§ 2.22 p. m.
§ Baroness Blatch rose to move, That the draft order laid before the House on 14th May, be approved [18th Report from the Joint Committee].
§ The noble Baroness said: My Lords, the order will give effect to the School Teachers' Pay and Conditions Document 1990 which sets out the rates of pay and conditions of service to apply in state schools in 1990–91.
§ The publication of the 1990 pay and conditions document will complete a process which began in September 1989 when my right honourable friend the Secretary of State for Education and Science asked the interim advisory committee to advise on teachers' pay in 1990–91. The committee was asked to consider what general pay increase should be given to teachers but also to look in particular at ways of further increasing flexibility within the pay system, of improving the career structure and of helping LEAs to tackle geographic and subject teacher shortages, giving particular consideration to the problems in London, and to review specifically again the pay of heads and deputies.
§ The committee has fulfilled its remit admirably and produced the third in what has been a series of excellent reports. It endorsed the thinking underlying the present pay structure and made recommendations intended to carry it even further into practice. The committee concluded that, although the recent improvements to the pay structure had all been in the right direction, more needed to be done to provide LEAs and governing bodies with sufficient flexibility to tackle the particular needs of individual schools, to reward responsibility and high performance, to respond to changing circumstances and to provide attractive career prospects for able and ambitious teachers whether they want to stay in the classroom or move to senior management positions.
§ The IAC made far-reaching proposals for change. It reaffirmed the importance of incentive allowances and boosted their number and value. But in addition it proposed that LEAs and governing bodies should be able to enhance the standard incremental pay of individual teachers on the standard scale on an annual basis and that it should be possible to adopt and use a local extension of the standard scale to enhance the pay of teachers on the top of the scale. It also clearly identified the need for greater recognition of differences in the circumstances of schools and the performance of individuals in the way heads and deputies are paid. It therefore proposed that the present system of spot salaries should be replaced by a system of range pay.
§ My right honourable friend the Secretary of State received the report on 30th January and announced on 1st February that he proposed to accept its recommendations in full but to stage their introduction in the same way as for the review body groups because of affordability within public expenditure totals within the year. By far the major part of the proposals will be implemented on 1st April, with some at the beginning of September.582
§ They will all be implemented in full from 1st January 1991. The overall cost will be £620 million in 1990–91 and would be £733 million in a full year.
§ Section 3 of the Teachers' Pay and Conditions Act 1987 requires consultation with interested parties before the proposals can be implemented. The Secretary of State considered carefully the points made to him by the teacher unions and the employers, orally and in writing, and as a result made a number of further minor modifications to the IAC recommendations which are incorporated in the draft document that accompanies the draft order. They include placing certain deputy heads on a point higher on the new pay spine, which will give some 4,000 deputies an extra £300 on 1st January. The pay ranges for heads and deputies in small schools will also be extended by one point.
§ Acceptance of the IAC's recommendations means that teachers will receive substantial pay increases. By January 1991 heads and deputies will have seen their pay rise by up to 12.2 per cent. since March 1990; and from 1st January, under the new system of range pay, LEAs and governing bodies will have flexibility to recognise the demands of the job and the performance of the individual in the way they pay heads and deputies.
§ The changes recommended by the IAC to general salary grades have been sensitively handled and skilfully targeted. For new teachers salaries will increase by up to 11.8 per cent. Teachers on the top of the scale will receive 8.9 per cent. There will be a further 14,400 new incentive allowances, bringing the total to 189,000 in primary and secondary schools, and the value of the four higher rate incentive allowances will increase by 17 per cent. But that is not all. From 1st January LEAs and governing bodies will be able to award an incremental enhancement of up to £999 to any classroom teacher below the top of the scale, provided that the value of the next incremental point is not exceeded; and LEAs will be able to put in place local extensions to the standard scale and thereby raise the top point from £16,000 to £18,000.
§ Used imaginatively and effectively, those improvements will mean better career prospects for good teachers, better matching of rewards with contribution, and greatly enhanced scope for effective local decision taking. They will offer better rewards to the teacher in mid-career—this is an important point—to whose needs the Education Select Committee recently drew attention. They will also give LEAs and governors much more flexibility to respond effectively to local recruitment and retention problems. In inner London, where the problems are particularly acute, there will also be a new discretionary pay supplement of £750.
