contributions for employees in previously

contracted-out pension schemes from April 2016 onwards cut the take-home pay of teachers even further. The following table illustrates the impact of the higher National Insurance contributions on the 2018/19 pay range values. These increased contributions have significantly diminished the benefit of the 2018/19 salary increase for many teachers.

Additional NI contribution on 2018/19 salary

England Salary 2017/18

Salary 2018/19 (Uplifted by 3.5% on all MPR, 2% UPR, 1.5% LPR)

Difference in Salary £

Additional NI contribution on 2018/19 salary

Difference £

Main Pay Range

Minimum £22,917 £23,720 £803 -£277 £526

Maximum £33,824 £35,008 £1,184 -£461 £723

Upper Pay Range

UPS1 £35,927 £36,646 £719 -£488 £231

UPS3 £38,633 £39,406 £773 -£533 £240

Leadership Pay Range

L6 £44,544 £45,213 £669 -£625 £44

L8 £46,799 £47,501 £702 -£632 £70

L11 £50,476 £51,234 £758 -£632 £126

L28 £76,466 £77,613 £1,147 -£632 £515

L43 £109,366 £111,007 £1,641 -£632 £1,009

England

Salary 2018/19 (Uplifted by 3.5% on all MPR, 2% UPR, 1.5% LPR)

Shortfall in salary in 2018/19 as a result of below- RPI pay increases

Additional Pension Contributions (over 6.4%) paid in 2018/19

"Combined Loss" in 2018/19

Total additional Pension Contributions (over 6.4%) paid between 2012/13-2018/19

Cumulative shortfall in salary between 2010/11 - 2018/19 as a result of below-RPI pay increases

"Combined Cumulative Loss" between 2010/11 - 2018/19

£pa with tax relief

£ £ with tax relief

£

Main Pay Range

Minimum

£23,720 -£3,529 -£190 -£3,719 -£1,080 -£20,575 -£21,655

Maximum

£35,008 -£4,818 -£616 -£5,434 -£3,781 -£28,758 -£32,539

Upper Pay Range

UPS1 £36,646 -£6,499 -£938 -£7,437 -£5,526 -£33,850 -£39,375

UPS3 £39,406 -£6,989 -£1,009 -£7,998 -£5,942 -£36,401 -£42,343

Leadership Pay Range

L6 £45,213 -£8,280 -£1,374 -£9,654 -£6,764 -£42,190 -£48,954

L8 £47,501 -£8,700 -£1,083 -£9,783 -£6,689 -£44,329 -£51,018

L11 £51,234 -£9,384 -£1,168 -£10,552 -£7,477 -£47,813 -£55,289

L28 £77,613 -£14,218 -£2,468 -£16,686 -£13,889 -£72,439 -£86,328

L43 £111,007 -£21,651 -£3,530 -£25,181 -£22,038 -£109,013 -£131,051

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2.42 It has to be stressed that these tables arguably portray a more ordered pay framework than is the case. Many teachers previously on M6 of the main pay range prior to 2013 have not received annual pay increases but have seen the maximum of the pay range move up beyond them, whilst their pay has been frozen.

2.43 In its submission of evidence to the Review Body for the 28th Report, the

NASUWT observed that the reduction in teachers’ real terms pay since 2010 was so extreme that a multi-year pay award would be necessary to restore teachers’ pay to its 2010 levels. Even then, restoration of teachers’ pay to 2010 levels would not be sufficient to ensure the competitiveness of teachers’ pay, and the Review Body would need to take additional steps to achieve this. The NASUWT will provide evidence of this in the section of this submission on comparable graduate pay.

Teacher hardship 2.44 Evidence indicates that teachers have continued to suffer from high levels of

hardship during the last 12 months. Teachers opting out of the Teachers’ Pension Scheme 2.45 Data provided by the DfE during 2018 indicates that teachers are continuing

to optout of the Teachers’ Pension Scheme (TPS) in record numbers, that this is focused on younger teachers and teachers early in their careers, and that financial hardship is the primary cause of teachers opting out.

2.46 The DfE’s published data on TPS opt-outs indicates that opt-outs from the

pension scheme are continuing to increase: 10

2.47 Moreover, it is teachers between ages 25 and 39, who are most likely to opt

out of the TPS, with the heaviest rate of opt-out being from those aged 25–29:

10

DfE, Teachers’ Pension Scheme Opt-Out and Opt-in Monitoring Report, July to September 2018, 2018.

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2.48 Age correlates closely with service in terms of teacher opt-outs. The DfE data

indicates that 43.5% of teachers opting out do not have a full year’s service, indicating that they are opting out at the beginning of their teaching careers.

2.49 The DfE’s opt-out form invites members to provide the reason for opting out

and the data for July to September 2018 confirms that 61% of teachers who opted out did so for personal financial reasons.

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2.50 However, 11% of teachers opted out because they had been auto-enrolled into the TPS and did not want to be in the scheme. It would be wrong to make the assumption that these are older teachers who have opted out because they believe that they have sufficient pensions – this category may well include teachers who opted out for reasons of hardship and have not selected the ‘personal financial reasons’ category.

2.51 In addition, the operation of the NASUWT’s Benevolent Fund during 2018

indicates the high levels of hardship which teachers face. 2.52 A total of 306 new applications were dealt with during 2018. This remains in

keeping with previous years and shows how demand for assistance from the Union’s Benevolent Fund remains consistently high. Many applicants continued to face escalating financial difficulties, mortgage and rent arrears and unmanageable loans and credit card debts due to a number of circumstances, reflecting the ongoing difficulties teachers are facing.

2.53 A total of £290,894 was paid out from the Central Benevolent Fund in the form

of grants to applicants. Of this total:

• £153,062 was for single-payment grants to applicants who were facing financial hardship for a whole variety of reasons;

• £47,800 was for convalescence grants to aid applicants during a time of physical or emotional illness;

• £20,075 was for holiday grants; • £13,330 was for monthly grants; • £16,150 was for education grants; and • £16,115 was for grants for rent and mortgage payments.

2.54 The Education Support Partnership has reported that it saw a 42% increase in

its hardship grant applications from teachers during 2017/18.11 Supply teachers 2.55 The NASUWT draws the Review Body’s attention to the fact that there are

provisions in paragraph 42 of the STPCD relating to supply teachers. The NASUWT, therefore, asserts that the Review Body is under an obligation to consider the pay of supply teachers. The Review Body will be aware that supply teachers are employed direct by maintained schools, local authorities and academies, or are employed by an agency.

2.56 The NASUWT has called, in previous submissions to the Review Body, for all

agency teachers to be brought within the scope of the Review Body and the STPCD. The NASUWT responded in detail to the Review Body’s consultation on the National Ireland Substitute Teacher Register (NIESR) research on the use of agency workers in the public sector in connection with its 27th Remit. This research, and the NASUWT’s comments, are still extremely relevant in respect of the Review Body’s 29th Remit.

2.57 There has been a substantial increase in agency teachers working in state

schools in recent years.

11

Education Support Partnership, Annual Review, 2017/18, 2018.

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2.58 This is consistent with the NIESR’s report of the Audit Commission’s finding that the proportion of supply teachers that were supplied through agencies rose from 43% to 54% between 2003 and 2010. Agency supply staff teaching expenditure for local authority maintained schools and academies in England has risen from 48.4% in 2011/12 to 69.7% of supply teacher expenditure in 2014/15.

2.59 The NIESR research identifies that an increase in the number of agency

teachers in recent years has been accompanied by a reduction in the number of supply teachers provided by local authority supply pools. This is also the NASUWT’s experience. Teachers in local authority supply pools should be employed in accordance with national terms and conditions, which is generally not the case for teachers employed by agencies. The increase in agency working has led to a reduction in the pay, conditions of service and pensions of supply teachers and the demise of the overwhelming majority of local authority supply provision. Teachers with protected characteristics as defined under the Equality Act 2010 are represented disproportionately within the supply teacher workforce.

2.60 Increasingly, supply teachers are being paid at the rate of cover supervisors,

yet are expected to teach to the standards expected of qualified teachers. The NIESR research correctly identifies that the failure of regulation in the system – both in respect of school-level HR practices and the practices of employment agencies – is leading to a downward spiral of conditions that are exploitative of supply teachers, which undermine the working conditions of the stock of teachers in schools and which lead to a waste of public money through unnecessary and costly procurement.

2.61 Overall, temporary agency working accounted for approximately 1.3% of all

public sector jobs in education in 2015. The NIESR research identifies that two common features of agency working are that agency staff are often highly experienced, frequently with many years’ experience of working within public sector industries, and also that agency workers are more likely to be born outside the UK.

2.62 The Review Body must recognise this pattern of teacher employment as a key

equalities issue and place a clear expectation on the Government to discharge its public sector equality duty to supply and agency teachers. It is vital that the provisions in the STPCD provide a clear expectation regarding the pay of supply teachers which should provide an unequivocal reference point for all employers.

The pay of supply teachers 2.63 The NIESR research has identified that agency workers are often described

as ‘vulnerable workers’, caught between the agency and the user client. In research carried out in 2016 by the NASUWT, 65% of supply teachers stated that they are not being paid commensurate with their level of experience. This has increased by 8% since 2014 and by 24% since 2012.12 The majority of supply teachers, despite their qualified teacher status, report being paid at rates equivalent to unqualified teachers.

