London Weighting - Fair Funding also means Fair Pay

Teacher shortages are harming education
Schools are struggling under a crisis of low morale and high teacher turnover. That's before the proposed school funding cuts add to the pressures on staff and schools alike.

NUT leaflet from 2001

These pressures are most clearly evident in London. DfE figures from the School Workforce Census confirm that London schools already have some of the highest rates of 'teacher wastage' and temporarily filled posts. Yet it will be London schools that will be worst affected by the proposed 'fair funding' cuts, further threatening jobs, morale and pay progression. Of course, those attacks also threaten children's education.

Workload is the biggest factor - but pay is also an issue
The single biggest factor that teachers identify when they are surveyed about why they might leave teaching is, of course, workload. As just the latest confirmation of this, in the latest 2017 survey of young NUT members in London, 84% gave 'volume of workload' and wanting 'a better work/life balance' as their main reason for considering leaving the profession.

This heartfelt response is typical: "I love teaching children. It is the best part of my day, but who runs a marathon then goes to the gym and does another 6/7/8 hour workout? By the end of the school day I want/need to relax and recharge my batteries. Instead, I feel waves of anxiety as I plough through the never-ending mountain of paperwork".

However, London's young teachers also identify pay and the high cost of housing as additional reasons why they might quit their post - to leave London at least, if not the profession overall. In the previous 2016 survey of young teachers in London, 60% said that they could not see themselves still teaching in London in five years’ time. Significantly, nearly two-thirds of responses specifically pointed to the cost of living in London as the reason that they would be leaving. As one teacher put it, “Teaching, yes; in London, no. I just can’t afford to live here”.

In the latest survey, London's young teachers linked together concerns about pay, lack of pay progression and workload. As one respondent explains: "We cannot keep working like this; something has to give, and I fear it will be teacher health and well. Plus, even if we were to hit our targets, our headteacher is pretty much guaranteed to do anything she can to block us moving up the pay scale anyway". Another replied “The pay does not reflect the actual hours and all the extra time we spend working on weekends and holidays. I will not feasibly be able to move out of my parents' house, on my current pay, in my current area, before the age of 30 - if I am lucky! ".
London Weighting to match London's living costs
If London schools are to recruit and retain the teachers our children and communities need, then action has to be taken - on workload, on pay progression, on housing costs. However, there's another issue where action is needed - making sure that pay levels in London sufficiently match the higher costs of living in the capital. Or, as it used to be described, teachers' salaries should include sufficient 'London Weighting'.

Higher pay for London workers, reflecting the higher cost of living, has been a long-standing feature in the UK economy. It was formalised into a recommended London Weighting, particularly by the Pay Board Advisory Report in 1974. Recent research by Donald Hirsch for the Trust for London and Loughborough University explains how, from 1974 to 1982, the Pay Board calculated a flat rate cost compensation for Inner and Outer London. Hirsch points out that, in practice, the Pay Board calculation was only the starting-point for bargaining, with the private sector generally being able to afford to pay more than the public.

Under the Tories, and with Norman Tebbit as Employment Secretary, the Pay Board index was discontinued.  The situation was further complicated in schools because some, but not all 'Outer' London boroughs, were designated as being eligible for 'Inner London' allowances. 

Strike action won gains for London's teachers
In the 1990's, with teachers shortages growing, NUT Divisions organised for action on London Allowances, culminating in two days of strike action taken by the NUT across London in 2002.

The action definitely had an effect. The 2003 Review Body report recommended significant increases for Inner London teachers in particular, especially those on the Upper Pay Scale. The difference between UPS2 in Inner London and elsewhere was agreed as being as high as £5,943 - close to the £6,000 Allowance that the NUT had been demanding.

NUT leaflet from 2002

However, the victory didn't come without strings attached. The increased pay was delivered through the introduction of a separate salary scale for Inner London teachers. This was  later extended to separate Outer London and Fringe scales as well. The idea of a distinct 'London Weighting' payment was lost. Instead, your effective 'London Allowance' depended on your point on the applicable salary scale.

