Santa takes a calculated fiscal risk

Have teachers been good this year? The Government must think so, since Santa - alias Gordon Brown - has popped a 2.5 per cent pay rise in their stockings. Granted, you are unlikely to make a downpayment on a luxury yacht on the strength of it, but it is more than the projected inflation rate, and more than health workers got.

Since teachers are paid from the public purse and still have final-salary pensions, uncle Gordon probably thinks he has been daringly generous.

Certainly, British teachers are comparatively better off than a generation ago: in Bulgaria they are on hunger strike for an extra pound;15 - a month.

But Santa is taking a calculated risk. The stocking has holes which could unravel horribly during this settlement's two-year life, risking much of Labour's investment in education.

The biggest hole is heads' pay and morale: many are on their knees after a term of reorganising staff, coping with snap inspections and covering teachers' PPA time on top of the day job. And failure frequently means getting fired.

Many heads are approaching retirement, and stress is driving more out early. Is the next generation hungry for power? Not on the money most get: it simply isn't a big enough salary jump for the hassle.

The pay review body wanted a workload-style inquiry into headship, to report in a year. The Government has kicked this into the long grass by fudging the time-frame and, meanwhile, market forces rule headship recruitment. Schools which can, will offer huge salaries to heads (pound;83,000 for a London primary, anyone?) But what will poorer ones do? Pay levels may also affect teacher recruitment more. University education costs students a lot: incurring an extra year's debt for teacher training is a big decision. If teachers' pay compares badly with other graduate professions - which the pay body report says it does - fewer will do that PGCE. Targets for maths and science teachers are already being missed.

There is calculated risk and there is tempting fate. Why delay the leadership review, which will cost little and may protect the Government's investment in education? Or do ministers fancy spending 2006 with their fingers crossed?

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