Nearly half of schools will struggle to afford salary rises for teachers - even if the 1 per cent pay cap remains - a thinktank has found.

Around two in five state-funded mainstream schools - around 7,500 schools in total - are unlikely to receive enough funding in 2018-19 to cover even a 1 per cent pay settlement, according to the Education Policy Institute (EPI).

This rises to nearly half of schools, affecting around 9,000 schools, by 2019-20.

This is despite the extra £1.3 billion announced by the government last summer - and does not take into account the fact that the next pay settlement for teachers may well be higher than a 1 per cent rise following the lifting of the public sector pay cap in other sectors. 

Teacher pay rise unfunded

The EPI report, School Funding Pressures in England, assumes any pay rise is unfunded. It states: “Expecting schools to meet the cost of annual pay increases from a combination of core government funding and their reserves does not, for many schools, look feasible even in the short term.

“So far schools have taken various measures to reduce costs, such as switching suppliers, reducing energy usage and reducing the size of leadership teams.

“However, as around two-thirds of school spending is on education staff, schools are unlikely to be able to achieve the scale of savings necessary without also cutting staff.”

Last December, former education secretary Justine Greening called for “pay discipline” but also said the government had “adopted a more flexible approach to public sector pay, to address any areas of skills shortages and in return for improvements to public sector productivity”.

‘Conservative estimate’

The pay cap has already been lifted for prison officers and police.

The EPI has based its calculations on a 1 per cent pay rise over the next two years, which it calls a “conservative estimate”. 

Its report adds: “Indeed, there may additionally be pressures on schools budgets resulting from pay progression. We also have not sought to take into account the pressures caused by increases in the National Living Wage and the National Minimum Wage rates.”

A Department for Education spokesperson said: “We do not recognise these findings. The fact is, thanks to our reforms and the hard work of teachers, standards are rising in our schools.

“By 2020, core school funding will rise to a record £43.5 billion - the IFS has confirmed that by then per pupil funding will have increased more than 70 per cent since 1990. Latest figures show schools hold surpluses of more than £4 billion and we are providing support to help them get the most out of every pound they spend.”

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