The Autumn 2024 Budget includes several significant updates that will impact employers in the education sector, particularly around staffing costs and support for workforce development, infrastructure, and sustainability initiatives.
Key Tax and Employment Cost Increases
- Employer National Insurance Contributions (NICs): Beginning in April 2025, employer NICs will increase by 1.2 percentage points, rising from 13.8% to 15%. Additionally, the threshold for paying employer NICs will lower from £9,100 to £5,000.
- National Living Wage Increase: From April 2025, the National Living Wage for workers aged 21 and over will increase by 6.7% to £12.21 per hour. This will impact payroll expenses, particularly for support staff, teaching assistants, and other non-teaching roles within educational institutions, as the minimum hourly wage increases.
- Youth Minimum Wage Adjustments: From April 2025, the National Minimum Wage for individuals aged 18 to 20 will increase by 16.3%, rising from £8.60 to £10.00 per hour. The minimum wage for 16 to 17-year-olds and apprentices will see an 18% increase, elevating the rate to £7.55 per hour.
Additional Sector-Specific Funding and Support
- Teacher Recruitment and Retention: The budget includes £500 million over the next two years to help with recruitment and retention efforts. This includes added support for newly qualified teachers, enhanced retention packages, and incentives for roles in underserved regions or subjects with higher demand.
- Skills and Vocational Training Funding: With additional funding through Skills England, secondary schools and colleges can expect increased resources for vocational courses and practical skill development.
- Early Years Education Boost: An extra £300 million will be allocated to early years education, supporting nurseries and childcare providers. This funding is intended to enhance accessibility and affordability for families while enabling institutions to invest in staff training and development, potentially offsetting some of the added costs associated with the NICs and wage increases.
Technology, Infrastructure, and Sustainability Initiatives
- Digital Learning and Infrastructure Grants: £200 million has been dedicated to technology in schools, covering infrastructure improvements and updated learning tools.
- Green Initiatives for Schools: Educational institutions are encouraged to pursue sustainable projects, with funding available for energy-efficient upgrades, such as solar panels and improved heating systems. This aligns with government climate goals and offers potential long-term cost savings.
