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Strike it rich

They have led to public outcry and condemnation, but bonuses are alive and well in the teaching sector

19th June 2009, 1:00am

For almost two decades, bonuses were instrumental in the City of London’s success as a centre of world finance. They lay behind the demand for shiny sports cars and red braces, not to mention ludicrously over- priced wine, and often a single cheque could buy a small mansion. But just as they are losing their grip in the City, it could be that the bonus culture is about to find another home - in schools.

Recruitment and retention allowances have been available to some teachers for some time, but now there are signs that a more explicit scheme, in the form of performance-related bonuses, could be inching into schools.

The issue was brought into the open at the Association of Teachers and Lecturers’ annual conference this year, when Hank Roberts, a member of the union’s national executive, claimed that a team of senior leaders at a school in north-west London had pocketed up to pound;1 million in bonuses.

The headteacher, deputy head and bursar at Copland Community School in Wembley were suspended last month pending an investigation, still underway when The TES Magazine went to press. Sir Alan Davies, the head, was said to have received about pound;130,000 in bonuses over two years on top of his pound;100,000 salary.

The chairman of governors defended the payments as recognition of the school’s good results and money raised in sponsorship. Ed Balls, the Schools Secretary, has also spoken out in favour of the principle of bonuses, saying there was “no reason” why heads should not receive them.

To their supporters, bonuses are a powerful incentive to improved performance, and can help schools retain high-quality teachers. Critics claim they are divisive and, while they may work in the cut and thrust of international high finance, they are at odds with the more egalitarian atmosphere of education.

So, is there any more reason why the head of an investment bank should receive a cash incentive than the head of a struggling comprehensive who has turned it around?

Although not strictly speaking a bonus, a recruitment and retention allowance performs a similar function. Instead of a reward for past success, its ostensible purpose is to guarantee future loyalty. In practice it provides additional rewards on top of a teacher’s regular salary. Science specialists, in particular, have found that teaching in a shortage subject can be a lucrative affair.

Paul (not his real name) received a pound;4,000 golden hello at the end of his first year as a physics teacher in Cheshire. After 30 years in industry, he had taken a substantial pay cut to become a teacher. He says the allowance is recognition that science teachers are in short supply and often have more employment options than graduates in other subjects.

“It is important that people with industrial experience or with alternative career options are encouraged into the profession,” he says. “It is simply a response to market pressures.

“We need a certain number of teachers and there aren’t enough people doing physics. You could also pay it to Latin teachers, not because they have other options but there aren’t enough people studying Latin at university.”

Paul, 55, says that while the inducement was helpful to him financially, it did not have as much impact as his school’s decision to take his previous experience into account and start him at the top of the main pay scale, on pound;30,000, rather than the standard new teacher rate of pound;20,000.

“I only took the plunge because I had paid off my mortgage. It does make a difference, but I was in the fortunate position of it not being vital,” he says.

There are doubts over whether the almost pound;200 million allotted nationally to golden hellos over the past eight years has been money well spent. Some shortage subjects are still struggling to attract sufficient applicants, while others still offer the incentives even though they are oversubscribed.

Figures from the Graduate Teacher Training Registry show only 71 per cent of maths and 58 per cent of information technology teacher training posts are being filled, despite qualifying for golden hellos.

Trainees on religious education courses receive golden hellos even though the subject was turning away recruits last year, and the incentive is also available for music, where 97 per cent of places were filled. A total of 6,825 payments were made last year, adding up to pound;28 million.

These golden hellos are about to be supplemented by golden handcuffs. From September, selected staff joining National Challenge schools - where fewer than 30 per cent of GCSE candidates achieve five A-C grades including for English and maths - will be eligible for pound;10,000 bonuses for three years’ service. The scheme has been criticised as divisive by union leaders, but John Holman, director of the National Science Learning Centre and himself a former headteacher, believes bonuses do have a role to play in schools.

“The phenomenon of some people being able to command higher rewards than others is everywhere. It is perfectly normal to get a higher starting salary if you have qualifications that are in short supply,” he says.