§ Pay flexibility and pay differentiation have a key role to play in improving morale and tackling shortages. The new flexibilities will greatly increase the capacity for local management to manage. They represent a real step forward in creating and sustaining the kind of teaching force we need for the future.
§ I am glad to have the opportunity to add my tribute to those already paid to the IAC for the 583 clarity of its analyses in pointing the way ahead. My noble friend Lord Chilver and the members of his committee deserve high praise not only for the time and care they devoted to their tasks but for the skilful and clearsighted way in which they assessed the evidence, analysed the issues and produced carefully worked-out recommendations.
§ Last December, in the debate on the Teachers' Pay and Conditions Act 1987 (Continuation Order) 1989, my noble friend Lord Davidson referred to the discussions my right honourable friend the Secretary of State had recently completed with the teacher unions and employers on new pay machinery. In the light of those discussions my right honourable friend announced on 26th April his proposals for new permanent negotiating machinery. He has recently completed a series of constructive meetings with unions and employers and is now considering carefully the best way forward in the light of the differing views expressed to him. He has made it clear in another place that his aim remains to introduce legislation early in the next Session of Parliament.
§ In the meantime, I ask for your Lordships' approval to this order to ensure that teachers can have their 1990–91 pay increases. I commend the order to the House. I beg to move.
§ Moved, That the draft order laid before the House on 14th May be approved [18th Report from the Joint Committee].—(Baroness Blatch.)
§ 2.30 p.m.
§ Lord Peston
My Lords, I thank the noble Baroness for her introduction of the Education (School Teachers' Pay and Conditions) Order 1990. If I may start where she ended, I am pleased to hear that the negotiations concerning the introduction of permanent negotiating machinery are completed. May I ask whether the Secretary of State will be making any kind of statement, ahead of the legislation, as to his interpretation of the negotiations? Also will he be giving us an indication beyond his earlier press statement of the likely content of the legislation?
The press statement itself was extremely interesting of course, and, for those of us who have been proponents of what is called an "income policy", parts at least of the statement which were indicative of the Secretary of State's thinking fall very much within incomes policy-type concepts. Let me say at this stage that I am not necessarily opposing some or all of the proposals the Secretary of State will eventually bring before us, but I should like to know whether we shall be informed earlier rather than later about progress.
Turning to the order itself, it is inappropriate late on a Friday afternoon to go back over the crisis in our schools, but I have to say that, as regards the problems arising from lack of motivation and low morale, it is difficult to see this order solving such problems. Indeed, if anything, the order will make teachers feel even less valued by this Government than they have felt up to now. In that connection, although I always pay tribute to any public body for 584 trying to do its work, I note that even the interim advisory committee felt unable to offer to teachers the kind of increase in real incomes that almost everybody else who has looked at this matter feels to be desirable. On the other hand, they were at least very courageous because the Secretary of State instructed them to propose a package of pay increases that would not add more than £600 million to the pay bill. They felt able to say that something of the order of £730 million would be more appropriate.
Let me add that even the latter, which was not accepted by the Secretary of State, does not increase the real incomes of teachers as a whole. At best it leaves them standing still: but the Secretary of State offers even less than that. It strikes me as strange that, in the twelfth year of a government which lay claim to economic success, teachers are being asked to accept a real pay cut and we are told that even what the Secretary of State proposes to implement has to be staggered because of the problem of affordability. It strikes me as curious that in 1990 teachers should still be told that they have on average to make sacrifices in this way because the country cannot afford anything else. I find that astonishing.
On pay structure, of course I welcome the efforts to reward heads and deputy heads: that seems to me a very important matter. I strongly believe that the leadership given by head teachers is of great significance in terms of what makes a good, as opposed to a bad, school. However, I have to add that I believe it is usually the case that certainly heads and, to a considerable extent, deputy heads do not do much actual teaching. There is a good deal less on offer for those who do the actual teaching. I am not certain that that can be entirely acceptable. The noble Baroness referred to incremental enhancement. That is a marvellous expression which I shall contemplate and no doubt use myself in a speech in due course. However, I think it means giving a little more but not as much as a whole increment to some teachers to whom the Government are anxious to give a little more money.
