Those deciding which independent school to accept - check if it is still in Teacher Pension

[WombatChocolate]

I’ve been following a number if the threads where people have been trying to decide which offer to accept and grappling with journeys, scholarships, extra curriculars, etc etc.

One further thing to consider in the mix - do you know if the independent school you’re considering remains in the Teacher Pension Scheme?

A number of schools (significantly less than half still) have withdrawn from the pension so they can reduce the longer term commitment to have much the school needs to fund their staff pensions.

On one level, parents might think that looks good because it means fees will be a bit lower. That is probably true. However, also consider staff recruitment into the future. We all know there is a teacher recruitment and retention crisis. Even the top independents are finding they have fewer applicants and sometimes none or no quality ones for vacancies. Schools that have left the Teacher Pension Scheme will find it harder and harder to recruit quality staff, because they will simply have the option to go elsewhere - to a state school or an alternative independent. The vast majority of top and larger independents still remain within the Teacher Pension scheme.

So, it’s just something you might want to ask at Offers Days and bear in mind. If your child wilL be going to a school for 7 years, you’d hope the good existing staff will stay and as people naturally leave, that the school will manage to recruit great replacements. Some schools might find that 7 years down the line, their staffing quality is quite different to today or even the last couple of years ago. Just something else to consider.

@chillypeppr your school has had no issues yet.. let’s see if this is still the case 10 years from now. You may be right but I doubt it.

You might also find you get a higher turn over of staff who take a job on a short term basis for the experience and then jump ship as soon as they can. (Recruiting can be expensive too in many ways). This happens when teachers go abroad to teach.. they forfeit the pension in short term in the knowledge they will get a lot of money tax free for a short period of time - and then return to the UK for a more permanent job with a pension scheme.

Time will tell if this has been a wise move.

If anything more will leave with inflation at the rate it is and the black hole of funding and expected rise in employer contributions from 23.6% by a few percentagepoints from April 2024. It may be offset by holding down pay, so that the overall package is similar. It remains a minority public sector pension scheme which is available when working in the independent sector. International teachers may be targeted as they are not already benefiting from TPS, but teacher movement is fairly common, the issue is if you get lots all leaving at the same time.

The TPS is a failing scheme, teachers should just be renumerated property in terms of salary and benefits full stop, not through an unaffordable and fundamentally risky scheme that it is very clear the government want to make unaffordable, so schools do withdraw and they can wind down. The only reason the employer contributions continue to go up, and are about to double, is because the fund is a black hole any they need to cash.

These incredible, employer contributions, which ate being asked of by the TPS are again, in the whole unafordable, it's a nod to byegone eras of full salary pensions, which are dead and buried.... apart from the Telecom, national rail, national power schemes, etc. that generations of young workers will be funding for decades to come through their tax.

I'm all for every teacher being renumerated and rewarded extensively for their work, but this thread stinks of the ramblings of disgruntled teachers who are angry their TPS might be going away.

The tps is not the future, it's a broken dinosaur. But we do need an effective and rewarding alternative so teachers are paid properly on monthly basis, can save for a comfortable retirement and that schools can properly afford it.

Properly *

I’m not a disgruntled teacher worried it’s going away for me - to be fair I’ve got my pension scheme and I was lucky enough to get the 80% final salary scheme when I first joined 20 years ago. It’s not me that will be impacted if the scheme is abolished but new teachers.. and quite frankly teachers terms and conditions have been eroded so much in the past 50 years this is one thing the needs to stay in my opinion.

Remmeber that over 90% of teachers are in the state sector and the TPS is not under threat for them. Likewise, the many NHS workers and Civil Servants have very similar pensions which are not being taken away from their staff.

The government is not indicating that it is going to pull the plug on these schemes. They are funded by general taxation, so there isn’t a pensions black-hole in the same way that some private sector final salary schemes had a black hole.