12

https://www.nasuwt.org.uk/asset/BC1B72F0-486E-4E86-A9C85D5F30CE173E/

18

22%

15% 17%

8% 12%

61%

68% 68% 63%

67%

19% 16% 16%

22% 20%

1% 1% 1% 1% 1%

0%

10%

20%

30%

40%

50%

60%

70%

80%

2014 2015 2016 2017 2018

Rates of pay

£51 - £99 £100 - £149 £150 - £199 £200 +

2.64 Almost a fifth (18%) of supply teachers reported that they have had to claim Jobseeker’s Allowance since becoming a supply teacher and over one in ten (14%) reported that they have had to claim other state benefits.13

2.65 This is supported by the NIESR research, which highlights the profoundly

exploitative conditions under which agency supply teachers are employed. One aspect of this is the trend to employ teachers as cover supervisors, on rates of around £70 to £75 per day, compared to around £120 for secondary school placements and £130 for primary school placements.14

2.66 The NASUWT annual survey of supply teachers, carried out in May and June

2018, found that almost four fifths (78%) of supply teachers are paid between £51 and £149 per day. Of this, 42% reported earning no more than £119 per day. For a teacher paid on £119 per day, the full-time equivalent (FTE) salary is £23,205.15

2.67 The chart below shows that the majority of supply teachers have only been

able to access between £100 and £149 per day (67%) per assignment.

2.68 Many supply teachers reported that the agencies operate a ceiling in respect

of remuneration. Almost four fifths (79%) reported that this was between £75 and £149 a day.

13

https://www.nasuwt.org.uk/asset/BC1B72F0-486E-4E86-A9C85D5F30CE173E/ 14

NIESR, Use of agency workers in the public sector, 2017, page 54, figure 2.2.2. 15 https://www.nasuwt.org.uk/uploads/assets/uploaded/450a93c7-e3e7-4a1d-ac9708dfd948034d.pdf

1% 2%

10%

28%

38%

20%

1% Rates of pay

Up to £50

£51 - £74

£75 - £99

19

3. TRENDS IN TEACHER SUPPLY

3.1 The Secretary of State’s remit letter asks that, in considering its recommendations, the Review Body should have regard to:

‘evidence of the national state of teacher and school leader supply, including rates of recruitment and retention, vacancy rates and the quality of candidates entering the profession’.

3.2 The evidence below sets out the NASUWT’s serious concerns about current and future rates of recruitment and retention into the teaching profession.

3.3 The Review Body will be aware that successive submissions by the NASUWT since 2011 have highlighted growing problems in relation to teacher recruitment and retention, as well as the factors that underpin these problems. In its evidence, the NASUWT has emphasised the high numbers of teachers trying to leave teaching altogether, the decline in the number of graduates seeking to train to become teachers and the substantial numbers of Initial Teacher Training (ITT) places that are unfilled. The Union’s evidence confirms that the current state of teacher supply remains a matter of significant concern.

3.4 The increasingly parlous teacher supply situation was acknowledged by the House of Commons Public Accounts Committee in the findings of its inquiry into these matters, published in January 2018.16 In particular, the Committee made clear its view that the DfE had ‘failed to get a grip on teacher retention’. However, notwithstanding the clear scale and extent of these issues, the DfE continues to deny that teacher supply is in crisis, a finding at variance with the outcomes of the Committee’s analysis.

3.5 The basis for the NASUWT's concerns in respect of teacher supply is set out below.

Recruitment into the teaching profession 3.6 The most recent data from the Universities and Colleges Admissions Service

(UCAS) End of Cycle Analysis Report confirms that approximately 46,205 people applied for an initial teacher training place through the UCAS Teacher Training (UTT) application scheme in 2017.17

3.7 This figure represents a 14% decline in the number of UTT applicants since 2014. Between 2010, when 67,289 applicants entered the formal initial teacher training (ITT) recruitment process, and 2017, the number of applicants has fallen by 31%. The Review Body will note that this period coincides with the imposition of significant pay freezes and restraints on the teaching profession.

16

House of Commons Committee of Public Accounts (2018). Retaining and developing the teaching workforce: Seventeenth Report of Session 2017-19 (HC460). Available at (https://publications.parliament.uk/pa/cm201719/cmselect/cmpubacc/460/460.pdf), accessed on 30.12.18. 17

Universities and Colleges Admissions Service (UCAS) (2018a). UCAS Teacher Training End of Cycle 2017 Data Resources: UTT1_001_02: Applicants by domicile. Available at: (https://www.ucas.com/file/162286/download?token=Y4x2lyjO), accessed on 02.01.19. The equivalent figure for 2016 was 46,000 applicants.

20

3.8 Interim data from UCAS for the 2018/19 UTT application round indicates that mid-phase applications for ITT remain at historically low levels. By 19 November 2018, 7,440 applicants had entered the UCAS UTT process, a broadly comparable level of entries to that recorded at the equivalent stage of the 2017/18 cycle.18 However, as noted in the NASUWT’s evidence to the Review Body in respect of its 28th remit, recorded levels of entry at this stage of the cycle prior to 2017/18 were significantly higher, emphasising the recent severe deterioration in the teacher recruitment environment.

3.9 It remains important to recognise that the significant fall in the number of applicants for courses of ITT since 2010 contrasts starkly with experience during previous periods of economic contraction or constrained growth, which were strongly correlated with increases in applications for such courses.

3.10 This decline in applications suggests that, despite the DfE's considerable investment in financial incentive schemes focused on attracting graduates into teaching, the policy agenda of the former Coalition Government and the current Conservative administration has had a powerful disincentive effect on graduate recruitment.

3.11 DfE provisional data on the number of new entrants who have started, or expect to start, an ITT programme in England confirms that the number of new entrants into training programmes only reached 91% of the central target set for 2017/18, a decline from the 94% of target figure achieved in 2016/17.19 Official data show that overall teacher recruitment was above target in each year from 2006/07 to 2011/12 but has been below target in each subsequent year.20 In this context, it is essential to recognise legitimate concerns that the targets based on the DfE's Teacher Supply Model may significantly underestimate the number of teachers required to sustain adequate levels of workforce supply.21

3.12 Many ITT courses remain significantly undersubscribed. Overall recruitment

into secondary programmes only met 83% of the total number of applicants identified as necessary by the DfE, down from 115% in 2010/11.22

3.13 The SFR data further confirms that the majority of subjects did not recruit

sufficient trainee teachers to meet the targets set by the DfE (Figure 1).

18

UCAS (2018b). Report A: UCAS Teacher Training applicants at Monday 19 November 2018. Available at: (https://www.ucas.com/file/196346/download?token=fMsMlZy9), accessed on 02.01.19. The number of applicants recorded at the equivalent stage of the 2017/18 cycle was 7,310, a decline of 43% in the number of applicants (12,840) recorded in November 2016. 19

Department for Education (DfE) (2018a). Initial Teacher Training (ITT) Census for the academic year 2018 to 2019, England. Available at (https://www.gov.uk/government/statistics/initial-teacher-training-trainee-number-census-2018-to-2019), accessed on 30.12.18. 20

Foster, D. (2018). Teacher recruitment and retention in England. House of Commons Library Briefing Paper No. 7222. Available at (http://researchbriefings.files.parliament.uk/documents/CBP-7222/CBP-7222.pdf), accessed on 02.01.19. 21

National Audit Office (2016). Training new teachers. Available at: (https://www.nao.org.uk/wp-content/uploads/2016/02/Training-new-teachers.pdf), accessed on 29.12.18. 22

DfE (2018a). op. cit.

21

Figure 1: New entrants to postgraduate initial teacher training by subject, as a proportion of Teacher Supply Model targets, academic year 2018 to 2019

Source: DfE: Initial Teacher Training Census 2018/19

3.14 The Government has placed great emphasis on the Teach First programme

but this route recruited only approximately 1,155 in 2018/19 of the 30,000 trainee teachers the DfE has set as the number to be recruited each year. Notwithstanding its relatively small size, the Review Body will note that entrants onto Teach First programmes have fallen from the peak of 1,500 reached in 2015/16.23

3.15 It should be noted that the education system in England has a longstanding reliance on the skills, talents and expertise of teachers with professional teaching qualifications gained from outside the UK to work in roles requiring Qualified Teacher Status (QTS) in schools. It is, therefore, a matter of significant concern that the official data indicate that the numbers of such individuals entering teaching in England have begun to decline significantly. In 2017/18, 3,525 teachers from European Economic Area countries obtained QTS, a decline of 26% on the corresponding figure in 2015/16. For teachers with qualifications gained in Canada, the United States, Australia and New Zealand, all of whom have an automatic entitlement to QTS in England, the annual level of QTS awards declined by 27% over the same period.24 If sustained, these declines are likely to exacerbate the teacher recruitment pressures described above.

3.16 The NASUWT is in no doubt that the depression in the value of teachers’ pay,

together with Brexit uncertainty and an increasingly hostile climate for migrants in the UK, have contributed significantly to these trends.

3.17 The Review Body will also be aware of the ongoing work of the Migration

Advisory Committee (MAC) in advising the Home Office on its shortage

23

Ibid. 24

Ibid.

22

occupation list.25 The NASUWT remains concerned that MAC’s assessment of the current teacher supply situation fails to reflect the profound recruitment and retention problems across the teaching workforce noted in this submission.

3.18 Current arrangements based on MAC’s assessment of the teacher labour

market mean that overseas trained teachers from outside the EEA, or the four countries referenced above, are subject to a £30,000 earnings requirement before they are likely to be eligible for a Tier 2 (General) work visa. Given the suppression of teachers’ pay described in this submission, many teaching posts do not attract this level of salary. The Review Body should note, therefore, that it is now increasingly difficult for teacher supply shortages to be addressed through the recruitment of overseas trained teachers.

