UK sets out teacher pay hikes that should outpace inflation - Finance news and analysis from Global Banking & Finance Review
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UK sets out teacher pay hikes that should outpace inflation

Published by Global Banking & Finance Review

Posted on July 1, 2026

2 min read

· Last updated: July 1, 2026

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UK Increases Teacher Pay Above Inflation With Major Boost From 2024

Government Announces Significant Teacher Pay Rises and Funding Measures

LONDON, July 1 (Reuters) - British teachers will receive pay increases that should outpace inflation over the coming two years, with the first rise coming in September, the government said on Wednesday.

Details of the Teacher Pay Increases

Teachers' pay will increase by 3.5% from September, and by 3% from September 2027, representing a cumulative 17% rise since the country's Labour government took power in 2024.

Pay Rises Compared to Inflation

• The increases are above the most recent rate of inflation which stood at 2.8% in May. Last month the Bank of England said inflation could be under the 3% mark in September

Funding Allocations for Schools

• Britain will provide £1.8 billion ($2.4 billion) to schools over two years to support pay rises, with schools expected to provide the first 1% of each pay award

Support for Further Education Providers

• Additional £485 million to be given to colleges and other further education providers over next two years to use towards recruiting and retaining staff, and courses

Executive Pay Restrictions

• Curbs will be placed on academy trust executive pay

Additional Information

($1 = 0.7553 pounds)

(Reporting by Suban Abdulla; editing by Andy Bruce)

Key Takeaways

  • Teachers are set for 3.5% pay rise in September 2026 and 3% in September 2027, equating to a 17% cumulative increase since 2024.
  • UK inflation was at 2.8% in May 2026, so the pay awards will outperform inflation in real terms.
  • The government is allocating £1.8 billion to schools (with schools covering the first 1% of awards), plus £485 million for colleges; academy trust executive pay will face new limits.

Frequently Asked Questions

When will UK teachers receive the next pay rise?
UK teachers will receive a 3.5% pay increase starting in September 2024.
How much will teacher pay increase over the next two years?
Teachers' pay will increase by 3.5% in September 2024 and by 3% from September 2027, totaling a 17% rise since 2024.
Will the teacher pay rises outpace inflation?
Yes, the government stated the pay increases will be above the most recent 2.8% inflation rate.
How much funding is the UK government providing for schools?
The government will provide £1.8 billion over two years to support schools with the teacher pay rises.
Are there funds for further education staff?
Yes, an additional £485 million will be allocated to colleges and further education providers over the next two years.

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