And of course teachers in the private sector don’t want their pension taken away from them. It is worth an enormous amount and forms a key part of the overall package. Ditching it is a sizeable reduction in the overall benefits package, so the equivalent of a substantial paycut. No teacher is going to be pleased about that.

Schools exist in a labour market where teachers have choices about where to work. They can choose between a private school with the TPS, a state school with the TPS or a private school without the TPS. It’s hardly surprising which will be more popular employers.

And yes, it will take some time for the real impact on recruitment to be seen. It’s naive to imagine it won’t make any impact ….it assumes teachers are daft and don’t value a really significant benefit that is available in many places.

Yes, it’s a big expense for schools. But independent schools have to budget for key staffing costs, and this is one of them. Would anyone recommend that any school offers a salary that is £10k less than the market norm in order to manage their budget? No. The TPS is part of the market norm.

Look at the NEU website to see the figures on how many indeoendnet schools remain in the TPS and how many have left. People might be told by some schools that most schools have left. It’s a myth. The vast vast majority are still in it.

I’m a teacher with a very elite university training in a top independent school. I will leave my school if it withdraws from the TPS. My notice will go in the very same day.

@WombatChocolate very well said 👏

@WombatChocolate the state teachers moving to our school without TPS must have thought things through surely.

All have moved to gain significant reduction on school fees. It seems to be a strategic way of hiring new teachers. That's quite a few years before turnover happens against most private schools have a reasonable turnover of teachers due to the nature of their cohort and the opportunities granted to many teachers. Also not all teachers in private schools are qualified to work in the state sector. Many of our unqualified teachers are great too.

I'm a teacher in an independent school. My employer took us out of TPS last year against our wishes - existing staff as well as new recruits. Recently we were advertising for a chemistry teacher and had no applicants at all. Bursar was sitting at lunch musing about why on earth all the local science teachers in state schools wouldn't prefer to work in our school - it gave me only a grim pleasure to enlighten him.
I don't want to move schools now - I'm 51 and very settled, and in lots of ways I love my school, so I have had to accept the huge dent in my pension, but I sure as hell wouldn't have taken the job 9 years ago if the school hadn't been in the TPS then.

Older teachers with 20+ years in the pension and who expect to retire in a couple of years might stay put and not move. Those with kids in the school on discounted places might stay and not move immediately. Yes, there are things behind pensions which teachers consider.

But every year some people leave for whatever reason. They need replacing. Will teachers who are currently in a TPS school want to go to one without? Will a teacher who only has 5 years in the TPS so far, want to have the next 25 years of their career without a key benefit they could have elsewhere?

Schools which have withdrawn hope that teachers are ignorant of the benefits of the TPS. Some are ignorant of them. But most know it’s a benefit worth a vast sum of money in future pensions, if they work for a school with it for many years, and that will be lost in a school without it.

To be honest, it’s too soon to see the full effects. Looking at staffing right now, when the schools which have withdrawn have only been gone for a couple of years is too soon to see the full impact on recruitment. The roll-over of staff body takes a number of years. The impact will be seen gradually.

If you’re a non-TPS school in an area with no other independents, you might find you can still recruit, although have less applicants from local state schools than previously. Teachers who have to stay in the area for whatever reason, and who really don’t want to teach in state schools might not have much else choice. But those in state thinking of jumping ship for independent who are also stuck in the area, might think twice about doing it if the indeoendnet available is non- TPS.

In urban areas with more schools and in the SE and London where there are loads of independent schools, teachers have lots of choice about where to apply to. A school without TPS will have nearby neighbours who are still in it. It’s daft to imagine the non-TPS school will have as many applicants as the TPS school.

If I was told I’d get a £10k pay-cut next year…I’d look for another job. No surprise. Why are people surprised that taking a school out of the TPS which will make the teacher tens of thousands worse off over their full retirement, will also make people leave and make the school less attractive to apply to if looking for another job?

