School Budgets (Pension Changes)

Oral Answers to Questions — Education – in the House of Commons at 2:30 pm on 27th October 2014.

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Photo of John Pugh John Pugh Liberal Democrat, Southport 2:30 pm, 27th October 2014

What assessment she has made of the effect of pension changes on school budgets; and if she will make a statement.

Photo of David Laws David Laws The Minister of State, Cabinet Office, The Minister for Schools

The employer contribution rates for the teachers’ pension scheme will increase by 2.3 percentage points following the recommendation to reform public sector pensions by the former Labour Minister, Lord Hutton of Furness. That will ensure that high-quality teacher pensions remain sustainable and affordable.

Photo of John Pugh John Pugh Liberal Democrat, Southport

That is reassuring, but why are so many secondary heads in my constituency alarmed by the prospect of increased national insurance contributions?

Photo of David Laws David Laws The Minister of State, Cabinet Office, The Minister for Schools

We have delayed the increase until September 2015 to give schools and head teachers time to plan; protected the schools budget in real terms in 2015-16; and—I know that my right hon. Friend will welcome this—allocated an extra £390 million to raise school funding in the most underfunded parts of the country. All those measures mean that the increase in pension costs is affordable.