My right honourable friend the Secretary of State for Children, Schools and Families (Ed Balls) has made the following Written Ministerial Statement.

Part I of the seventeenth report of the School Teachers' Review Body (STRB) is being published today, covering a range of matters referred to it in March 2007. I am grateful for the thorough attention the STRB has given to these matters. Copies of the report and of my detailed response to it are available in the Vote Office, the Printed Paper Office, the Libraries of the House and at www.teachernet.gov.uk/pay.

The STRB has made recommendations for values of pay scales, spines and allowances, including leadership group pay covering three years from September 2008 to August 2010. It has recommended a 2.45 per cent increase from September 2008 and has made recommendations that would give teachers further increases of 2.3 per cent from September 2009 and 2010.

I very much welcome the framework of predictability that these three-year recommendations will give, which will assist long-term strategic decision-making by local authorities and schools. The multi-year figures and processes proposed by the STRB provide an approach which is in accordance with the Government's stated policy on public sector pay, which is for awards that are consistent with the achievement of the CPI inflation target of 2 per cent, are affordable, represent value for money for taxpayers and reflect the labour market position of workforces.

As regards schools in England, the 2.1 per cent minimum funding guarantee which was announced in the school funding settlement on 12 November 2007 is based on a cautious and realistic assessment of the wide range of cost pressures schools will face both from pay and non-pay.

I am therefore confident that these figures will be manageable over the next three-year period.

I propose therefore to accept the STRB's recommendation of a 2.45 per cent award payable from September 2008, and to accept the figures of 2.3 per cent from September 2009 and September 2010 which it has indicated in its report. Consistent with its report, I propose to set the STRB a remit in the course of 2008 to enable it to ensure that the increases it has proposed for 2009 and 2010 continue to be appropriate in the light of latest recruitment and retention data and wider economic and labour market conditions. I should however make clear that it is my firm view at this stage that the increases set out in the recommendations in relation to 2009-11 are the right ones. There would need to be clear evidence of a significant and material change in these factors to justify any change to these figures. The STRB would also need to take into account the fact that schools' budgets will have been set assuming the current figures.

The STRB's recommendations also include enhancements to the salaries of some categories of teacher in inner and outer London and it recommends that there should be a review over a longer timescale of the current regional pay bands. I also propose to accept these recommendations.

The review body has also made recommendations on the unqualified teachers' pay scale. These are detailed and technical matters on which I would like to take the views of consultees before proposing how these matters should be resolved. My detailed response contains further information on both these issues.

Annexe to Written Ministerial Statement of 15 January 2008

School Teachers' Review Body recommendations and response from the Secretary of State for Children, Schools and Families (Ed Balls)

The following sets out the full set of recommendations from the School Teachers' Review Body and was published in the seventeenth report part 1 (Cm 7252) on 15 January 2008, together with the response from the Secretary of State for Children, Schools and Families. The STRB's recommendations below are in bold.

The Secretary of State for Children, Schools and Families (Ed Balls): Part 1 of the seventeenth report of the School Teachers' Review Body (STRB) is being published today. It covers a range of matters referred to the STRB in March 2007. Copies are available in the Vote Office, the Printed Paper Office and in the Libraries of the House and at www.teachernet.gov.uk/pay. The second part is expected later this year.

In making its recommendations, the STRB was required to have regard to items a to g set out in the remit letter of 29 March 2007. Part 1 of the seventeenth report covers the main pay award for 2008-09, provides an indicative award for 2009-11 and makes recommendations related to unqualified teachers' pay arrangements. I am grateful for the thorough attention the STRB has given to these matters. I am inviting comments on the STRB's report and my response to its recommendations by 11 February 2008.

Teachers' pay from September 2008

The STRB has recommended the following:

an increase of 2.45 per cent from September 2008 in the values of the main pay scale and the upper pay scale for qualified teachers;

that they undertake a review of teachers' pay for the period from September 2009 and submit a report by June 2009;

contingent upon their undertaking a review on this basis, further indicative increases of 2.3 per cent from September 2009 and 2.3 per cent in September 2010 in the values of the pay scales.

I am grateful to the STRB for this set of recommendations on teachers' pay, covering the period from September 2008 to August 2011, and which I propose to accept. I very much welcome the framework of predictability that these recommendations will give, which will assist long-term strategic decision-making by local authorities and schools. The multi-year figures and processes proposed by the STRB provide an approach which is in accordance with the Government's stated policy on public sector pay, which is for awards that are consistent with the achievement of the CPS inflation target of 2 per cent, are affordable, represent value for money for taxpayers and reflect the labour market position of workforces.