Am I right in saying that although the Secretary of State wishes to see that happen he is providing no additional funds whatsoever to implement any flexibility, but is instead relying on a statement that I believe he made on 7th March 1990 when he said that somehow local authorities would be able to squeeze the amount of money required out of savings from their education services? I find that puzzling. I stand second to none in my desire to see all public sector bodies behave efficiently but I do not see how, in present circumstances, local authorities will squeeze any money out of savings. If we take into account the poll tax problems that local authorities have, all the evidence is that less money will be available rather than more.
I do not like to introduce a carping note. I know that when one looks at the figures simply as figures they appear to be large sums. However, that is simply an indication of the inflationary world we live in. Nowadays £600 or £700 million does not appear to be a lot of money. I take it that this will be our last debate on a school teachers' pay and conditions 585 order because by this time next year the legislation will be in place.
I believe the Government have missed an opportunity here. They could have responded much more imaginatively to the needs of education and therefore to the needs of teachers. I am not discussing here whether or not teachers are a deserving case. They are a perfectly deserving case but that is not the way we need to approach this matter. I am suggesting that your Lordships consider the fact that we are discussing a pay award which will not help teacher recruitment. It will do absolutely nothing as regards recruitment to the extreme shortage subjects. However, we shall have an opportunity to debate pay differentials and other such matters in due course.
In welcoming the statement of the noble Baroness I must conclude by saying that I do not believe that what the Secretary of State has offered here meets the needs of our schools. When I consider the private sector of education, there is no better measure of the failure of the Secretary of State than the fact that no teacher in the private sector is being asked to take a real pay cut this year although, for reasons that are beyond me, teachers in the public sector are being asked to take such a pay cut.
§ 2.38 p.m.
§ Lord Rochester
My Lords, I wish to join in thanking the noble Baroness, Lady Blatch, for introducing this order. At this time on a Friday afternoon I do not propose to discuss the findings of the interim advisory committee in detail but rather to take the opportunity briefly to say how we on these Benches view the present situation regarding the pay and conditions of teachers generally.
Sadly in the introduction to its report the committee states that the commitment of teachers:needs to be underpinned by far higher morale than we have found. Too many teachers feel that their efforts are undervalued by the Government, their employers, parents and society more generally. Our recommendations in this Report can address that only to a small extent. There is a wider challenge for the country".That statement shows clearly just how serious the current position is.
The Secretary of State set a limit of £600 million on the cost of the committee's recommendations. He further directed that regard should be had to what he called affordability and the falling rate of inflation. In fact, while the retail prices index fell for a time from 8.3 per cent. in May last year, it rose during the course of the committee's inquiry and is now running at 9.7 per cent. That compares with an increase of only 7.9 per cent. in the total pay bill for teacher; during the year 1990–91. In real terms, therefore, as the noble Lord, Lord Peston, has already said, there will be a considerable reduction in teachers' pay this year.
In those circumstances one would have expected the Government at the very least to have accepted the committee's recommendations in full. The Government say that that is what they have done. However, they underplay the fact, made plain in the order that we are considering, that implementation of the recommendations is to be phased in rather 586 than given immediate effect as the committee proposed. The committee's recommendation was that pay increases in 1990 should total £733 million, but because the Government are delaying payment of a substantial part of that amount until 1st January 1991 there will be a deficit.
On that point I do not believe that the Government have dealt adequately with the problem that is caused by revenue support to local authorities being calculated on the basis of a pay award costing £600 million compared with the immediate cost of £620 million that I have just mentioned. The difference of £20 million will have to be found by local authorities at a time when schools are already facing severe problems in finding the resources to introduce the national curriculum and to accept local management and when there are problems associated with the poll tax, as the noble Lord, Lord Peston, mentioned and so on.
I do not propose to return now to the arguments that we had when the Education Reform Bill was discussed in this House about the way in which the pay for teachers should be determined. We have to recognise that the Secretary of State announced his proposals for new permanent negotiating machinery at the end of April, and it is those proposals that we are now considering. Arising from the meetings that he has since held with employers and unions, however, I should like to ask the noble Baroness this straight question: can she assure me that those meetings really were consultative in the sense that the Secretary of State will give careful consideration to the views of those consulted? It is highly desirable that if at all possible a negotiating structure is designed which proves sufficiently acceptable to teachers and their representatives to ensure that there is no repetition of the disruption from which our schools have so recently suffered.