3.19 In light of this evidence, it is clear that problems with recruitment into teaching

are intensifying and creating significant barriers to ensuring adequacy of teacher supply, underlining the status of the current teacher supply position as a ‘crisis’ rather than merely, as the Government continues to insist, a ‘challenge'.

The quality of trainees by degree classification

3.20 The NASUWT acknowledges that the Review Body is remitted to consider the ‘quality of candidates entering the teaching profession’. The Union notes that the DfE’s preferred indicator in this respect is the proportion of trainees with a first degree classification of 2:1 or higher.26 The DfE has continued to seek to draw attention to the fact that the proportion of entrants into ITT meeting this criterion increased from 66% in 2011/12 to 73% in 2018/19, representing evidence that its policies are securing a better-qualified teacher workforce.

3.21 However, it should be recognised that the proportion of trainees entering teaching with a 2:1 or above has been increasing over the past two decades. The increases recorded since 2010 represent a continuation of the trend rather than an outcome demonstrably attributable to policy since that date. It is also important to note that this increase reflects changes in the proportion of degrees classified as 2:1 or higher across the broader graduate population over this period.27 The proportion of graduates overall with a degree classification at 2:1 or higher increased from 70% in 2013/14 to 76% in 2017/18.28

25

Migration Advisory Committee (2018). Shortage occupation list 2018: Call for evidence. Available at: (https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/769700/sol-call-for-evidence-extended-deadline.pdf), accessed on 18.01.19. 26

DfE (2018b). ‘New teachers ready to deliver in the classroom’. Gov.uk (5 September). Available at (https://www.gov.uk/government/news/new-teachers-ready-to-deliver-in-the-classroom), accessed on 02.01.19. 27

Richmond, T. (2018). A degree of uncertainty: An investigation into grade inflation in universities. Available at: (https://reform.uk/research/degree-uncertainty-investigation-grade-inflation-universities), accessed on 02.01.19. 28

Higher Education Statistics Agency (2018). Higher Education Student Statistics: UK, 2017/18 - Qualifications achieved. Available at (https://www.hesa.ac.uk/news/17-01-2019/sb252-higher-education-student-statistics/qualifications), accessed on 18.01.19.

23

Teacher wastage

3.22 Levels of wastage from the teaching profession, other than for reasons of retirement or death-in-service, have risen significantly. The School Workforce Census (SWC) confirms that between 2011 and 2017, the number of teachers leaving teaching for reasons other than retirement or death-in-service rose from 24,750 to 35,800, the highest recorded annual wastage rate.29

3.23 This unprecedented increase in teachers exiting the profession draws attention to concerns highlighted by the outcomes of the NASUWT’s annual Big Question Survey (2018) of teacher opinion, which found that:

56% of teachers felt that their job satisfaction had declined over the past 12 months;

59% of teachers indicated that they did not think that they were empowered professionally to deliver the best outcomes for their pupils;

42% had not received the pay progression to which they were entitled over the past 12 months;

46% were not paid for the full range of responsibilities they undertake;

71% would not recommend teaching as a career; and

65% had considered quitting the profession altogether in the last 12 months.

3.24 Comparable figures were reported in a recent independent ComRes poll

which found that:

almost six in 10 teachers (59%) state that they had seriously considered leaving their current job in the last 12 months;

over half (52%) had seriously considered leaving the teaching profession over the past year; and

well over half (56%) disagreed with the statement ‘I would recommend a career as a teacher to a friend.’

3.25 It has always been the case that a proportion of those individuals entering

teaching decide to move to another occupational sector, either during their training or relatively shortly after its completion. However, official data confirm that retention rates among those who have recently acquired QTS have deteriorated significantly. Between 2009 and 2014, the proportion of Newly Qualified Teachers (NQTs) still in service after two years of qualification fell from 80% to 73%.30

3.26 Recruitment into Teach First, often regarded as the ‘gold standard’ of ITT programmes, highlights the extent of these issues. For secondary Teach First participants, the ‘Year 1’ retention rate (i.e. the proportion of trainees employed as teachers one year after gaining QTS) is relatively high, estimated to be in the range of 80-87% of all trainees. However, this rate is related in large part to the fact that successful completion of the Teach First programme requires participants to remain in post for one year after gaining

29

DfE (2018c). School Workforce in England: November 2017. Available at: (https://www.gov.uk/government/statistics/school-workforce-in-england-november-2017), accessed on 02.01.19. 30

Ibid.

24

QTS. By Year 5, the retention rate was much lower at between 37-44% of participants.

3.27 The NASUWT held its annual Young Teachers’ Consultation Conference in

January 2019. 87% of attendees had been in teaching for less than five years and pay was the highest most single identified reason why attendees were considering leaving the profession, with 17% of young teachers selecting this option.

3.28 It is worthy of comment that only 19% of young teachers attending had no

plans to leave teaching. In other words, 21% of young teachers who wanted to leave the profession wanted to do this because of dissatisfaction with their pay.

Retirements

3.29 The current demographic composition of the teacher and school leader workforce highlights the implications of retirements for the future adequacy of teacher supply.

3.30 Between 1993 and 2017, the number of retirements per year by teachers of pension age increased from 3,310 to 9,950, despite the increased restrictions placed on the ability of teachers to access retirements imposed over this period.31

3.31 It is, therefore, important to note that the School Workforce Census (SWC) confirms that approximately 17% of the total teacher population is aged 50 or over and that, as a result, age retirements are likely to continue to exert pressure on maintaining the sufficiency of the pool of active teachers.

3.32 In addition to retirements, evidence suggests that a significant proportion of teachers will continue to seek early exit from the profession, including through the use of actuarially-reduced pensions. Of the 14,010 teachers in the state-funded school sector accessing Teachers' Pension Scheme benefits for the first time in 2016/17, 5,740 (41%) took actuarially reduced benefits as a result of retirement before reaching eligibility for full pension benefits.32

3.33 It is also important to note the significant financial costs to which teachers

electing to take actuarially reduced benefits are subject. The scale of the economic consequences experienced by teachers accessing pension entitlements on this basis serves to illustrate the extent of the teacher retention crisis, given that approaching half of all teachers in 2016/17 regarded taking an actuarially reduced pension as preferable to remaining in the profession.

3.34 The Review Body will note that the age profile of the teaching workforce continues to be subject to significant change. International evidence confirms that England has experienced the largest decline in the proportion of teachers aged over 50 of any Organisation for International Co-operation and

31

Ibid. 32

Ibid.

25

Development (OECD) jurisdiction over the period 2005 to 2014 and has one of the youngest teaching workforces among OECD member jurisdictions.33

3.35 The NASUWT is clear that the highly unusual demographic composition of the

teaching workforce in England is directly related to widespread age discrimination across the school system. The Union continues to encounter many older teachers who are forced out of the profession because of their age and perceptions about their relatively high wage costs by employers.

3.36 In the NASUWT’s experience, older teachers are at disproportionate risk of

capability and disciplinary procedures, report being denied access to professional development, and are often put under intense pressure to leave their jobs.

3.37 It is for this reason that the NASUWT continues to call on the Government to

take more effective action to tackle an increasingly prevalent culture in schools that fails to value older teachers for their experience and expertise.

3.38 However, it is critical to acknowledge that declines in the proportion of

teachers aged 50 or over will not ameliorate the ongoing teacher recruitment and retention crisis and that claims to the contrary do not withstand meaningful scrutiny.

3.39 As noted above, the increasing tendency of teachers to leave the profession well before retirement age, combined with continued failures to recruit sufficient trainee teachers, will continue to more than offset any teacher supply implications of changes to the demographic composition of the teaching workforce. The teacher supply implications of these trends became evident in 2017 when, calculated on a full-time equivalent (FTE) basis, more teachers left the profession than joined.34

Vacancy rates

3.40 The issues described above in relation to teacher recruitment and retention are reflected in current vacancy rate data, although it is important to note that in its present form this data may not capture the full extent of issues across the education system in respect of teacher supply.

3.41 The Review Body will be aware that the basis upon which annual vacancy rate data is calculated was changed by the DfE in 2010 so that it is now collected in November, rather than January as was previously the case. The current data, therefore, excludes the significant number of vacancies that arise at the end of the calendar year and are, therefore, likely to understate the extent to which teaching posts are not filled permanently. The Review Body will note the specific concerns raised by the National Audit Office (NAO) in relation to the potential for official vacancy figures to underestimate the current extent of unfilled posts across the system.35

33

Organisation for Economic Co-operation and Development (OECD) (2018). Education at a Glance 2018. Country Note: United Kingdom. OECD: Paris. 34

Foster, D. (2018). op.cit. 35

National Audit Office (NAO) (2017). Retaining and Developing the Teaching Workforce. Available at: (https://www.nao.org.uk/wp-content/uploads/2017/09/Retaining-and-developing-the-teaching-workforce.pdf), accessed on 30.12.18.

26

3.42 Nevertheless, teacher vacancy data provides clear evidence that teacher supply issues are becoming more acute. Official DfE data confirms that the overall wastage rate for secondary schools increased from 1.2% to 1.4% between 2015 and 2017 compared with a recorded equivalent rate of 0.3% in 2011.36 It should be noted that the current rate is approaching the 1.4% teacher vacancy rate calculated on the pre-2010 basis, reached in 2000, acknowledged at the time by the Review Body as indicative of substantial teacher supply problems.

