When schools spend, on average, nearly three-quarters of their budgets on teachers’ salaries, the ability to set pay locally should be an important factor. But so far there has been little significant use of local discretion over teachers’ wages. And this is not likely to change unless school governors receive stronger support and more money to allocate, judging from my research in Cambridgeshire, an authority which pioneered local management and where schools have been managing their own budgets for more than a decade.

My research into the impact of local decisions on teachers’ pay sought to answer four questions: Is local determination of pay succeeding as the Government intended? How do governors view the scheme? What are the reasons for its success or failure? What changes would promote more effective reward management?

Teachers’ pay was negotiated nationally through the Burnham committee for 70 years. By abolishing the committee in 1986, after industrial unrest in schools, the Government was able to end collective bargaining for one of the country’s largest groups of public employees. Power over teachers’ pay was passed to governors, within the national framework proposed by the School Teachers’ Review Body (STRB) established in 1991. The Government strongly advocates performance-related pay (PRP) for teachers.

To find out whether governors agree, I sent a questionnaire to all headteachers and chairs of governors of Cambridgeshire local authority and grant-maintained schools, and talked to teacher and headteacher union officials, civil servants and representatives of the employers’ organisations. more than 40 per cent of the 620 questioned replied (approaching 60 per cent from headteachers and more than 25 per cent from governors) evenly distributed between different categories of schools.

Responses suggest there has not been significant use of local pay discretion and there is still support for a national pay structure. Although the law allows GM schools or the local authority to opt out of the national recommendations in the Teachers’ Pay and Conditions Document by proposing an acceptable alternative pay structure for its teachers, no such application appears to have been seriously contemplated in Cambridgeshire.

Schools are making much use of special needs points and some use of recruitmentretention points, although the present high unemployment means recruitment has not been a problem. Schools are not enthusiastically embracing points for excellence: only two teachers receive them. The most significant reason for not using excellence points is lack of funding; some schools indicated PRP would be acceptable if they had enough money or if there was some form of specific grant.

Those schools not intending to use PRP unless compelled did not appear to be influenced by teacher opposition since they did not think it should be used even if it became acceptable to teachers. It is possible that this response reflects resistance to change, encouraged by teaching unions and, to a lesser extent, LEAs which have doubts about PRP in schools. However heads and chairs of governors are unlikely to be wedded to the pre-1987 national pay structure as fewer than 22 per cent were in post at that time. Nor is it a case of being new to post and therefore still “weighing up” pay options, as almost two-thirds had been in post for between two and eight years.

Schools view PRP as more important for determining heads and deputies’ pay; 50 per cent of heads and 44.5 per cent of deputies have had their salary points raised since January 1991 in Cambridgeshire. In some cases these increases went beyond the range suggested in the pay and conditions document. Generally, however, PRP for heads and deputies is being hindered by difficulties in measuring performance.

The support for PRP for heads and deputies mirrors what has been discovered in other areas of employment; that performance-related pay is mainly confined to managers. Given that budgets are tight, there is a danger that general concerns about senior managers receiving “fat cat” salaries could become an issue in schools. Certainly local authority employers feared that some governors could be persuaded to increase headteachers’ salaries on the pretext of PRP without considering their performance properly and when staff and equipment are under-funded.

The only local discretion for teachers with which schools are comfortable is points for responsibility. There has always been a measure of discretion to reward responsibility and its use is now only limited by budget constraints and the five-point limit for any individual.

A quarter of those responding want changes to the pay and conditions document, including clearer guidance on how to use PRP and wanting to see “excellence” pay removed altogether. Most wanted to axe local discretion for anything other than rewarding responsibility and special needs.

The survey demonstrated that discretion to reward teachers is meaningless unless schools are properly funded. Many governors would even be prepared to consider PRP for all teachers if money was available. Either a way to improve funding to support PRP development must be found, or it has to be accepted that for classroom teachers PRP is unachievable.

A pay spine consisting of points which in effect are unobtainable could work against improving motivation, particularly if at the same time some heads exceed their salary range through increases for undefined performance.

Though it is sometimes thought that the Government wishes to see a move to more school-based pay deals along the lines of National Health Service trusts, the view from the Department for Education and Employment was that individual negotiations for all schools would simply lead to governors turning to the local authority for support. They, in turn, would collectively seek national agreement on pay standards with the unions and collective bargaining would be re-established. The STRB is seen as offering governors more flexibility and discretion.

Teachers, particularly heads and deputies, have faired comparatively better under their review body than employees in many other sectors. Although some teachers’ leaders have (predictably) called for a return to collective bargaining, this aim and outright opposition to the STRB has been dormant for some time now.

Even the Labour-controlled Association of Metropolitan Authorities, while not in favour of pay review bodies for determining public sector pay, does support a pay commission which would make recommendations within which any collective bargaining would take place.

Bev Curtis is a director of Education Personnel Management and a fellow of the Institute of Personnel and Development. He recently researched teachers’ pay as part of an MA in Employment Strategy.

Discretionary payments

Governors must increase teachers’ pay according to their years of experience and qualifications. They may also give extra increments for:

School responsibilities

Recruitment or retention

Teaching children with special needs

Excellence as a teacher.

Discretion for heads’ pay

Governors must consider, among other factors:

the responsibilities of the post

the social, economic and cultural background of the pupils

whether the post is difficult to fill

sustained overall performance which appreciably exceeds that normally expected

The review body proposals

The pay review body suggests that to consider performance, governors should:

set at the start of the school year the basis on which performance will be reviewed, including personal and school-based objectives

review progress towards those objectives during the school year

consider the performance achieved over the year