Posted in education, Funding, opinion, teacher's pay, Uncategorized

Budget 2015: Earn vs. Learn

Since the government released details of their ‘emergency’ summer budget they have been both criticised for “failing the young”, but also praised for introducing a “budget for the working people” – depending on which newspaper you choose to read.

Whichever way you look at it, the young people set to leave school in 2016-17, asking themselves “What do I want to do with the rest of my life?”, will be in a heightened, pressurised position due to the new budget.

Disadvantaging the disadvantaged?

The most fundamental changes to the budget include an increase to the national living wage, which will rise to £7.20 next April, and should reach £9 by 2020. This was surprising but (somewhat) welcome news in George Osbourne’s budget announcement. [1] So, what’s the catch? It excludes under 25s, and together with the cuts made to the welfare budget − which includes a freeze on working-age benefits, tax credits and local housing allowance until 2020 − the reform is estimated to cost 3 million families an average of £1000 a year. [2]

“The key fact is that the increase in the minimum wage simply cannot provide full compensation for the majority of losses that will be experienced by tax credit recipients.”

− Paul Johnson, director of the Institute of Fiscal Studies.

Another major introduction with the budget was the ‘youth obligation’, which says 18 to 21-year-olds must ‘earn or learn’, rather than sign-up for benefits after leaving school. Young people who don’t find work or education will be expected to gain work-based skills through an apprenticeship, traineeship or work-based placement, or they will lose their benefits.

While this could potentially produce positive effects, it may also be a threatening prospect for those from poorer backgrounds, considering that the automatic entitlement to housing benefit has essentially been scrapped, and that last year those under 25 missed out on most of the apprenticeships on offer.[3]

Alongside this, university students will no longer be able to claim maintenance grants. The entirety of their student finance will come in the form of a loan, but larger loans are up for grabs, meaning more debt.[4]

So, with all these factors laid out on the same page, it seems that when the pupils of today come to leave school, in particular disadvantaged pupils, they will be faced with two options: accumulate thousands of pounds worth of debt for the chance at a higher paid job later in life, or attempt to go into a low-paying apprenticeship with the potential to climb the ladder over time. It’s safe to assume that for a lot of disadvantaged pupils neither of these options may be viable, so what happens to them?

Public sector pay rise cap

The breakdown of the new budget shows that the government is set to spend a total of £742.3bn on the public sector in 2015-16, with £99bn of that on education, third in the ranking below welfare and health. Despite this, school teachers and leaders still fall victim to a cap on public sector pay rises, which limits them to a one percent pay rise annually over the next four years. Therefore, the budget’s effect could extend further than those pupils leaving school, and to those still in school.[5] Unions are concerned that an announcement like this, amidst the ‘teaching crisis’, will make recruitment and retainment harder. This, together with a rise in pupil numbers, could have a knock-on effect that leaves more pupils with fewer teachers, and according to evidence highlighted by the Chair of Social Mobility and Child Poverty Commission, excellent teachers are already thin on the ground for poorer pupils.[6]

Earn don’t learn?

In the run-up to the election, we saw a lot of emphasis on ‘skills, skills, skills!’ with parties attempting to trump one another with regards to the number of apprenticeships they could offer young people. These factors of the new budget seem to further deter young people from university and towards a more vocational method of attaining working-life skills and knowledge.

With all this in mind, it could seem that the government want school leavers to earn rather than learn. While this could be a short-term solution to solving the deficit problem, it does cast doubt over what sort of society we will have in the future if people with potential have been denied the opportunity to further their education.

Coming to the end of this article, it feels like there is a dark cloud looming over school leavers; however, while the future may look like a complex web of ‘what ifs’ and ‘buts’, schools can still work their hardest to prepare their pupils to face these tough life-decisions at the end of school-life, and to face the results that incur as they progress further and further into adult life.

If you haven’t already, perhaps now is a good time to ensure your school’s careers advice is up-to-scratch!

TheSchoolBus has a number of resources to help schools make it through this squeeze on the budget. We have a topic dedicated to careers guidance, which contains research, guidance and templates. We also make recruitment and retainment less of a strain with our job descriptions for teaching and support staff and staff management guidance and templates.

This will surely not be the end of the discussion in the media, so make sure you have your say in the comments section below.

[1] UK Politics (2015) ‘Budget 2015 key points: At-a-glance summary’ <http://www.bbc.co.uk/news/uk-politics-33440315> [Accessed: 13 July 2015]

[2] Heather Stewart and Patrick Wintour (2015) ‘George Osbourne took ‘much more from the poor’ in budget’< http://www.theguardian.com/uk-news/2015/jul/10/george-osborne-took-much-more-from-poor-budget-2015-ifs> [Accessed: 14  July 2015]

[3] Sally Weale and France Perraudin (2015) ‘Osbourne accused of picking on young people with ‘earn or learn’ budget’ <http://www.theguardian.com/education/2015/jul/08/budget-2015-grants-poorer-university-students-scrapped-loans> [Accessed: 13 July 2015]

[4] Anoosh Chakelian (2015) ‘Budget 2015: what welfare changes did George Osbourne announce, and what do they mean?’ <http://www.newstatesman.com/staggers/2015/07/budget-2015-what-welfare-changes-did-george-osborne-announce-and-what-do-they-mean> [Accessed: 13 July 2015]

[5] Kaye Wiggins (2015) ‘Teachers’ pay rises limited to 1 per cent for four years’ <https://www.tes.co.uk/news/school-news/breaking-news/teachers-pay-rises-limited-1-cent-four-years> [Accessed: 13 July 2015]

[6] Javier Espinoza (2015) ‘’Turbo-charge’ young teachers’ careers to get them to teach in tough schools, says social mobility tsar’ <http://www.telegraph.co.uk/education/educationnews/11734661/Turbo-charge-young-teachers-careers-to-get-them-to-teach-in-tough-schools-says-social-mobility-tsar.html> [Accessed: 13 July 2015]

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