There is one other matter concerning the extension of the 1987 Act on which I must press the Minister. On 5th December last the Secretary of State said in another place:it is necessary for the present arrangements to be in place for one more year".—[Official Report, Commons, 5/12/89; col. 271.]In dealing with the question of future pay machinery, he added on 6th June last:It remains my aim to introduce legislation early in the next Session of Parliament".—[Official Report, Commons, 6/6/90; col. 736.]The noble Baroness repeated that statement this afternoon, and we understand that.
It is now rumoured that because it may not be possible for that legislation to be enacted by 31st March 1991 the Government intend to extend the duration of the 1987 Act still further. Accordingly I shall be grateful if the noble Baroness will confirm that legislation will not simply be introduced but will be enacted in time to ensure that the present arrangements will not be extended beyond 31st March 1991.
At the end of the day we have to say whether we consider that the overall amount of £600 million authorised by the Government this year is enough to recruit and retain a sufficient number of teachers of the quality required for the education of our 587 children. Speaking on behalf of my noble friends, I have to say that in our view it is not.
§ 2.45 p.m.
§ Baroness Blatch
My Lords, this has been a short but I believe important and very interesting debate. It has ranged quite widely and it may be of help to remind your Lordships that the order we are considering this afternoon is needed to bring into force the new rates of pay for school teachers to have them in their pockets with effect from 1st April 1990.
We have heard a good deal about the Government's decision to stage the recommendations of the interim advisory committee. As noble Lords are aware, the Government took the view that the cost of implementation from 1st April would be too high. Given that the original costing for the recommendation was put at £600 million and the sum came in at £733 million, I am grateful for the generous comments that have been made in generally welcoming this order. I understand some of the concerns about the phasing. We had to keep within financial guidelines and it was important to the Government—I hope it will be recognised by noble Lords—that that recommendation was met in full, albeit phased in at the tail end. It will mean very substantial improvements in both levels of pay and career structure.
Typical secondary heads will see their pay rise by some £3,000 from March 1990 and typical primary heads by some £2,000. For deputies the comparable increases will be £2,300 and £1,800. In addition, the introduction of range pay from 1st January will give local education authorities and governors much greater flexibility to reward responsibility and achievement.
For example, a good honours graduate entering the profession after 1st January will start on at least £10,503 or £12,003 in inner London. Teachers in inner London starting their second year of teaching next term and awarded one of the new pay supplements will see their salaries rise by 23 per cent. between March 1990 and January 1991. For such teachers there will also be the possibility of one of the new incentive allowances and of incremental enhancement worth up to £999. For teachers at the top of the scale there will be the possibility of one of the new higher value allowances and of a further substantial increase in salary if their local education authority adopts a local extension to the standard scale. Even without the use of the new discretions, teachers will have seen their pay increase by 50 per cent. on average since March 1986.
The speed with which the Secretary of State accepted the report clearly demonstrated his approval of the committee's whole approach. I welcome the comments made this afternoon about the quality of the committee's analysis and recommendations over the past three years. Such tributes are well merited and I shall pass them on. In a moment I shall come to the points made by the noble Lord, Lord Rochester.
588 The interim advisory committee recognised that the introduction of a more flexible pay system places particular responsibilities on local decision-takers, in particular the governing bodies of the increasing number of schools with delegated budgets, but also local education authorities. There will clearly be some difficult choices to be made. There is no escaping that. But local management is about the targeting of resources to where they are most needed and will do the most good. As was said by my right honourable friend in another place, that will not be achieved if pay increases are awarded simply by "Buggins' turn".
