Few issues are as potentially controversial as a headteacher's pay rise. When a minority of heads were first given large discretionary increases three years ago, there was a predictable outcry from other staff who claimed heads were snatching the early fruits of local management.
Now, three years after governing bodies were first given the power to award extra spine points to their heads and deputies, all schools must carry out an annual review of their salaries.
The requirement came into force at the beginning of this term, although there are few signs yet that large numbers of heads are receiving hefty pay increases or even that governors have set up committees to carry out the review. But the introduction of the annual review, which may include assessment of the head's performance, has revived fears that governors are being asked to carry out tasks for which they are not qualified.
The annual review was suggested earlier this year by the School Teachers' Review Body and received the backing of the Department for Education. It follows the introduction in 1993 of regular reviews for other teachers.
Just as governing bodies must give all teachers a formal statement of their salary and how it was arrived at, in future they will also be required to explain how heads' and deputies' salaries are determined.
All pay decisions should be based on a school's salaries policy, which in many instances is still in its infancy. But the annual review for heads will go further. Spine points must take account of the responsibilities of the post; the social, economic and cultural background of pupils; whether the post is difficult to fill and - most controversially - sustained overall performance by the postholder.
In the words of the review body, governors must assess whether a head's performance "appreciably exceeds that normally expected from the holders of such posts". To make such an assessment, governors would be expected to set personal and school-based targets for the head to meet.
The National Association for Head Teachers has received complaints from heads who are concerned about the way some governors may attempt to measure performance. The association believes schools are in effect being encouraged to set up their own performance-related pay schemes.
"On one hand the review body is in consultation over possible PRP and yet it is telling governing bodies to do their own evaluations and come up with their own PRP," said Kerry George, the NAHT's senior assistant secretary for salaries."We see huge problems where governing bodies which do not include personnel professionals are required to measure performance and carry out job evaluations ."
Consultations by the review body on a proposed PRP scheme, based on indicators such as exam results and attendance, closed on October 10. The STRB suggested that heads might receive one-off bonuses which would be met from extra Government funds. Participation would be voluntary.
Ms George said the absence of any additional funding would probably prevent most heads from receiving a pay rise as a result of the annual review. "There is not much money in the budget," she said. "I'm not aware of any rush of people receiving pay rises."
Local authorities are being encouraged to advise governing bodies on how to carry out reviews and provide information on pay levels for heads and deputies in their area. Councils such as Somerset advised governors to be cautious about awarding performance-based bonuses before national PRP indicators are agreed. "It's a health warning to try and avoid inconsistency and aggravation among staff," said Andy Hunt of Somerset .
David Hancock, salaries officer for the Secondary Heads Association, said the advice given out by LEAs varied. "An authority which is prejudiced in its guidance might say 'this is a requirement, but budget restraints will make it highly unlikely that governors will upgrade pay'," he said. "Others are more laid-back and leave the decision to governors."
The annual review is an attempt to make the awarding of additional spine points less haphazard, but at the same time the DFE has stressed that heads should not necessarily expect to receive an increase. A proposal by the review body that the DFE should publish a code of practice for deciding heads' and deputies' pay is not being taken up by ministers.
Martin Corrick, who runs a governor training and support service at the University of Southampton, said a head's performance was normally inextricably linked to the performance of the school. "There is a tendency among governors to want to be generous to the head," he said. "They feel that they are amateurs and there is a tendency to over-reward the head because he or she is the person they see."
A survey carried out last year for the STRB found that 21 per cent of heads and 20 per cent of deputies received at least one extra spine point between March and September 1993. Nearly eight per cent of heads were awarded more than three spine points, including four individuals who received either 13 or 14 additional points.
The findings in the 1993 survey were similar to the results of a survey carried out for the STRB between April 1991 and 1992 which found about one in five heads and deputies received discretionary increases during this period. Neither survey revealed the reasons why governors decided to give a head or deputy a pay rise. Nor is it possible to say whether the same heads have been awarded more than one increase.
A recent survey of 680 schools carried out by the SHA found 36 per cent of heads and 34 per cent of deputies have been awarded discretionary spine points during the past three years.
Heads in small and medium-sized secondaries were more likely to have received an increase - so helping to flatten the pay spine. The most popular reasons for awarding points were increased pupil numbers and sustained overall performance.
Sixty-two per cent of heads in grant-maintained schools had received increases compared with only 31 per cent of LEA heads. "You have probably got a better chance that governors in a GM school will recognise that the head is taking on an additional burden," said David Hancock.
SHA is concerned that, even with annual reviews, heads in similar schools will not always be treated equally by their respective governing bodies.
"There is the potential for resentment between colleagues," added Mr Hancock. "But that is the market economy we are working in."
Kath Brooke, head of Garth Hill School in Bracknell, Berkshire, said the annual review would enable schools which had not awarded discretionary rises to look at the issue objectively.
Berkshire LEA has provided schools with details of the salaries paid to other heads in the county, although individual schools and their heads are not identified.
Mrs Brooke, whose annual review was carried out last summer, said it was vital that governors were provided with as much advice and guidance as possible.
Ultimately she was not concerned that governors would also assess her performance.
"Heads have to feed information to their governing body or they won't be in a position to carry out the review," she said. "I have always related my salary to the unit total and the job I do and then the governors have put their perspective on performance and how the school has progressed over a period of time."
Decisions on pay should be delegated to a committee made up of members of the governing body. For many schools, the setting up of this committee will have been one of the first tasks to be carried out this term.
The STRB recommended that the committee, which makes recommendations to the full governing body, should include the chair of governors and two or three other governors. In most cases it would be inappropriate for teacher governors to be on the committee, added the review body.
Kerry George said that the NAHT believed it was inappropriate for employees of the school to be members of the pay committee.
The DFE, however, pointed out in Circular 794 that only governors who had a direct or indirect pecuniary interest were disqualified from discussing matters such as pay. Teacher governors are not held to have a pecuniary interest if that interest is no greater than that of the generality of teachers in the school.
Kath Brooke, who chairs the SHA's salaries committee, said a teacher governor had been among the members of a personnel committee which had carried out her review: "They should not be treated in any different way to other governors. " Teacher governors have attempted to block pay rises for heads in some schools, however. Heads' performance payments are likely to be a sensitive issue since STRB surveys suggest that only about one school in 100 awards "excellence" payments to teachers.