Hello, now kiss #163;800 goodbye

Students enrolling on maths and science PGCEs can knock the best part of #163;800 off the "golden hello" promised by the Government - the second instalment is likely be taxed.

Once the Inland Revenue and Benefits Agency have taken their cut of income tax and national insurance, debt-laden newly-qualified teachers will receive only around Pounds 1,700 of the Pounds 2,500 due when they start their first job. But as an addition to salary it should be taxed.

The payment was the headline feature of the five-point package announced by school standards minister Estelle Morris and the Teacher Training Agency to boost recruitment last week - a package which left teaching unions distinctly underwhelmed. The news that it would be taxed brought a weary response.

"They're pouring cold water on an already damp squib," said Nigel de Gruchy, general secretary of the National Association of Schoolmasters Union of Women Teachers, with one eye on bonfire night. "It makes a mockery of the staging idea."

The Teacher Training Agency says it is unsure whether the sum will be taxed or not. But Department for Education and Employment sources admit they have not yet found a way round the problem.

The Government decided to pay the Pounds 5,000 incentive payment in two instalments - half on starting a PGCE, the rest on starting work as a newly-qualified teacher - to minimise the numbers who train but drop out of the profession before ever getting a job as a teacher.

It's unlikely to be the only problem with the incentive payments. Recruitment analyst John Howson said the failure of ministers to discriminate between science subjects could actually lead to fewer physics and chemistry graduates taking up places on teacher-training courses.

"The money will be paid to all scientists, but we're not short of biologists, " he said. "There is a danger that institutions will be swamped by biology graduates. They will say 'first come, first served', and not leave places open for physicists and chemists, because there's nothing in it for them. "

With some elements of the incentive scheme still to be worked out, ministers also ran the risk of leaving it too late, he warned. By the time careers officers had full details, a large number of PGCE applications would be made - 40 per cent are made by Christmas.

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