3.43 Further evidence of increasing barriers to filling vacancies is confirmed by the rise in the number of FTE unqualified teachers working in teaching roles in schools from 16,620 to 24,400 between 2013/14 and 2016/17.37

3.44 It is also clear that the issues of teacher supply are driving schools to deploy

teachers to teach in subject areas which are not their first specialism or for which they do not possess appropriate academic qualifications. The SWC confirms that only 78% of mathematics lessons in year groups 7-13 in 2017 were taught by teachers with a relevant post-A-level qualification in the subject, a decrease from the 84% of lessons taught by such teachers in 2013. The SWC further confirms that only 62% of physics lessons across these year groups were taught by staff with relevant post-A-level qualifications.38

3.45 Pupil/teacher ratios have also been affected by the recruitment and retention

crisis. Across all state-funded schools, the pupil/teacher ratio rose from 17.2% in 2011 to 17.9% in 2017.39

Figure 2: Pupil/teacher ratios 2011 to 2017

36

DfE (2018d). Analysis of teacher supply, retention and mobility. Available at: (https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/615729/SFR33_2017_Text.pdf), accessed on 29.12.18. 37

DfE (2018c). op.cit. 38

Ibid. 39

Ibid.

27

The teacher supply crisis: implications

3.46 It is clear that the problems in respect of teacher recruitment and retention highlighted above will have a significant adverse impact on the provision of education in schools. Pupil numbers are increasing significantly across the system. DfE data confirms that the state-funded school sector will continue to experience significant and sustained increases in pupil numbers over the next decade. In the secondary sector, the overall population is projected to reach 3,267,000 in 2027, 14.7% higher than the current secondary cohort.40

3.47 This combination of increasing pupil numbers and constraints on teacher

recruitment and retention will result in significant shortages in teachers and school leaders unless the situation is considered seriously by the Government and it implements policies to increase recruitment and retention into the profession. For example, based on the current DfE Teacher Supply Model, cumulative shortfalls in recruitment between 2013/14 and 2018/19 have resulted in a shortage of over 12,000 teachers across this period.41 This recruitment deficit is likely to result in unacceptable increases in pupil-teacher ratios, an increasing reliance on unqualified staff to lead teaching and learning, and teachers being required to teach subjects for which they do not have a relevant post-A-level qualification.

3.48 The NASUWT notes debates about the future of school leader supply. Policy

assessments of this issue have failed to take account of the implications for leader recruitment and retention of the broader teacher supply issues. School leaders are drawn from the wider teacher workforce, and a teacher supply problem will inevitably impact on leadership recruitment.

3.49 It is reasonable to conclude that the impact on recruitment and retention of the current teacher supply crisis will, in time, result in problems in securing a sufficient number of suitably qualified and experienced teachers to fill middle and senior leadership roles. The NASUWT believes it is essential to address teacher recruitment and retention issues to support school leader supply strategies.

Policy influences on teacher supply and further action

3.50 As emphasised elsewhere in this evidence, the depression of teachers’ pay

has resulted in significant implications for teacher supply and is a clear driver of the recruitment and retention crisis.

3.51 However, in addition to pay, workload remains a significant contributor to retention pressures. The DfE, through its Workload Challenge and subsequent actions based on its findings, has recognised that teachers have been negatively affected by excessive workload.

3.52 The extent of these workload pressures is confirmed in the results of the most recent DfE Teacher Workload Diary Survey. The Survey confirms that

40

DfE (2018e). National pupil projections – future trends in pupil numbers: July 2018. Available at: (https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/719772/SWFC_MainText.pdf), accessed on 02.01.19. 41

DfE (2017a). op. cit.

28

teachers’ average working time remains at unsustainable levels, averaging over 54 hours per week.42

3.53 These pressures are compounding the recruitment and retention crisis. The

NASUWT has highlighted the implications of excessive teacher workload since 2011 through its annual Big Question Survey. The thousands of teachers responding to the survey have reported consistently workload as their principal concern. The Teacher Workload Diary Survey found that 80% of teachers were dissatisfied with their overall workload, while the NASUWT’s most recent survey evidence confirms that workload remains a key reason why teachers contemplate leaving the profession. Recent DfE research emphasises the importance of excessive workload in individuals’ decisions to exit teaching.43

3.54 It is, therefore, deeply regrettable that Government policy has continued to

increase burdens on teachers. These policies have related to, for example, the implementation of curriculum, qualifications and special educational needs and disability (SEND) reform, as well as a failure to take effective steps to ensure that all teachers are protected from drivers of excessive workload imposed at school level.

3.55 Increasing feedback from NASUWT teacher and headteacher members suggests strongly that the quality of employment practice is having a considerable impact on teacher retention.

3.56 Relevant factors in this respect include:

a lack of regard given by employers to teachers’ job satisfaction;

a disregard by employers for good personnel practice;

a disregard for, and the active flouting of, statutory and contractual provisions;

a significant sense of professional disempowerment across the workforce;

a lack of knowledge, skills and commitment among too many employers with regard to the management of good industrial relations; and

a lack of fairness and concern in relation to key aspects of teachers’ working lives, including their pay and career progression.

3.57 The debilitating employment environment experienced by many teachers is

also significant in this regard. If unaddressed, it is likely to have a sustained negative impact on the attractiveness of teaching, particularly for members of the workforce at the early stages of their careers. Independent research makes clear that factors including the degree to which teachers are respected as professionals, can exercise an appropriate degree of professional autonomy, and the extent to which they are supported and valued by

42

DfE. (2017a). Teachers Workload Diary Survey 2016. Available at (https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/592499/TWS_2016_FINAL_Research_report_Feb_2017.pdf), accessed on 02.01.19. 43

DfE (2017b). Analysis of school and teacher level factors relating to teacher supply. Available at: (https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/682023/SFR86_2017_Main_Text.pdf), accessed on 02.01.19.

29

managers and employers are strongly associated with individuals’ decisions to leave teaching.44

3.58 Research into graduate career aspirations continues to confirm that younger graduates are more likely to enter and remain in professional occupations that offer flexible employment practices, permit inclusive and collaborative-decision making and eschew crude ‘command and control’ management structures. In too many instances, schools do not provide working environments of this type.45

3.59 Many teachers are further demoralised by the way in which schools often

place pressures on teachers that undermine the wellbeing of pupils. 3.60 In this context, it is important to note that the demographic composition of

those entering teaching is changing significantly. In particular, more new entrants to teacher training are aged over 25, up from 39% of recruits in 2014/15 to 50% in 2018/19.46 It is likely that these entrants have gained experience of work in other contexts and are more able, therefore, to compare poor employment practices in schools with the better practice they may have experienced previously working in other sectors. These teachers may be less inclined to tolerate such practices and elect to leave the profession.

3.61 The considerations set out above, and the inadequate response of the Government to them to date, emphasise the urgent need for more concerted and far-reaching action by the DfE to address the fundamental drivers of the current retention crisis.

44

Worth, J.; Lynch, S.; Hillary, J.; Rennie, C.; and Andrade, J. (2018). Teacher Workforce Dynamics in England. Available at: (https://nfer.ac.uk/media/3111/teacher_workforce_dynamics_in_england_final_report.pdf), accessed on 30.12.19. 45

Bright Network. (2015). What do the brightest graduates want? A look at what the brightest graduates look for in their career and future employers. Available at: (https://www.brightnetwork.co.uk/sites/default/files/Bright%20Network%20-%20What%20do%20the%20brightest%20graduates%20want.pdf), accessed on 05.01.18. 46

DfE (2018a). op.cit.

30

4. THE WIDER STATE OF THE LABOUR MARKET

Graduate Labour Market 4.1 Salary levels across the graduate labour market serve to demonstrate the

uncompetitive nature of teachers’ pay. This point is emphasised by the most recent Report from High Fliers Research, The Graduate Market in 2019.

4.2 The Report indicates that competition in the market for graduates continues to

be high and schools will continue to have difficulties in recruiting and retaining teachers.

4.3 The researchers also found that the highest graduate starting salary has hit

£60,000 for the first time. 4.4 In contrast, as can be seen from the table below, teachers’ starting salaries in

England of £23,720 are set within the range of the lowest paying 13% of UK employers:

4.5 The median starting salary for graduates is £30,000, which is 26% higher than

the 2018/19 starting salary for a teacher. 4.6 The demand for graduates is high and is increasing. The research found that

employers’ vacancies for graduates are up by 9.1%, the highest increase since 2011. This followed a 4.3% increase for graduates in 2018.47

4.7 The Managing Director of High Fliers Research commented that: ‘Our latest

research shows that despite all the continuing uncertainty over Brexit, the UK's top employers are planning to recruit a record number of new graduates in 2019. The number of graduate roles is rising again after it fell for the first time in five years over uncertainty around Brexit, he said. In 2019, a sixth of the top 100 schemes will pay more than £40,000, according to the research.’48

47

High Fliers Research, The Graduate Market in 2019, 2019, Chart 2.1 48

Daily Telegraph, https://www.telegraph.co.uk/education/2019/01/21/highest-graduate-starting-salary-hits-60000-firsttime/?WT.mc_id=tmg_share_tw, accessed 24 January 2019.

31

4.8 With increasing pay uncertainty for teachers, no guarantee of an annual pay award and measures by the Government and some employers actively to depress pay, teaching is unable to compete with other graduate employers unless and until the school statutory pay framework is improved and strengthened.

4.9 Teacher supply will not improve until the situation where the only pay level

teachers can aspire to is their current salary. British Chambers of Commerce Survey 4.10 Results from the British Chambers of Commerce (BCC) survey of 6,000 firms,

employing over one million people across the UK, show that recruitment difficulties across the economy have reached near record highs.49

4.11 The findings, which were released on 3 January 2019, highlight the extent to

which labour shortages have risen in the UK as four-fifths (81%) of manufacturers that tried to recruit report difficulties in finding the staff they need – this is the joint highest percentage since the survey began in 1989.

