The Government is heading for conflict with the unions over its suggestion of bonuses for teachers in tough areas and its advice to the review body that there should be no increase in the pay bill this year.

Gillian Shephard, the Education and Employment Secretary, has asked the School Teachers’ Review Body to consider new incentives to attract teachers to inner-city schools. She also confirmed the Government’s view that teachers, in line with other public sector groups covered by pay reviews, should only be awarded pay increases that can be offset by efficiency savings.

The unions warn that any repetition of last year’s refusal by the Government to fully fund the 2.7 per cent pay rise awarded by the pay review body will lead to larger classes and increased workloads. ) Unions are already threatening to take action in schools where teachers are having to take classes of more than 30. Further cuts in school budgets next year could lead to industrial action in the critical months before the general election.

In their collective evidence to the pay review body, the main teacher unions call for a substantial pay rise in excess of inflation. However, the Association of Teachers and Lecturers, which is a signatory to the joint claim, has also submitted a separate paper that suggests a 7.7 per cent increase across the board.

The two largest unions, the National Union of Teachers and the National Association of Schoolmasters Union of Women Teachers, are opposed to extra payments to teachers in tough areas. Both unions argue that extra funds should go to schools in disadvantaged areas, but pay for teachers in those schools should not increased at the expense of others.

Nigel de Gruchy, general secretary of the NASUWT, says there is no evidence that the social priority allowance, an additional payment to teachers in schools in poor areas phased out in 1988, made any difference to recruitment.

He said: “You would have to make payments of the order of Pounds 5,000 to Pounds 10,000 to make any significant difference and we are being told there isn’t any money anyway. The other problem is that such payments stigmatise schools.”

The NUT takes a similar view. It wants to see pay levels improved generally and schools in disadvantaged areas funded on a scale that allows then to pay for additional support teachers.

However, the ATL suggests the pay review body should give the Education Secretary discretionary powers to designate areas or types of schools where teachers could be awarded a specified higher maximum number of points. Extra payments, it says, could go to schools judged by the Office for Standards in Education to be failing.

In its evidence, the DFEE argues that there are no serious problems recruiting teachers. The number of pupils is rising, leading to slightly higher pupil-teachers ratios. The overall pupil-teacher ratio has worsened in the past 12 months from one teacher to 18.1 pupils to one teacher for every 18.3 pupils.

The DFEE concedes that average class sizes are increasing, but says that 75 per cent of one-teacher classes in primary schools and 95 per cent of secondary classes have 30 or fewer pupils. The statistics submitted showed that 22. 5 per cent of primary classes have between 31 and 35 pupils, compared with 21. 3 per cent in 1994. The proportion of primary pupils taught in classes of 41 plus is 0.3 per cent.

The DFEE, in its evidence on the problems facing poor urban areas, says there is enough flexibility in the system to pay extra to heads and deputies. However, it notes that the largest increases to heads appear to have been paid in relatively affluent areas.

The DFEE asks the review body to consider whether teachers might be attracted to schools in difficult areas if they were paid up to two extra points on the scale, roughly an extra Pounds 1,500 a year. Teachers, it says, might also be encouraged by relocation packages and incentives such as season ticket loans and the payment of new teachers from July instead of September. Almost 60 per cent of vacant teachers posts are in Greater London and the south-east of England.

The document invites the pay review body to recommend that extra payments for excellent class teachers could include recognition for teachers involved in extra-curricular sport, an incentive that might support the Prime Minister’s attempts to encourage sport in schools.