This is the first of the public sector pay awards for 2008 and beyond. These recommendations for teachers' pay for the coming three-year period increase the capacity to focus on service delivery by providing stability and certainty for staff and employers alike. In addition to supporting public service delivery, appropriate multi-year pay settlements support the Government's goal of entrenching economic stability by holding down inflation expectations and locking in moderate earnings growth over the medium term.

As regards schools in England, I am also confident that these figures will be manageable over the next three-year period within the minimum funding guarantee of 2.1 per cent, which was announced in the school funding settlement on 12 November 2007. The minimum funding guarantee is based on a cautious and realistic assessment of the wide range of cost pressures schools will face from both pay and non-pay.

I propose therefore to accept the STRB's recommendation of a 2.45 per cent award payable from September 2008, and to accept the figures of 2.3 per cent from September 2009 and September 2010 which it has indicated in its report. Consistent with its report, I propose to set the STRB a remit in the course of 2008 to enable it to ensure that the increases it has proposed for 2009 and 2010 continue to be appropriate in the light of latest recruitment and retention data and wider economic and labour market conditions. I should however make clear that it is my firm view at this stage that the increases set out in the recommendations in relation to 2009-11 are the right ones. There would need to be clear evidence of a significant and material change in these factors to justify any change to these figures. The STRB would also need to take into account the fact that schools' budgets will have been set assuming the current figures.

We will also need to consider with the STRB some practicalities as regards the timing of a report following such a review, as the date proposed (June 2009) would not allow enough time for changes to be implemented by September 2009.

Starting Salaries and the Four Pay Bands

The STRB has recommended the following:

That:

the department, in consultation with interested parties, review the current structure of the four pay bands to ensure that they effectively help those areas facing the most significant local labour market challenges, having particular regard to:

what the basic constituent units (areas) included in the four pay bands should be;

whether the existing basis of geographical boundaries for the inclusion of areas in different pay bands is effective or whether there should be different criteria;

whether there are currently any areas in bands B, C, or D that should be in a higher band, or in bands A, B or C that should be in a lower band;

what the process should be for determining which areas are included in each pay band, and for moving areas from one pay band to another when appropriate;

the conclusions of this work be referred to the review body for consideration and recommendation, in time for any consequent changes to the pay system to be taken account of in revised school funding arrangements in England from April 2011.

I welcome this recommendation, which recognises that a review of the four pay areas covering England and Wales would be valuable. The timescale proposed is also helpful and allows time for careful and considered study of the situation. There would be a number of issues to resolve, including in respect of the STRB's suggestion that future banding could be non-static (picking up an aspect of broader proposals in its thirteenth report part 2¹). I shall take careful note of any immediate reactions expressed by consultees on these recommendations in relation to this current consultation. I shall also want to take into account in due course the views of the Welsh Assembly Government in respect of their own funding arrangements.

The STRB has further recommended:

a minimum starting salary (M1) of £25,000 for teachers in band A and £24,000 for teachers in band B and consequential adjustments to the main pay scale in these pay bands from September 2008;

enhancement in the value of the upper pay scale in bands A and B from September 2008; and

subject to their review of teachers' pay:

an indicative minimum starting salary (M1) for teachers in band A of £26,000 from September 2009 and £27,000 from September 2010 and consequential amendments to the main pay scale in band A; and

further enhancement in the value of the upper pay scale in band A.

I note the STRB's recommendation for certain revisions in advance of a review of the structure of the four pay bands. I note its view that a revision is needed to the first point on the main pay scale (Ml) for teachers in inner and outer London, with consequential adjustments to points M2 and M3 on that scale. I also note its recommendations for enhancements in these same areas to the value of each of the three points on the upper pay scale.

I appreciate that the STRB has sought to make recommendations which would lead to the minimum starting salary, in areas where recruitment is generally more competitive, being set at an eye-catching rate over the next three years. I propose to accept these recommendations. As regards the upper pay scale, I consider that it is important for the rewards attached to becoming a post-threshold teacher to be maintained year-on-year and so I propose to accept these recommendations also. DCSF will make available additional funding through a specific grant to cover the increased cost to London authorities of implementing the STRB recommendations on London pay. Our aim is that from 2011-12 this grant will be mainstreamed into the DSG.