4.12 The survey results further demonstrate that the recruitment landscape in the

wider economy is becoming increasingly competitive. The International Labour Market 4.13 The OECD publishes regulator benchmarking data across the OECD nations

about teachers’ salaries. The latest set of indicators50 shows the following:

4.14 Figure D3.2 indicates the level of lower secondary teachers’ salaries at

various points in their careers. Teachers in England are 30th out of a list of 40 jurisdictions in terms of their starting salaries. It also has to be noted that,

49 https://www.britishchambers.org.uk/news/2019/01/bcc-quarterly-economic-survey-big-squeeze-on-firms-from-recruitment-prices-and-cash-flow, accessed 3 January 2019. 50

OECD, Education at a Glance 2018, OECD indicators, 2018

32

following the 2013 reforms to the teachers’ pay framework, the starting salary is the highest salary to which a teacher can ever aspire.

4.15 In contrast, headteachers’ salaries in England are highly competitive. Figure

D3.4 shows that headteachers’ salaries in England place them second out of the 40 OECD jurisdictions.

33

5. AFFORDABILITY

‘I can report to the British people…that their hard work is paying off…and the era of austerity [is] finally coming to an end.’ Phillip Hammond, Chancellor of the Exchequer, 2018 Budget Speech.

5.1 The Secretary of State for Education’s remit letter to the Chair of the Review

Body uses the term ‘affordable’ or ‘affordability’ on five occasions. It is generally the case that the Review Body is asked to consider affordability, but the Secretary of State has gone further than has previously been the case in constraining the Review Body over this issue, short of expressly imposing a pay cap.

5.2 It is fundamentally disingenuous of the Government to claim that austerity in

public sector pay has come to an end, as the Chancellor of the Exchequer claimed in the 2018 (Autumn) Budget and for the Secretary of State for Education then to impose an affordability constraint in the matter for recommendation to the pay review body for a key section of the public sector workforce. This is not the first time since 2010 that the Government has singled out teachers for particularly harsh treatment.

5.3 The NASUWT believes that a key fundamental principle of public sector pay

review bodies is that they are independent of the Government, and indeed the success of the Review Body for the teaching profession and the school system as a whole has been predicated on its independence. The NASUWT believes that the Review Body must be allowed to draw its conclusions about teachers’ terms and conditions and make its recommendations following unconstrained consideration of the available evidence.

5.4 Moreover, it is fundamentally unfair of the Government to ask the Review

Body to constrain its recommendation within an affordability envelope when the 2019/20 pay award will cover part of the next Spending Review period and the Departmental Expenditure Limit (DEL) for Education for the 2020/21 financial year has not yet been determined. It is stating the obvious to make the observation that the Review Body does not determine education spending.

5.5 In fact, the Government’s 2019 Spending Review consultation has not even

begun and it is fundamentally unfair to expect consultees to provide evidence to the Review Body to demonstrate the ‘affordability’ of teachers’ pay during the 2019/20 teachers’ pay year.

5.6 The level of public spending on education during the next Spending Review

period will be a matter of political choice, as has been the case since 2010 and, indeed, before then. In this respect, it is vital to the future of society that the Government’s political choices about school funding address two key factors:

the overall quantum of school funding must be sufficient to meet the school system’s needs, including investment in the teaching workforce;

the nature of the school system must ensure that funding is targeted where it is genuinely needed as efficiently as is possible, and that funding is not siphoned away from where it is genuinely needed because of profiteering, individual or corporate greed.

34

5.7 The NASUWT asks the Review Body to make it clear that it expects to see a substantial increase in education funding to meet the needs of teachers, children and young people and wider society. The NASUWT would hope that the Review Body will act as an advocate for this, but the Union accepts that, at the end of the day, education funding is not under the control of the Review Body.

5.8 Moreover, there are key areas of expenditure on remuneration for staff within

the academy sector in particular, which impact on the issue of affordability and over which the Review Body has no current control. This is especially the case for the salaries of high earners, which have soared in recent years. As the academy sector has grown since 2010, the amount of public funding spent on academy trust high earners, and related party transactions to parties related to high earners, has soared. It surely cannot be long until we see the spectacle of the first academy trust CEO earning an annual salary of £1 million plus.

5.9 If the Review Body is to be given a remit which is predicated on affordability,

and as expenditure on the academy sector grows to match expenditure on the local authority maintained sector, the NASUWT believes that the Review Body cannot ignore the unregulated nature of that sector. The NASUWT believes that the Review Body should issue a clear recommendation that the salaries of all staff in state-funded schools, including CEOs and other trustees of academies and free schools, must fall within the remit of the Review Body and be included in the School Teachers’ Pay and Conditions Document (STPCD).

5.10 The NASUWT believes that the evidence points to several factors to which the

Review Body should have regard when considering the issue of affordability of a substantial pay increase for teachers:

Teachers’ salaries account for less than half of education spending and a substantial increase in teachers’ salaries is affordable. 5.11 Government policy on school funding for 2019/20 and 2020/21 has been

marked by a delay in moving to a hard schools National Funding Formula (NFF), which is where all schools would receive their funding allocation directly from Whitehall. This delay has been accompanied by an increase in funding which schools will receive from their local authorities. Local authorities will continue to determine the local school funding formula through 2020/21, allocating the NFF block funding which they receive from Whitehall to do so (the soft NFF).

5.12 In July 2018, the Government published funding allocations for 2019/20,

which confirmed that the minimum per pupil funding levels which local authorities will receive to allocate to their schools in 2019/20 will increase to £4,800 per secondary pupil and £3,500 per primary pupil. Irrespective of the local funding formula, all schools will attract a 1% gain per pupil against their 2017/18 baseline funding and underfunded schools can receive an additional 3% on top of the 3% they gained in 2018/19.51

51

DfE, The National Funding Formulae for schools and high needs, 2019 to 2020, July 2018, page 5.

35

5.13 In addition, the DfE has changed the methodology for growth funding for 2019/20, so that local authorities will receive funding for in-year pupil growth which they actually experience.

5.14 The funding allocations to local authorities, including growth allocations, were

published in December 2018.52 In addition, the Secretary of State announced the provision of an additional £125 million for local authorities in 2019/20, to reduce the need to move funding from the schools block to the high needs block.53

5.15 The combination of these changes is that schools should receive funding for

increased pupil numbers more quickly and the funding allocated should better reflect actual need on a school-by-school basis, although this will continue to depend on how effectively local authorities manage the growth funding which they receive.

5.16 An important detail for the Review Body is that just 46.3% of local authority

maintained school expenditure is on teachers. This figure includes expenditure on supply teachers who are directly employed by schools and local authorities.54

5.17 The most recently published data from the DfE indicates that spending on

teachers’ salaries in the academy sector (which includes high salaries of academy trust employees) is 50.1% and has fallen by 3.2% since 2011.55

5.18 As has been observed earlier in this Evidence, teacher numbers fell between

2016 and 2017 from 457,200 to 451,900, according to the 2017 SWC. Whilst the NASUWT would never argue that this is desirable, either for schools or for the education system, it lowers the total teacher pay bill.

5.19 Furthermore, key known teacher costs for 2019/20 are being met. An increase

in employer pension contributions for teachers will occur in September 2019. On 6 December 2018, the Chief Secretary to the Treasury wrote to the TUC, NASUWT and NEU to state:

‘The Government is acting to ensure that these additional costs do not jeopardise the front-line delivery of public services or put undue pressure on public employers... For state schools, the Department for Education are proposing to provide more funding to cover pension costs for the rest of this Spending Review period. To supplement this, Budget 2018 allocated extra DEL to the reserve for 2019-20 to cover an expected £4.7 billion of additional costs.’ 56

5.20 The NASUWT believes that stability is provided to schools about funding

levels through 2019/20, irrespective of any further decision by the

52

https://www.gov.uk/government/publications/dedicated-schools-grant-dsg-2019-to-2020, accessed 3 January 2019. 53

https://www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2018-12-17/HCWS1185/, accessed 3 January 2019. 54

DfE, Expenditure by local authorities and schools on education, children and young people’s services in England, 2017-18, published December 2018. 55

DfE, Income and Expenditure in Academies in England 2015-16, SFR 32/2017 56

Annex B.

36

Government to make a teachers’ pay grant available to support the 2019/20 pay award. As the Review Body has argued in recent years, funding for teachers’ pay can be identified by prioritising over other expenditure and this must be a key aspect of financial planning for schools.

School funding is often not used for the benefit of teaching and learning or spent on the workforce. This funding can be redirected to be spent on teachers’ salaries. 5.21 Despite the school funding squeeze since 2010, much education spending still

does not reach the front line. Substantial levels of unspent reserves, inefficient and wasteful school-level procurement, together with excessive levels of academy trustee and CEO leadership pay, are now hardwired into the school system. The NASUWT believes that there is need for urgent change in these areas, so that the available school and academy trust funding is used appropriately to support teachers to secure the best outcomes for all pupils.

5.22 The academy sector has a worse record than the maintained sector in this respect. The DfE’s 2017 School Workforce Census data indicated that, in the secondary phase, classroom teachers’ salaries are £1,500 lower in academies than in local authority maintained schools. In the primary phase the gap is even greater: classroom teachers’ salaries are £1,700 lower in academies than in local authority maintained schools.57

5.23 The Review Body has made it very clear that schools should focus their

budgets on teachers’ pay in its 27th and 28th Reports, but there is inadequate oversight of schools by the DfE to ensure that this recommendation is being followed. It is not just teachers’ pay that has suffered - the Government bears responsibility for the failure of many schools to spend their funding on teaching and learning purposes.