I suppose schools pulling out, hope parents and kids don’t notice that over time, they’ve had less choice of staff and had to employ less good candidates. They hope it won’t reflect in the learning experience or results. But of course, not attracting good teachers does make a difference.

It’s a strategy that is taken by schools who are already financially insecure and who are looking to cut corners. It’s short-sighted because the long term future of those schools relies on them performing well and attracting students. People don’t want to pay lower fees for an inferior experience. But of course, if you don’t give the staff a decent and competitive package, that’s what you’ll get. The going rate or market rate for teachers is the price of the full package of costs - that includes their salary, the NI the school has to pay, training costs, pension costs etc. if you give a package and pay for a package which costs peanuts, you’ll get monkeys!

And I intend no offence to any teacher.

We know that in all sectors, firms which pay higher rates and give packages worth more, have the choice of more candidates. Teaching is no different.

I’d imagine an even more tiered independent sector will emerge as a result of this.

There will be the big, often HMC senior schools. There will be the more secure Preps…larger, or linked with senior schools. They will continue in the TPS as they always have done. Their fees will be high and they will pay well and offer the TPS and have their pick of teachers. They will be successful and be increasingly popular.
And there will be the other schools - usually smaller or more financially vulnerable. Likely to include more single sex schools, more likely to be Prep schools, possibly in areas which aren’t so affluent and where less parents choose private education. There’s certainly a place for them as not all parents want or can afford the big highly selective schools. But increasingly they will find the best staff are elsewhere. Some will survive, but over time, a good number will close down - that is the trend already underway. Withdrawing from the TPS might be intended to stave that off, but in reality it might hasten what’s coming.
Private education is increasingly expensive to provide. It really is a luxury product that few can afford. Those who are on the margins of being able to afford it, increasingly look to see if what is provided is ‘worth it’ in relation to what they could get elsewhere. It’s a risky strategy to value the staff less and reduce their benefits package.

I suspect more independent schools will be coming out or asking teachers to take a salary cut due to the further increase in employer contributions (up from 23.68% to 28.68% a further 21% increase). I don’t know any other private sector jobs with this level of employer pension contribution - it’s just not affordable.

I have to agree I think this will make a difference in the future - especially to experienced staff who are still some way from retirement, as they know that leaving TPS effectively means the value of the pension will grow by 1.6% less per year - for me this would mean losing over one third of what I've paid in during the last 15 years, compared to if I stay in TPS.
It feel like, and hopefully it's true - that the state system is currently approaching the bottom in terms of funding issues / class sizes / work load , and if these things improve then moving to independent schools will become less tempting, especially if TPS is no longer on offer.

As a teacher I’ve noticed a trend in the TES and Eteach where teachers go to get jobs… those institutions without teacher pensions advertising for months and months presumably because they can’t recruit! One I saw recently was on the website for nearly 8 months and is still there. When you have a shortage of teachers cutting the pension is not a great option, when teachers can shop around!!! Attractive as it may seem to a school to pull out of the scheme I believe in the long run it will be a massive mistake.

I’ve looked up the list of those schools who have left/are going to leave/are currently staying, they are here if anyone wants.

In our local area (SW London) it seems about half or slightly more of the private secondaries have left or are in the process of leaving the TPS, including some big names. The GDST schools are a large chunk of that but by no means alone.

Given that, I wouldn’t be surprised if the rest feel they can and/or need to do the same in coming years - especially if and when the 20% VAT applies, the demographics drop kicks in, and schools are under more pressure to reduce fees and attract parents than currently. Maybe a few top schools know their clientele won’t care about fee levels, but that’s not usual.

As such, whilst I agree that teacher recruitment is very important, I would be cautious as a parent about choosing a school based on TPS membership now, as it may well change in the nearish future.

@minipie , great list, except GDST have left and only teachers there for years have TPS and not newer teachers. Saw the picket lines and had a chat with a few teachers.
Also, agree that selection of schools should include a lot of variables besides TPS. Though, I think pay and pensions etc on how teachers are treated by Head and senior staff are important.