A number of points were raised during the course of the debate. Given that it is Friday afternoon, I hope that noble Lords will forgive me if I deal with them relatively cursorily. The first question put by the noble Lord, Lord Peston, asked whether my right honourable friend will be making a Statement in advance of presenting legislation to Parliament. I can give him the assurance that the intention is that that Statement will be made as soon as possible. It links up to a question asked by the noble Lord, Lord Rochester: how long will the talking go on? I hope that there will be understanding that talk is seriously going on now and there is a very real intention that the highest degree of consensus should be arrived at. But at the end of the day a decision will have to be made, or we shall be into another year and yet another year. Understanding that that decision must be made, we can expect a Statement. The aim remains that if it is possible to put legislation before Parliament in the next Session it may well involve an extension for a short time while that legislation is put in place. Although I can never state it categorically, I hope that this will be the last time that Parliament is asked to make any extension for technical reasons and that the permanent arrangements will be put in place.
A very real point was made about recruitment, retention and motivation. A valid point was made that pay is only a part of that issue. I accept that. However, I hope again that some credit can be given to the Government and my right honourable friend for a range of measures that are being taken in order to deal with teacher shortages, the difficult times in which we live and the mobility of teachers. To name a few measures, I refer to the articled teachers scheme; the licensed teachers scheme; the encouragement of re-entry into teaching; a fairly expensive publicity campaign to attract people into the profession; helping with housing in London; a special additional London allowance; and I could go on. Therefore pay dovetails nicely into those arrangements. The very flexibility that has been built into the pay system will also make teaching more attractive.
A good deal was made of the relativity of teachers' pay to other non-manual earnings. I have taken that point because if one refers to the tables, the very best figure is the year of the Houghton award in 1973–74, which is rather a long time ago. Teachers were then earning 136 per cent. of the national average wage of non-manual earnings. By 1978, only a short time later, the relative value of teachers' pay to non-manual earnings had fallen by 22 per cent. It 589 has dropped from 136 per cent. to today's figure of 107 per cent. That will creep up very slightly as a result of this award.
This is no time to score points. However, it dropped by 22 per cent. between 1974 and 1978 but between 1979 and 1989–90 the drop has been only 5 per cent. Nevertheless, in real terms it has dropped; I accept that point. There is nothing magic about relativity tables in themselves. At the end of the day the policy must be that teachers need to be paid sufficient to make recruitment and retention buoyant and to motivate teachers. I am sure that all noble Lords will agree on that point.
The point was also made about local authorities having difficulty in meeting the pay award because it was above the figure that noble Lords believed they can afford. Local authorities have to live in the real world like everyone else. They have to determine priorities. I believe they are partners in the funding of the teachers' pay award. Under the new system of community charge it will be for local authorities and their local communities to consider whether teachers should be paid more.
I wish to put a very important point on record. The issue was raised that teachers feel undervalued and that morale is low. My right honourable friend in another place, I believe, has consistently recognised and paid tribute to the work of teachers and of all people working in education. I have no hesitation in joining in that tribute to teachers, in particular at this time when there is so much change. I believe that it is not simply rhetoric. My right honourable friend has been concerned about the burden laid on teachers at this time and has taken positive steps to reduce that burden. For example, I cite the measures that he has taken with regard to the testing of children at the age of seven, and to lessen the burden of returning statistics to the Department of Education and Science. Therefore 590 some positive measures are being taken. The work of teachers is not being underestimated by this Government.
If noble Lords will forgive me, those are the individual points with which I shall deal. The Government have taken wide-ranging measures to combat shortages. I have mentioned some. But, with the interim advisory committee, they firmly believe that pay flexibility and the targeting of resources by local education authorities and governing bodies is the correct, essential response to local problems. The new pay discretions for heads, deputies and classroom teachers will have a key role to play and the Government look to governors and LEAs to use them effectively and with imagination. In fact, there is evidence in London that many local education authorities are making good use of the new discretion to pay teachers a £750 inner London supplement.
The Government have made clear their view on teachers' pay and on the structural changes necessary to enhance career prospects, improve morale and tackle shortages at a local level. The Opposition, on the other hand, are anything but specific. There will be time to engage in a debate about the positive proposals that may come from our friends on the opposite Benches.
My right honourable friend the Secretary of State for Education and Science made clear in another place that his aim is to introduce legislation for new permanent negotiating machinery early in the next Session of Parliament. I am happy to repeat that statement. In the meantime, the order is needed to ensure that teachers receive their 1990–91 pay increases and I commend it to the House.
On Question, Motion agreed to.
House adjourned at five minutes before three o'clock.