5.24 The NASUWT has long believed that more effective statutory guidance, to

supplement the Section 3 Guidance in the STPCD, is needed to achieve the Review Body’s aims. In fact, the Review Body indicated a need for more effective statutory guidance in its 28th Report. However, the DfE has doggedly refused to publish this and the NASUWT believes that the Review Body should make a specific recommendation for statutory guidance on focusing spending on teachers’ pay.

5.25 In July 2018, the DfE published details of academy sector reserves as of 31

August 2017. This confirmed the level of surpluses in academies:

91.6% of academy trusts had a cumulative surplus.

2.3% had a zero balance.

6.1% of academy trusts had a cumulative deficit.

94.5% of academies were in trusts that had a cumulative surplus

1.2% in a trust with a zero balance.

4.3% of academies were in trusts that had a cumulative deficit.

57

DfE, 2017 School Workforce Census Data, published July 2018.

37

the total net financial position of all academy trusts was a cumulative surplus of £2.4 billion. This was an increase on £2.2 billion on 31 August 2016.58

5.26 The excessive reserves held by academy trusts have been commented upon

by Ofsted. In March 2016, Her Majesty’s Chief Inspector of Schools (HMCIS) wrote to the Secretary of State for Education to make the following observation about seven multi-academy trusts (MATs):

‘This poor use of public money is compounded by some trusts holding very large cash reserves that are not being spent on raising standards. For example, at the end of August 2015, these seven trusts had total cash in the bank of £111 million. Furthermore, some of these trusts are spending money on expensive consultants or advisers to compensate for deficits in leadership. Put together, these seven trusts spent at least £8.5 million on education consultancy in 2014/15 alone.’59

5.27 As of 31 March 2018, the total unspent balance across all local authority

maintained schools was £1.56 billion.60 5.28 The percentage of schools with a surplus was 88.6% on 31 March 2018. 5.29 The average surplus in each school with a surplus is £135,000, an increase of

£4,000 since 31 March 2017. 5.30 The average surplus in each primary school with a surplus is £113,000 and

the average surplus in each secondary school with a surplus is £370,000. The average primary school surplus has increased by £5,000 since 31 March 2017.

5.31 For illustrative purposes, if the amount held in unspent balances in maintained

schools in England is divided by the total number of teachers (in both maintained schools and academies), the unspent balance per teacher in England is £3,454. If the unspent reserve in the academy sector is taken into account in the calculation, the figure per teacher would be £8,763.

5.32 Whilst accepting the complication of the most recent data from the academy

sector being from a previous school year to the maintained school data, the overall picture is that the level of combined unspent balances across both sectors has remained relatively stable over the last twelve months:

in 2015/2016 (academy sector) and 2016/17 (maintained sector), the level of unspent balances was £2.2 billion in academies and £1.7 billion in the maintained sector (totalling approx. £3.9 billion);

in 2016/17 (academy sector) and 2017/18 (maintained sector) the level of unspent balances was £2.4 billion in academies and £1.56 billion in the maintained sector (totalling approx. £4 billion).

58

DfE, Academy revenue reserves 2016 to 2017, July 2018. 59 DfE, HMCI, Focused inspections of academies in multi-academy trusts, March 2016. 60

DfE, Expenditure by local authorities and schools on education, children and young people’s

services in England, 2017-18, data tables published December 2018.

38

5.33 The change in the totals across the two sectors could partially be explained by a change in the size of the sectors. However, it is noteworthy that the trend for significant reduction in the level of maintained school unspent balances (from 2016 to 2017 by £384 million) did not continue from 2017 to 2018.

5.34 The tendency of schools to hoard funding is shown by the DfE’s analysis of

the percentage of schools with surpluses which have exceeded the DfE’s recommended maximum surplus level of 5% for secondary schools and 8% for primary schools.61 This was at its lowest in 2009/10, when local authorities began to redistribute excess balances back into the Schools Budget (27.7%) and it rose through to 2015/16 when complete autonomy to build up balances had been in place for several years (47.7%). Even though the percentage fell to 40.4% in 2016/17, it increased to 41% in 2017/18 (a marginal increase, but an increase nonetheless).

All LA schools

Schools with surpluses above 5% of total income for secondary schools and 8% of total income for nursery, primary and special schools

Total number of schools with surpluses above 5% (secondary) and 8% (other schools)

% of schools with excess surpluses

Total value of surpluses over excess cut-off point (£)

Average value of surpluses over excess cut-off point (£ per school)

2009-10 6,014 27.7% £407,033,701 £67,681 2010-11 7,157 33.2% £497,796,145 £69,554 2011-12 9,249 44.1% £748,344,521 £80,911 2012-13 8,566 43.6% £760,992,447 £88,839 2013-14 8,123 43.4% £754,278,512 £92,857 2014-15 8,074 45.6% £729,277,934 £90,335 2015-16 8,003 47.7% £737,536,758 £92,158 2016-17 6,506 40.4% £607,751,403 £93,414 2017-18 6,164 41.0% £580,475,291 £94,172

5.35 The average value of surpluses over the excess cut-off point is higher than it

has ever been. 5.36 This has not been influenced by the 2018 teachers’ pay grant, as the

surpluses relate to 31 March 2018, well before this was announced, never mind paid to schools.

5.37 These statistics are important when considering how local authorities and the

DfE can support that minority of schools (10.2%) which are in deficit. A small minority of schools are in deficit.

5.38 The NASUWT does not minimise the challenges which a deficit budget

presents to individual schools. 10.2% of schools in the maintained sector are in deficit and 4.3% of academies are in trusts with a deficit. However, solutions for these schools can be found.

61

Ibid.

39

5.39 Deficits are a longstanding feature of the education system and existed even during the era of real-terms growth in school budgets. In fact, the current level of deficits is not that large by historical standards. In 2009/10, 1,968 or 9.1% of schools were in deficit and in 2017/18, 1,532 or 10.2% of schools were in deficit.

All LA schools

Total number

of schools

Total revenue balance (£,000)

Average revenue balance (£ per

school)

Change in

average balance

Schools in deficit Schools in surplus

Number of

schools in deficit

% schools in deficit

Total deficit (£,000)

Number of

schools in

surplus

% schools

in surplus

Total surplus (£,000)

2009-10 21,722 £1,665,279 £76,663 1,968 9.06% -£161,418 19,671 90.56% £1,826,697

2010-11 21,567 £1,955,448 £90,669 18% 1,511 7.01% -£143,478 19,930 92.41% £2,098,926

2011-12 20,978 £2,323,533 £110,760 22% 1,081 5.15% -£109,937 19,679 93.81% £2,433,469

2012-13 19,648 £2,224,954 £113,241 2.2% 1,111 5.65% -£81,191 18,318 93.23% £2,306,145

2013-14 18,708 £2,184,369 £116,761 3.1% 1,057 5.65% -£75,947 17,438 93.21% £2,260,316

2014-15 17,693 £2,119,569 £119,797 2.6% 948 5.36% -£103,040 16,534 93.45% £2,222,608

2015-16 16,767 £2,086,820 £124,460 3.9% 1,000 5.96% -£119,864 15,621 93.17% £2,206,684

2016-17 16,106 £1,702,027 £105,677 -15.1% 1,461 9.07% -£191,665 14,498 90.02% £1,893,692

2017-18 15,050 £1,560,740 £103,704 -1.9% 1,532 10.18% -£233,248 13,336 88.61% £1,793,987

5.40 In a report into school budgets published in January 2019, the Education

Policy Institute (EPI) has commented that 3% of schools were in deficit in 2016/17, but moved into surplus in 2017/18. Schools move between the categories of surplus and deficit. 62

5.41 The Review Body should not allow the existence of some deficits in the

system to deter it from recommending a significant pay increase for teachers. 5.42 Furthermore, the NASUWT can see no rationale for the continuation of a

system which allows schools and academy trusts to build up excess balances, which amounted to £580 million as of 31 March 2018. The NASUWT uses the DfE’s definition of ‘excess balances’ - surpluses of over 5% for secondary schools and over 8% for primary schools. In particular, local authorities should be given the power to redistribute excess balances into a contingency fund in the schools budget to support schools in difficulties. In fact, the total deficit in the maintained sector as of 31 March 2018 was £233 million, which is two fifths of the total excess balance in the sector.

5.43 Moreover, the EPI has commented on the potential solution for schools with

deficit budgets of redistributing excess balances. Local authorities are actively deterred from pursuing this situation at the moment because of an inappropriate emphasis in the relevant statutory guidance on school autonomy and the entitlements of schools to carry forwards unspent balances.63 The NASUWT believes that the Review Body should recommend that this statutory guidance be revised.

62

Education Policy Institute (EPI), School Revenue Balances in England, 2019, 63

DfE, Schemes for Financing Schools, March 2018.

40

5.44 The NASUWT does not support the view that such an approach would reward profligate schools which cannot remain within their budget because of management or governing board incompetence. Local authorities have powers at their disposal to address this and, in any case, school funding is public money and should be spent where it is needed.

5.45 Government policy builds inability and waste into the system in a number of

ways which can lead to deficit budgets. For example, some models of academy trust organisation which are promoted by the DfE will inevitably face difficulties with their viability.