That remains true today, although of course now, even the idea of fixed salary scales is being attacked by the Tories. Nevertheless, most schools are still adopting scales where an effective 'London Weighting' can be identified. Taking the recommended joint union scales, the effective 'London Weighting' for teachers paid on the Inner and Outer London scales, compared to a teacher in England and Wales is as follows:

Effective 'London Allowances' based on joint union scales, 2017

It's worth highlighting that, as pay progression becomes harder to achieve, particularly to and along the Upper Pay Scale, the proportion of teachers being awarded these higher Inner London UPS 'allowances' is decreasing.

What are the additional costs of living in London?
Are the higher salaries paid to London's teachers - and other London workers - sufficient to compensate for the additional cost of living in the capital? Without an authoritative 'Pay Board' calculation, that question has been difficult to answer. However, Donald Hirsch's research has set out to provide an answer. 

Hirsch shows that levels of London allowances paid by a range of employers have failed to rise significantly over the last three decades. The average is between £3,000 and £4,000, matching those for teachers on Outer London scales. This is despite large increases in the cost of living in London, notably in transport costs and, above all, housing.

Data from Hirsch's Report

Hirsch concludes, through detailed calculations of additional costs and weightings to take account of the range of housing Londoners live in, by setting out a "minimum London Weighting" required to compensate low-income households for additional London costs. (Hirsch defines 'low-income' as earning less that £40K - which includes London teachers paid on the main scale).

Hirsch's calculations produce an average "minimum London Weighting" required of £7,700 for Inner London and £6,200 for Outer London. Apart from those older teachers on the Inner London Upper Pay Scale, most teachers receive far less additional pay than required to meet the added cost of living. No wonder many are looking to leave London.

NUT 2016 Conference Policy on Greater London Pay
Last year's NUT Annual Conference passed a motion that set down policy for London Pay, including:
i. It is time that teachers working in London receive a pay award that reflects the real costs of living in the third most expensive city in the world;
ii. The Inner and Outer London Teachers’ Pay Scales no longer reflect the reality of the housing and other expenses in London: it is both out of date and unfair;
iv. There should be a single “Greater London Pay Scale” that covers the whole of London that should be no lower than the current inner London Allowance;

Recognising the particular pressures of housing costs, it also stated:
v. It is also time for action to address the cost of housing in London, which is an even greater barrier to staying in London than the rest of the cost of living; and
vi. A long term solution to the problem of ever-increasing housing costs, which is affecting teachers in many other areas as well as London, can only be delivered through an increase in the supply of affordable housing.

Additionally, the motion concluded that the NUT Executive should "Investigate what would be the best and fairest system of paying the “Greater London Pay Scale”, including the consideration of a “flat rate” payment that would apply the same additional payment to all teachers who work in London regardless of where they are on the National Pay scale". 

Hirsch's research adds support and evidence to back up this policy.  

Fair Pay in London requires genuine Fair Funding 
Despite these facts, the funding threat to London's schools means many Heads and employers will be trying to cut pay, particularly through blocking pay progression, rather than increase it. However, that will only compound the recruitment and retention difficulties.  

That's why the NUT has been calling for needs based funding for all authorities in England and Wales, and, as part of that campaign, we must add the demand for the funding needed to pay staff London ‘allowances’ that genuinely compensate for the additional cost of living in the capital

As the joint union evidence to the Review Body last year stated, "All of us are concerned that the school funding settlements proposed by Government for the remainder of this Parliament will place insurmountable pressure on schools in terms of their ability to maintain current spending, let alone afford matters such as pay increases or other forecast increases in costs. We all believe that there needs to be an overall funding increase for schools, not just smaller real terms cuts for some schools and larger real terms cuts for others via the redistribution mechanism of a national funding formula. We believe that any pay increase must also be fully funded by Government ".