Professor Holman, who is also national STEM (science, technology, engineering and maths) director for the Department for Children, Schools and Families, says these incentives are particularly useful in science and maths. As a head, he says, he sometimes found it difficult to recruit physics, chemistry and maths teachers, even though his school could offer good facilities.

However, schools are often reluctant to use the flexibility over salary levels that they already have, he says. “There is a lot of potential for paying over the odds and heads are extremely clever at using pay scales to get what they want, but schools are egalitarian places and when I was a head there was a lot of pressure not to pay extra,” he says.

Teachers spend a lot of time talking to their pupils about fairness and treating people equally, he says. Schools are also places where it is essential for people to work closely together. Despite this prevailing culture, he says schools should be prepared to break their pay structure for particular individuals, and nowhere more so than for headteachers.

To some extent, the pay barrier has already been broken for heads. Academies in particular are able to offer more generous rewards than the national pay and conditions agreement, which gives the maximum for a head as pound;107,192. Some academies are thought to offer up to pound;150,000 a year, with hello bonuses of up to pound;40,000 available to the right candidate.

“A headteacher can make such an enormous difference to a school,” says Professor Holman. “You have to do everything you can to give the pupils the best possible start in life, and if the price is upsetting the spirit of equality in a school, that is worth paying. The pupil must always come first.”

Professor Holman also believes in rewarding performance. He balks at paying by exam results alone, but says a range of measures could be used to determine whether a particular teacher or head merits a bonus payment.

This issue of how to decide who gets a bonus could be a sticking point, says Alan Smithers, director of the Centre for Education and Employment Research at the University of Buckingham.

The lack of an objective measure means it will come down to individual judgment, and that has the potential for sowing divisions, he says. Where bonuses are accepted in the private sector, they can end up being paid even when targets have not been met, as the banking industry found.

Targets such as improving exam results or cutting truancy could also prove too crude, he says. Heads will find a way to meet them, but this may be at wider expense, such as raising grades by excluding low-performing pupils.

But Professor Smithers believes that schools should have more flexibility in pay, giving an indirect link between salary and performance.

“There could be more flexibility to reward particular achievement or meet specific needs,” he says.

“It should be left to the head and governors. If they want somebody to run the Duke of Edinburgh scheme or they are short of physics teachers, they should be able to provide an enhancement on top of the basic rate. There is a case for more autonomy for schools when it comes to salaries.”

He says the teaching unions are responsible for much of the rigidity in the pay scales, an approach that fails to take into account both regional variations in the cost of living and the differing challenges between schools.

John Dixon, head of membership at the NUT, believes there is possibly too much flexibility in the system already. He says that singling out individual teachers for additional payment would be a divisive step. “Teaching is very much a collaborative exercise,” he says. “Schools are about working together.”

The union recognises the need to attract people to teaching and reward them for staying in the profession, he says, but this should be done through an enhanced pay structure for all. It is a lack of flexibility in funding, rather than in pay, that is proving a disincentive, he argues.

Martin Freedman, head of pay for the Association of Teachers and Lecturers, says that unlike in businesses, where an individual may have a dominant influence over its success or failure, schools’ success relies on collective good performance. “You need all teachers to be performing well for a school,” he says.

The reliance on collaboration means a bonus culture would be counterproductive. Even golden hellos are a short-term fix that may have little impact in the long term, he argues.

One option could be to reward groups or departments collectively, suggests Cary Cooper, pro-vice-chancellor for external relations at Lancaster University and professor of organisational psychology and health at its management school. But he says the financial reward may not be as important as the simple acknowledgement of a job well done.

“If you can give somebody recognition for doing a good job it shows you are trying to reinforce that recognition, which is more important than the money, unless you’re paying big bucks,” he says.

Without a clear, robust and widely accepted means of deciding who qualifies for a bonus, he believes any scheme could cause dissent among staff: it is something that applies as much to bankers as to teachers. “I would not want to give bonuses to individuals; that would be very disruptive. I would rather incentivise the whole group to do well.”

It may be an irony that as bonuses in banking are becoming as desirable as toxic assets, they are making an appearance in teaching. But now the genie is out of the bottle, will it take a banking-style collapse to put it back?