5.46 One recent policy development within the Government is the promotion of

academy alternative and SEND provision, which is a longstanding DfE ideological goal. The NASUWT has become aware of the establishment of a special academy MAT which is made up of three schools in Hillingdon, one in Harrow, one in Northumberland and one in Cumbria.64 It is difficult to think of an academy trust which is more unviable in terms of its geography, or where unnecessary back office, administrative and leadership costs will be higher.

5.47 The DfE and the Education and Skills Funding Agency (ESFA) should have

clear duties placed upon them not to create unviable academy trusts. There should also be a clear expectation that the DfE will support local authorities, as appropriate, as the responsible bodies for high needs provision, in maintaining and commissioning efficient provision. The NASUWT would welcome recommendations from the Review Body in these areas.

The DfE has taken steps to enable local authorities to manage the allocation of budgets to individual schools more effectively. 5.48 The NASUWT supports the change to the DfE policy on the awarding of

growth funding to local authorities, so that this more closely reflects annual growth in pupil numbers.

5.49 Waiting for growth funding to catch up with increased pupil numbers is a

reason why schools develop deficits, and the responsibility for ensuring that this does not occur in the maintained sector lies with local authorities, and will do through to the end of 2020/21 at the earliest. A clear duty should be placed on local authorities to ensure that growth funding allocated by the ESFA is effectively used to avoid schools developing deficit budgets.

5.50 A similar duty should be placed on local authorities in respect of excess

surplus balances at school level, together with powers to cap and redistribute these, as identified above.

The DfE’s support to schools, to enable them to manage their budgets effectively, has improved. 5.51 Over the last 12 months, the DfE’s support which is provided to schools to

enable them to manage their budget efficiently has improved. The DfE has:

recruited a series of school resource management advisors to support schools, local authorities and academy trusts;

64

The Eden Academy Trust, http://www.theedenacademy.co.uk/, accessed 3 January 2019.

41

established a central buying strategy, through Crown Commercial Services (CCS), which takes advantage of economies of scale which can be achieved by large-scale procurement;

produced a toolkit, including a checklist, on effective resource management;65

made benchmarking data easily accessible to enable schools to compare areas of expenditure with close comparators.66

5.52 These measures support schools in freeing up funding which can be directed

to teachers’ pay. The Review Body is able to address the greed and excess in the academy sector. 5.53 Within the academy sector, it has not been a case of austerity for everyone. 5.54 In some academy trusts, greed, excess and waste have run out of control.

The Review Body is able to address one aspect of this. 5.55 In many academy trusts, there is excessive spending on Trustee pay (which

includes CEO and executive headteacher pay). The DfE has reported that, in 2016/17 (which are the most recently published DfE figures), academy trusts made 103 payments of over £150,000 to Trustees, an increase on the previous year. In 16 cases, these were single academy trusts. All in all, 895 payments of over £100,000 were made by academy trusts to Trustees in 2016/17, which was 53 more than in 2015/16. This was a greater increase than from 2014/15 to 2015/16, when the number of payments had risen by 30.67

5.56 Even Ofsted has commented on this issue, stating that: ‘Salary levels for the

chief executives of some of these MATs do not appear to be commensurate with the level of performance of their trusts or constituent academies. The average pay of the chief executives in these seven trusts is higher than the Prime Minister’s salary, with one chief executive’s salary reaching £225k.’ 68

5.57 There is an inadequate level of DfE scrutiny and therefore public

accountability of spending by MATs. The Government masks frequently excessive levels of leadership and CEO pay when reporting income and expenditure in academies. An example of this is that the DfE chooses only to group all salary levels of £150k plus into one category for reporting purposes, when individual academy trust annual reports and accounts reveal that CEO pay is often much higher than this.

5.58 For example, in the Harris Federation, the number of salaries over £100k

increased from 25 to 29 from 2015/16 to 2016/17. Moreover, the number of salaries over £150k increased from 8 to 10. Most specifically, the pay of the

65

https://www.gov.uk/government/collections/schools-financial-health-and-efficiency 66

https://schools-financial-benchmarking.service.gov.uk/ 67

DfE, Academy schools sector in England, consolidated annual report and accounts for the year ended 31 August 2017, November 2018 68 HMCI, Focused inspections of academies in multi-academy trusts, March 2016.

42

Harris Chief Executive Officer (CEO) increased from in the £420,000 to £425,000 pay band to in the £440,000 to £445,000 pay band, an increase of £15k per year (as a minimum).

5.59 The Harris CEO’s 2016/17 remuneration package includes pension

contributions of between £50,000 and £55,000, taking his remuneration to approximately £500,000 per year.

5.60 In addition, Harris pays another Senior Executive in the £260,000 to £270,000

pay band and a third Senior Executive is paid on the £240,001 to £250,000 pay band. 69

5.61 The ratio between the salary of the Harris Federation CEO and a teacher on the minimum of the main pay range is approximately 17:1.

5.62 In refusing to report actual salaries in the academy sector annual report and accounts (SARA), the DfE has actually failed to follow the Government’s Financial Reporting Manual, the FReM. In the 2017 academy sector annual report and accounts, the Auditor General has commented as follows:

‘The use of some exemptions, provided by HM Treasury, from standard reporting requirements – including on related party transactions and senior staff pay – has made production of the first sets of Academy Sector Accounts practical, but ongoing use of these exemptions reduces transparency.’

5.63 In response, the Auditor General has also made the following

recommendation, that the Government should, ‘Consider with HM Treasury the extent to which it should reduce the number of exemptions from the normal FReM reporting requirements, and the timeframe for doing so, including in areas of high interest such as senior staff pay and related party transactions.’ 70

5.64 The DfE claims that it has not reported actual salaries in academy trusts

because it has no influence over these, stating, ‘Accordingly, in a departure from FReM, the Department has not presented the employment and remuneration policies of the sector as this would imply a greater level of influence of the Department than is actually held.’ 71

5.65 However, this failure to regulate is a conscious choice on the part of

successive Secretaries of State for Education which is not consistent with measures taken by other Government departments – other Government departments set the salaries of their high earners. The NASUWT believes that it is very clear that it is the refusal of successive Secretaries of State for Education to regulate academy sector salaries, by ensuring that the (STPCD) covers the entire sector and all remuneration in it, which has led to this situation occurring.

69

Harris Federation annual report and accounts for the year ended 31 August 2017. 70

DfE, Academy schools sector in England, consolidated annual report and accounts for the year

ended 31 August 2017, 2018, page 62. 71

Ibid, page 54.

43

5.66 Unsurprisingly, senior staff salaries in academy trusts have soared over the last 12 months. The 2015/2016 SARA revealed that, in 2015-2016, there were 122 academy trusts which pay at least one employee over £150,000 per year. The 2016/-7 SARA reveals that, in 2016-17, this number increased to 125. From 2015/2016 to 2016-2017, the percentage of academy trusts paying at least one trustee £100,000 or more increased from 29.3% to 30.1%.

5.67 The NASUWT believes that there can be no justification for the DfE’s

continued failure to report the actual salaries of academy trust senior executives and trustees, particularly now that the Auditor General has drawn attention to this.

5.68 Nevertheless, the NASUWT believes that, should the DfE continue to fail to

act against corporate greed which threatens the stability of the school system, the Review Body should do so, by recommending that the salaries of all staff in state-funded schools, including the leadership in academy trusts, are included in the STPCD.

5.69 An analysis of income and expenditure for 2016/17 in the standalone

academies which are paying salaries in excess of £150k reveals that, in addition to excessive expenditure on leadership pay in these schools, there is high expenditure on other areas which siphon funding away from teaching and learning.

5.70 However, the Review Body is able to address this situation by recommending

that all remuneration for academy trust senior staff is included in the STPCD and by setting an appropriate salary range for academy trust CEOs. As the NASUWT has indicated earlier in this section, classroom teachers’ pay in the academy sector is lower than in the Local Association maintained sector. The lack of a cap on CEO pay in academy trusts distorts the pay framework and drives down teachers’ pay in order to create capacity for high senior staff pay.

5.71 The NASUWT believes that the Review Body needs to act in this area

because of the clear inadequacy of the Government’s regulatory framework. Education is the only Government department where high salaries are not set by the department and it is completely inappropriate for this situation to continue, particularly as Government expenditure on the academy sector has now reached £24 billion72 (the Schools Budget for 2017/18 in the maintained sector is £21.8 billion).73

5.72 The DfE’s lack of effective regulation does not just extend to the academy

sector, but also to the activities of teacher supply agencies. Schools are being exploited financially by unscrupulous and unregulated supply agencies.

5.73 Expenditure by schools and academy trusts on supply agencies has reached

eyewatering proportions as the teacher shortage has grown. However, the DfE has not addressed this by acting to prevent schools from being exploited by employment agencies which charge excessive fees.

72

DfE, Academy schools sector in England, consolidated annual report and accounts for the year ended 31 August 2017, 2018 73

DfE, Expenditure by Local Authorities and Schools on Education, Children and Young People’s Services in England, 2017-18, 2018

44

5.74 The NASUWT’s research indicates that, in 2015/16, £792 million was paid to supply agencies by schools and academy trusts, of which just £346 million was used to pay the salaries of the supply teachers provided.

5.75 The Government has failed to ensure the supply of sufficient teachers, but has

also failed to regulate employment agencies to prevent many of them profiteering from the teacher shortage. The Government also permits supply agencies to continue to charge ‘finder’s fees’ which trap agency workers in low paid employment but increase profiteering. Finder’s fees also distort the teacher supply market as they prevent teachers from obtaining direct employment as teachers with schools and academy trusts, thereby exacerbating the teacher shortage.