Further pay matters

The STRB has recommended the following:

an increase of 2.45 per cent from September 2008 in the values of:

the leadership group pay spine;

the pay spine for advanced skills teachers;

individual excellent teachers' spot salaries and spot salaries for ETS posts included in staffing structures before 1 September 2008 but not yet in payment;

SEN allowances;

the minimum and maximum of the two TLR ranges, individual teachers' TLR payments and TLR payments included in staffing structures before 1 September 2008 but not yet in payment;

a ETS salary range from September 2008 of £37,672 to £48,437 in bands B to D, extending additionally to £53,819 in band A;

subject to its review of teachers' pay, further indicative increases of 2.3 per cent from September 2009 and 2.3 per cent in September 2010 in the values of the above pay spines, spot salaries, allowances, payments and range minima and maxima.

I welcome and propose to accept the STRB's recommendations in respect of the leadership group spine, the spine for advanced skills teachers, and the rises proposed for SEN allowances and TLR payments, as described. I believe it is appropriate that these are consistent with the recommendations for main and upper pay scale teachers over the next three years.

As regards the salary of excellent teachers appointed or in the staffing structure on or after September 2008, I am pleased now to be able to take forward the recommendation originally made by the STRB in its fifteenth report² that there should be pay ranges for this category of teacher from which relevant bodies select a spot salary. Providing salary ranges for excellent teachers will give schools the flexibility they need to set appropriate spot rates which take into account the job weighting of excellent teacher posts compared with other teachers in the staffing structure. Now that criteria for relevant bodies to select an appropriate spot salary from within the range have been developed³, ranges can be introduced. I welcome the general principle that the minimum of the range in September 2008 should be the current spot salary for England and Wales with a 2.45 per cent uplift. I also agree that in September 2008 the maximum of the range, and the maximum figure for inner London, should be on the basis of the original proposals of £45,000 and £50,000, updated (as would have been appropriate) with the application of the 2.5 per cent uplifts which were generally applicable in 2006 and 2007, plus the 2008 uplift of 2.45 per cent, leading to the figures set out in this report, which I propose to accept.

I believe there is a need to reflect further on the position of teachers who have been or will be appointed to excellent teacher posts before September 2008, or where excellent teacher posts are already in the staffing structure, with published salaries. These posts are currently paid a spot salary with no discretion for variation. In view of the changes to salary arrangements for excellent teachers outlined above, my view is that rather than applying a set increase to existing posts, it may be more appropriate for schools to reassess the salaries of any such excellent teachers and determine a spot salary on the range in line with the criteria which will be generally applicable. This would also promote clarity and fairness. I should also mention that if in these circumstances the reassessment led to a lower spot salary, then appropriate safeguarding arrangements would need to apply, in line with the specified criteria. I invite consultees' views on this particular issue.

Unqualified (Associate) teachers

The STRB has recommended the following:

That:

the unqualified teachers' pay scale become a 10-point pay spine, ranging from £15,113 to £23,903 in band D, to £16,106 to £24,893 in band C, £17,953 to £26,746 in band B and £19,007 to £27,794 in band A, with points on the spine evenly spaced in value in percentage terms;

when appointing associate teachers, including when teachers move from another school or service, individual schools and services select an individual pay scale of five consecutive points on the pay spine for each associate teacher and decide on a point within that scale on which the teacher should be paid;

schools and services have flexibility to select a smaller number of points where they deem it appropriate for an individual pay scale to start at points 7 to 9 of the spine, and a spot salary where they deem it appropriate for the teacher to be paid at point 10;

in selecting individual pay scales, schools have regard to the teacher's qualifications, skills and experience that they consider to be of value in the performance of the teacher's duties;

arrangements for pay progression for associate teachers within their individual pay scales should be consistent with those for pay progression of qualified teachers on the main pay scale;

teachers receive pay progression on this basis until they reach the top of their individual scale within the spine;

arrangements for the allowance for these teachers remain as currently specified in the School Teachers' Pay and Conditions Document, with guidance that the allowance should not be used in response to recruitment and retention considerations;

once determined, associate teachers' basic salaries and allowances may be reviewed if the school or service deems this appropriate, either on an individual basis or as part of a wider review of salaries;

subject to its review of teachers' pay, further indicative increases of 2.3 per cent from September 2009 and 2.3 per cent in September 2010 in the values of the associate teachers' pay spine.

It is important to remember that the STRB was asked to consider unqualified teachers' pay arrangements especially because of the legal issues which had been identified regarding the length of the scale. There were also some significant concerns with regard to the spacing between the points on the scale and the ways in which those points could be awarded. I recognise that the STRB has responded to these issues and sought through its analysis to address the range of specific concerns, and I agree that change is necessary with effect from September 2008.

These proposals would introduce significant changes to the unqualified teachers' pay arrangements and I believe that it will be important to consider them very carefully, taking into account the detailed views of consultees.

