The Welsh Government has decided to award a pay increase in line with England and higher than the 4.3 per cent recommendation of the Independent Wales Pay Review Body (IWPRB). They will award a 5.5 per cent pay increase to all teachers and school leaders in maintained schools in Wales.
The 5.5 per cent pay increase would be paid in full, across all pay points and allowances and backdated to 1 September, following the statutory consultation on the 2024 edition of the School Teachers’ Pay and Conditions (Wales) Document (STPC(W)D) which ends in October. This means that most teachers and school leaders will receive the backdated pay increase in their October or November pay. This is a “consolidated” pay increase, so the 5.5 per cent would be a sustained increase setting pay on a permanently higher foundation on which future pay increases would be built.
How is the 5.5% teachers’ pay offer funded?
The Welsh Government have confirmed that they have secured additional funding to cover the teachers’ pay award of 5.5 per cent. The funding covers the financial year 2024-25. The Welsh Government have yet to decide school funding for 2025-26. This additional funding will be ring fenced for pay rises. The Government has not provided specific detail of the total amount of additional funding they have secured from Treasury.
How much progress does the 5.5% pay offer represent?
The 5.5 per cent pay increase recommendation is significantly above inflation and requires additional Government funding beyond what had previously been budgeted for teacher and school leader pay. The IWPRB’s recommendations this year and last year represent a significant change compared to its practice prior to 2023. The efforts of NEU Cymru members strike action in 2023 and again voting in an indicative ballot earlier this year changed the IWPRB’s thinking on teacher pay. Time after time prior to the 2023 pay dispute, the IWPRB recommended pay freezes or below-inflation pay increases and refused to make pay recommendations that would have required additional funding outside of the Government’s funding envelope.
On the basis of anticipated inflation levels in September (see the section below on inflation for more details on this), the 5.5 per cent increase will be among the four highest teacher pay increases against inflation in the last 50 years. It would be a significant first step towards the major correction in teacher pay that is needed to properly value teachers and protect our education service.
We have always argued that only a major correction in teacher pay, alongside significant improvements in workload, can solve the teacher recruitment and retention crisis.
The action taken by NEU members and the weight of evidence in support of our case have put our demands on pay and workload at the top of the political agenda.
How does the 5.5% increase compare to inflation?
We don’t know for certain yet what inflation will be in September 2024 so it’s impossible to say for sure, but based on the latest inflation forecasts we expect that a 5.5 per cent pay increase would be significantly above Retail Prices Index inflation (forecast to be 2.5 per cent in the third quarter of 2024 according to the OBR) and Consumer Prices Index inflation (forecast to be 1.6 per cent in the third quarter of 2024).
The Bank of England has said that it expects the inflation rate to rise a little this year, but that this will be a temporary phenomenon with the inflation rate coming down again next year.
A 5.5 per cent pay increase this year is likely to mean a gain of some 3 percentage points against RPI inflation in September, enough to make a start on restoring the pay lost in real terms against RPI inflation since 2010. With teacher pay having been cut by some 25 per cent against RPI inflation between 2010 and 2023, the 5.5 per cent increase would be only the first step in the major correction to teacher and school leader pay needed.
How does a 5.5% increase compare with pay increases in the wider economy?
A 5.5 per cent increase is higher than the latest Labour Research Department figure available at the time writing of 5 per cent for average pay settlements in the wider economy. Pay settlement figures have been reducing and if this trend is confirmed the settlement figures for September will be lower than 5 per cent.
Pay settlement figures are the appropriate comparators when considering the economic context for the 5.5 per cent teacher cost of living pay increase. The Office for National Statistics also publishes average earnings increases with increases higher than the pay settlement increases, but the average earnings include pay progression, bonuses and lump sums as well as cost of living pay increases.
The 5.5 per cent increase compares well to other groups of public sector workers covered by review bodies (e.g. 5.5 per cent for nurses, 5 per cent for prison officers, 5 per cent for senior civil servants, 4.75 per cent for police). The increase for armed forces is 6 per cent, and the increase for doctors and dentists is 6 per cent plus £1000, though this follows two years when pay increases for both of these groups were lower than for teachers (in 2022 and 2023).
How does a 5.5% rise in teacher pay in Wales compare to teacher pay rises in England and Scotland?
In England, the teacher pay increase of 5.5 per cent was announced by the Secretary of State for Education, Bridget Phillipson on the 29July 2024. She also announced the offer would be fully funded by an extra £1.1 billion in the financial year 2024-2025.
In Scotland, the teacher pay increase was due to be implemented on 1 August. An offer of 2 per cent in August 2024, followed by 1 per cent in May 2025, has been rejected by the teacher unions in Scotland. Scotland’s main teaching union the EIS has noted that the 5.5 per cent offered in England is significantly higher than the amount offered in Scotland.
Whatever the outcome of this year’s negotiations in Scotland, the pay gap compared with Scotland will remain significant and unacceptable. Nevertheless, the 5.5 per cent offer secured thanks to the efforts of NEU members may well result in a significant step towards reducing the gap – certainly compared to how the Conservative Government would have widened it. Our campaign to win better pay, recover the pay lost in real terms and remove the gap between teacher pay in England and Scotland altogether must continue.