An annual increase of about 2.7 per cent is expected to be recommended by the School Teachers’ Review Body in its report, due to be published next week.

The pay award is equivalent to approximately pound;780 next year for a teacher at the top of the main scale, and about pound;550 for newly qualified teachers.

The review body delivered its report to ministers last Friday.

The report is believed to recommend a two-year deal with an increase above the 2 per cent suggested by ministers.

Heads and deputies are set for bigger rises amid claims that they have not benefited from efforts to reduce workload and concerns that too few teachers are applying for leadership posts.

The report will set pay rates for the new post of “excellent teacher”. This was created to replace the top two points of the upper pay spine in a deal between the Government and the unions which signed up to the workforce reform.

It will also deliver the review body’s latest verdict on local pay and decide whether advanced skills maths and science teachers should be paid more than colleagues teaching other subjects.

Inflation, as measured by the retail price index, runs at 2.7 per cent per year. The consumer prices index, the Government’s preferred measure, stands at 2.5 per cent.

The pay rise for 2007 may be re-examined if inflation increases substantially in the meantime. Unions hope the review body will respond to the Government’s calls for stronger links between professional development and pay by demanding that teachers have access to better training.

John Dunford, general secretary of the Secondary Heads Association, said:

“It is important that teachers’ pay keeps pace with other graduate professions.”

A survey by NatWest bank shows that graduates’ starting salaries increased by 3.6 per cent last year. The two-year deal, for teachers, combined with new three-year budgets, is intended to give schools greater stability.

News of the increase came as Tony Blair tried to reassure teachers that last week’s education white paper would not give schools greater freedom over pay.

Answering questions in this week’s TES, the Prime Minister said:

“Self-governing and trust schools will, of course, be the employers of their staff. But they will also have to respect existing contracts and work within the national system for determining pay and conditions of teachers.”

Any school or trust wanting to opt out of the national system will have to follow the same application process available to all schools at present, he said.

Headteachers’ leaders said the threat to speed up the removal of heads of failing schools emphasises the need for an increase in school leaders’

pay.

Mick Brookes, general secretary of the National Association of Head Teachers, said: “The small gap between the pay of heads, deputies and teachers is a key factor in why people are not interested in leadership posts. Why should they take on these additional responsibilities for peanuts?”

jon.slater@tes.co.uk