In short, the STRB has proposed a 10-point pay spine, with the points evenly spaced in percentage terms. Whenever an unqualified teacher is appointed, an individual pay range of up to five points, or a spot salary at the top point (point 10), would be selected from the spine, depending on the teacher's skills, qualifications and experience. Pay progression would be consistent with that of main scale teachers (ie on the basis of experience and satisfactory service), but on the basis of the individual range only. Spine points could be reviewed and would not be permanent. No changes are proposed to the unqualified teacher's allowance.

I welcome the recommendation to align progression arrangements for unqualified teachers with those of main pay scale teachers. This would explicitly enable double points for excellence for those unqualified teachers who are placed on a range, and would remove the complete freedom which currently exists for relevant bodies to award points to unqualified teachers as and when they wish. This would be a benefit as it would enable greater clarity and fairness. I also welcome the STRB's recommendations not to alter the top and bottom values of the current scale (apart from applying the recommended uplift) and to space the points evenly, so that those progressing receive consistent pay increases.

However, it must be noted that the principle of setting ranges on a spine would be quite a new—and rather more complex—arrangement for unqualified teachers' pay. Keeping the range of progression points to a maximum of five would in principle remove the concerns about long scales and the legal issues which could arise. I am concerned that with this arrangement there could still be scope for relevant bodies to make decisions which could negate the underlying legal purpose of the change in the arrangements, since they would be able to review these decisions when they deemed this appropriate and teachers could therefore receive more progression points than desirable. I would prefer such a situation to be avoided.

I also have particular concerns about the proposal that unqualified teachers' points would no longer be permanent. This would be unlike the current situation for unqualified teachers and also unlike the position for main and upper pay scale teachers. It is of concern that unqualified teachers could be awarded points for experience, and then potentially lose them, following a review by their school or a job move. It is true that spine points for members of the leadership group and ASTs are not permanent. But that is because ranges for these teachers are entirely post-based and progression is on the basis not of experience but of performance. Spot salaries for excellent teachers, similarly, would from 2008 be subject to review, but again this would be not on the basis of experience but on job weight. I would welcome consultees' comments on this proposed change of principle for unqualified teachers, but at present this is not an approach I am minded to accept.

In its report, the STRB has set out in some detail the proposals with regard to unqualified teachers put forward by the Rewards and Incentives Group⁴, which I endorsed. The RIG evidence included a proposal to shorten the pay scale to six points, which in RIG's view would be consistent in principle with employment law. I note that the STRB reports that in oral representation sessions, most other consultees agreed with RIG's proposals. I therefore invite comments from consultees on whether, having taken into account the STRB's views and recommendations, this approach might be a preferable one.

I welcome the recommendation for further increases in the values of the unqualified teachers' pay spine in September 2009 and 2010. The application of this recommendation would, in due course, depend on any decisions taken following the consultation process on this report and the subsequent statutory consultation, as well as on the STRB's review.

As regards the unqualified teachers' allowance, I fully endorse the view of the STRB that the allowance should not be used for recruitment and retention purposes. In addition to enhancing the statutory guidance as the STRB has recommended, it may be appropriate to look at clarifying the criteria for the award of the allowance in the School Teachers' Pay and Conditions Document itself, in line with the sort of approach adopted in respect of Teaching and Learning Responsibility payments (which are exclusively for qualified teachers).

I agree with the STRB that the allowance should be capable of review, and consider that the ability to review (which could require appropriate safeguarding measures) would be a logical consequence of the enhanced clarity in the criteria for the award of the allowance which I believe may be necessary. I invite consultees' thoughts on all these points.

I wish to highlight for consultees also the STRB's suggestion that the term “unqualified teacher” should cease to be used; its comments expressed in the body of its report that the term is misleading, negative and potentially demotivating; and its alternative suggestion of “associate teacher”. Although legally unobjectionable, as the term “unqualified teacher” simply means those teachers who do not have England and Wales qualified teacher status, I note the STRB's views. I am willing therefore to accept this change of term, or to consider other terms, but I should also welcome consultees' views on whether a change would on balance be beneficial and welcomed.

Lastly, and on a separate point, I note that the STRB's recommendations for 2008 move us away from a system where pay points are no longer, as has traditionally been the case, divisible by three. I have no objection to this change, especially since the teachers' pay system already allows in some respects for payments to be made on another basis, but I would invite consultees' views on whether this is in any sense an issue.

¹ Cm 6164, March 2004.

² Cm 6663, December 2005.

³ The criteria will be the nature of the work to be undertaken and the degree of challenge of the role.

⁴ ASCL, ATL, DCSF, NAHT, NASUWT, NEOST and PAT.