Are heads salaries on the rise: What are the consequences for taxpayers?

How come secondary heads cannot fill in forms about their salary correctly? Figures issued yesterday by the DfE show around 300 misreported leadership salaries in the primary sector, but some 400 misreported salaries in the numerically much smaller secondary sector where the misreported figures were split evenly between academies and other maintained secondary schools. According to a footnote in the government tables the misreporting includes any salary above £200,000 per annum.

Now it may be that the census form that collects data on teachers and school leaders and their salaries does not deal well with issues such as executive heads and those head teachers leading federations of schools where others have the courtesy title of head when in fact they are just a head of a school site. If this is the case, then the form needs revision after three years in use. However, if it is heads, and they are responsible for their schools return of the form, fudging their salary and those of others on the leadership team then the schools should be identified and required to provide a correct return.

At the start of this parliament the Prime Minister was keen than no public servants should earn more in salary than he does, but of course he has a rent free house in London and a large country mansion for the weekends in addition to his salary. Nevertheless, one side effect of Michael Gove’s freeing up of teachers’ salary regulations could be that the salaries of heads rise even further and faster in the coming years while those of classroom teachers are held down because of their relative bargaining power.

After more than a quarter of a century of studying the pay of heads, I am aware that the job is a challenging one, and with Ofsted breathing down their necks it can be very like that of a football manager seeking either a place in Europe for their team or striving to avoid relegation. Either way, their job is at risk if they fail to perform well. The tragic case of the Worcestershire primary head reported at her inquest earlier this week shows just how much pressure Ofsted can exert of school leaders. As a result a risk premium is increasingly necessary for many headships. How large that premium should be must be determined by governing bodies, and they need guidelines for what is appropriate.

However, letting the market be responsible for the calculation of salaries in education has another and wider impact on taxpayers in general. At present, many heads are still retiring on a final salary pension, although this will be replaced by an average salary pension for those who retire in the future. As the Teachers’ Pension Fund doesn’t actually exist, and any pension is paid out of  taxation, the burden of the large pensions of up to half the final salary falls onto general taxation. A pension of £50,000 would require the contributions from around 20 NQTs, so if there are now more than say 500 pensioners in the Teachers’ Pension Scheme with pensions of over £50,000 they might require the contributions of 10,000 Newly Qualified Teachers just to cover their pensions. As this number increases so will its share of the income from the Pension Fund necessary to cover the payout even if it is offset by the higher pension payments from those receiving the high salaries.

Teacher compensation regimes are complicated affairs, and the government should be wary of tackling some areas of pay without considering the consequences as a whole. At present governing bodies have the power to set salaries, but without the responsibilities for all the consequences. That said I quite understand why heads want to achieve the highest salary possible in an environment where the ethos of public service seems to reside solely with a Prime Minister who can afford to take such a stance.

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