Guidance

Teachers' pension employer contribution grant (TPECG) 2024 to 2025 conditions of grant for local authorities and academies:

Updated 23 October 2024

Applies to England

1. Introduction

In March 2024, we announced an additional £1.1 billion in the 2024 to 2025 financial year for mainstream schools, high needs settings, and local authorities with centrally employed teachers. We are allocating this funding to support schools to meet the costs of increases to teachers’ pension employer contributions.

The Education and Skills Funding Agency (ESFA) will pay the teachers’ pension employer contribution grant 2024 (TPECG 24) funding to local authorities for mainstream maintained schools and directly to academies on behalf of the Secretary of State for Education.

For maintained special schools and alternative provision, special and alternative provision academies, hospital schools and for independent special schools ESFA will pay the TPECG 24 funding to local authorities.

Non-maintained special schools (NMSS) will be funded directly by ESFA.

Local authorities will also receive TPECG 24 funding for teachers categorised as centrally employed on the schools workforce census 2023.

The following terms and conditions apply to TPECG 24 for the financial year 2024 to 2025.

For mainstream school settings, the funding will be rolled into the schools national funding formula (NFF) for 2025 to 2026. We will confirm the approach for high needs and centrally employed teachers in due course.

2. Allocation and payment to mainstream schools

Local authorities must pay to each:

• maintained primary and secondary school
• all through maintained school

which they are responsible for maintaining, the allocation amounts shown in the school level allocations.

Local authorities must comply with the condition above irrespective of any deficit relating to the expenditure of the schools budget share.

Mainstream academies will receive their funding directly from ESFA.

In all settings, TPECG 24 funding for mainstream schools is not part of schools’ budget shares and is not part of the individual schools’ budget. It is not to be counted for the purpose of calculating the minimum funding guarantee.

Local authorities should pay the instalments of TPECG 24 allocations to any and all schools listed as maintained schools in the local authority area on the relevant allocation spreadsheet. In a small number of cases, schools that convert to academy status after the allocations spreadsheet for a given instalment of the grant is produced, will still be listed as local authority-maintained schools on the allocations spreadsheet. In such cases, the local authority should still pass the funding listed on the spreadsheet to the successor academy. EFSA will then pay any subsequent instalments of the grant to the academy.

If a school is closing in the 2024 to 2025 financial year, ESFA’s TPECG 24 allocations to local authorities are calculated pro-rata for the portion of the funding year that the school is open. Local authorities should therefore pay the pro-rata sum listed for the school on the allocations spreadsheet for the relevant payment period.

3. Allocation and payment to high needs settings

Local authorities must pay TPECG 24 funding for each:

• maintained special school
• special academy and free school
• pupil referral unit
• alternative provision academy and free school
• maintained hospital school and the equivalent academy

which they are responsible for maintaining, they previously maintained but is now an academy and, in the case of a free school, which is located in their area.

Local authorities must comply with the following requirements in setting their local methodologies for how they will pass on the additional funding to the eligible school types as listed above, excluding the funding notionally allocated for helping with any independent school fee increases.

Local authorities must:

• pass on 100% of the TPECG 24 funding notionally allocated to the eligible school types as listed above
• ensure that all eligible schools of the types listed above receive a funding allocation through TPECG 24 in 2024 to 2025
• have transparent criteria to distribute funding to individual schools, treating academies and maintained schools the same
• consult with eligible schools of the types listed above before deciding their methodology for allocating TPECG 24 funding

Local authorities should seek to swiftly confirm the allocations for eligible schools of the types listed above to provide them with the earliest possible certainty over their budgets.

TPECG 24 funding is not to be counted for the purpose of calculating the minimum funding guarantee for special schools.

Local authorities are also allocated funding based on the number of pupils with education, health and care (EHC) plans placed in independent schools, as reported in the January 2024 alternative provision census. This funding is to support the payment of any increases in fees charged by independent schools as a result of the increase in the employer contribution for those teachers who belong to the teachers’ pension scheme.

Local authorities should also use this funding to support independent special schools with costs due to increased employer pensions contributions where – due to the timing of fee agreements – those costs have not been reflected in the fees for 2024 to 2025. Local authorities should pass on 100% of the funding notionally allocated for independent special schools, on either of the 2 circumstances above.

NMSS will receive their TPECG 2024 funding direct from the ESFA.

We will confirm in due course how the high needs element of TPEGC 24 funding will continue to be provided in 2025 to 2026.

4.Centrally employed teachers (CETs)

Teachers categorised as centrally employed on the schools workforce census 2023 will be funded on a per teacher basis, based a proportional split of the total quantum assigned to fund CETs.

Local authorities will receive one payment for their centrally employed teachers in 2024 to 2025. This will be at the same time as the second TPECG 24 payment for mainstream schools, in October 2024, following the release of the schools workforce census 2023 data.

5. Permitted use of TPECG 24 funds

Mainstream, special and alternative provision academies (including hospital schools), and NMSS must only spend TPECG 24 funds for the purposes of the school. Local authorities must ensure that their maintained mainstream and special schools, pupil referral units and hospital schools only spend TPECG 24 for the purposes of the school or unit.

Local authorities should use all or a portion of the funding they receive for their centrally employed teachers to cover the increase in the employer contribution rate.

In all schools, TPECG 24 funds do not have to be spent by schools in the financial year beginning April 2024. Schools may carry some or all of the TPECG 24 funds forward to future financial years.

6. Certification

Each local authority will be required to certify to ESFA that they have complied with these terms and conditions.

ESFA will set out the arrangements for certification in the spring.

7. Variation

The basis for allocation of this grant may be varied by the Secretary of State from those set out above.

8. Overpayments

Any overpayment of TPECG 24 funding for schools by ESFA to a local authority, academy or NMSS shall be repaid by the authority, or the academy’s or NMSS’s proprietor on such terms and conditions as ESFA or the Secretary of State for Education shall determine.

9. Further information

Books and other documents and records relating to the recipient’s accounts shall be open to inspection by the Secretary of State and by the Comptroller and Auditor General.

The Comptroller and Auditor General may, under Section 6 of the National Audit Act 1983, carry out examinations into the economy, efficiency, and effectiveness with which the recipient has used its resources in discharging its grant-aided activities.

Schools (including academies and NMSS) shall provide information as may be required by the Secretary of State to determine whether they have complied with these conditions.