The Budget

Today’s UK Budget, delivered by Chancellor Rachel Reeves, introduces a range of investments and reforms aimed at supporting education and broader socio-economic priorities that affect teachers and school communities.

We welcome the Government’s commitments to education and public services set out in the Budget today, which marks a step change in approach by the new Government.

The Chancellor has had to make some tough choices in the context of the acute pressure on public finances, but it is clear that the Government has chosen to invest in our children’s future and our education system as a priority.

Below is a summary of the most relevant points for NASUWT members.

Key Education Budget Announcements

1. Core Schools Budget Increase: The core schools budget will receive an additional £2.3 billion next year to address the teacher recruitment crisis, enabling schools to hire more teachers and reduce class sizes, improving learning outcomes​

2. Special Educational Needs and Disabilities (SEND) Funding: High needs funding will receive an additional £1 billion, a 6% real-terms increase taking total to £11.9 billion, to meet the rising demand for specialised resources and support for students with disabilities, ensuring equitable access to quality education​.

3. Capital Investment in Schools: The budget provides £6.7 billion for capital improvements in school infrastructure, a 19% increase from last year. This includes £1.4 billion to rebuild schools and £2.1 billion more dedicated to school maintenance. These funds will support necessary repairs, modernisation, and facility upgrades, ensuring safe and conducive learning environments across the UK​.

4. Expansion of Breakfast Clubs: The budget includes a tripling of investment in school breakfast clubs, focusing on improving student nutrition, especially in low-income areas. This initiative will enhance student readiness and engagement in the classroom​.

5. Further Education Funding: An extra £300 million is allocated to further education (FE), supporting vocational programs that bridge education and employment, better preparing students for the workforce​.

6. Devolved Nation Funding Allocations - Barnett Formula: To ensure consistency across the UK, additional funds have been designated for devolved nations, with £3.4 billion for Scotland, £1.7 billion for Wales, and £1.5 billion for Northern Ireland in the 2025-26 fiscal year​.

7. VAT and Business Rates for Independent Schools: Starting January 2025, VAT will be applied to all education, training, and boarding fees at independent schools, and their business rates relief will be removed. This shift is intended to raise £9 billion and pay for additional 6,500 teachers in state schools, whilst narrowing the financial disparity between private and public education.​

Broader Economic Measures Impacting Schools and Communities

1. Clamp Down on Umbrella Companies: The budget introduces new measures to address tax non-compliance among umbrella companies, aiming to curb exploitative practices. The goal is to improve payroll transparency, ensuring that workers in temporary and flexible employment receive fair treatment and correct tax deductions, ultimately protecting employee rights in this sector, including for supply teachers.

2. Increase in Employers’ National Insurance Contributions (NICs): A 1.2% rise in employers’ NICs will impact payroll costs for schools and other employers, which may affect school budgeting and resource allocation​.

Conclusion

This budget reflects a commitment to prioritising children and education.

NASUWT will continue to encourage government to ensure these funds to be strategically allocated to maximise their positive impact on teachers, students, and school communities across the UK.