5.76 The DfE has commissioned Crown Commercial Services (CCS) to provide

supply teachers to schools. The NASUWT believes that it is a matter of regret that the CCS fails to apply a maximum to suppliers’ fees and has not prohibited the charging of finder’s and transfer fees by agencies in circumstances where schools and academy trusts wish to transfer agency teachers to direct employment.

5.77 The NASUWT calls on the Review Body to recommend action by the DfE to

prevent practices by supply agencies which exploit both agency teachers and the schools in which they work.

A mythology has developed around school funding which exacerbates funding problems in schools. 5.78 A mistaken view has developed within the system that ‘schools cannot afford

anything.’ 5.79 It is common for teachers whose pay and conditions are being deteriorated to

contact the NASUWT to pass on concerns about funding difficulties which their Employer or school has communicated to them. On closer inspection of individual school funding data, some of the claims are simply false and must have been knowingly false when made. It is difficult not to draw the conclusion that some employers and school managements are deliberately attempting to mislead the workforce over school funding issues.

5.80 Inaccurate information about school funding, including fictitious school funding allocations, is circulating round the system, which is leading schools to believe that they must cut expenditure on teaching and learning when this is unnecessary. 74 The DfE, Education and Skills Funding Agency (EFSA) and local authorities must take responsibility for ensuring that schools are clear about the actual funding which they are receiving and will receive in the future.

5.81 Ill-judged research has also led some schools, multi-academy trusts and

employer organisations to claim that teachers’ pay and other teaching and learning expenditure is unaffordable. For example, the Education Policy Institute (EPI) published a report in March 2018 which claimed that schools could not afford the annual pay increase for teachers. The Report claimed that

74

https://www.statisticsauthority.gov.uk/correspondence/response-to-statements-on-cuts-to-school-funding/, accessed on 28 January 2019.

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it would not be ‘feasible’ for schools to meet the cost of even a 1% pay award, despite 6.4% of schools’ income being held in unspent balances by schools.

5.82 The EPI Report was highly misleading. The percentage of schools with deficit

budgets rose by 3% to 10% by March 2017, with a decrease in the average surplus by £11,000 to £131,000 for 90% of schools.75 However, the EPI Report drew the conclusion that over sixty% of schools spent more than their income in 2016-17. No wonder that the EPI has noted that the figures in their report differ from published statistics on school balances. Most importantly, the EPI Report ignored the £2.2 billion held in reserves in the academy sector and has drawn its conclusions from research into a tiny fraction of the total 17,922 local authority maintained primary and secondary schools. Its research also largely ignores nursery schools, special schools and alternative provision.

5.83 It was also disingenuous for EPI to claim that two thirds of school spending is

on ‘education staff’, implying that this is the figure spent on teachers, or even teachers and teaching assistants. This figure includes inflated CEO and trustee pay – the spend on teachers is 50.1% of total expenditure for the academy sector76 and 43.6% for the local authority maintained sector.77

5.84 In a sense, the relatively static position in respect of school balances in the

last 12 months is a response to the EPI’s claims. No doubt, EPI would claim that the purpose of their report was to campaign for greater school funding. However, misleading claims about school funding are cynically used by unscrupulous employers to drive down teachers’ pay levels even further, whilst at the same time enriching the few in leadership of the organisations in question.

75

DfE Expenditure by local authorities and schools on education, children and young people’s services in England, 2016-17, data tables published December 2017. 76 DfE, Statistical First Release (SFR) 32/2017, 2017. 77

DfE, Expenditure by local authorities and schools on education, children and young people’s

services in England, 2017-18, data tables published December 2018.

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6. OTHER ISSUES

6.1 The NASUWT has not presented Evidence which relates to amendments to the STPCD which it currently believes are necessary in this Evidence Submission. These will be outlined in the Union’s Evidence to the remit for the Review Body which the Secretary of State has announced will follow this one.

6.2 The NASUWT drew attention to its strong concerns, earlier in this Submission,

about a delay which has already developed within the Review Body’s processes in connection with its 29th Report because of the Government’s failure to submit evidence in connection with the initial deadline.

6.3 The NASUWT believes that the Review Body must condemn this and state

clearly that no further delays are acceptable – the Review Body’s 29th Report’s publication must be timely. The NASUWT believes that the Review Body should place this expectation on the DfE.

The Teachers’ Pay Grant 6.4 The NASUWT notes that a pay grant was made by the Government to support

the implementation of the 2018 pay award. There were a number of issues relating to this grant of which the Review Body should be aware.

6.5 A fundamental issue was that no expectation was placed by the DfE on

schools to use the money for teachers’ pay, in stark contrast to, for example, the recent announcement by the Secretary of State of additional funding for high needs, to which strict conditions were attached. It is clear that the failure to attach any conditions to this grant demonstrates that it was aimed more to mollify concerns about overall school funding rather than to address issues related to teachers’ pay.

6.6 The pay grant was awarded on a per pupil basis, with weighting given for the

phase of education and the London pay scales. Following this methodology, it would always be the case that the grant would not be an exact match at individual school level for the costs of the 2018/19 pay award, but the key difficulty with the grant was that the DfE placed no expectation on the large range of schools, academy trusts, free schools and 16-19 academies that the pay award would actually be paid to teachers, or that any pay award (even of 1%) would be paid from the grant.

6.7 In short, there was nothing in the DfE’s approach to prevent the 2018

teachers’ pay grant from being spent entirely on the pay of an academy trust CEO, or being used by an employer for purposes entirely unrelated to teachers’ salaries.

6.8 If they were serious about addressing teachers’ pay, the DfE and ESFA would

have placed an expectation on the grant’s recipients that it would be spent on the September 2018 annual pay award for teachers. This should have been made a condition of ESFA funding to academy trusts and failure to ensure that the grant was used for the September 2018 pay award should have resulted in remedial action being taken by the ESFA against the academy trust concerned. This should have included the use of sanctions such as a

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Financial Notice to Improve (FNtI) which made the use of the teachers’ pay grant for teachers’ pay a requirement for the lifting of the FNtI.

6.9 Local authorities were given the 2018 teachers’ pay grant by the DfE for

distribution to all maintained schools, special academies and free schools, pupil referral units, alternative provision academies and free schools and hospital schools. In the case of maintained settings, a duty should have been placed on local authorities by the DfE to ensure that the grant was ring-fenced to the 2018 teachers’ pay award. In the case of special free schools, special academies and alternative provision academy settings, local authorities should have been given a duty by the DfE to report to the ESFA any failure to ring-fence the grant to the 2018 teachers’ pay award.

6.10 However, the DfE failed to take these steps and the NASUWT has received

reports from members and from union representatives of refusals to spend the grant on teachers’ pay, including from employers in an extremely healthy financial position. It is a matter of regret to the NASUWT that the DfE provided a teachers’ pay grant to support the implementation of the September 2018 pay award, but its failure to place sufficient conditions on the use of the grant has resulted in fewer teachers receiving the pay award than would otherwise have been the case.

6.11 If a further teachers’ pay grant is to be made available, the NASUWT believes

that the Review Body should make recommendations along the lines above about how the grant is to be allocated.

The Tollbar Multi-academy Trust 6.12 The use of the teachers’ pay grant by the Tollbar MAT illustrates the

consequences of the DfE’s approach to implementing the grant. 6.13 On 1 August 2018, the Tollbar MAT wrote to teachers announcing that there

was ‘no possibility’ of a 2018/19 pay award as ‘the 2018-2019 academy budgets have all been set.’ Clearly, the Trust had not even budgeted for a 1% pay award. The Tollbar MAT had an income of £28.7 million and had spent £338,000 on educational consultancy costs. Unrestricted funds were £693,000, and £2,657,000 (9.2% of the budget) is spent on back office costs.

6.14 Despite the Teachers’ Pay Grant, the Trust refused to implement the pay

award from 1 September 2018 and instead applied the salary increases from 1 January 2019.

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7. MATTERS FOR RECOMMENDATION

7.1 The Review Body rejected the targeting of the 2018/19 pay award in its 28th Report and the NASUWT calls on the Review Body to reject targeting in its 29th Report. The recommendations must be formulated in such away as to secure a pay award for all teachers. The teacher supply crisis is too deep, too universal and too long-lasting for a targeted award to do anything other than compound the current crisis situation and secure the resentment of the teaching profession.

7.2 Furthermore, an award for 2019/20 only, even if that award is higher than the

Review Body’s recommendation for the 2018/19 award, will not even begin to close the pay gap which has arisen since 2010 and, furthermore, start to make teachers’ salaries competitive with other graduate professions. A single- year percentage award will be insufficient. As this Evidence Submission indicates, teachers and school leaders who have received in full every Review Body award since 2013 have still seen their salaries fall in real terms by between 14% and 19% since 2010/11.

7.3 When submitting its pay evidence, the NASUWT does not simply pluck a

percentage figure from the air and ask the Review Body to award this. The NASUWT’s approach is evidence-based.

7.4 The NASUWT has presented detailed evidence of the extent to which many

teachers are not receiving the 2018/19 annual pay award at all, including those teachers for whom this is a clear statutory entitlement.

7.5 The Review Body should therefore recommend that:

national pay scales for all teachers and school leaders should be restored to the STPCD to ensure that the 2019/20 pay award is received by teachers;

all supply teachers should receive the 2019/20 pay award;

there should be a multi-year award with a clear end point which restores the competitiveness of teachers’ salaries, closes the teachers’ pay gap and provides the basis for the appropriate remuneration of the teaching profession. As the first year of a multi-year award, the 2019/20 pay increase should be substantially higher than the current rate of inflation.