I've been involved in this to a high level of detail (was a staff pension consultation rep & moved from independent to state). I'm in my 50s.

I'm not sure younger staff are very bothered about pensions. Those under say 35 are more interested in salaries and housing and those with DC, in fee discounts. All are interested in well behaved students and having enough resources and working conditions generally.

It's a complex matter.

However, a recent bitter or only partially resolved pension dispute can have left a lot of bad feeling and tension. Older more experienced staff may have voted with their feet.

Always worth reading news reports on a school before deciding - state or private.

@minipie while I agree somewhat with what you’ve said - recruitment is perhaps the most important thing in a school - anything that has a major impact on that should be viewed very seriously - the crisis in teaching is real and it’s only going to get worse - as terms and conditions get steadily eroded.

Oh I agree, I’m not denying the importance of teacher recruitment/retention or the impact of leaving the TPS. My point is more that schools which haven’t left the TPS yet, may well decide to in future, so it would not be sensible to choose a school on whether it has or hasn’t left at this point in time.

The individual schools that are part of GDST are listed under "Independent Schools that have given notice that they intend to use the phased withdrawal from TPS", which is correct.

Nearly all independent schools will have exited in the next couple of years. It is inevitable with the recent increase to 28.68% employer contribution. A huge number of big names have already exited and many more have announced their intention to consult. Schools have to factor many things into costs and the likely change in government, cost of living, parent affordability in addition to a pension cost they cannot control is not something most can live with and/or afford.

In terms of recruitment, this will impact those schools who left first and therefore settled at lower contribution rates more than those exiting now. Many are now offering phased withdrawal (existing teachers can stay in TPS if they wish) and the new offering to teachers are usually very generous DC schemes of up to 25% employer contributions. This is unmatched in most other sectors.

The argument that state schools will begin to look more attractive is unlikely when the whole package of benefits offered at most successful independent schools is considered.

I think it will create a two tier private schools system. The big and successful schools (often HMC schools but not always) have the money and want to retain everything they can to set themselves apart from the competition. They will have their pick of staff when recruiting and less retention issues. For a good period, they will and can fund the extra pension costs. They have some flexibility about cost savings elsewhere - perhaps pay rises won’t be so generous or there could be other areas to make some savings. Many of the successful schools can also boost their intake a bit - a few extra kids can cover a lot of the costs. Some schools are struggling to recruit enough students and their finances are already in the balance…but there are others with queues so applicants stretching down the road and they can take more to boost their income. The market is becoming more polarised.
Already those bigger schools within the Teacher Pension find they have more applicants. Teachers check school websites to see if a school is in the Teacher Pension and many (not all) will discount schools that aren’t. In a market where teachers are leaving education in droves already and less are training, quality teachers are high up the priorities of schools.

It’s an ahead one for parents to think about. On a basic level, most will see membership of teacher pension as meaning more costs to schools and higher fees. They could think the same about higher wages which are paid in certain desirable schools. Or they could see it as a cost which delivers a benefit they want.

@MargeIsBack as I've said further up the thread time will tell - and with new Labour government looking more and more likely, this along with other factors should be taken very seriously if looking at independent schools.

As a teacher, I know I am biased, but I think any school that has opted out of the teacher pension scheme needs to avoided like the plague. I really don't see the attraction of teaching at an independent school now -in terms of workload between the two, it seems to be swings and roundabouts. It will be interesting to see how this unfolds over the next decade. Either way parents are right to be factoring this into their decisions.

I think it will create a two tier private schools system. The big and successful schools (often HMC schools but not always) have the money and want to retain everything they can to set themselves apart from the competition. They will have their pick of staff when recruiting and less retention issues.

But surely this has always been true? The big and successful private schools have always been able to offer better salaries, perks, job security. This is now one more way in which they can (if they wish) differentiate themselves as an employer - but it’s not like there were never any differences before.