The era of academy school leaders in England receiving “banker-style salaries” and hefty annual increases may soon be over, with the government to introduce limits on executive pay.
The new cap
Education secretary Bridget Phillipson is expected to announce a cap of £174,000 on academy trust executive salaries, with government approval required to advertise pay packages above that amount. She is also expected to limit future pay increases to the same annual awards agreed for teachers. The announcement, likely to come on Wednesday, will be followed by the annual pay recommendation for teachers in England from the government’s independent review body.
Sources indicated that Phillipson will require trusts running academy schools, including multi-academy trusts (Mats) responsible for state schools, to follow executive pay rules similar to those used in the NHS and further education colleges. In the NHS, senior managers have high salaries signed off by officials, with pay at the largest trusts capped at around £280,000 and salaries exceeding £170,000 requiring sign-off by NHS England for most roles. In further education colleges, sign-off was required for salaries above £174,000 from August 2025.
Nearly 90% of secondary schools in England are now academies, and the £174,000 cap will not affect the majority of trusts, which pay salaries closer to those of secondary-school heads. Analysis by Schools Week found that chief executive pay in more than 1,000 trusts averaged £142,000 a year. The median basic salary for chief executives increased by 6.9% in 2024 compared with 2023.
Among the highest earners, Dan Moynihan, chief executive of the Harris Federation which runs 55 academies, received a salary of between £530,000 and £535,000 in 2024-25, making him the highest-paid academy leader. His pay has nearly doubled since 2009-10. Dayo Olukoshi, executive principal of the Brampton Manor trust which runs two schools, earned between £350,001 and £360,000 in 2024-25, up from £271,360 in 2020-21 and from £280,000-£285,000 in 2021-22. Nearly 100 academy chief executives earn more than £200,000 a year, with pay in academy trusts ranging from less than £5 per pupil to more than £150 per pupil. Only a quarter of the high-earners were women.
Around one in four academy trust chief executives received a pay rise greater than that given to classroom teachers in 2024-25, with many receiving double-digit increases.
Rationale behind the cap
A government source said the changes were “a straightforward matter of fairness, for both the taxpayer and teachers.” The source added: “Academy trusts are doing brilliant work for millions of children. But we simply cannot have double-figure pay rises on top of six-figure salaries. These are salaries paid for by the taxpayer, and excessive rates risk diverting funding from frontline teaching.”
The move follows the government’s statement in February’s schools white paper that it wanted to tackle “unjustifiable” executive pay. A Labour source said that “banker-style” salaries were inappropriate for administering academies funded by public money. “Many academies are doing great things and we continue to back them,” the source said. “But with freedom comes responsibility, and on executive pay, this has not always been exercised in the sensible way the public would expect. Admirably, the Tories recognised this was a problem, but their voluntary approach didn’t work, and six-figure salaries have soared in recent years. That’s why we’ll now be treating executive salaries in school trusts no differently from the rest of the public sector, making sure they’re a fair and accountable use of taxpayer cash.”
The Department for Education declined to comment officially. The Academy Trust Handbook already sets expectations for executive pay: decisions must be evidence-based, reasonable, defensible, transparent and proportionate, reflecting responsibilities and demonstrating value for money. The board of trustees is ultimately responsible for pay decisions, which must be formally approved by the full board. The DfE can challenge decisions if there is insufficient demonstration of value for money, no direct link to improving pupil outcomes, or if the trust is in financial difficulty. In 2024, the previous government named and shamed 37 leaders over their pay in 2021-22, though all trusts were found to be compliant.
The National Education Union has said there was “no justification for inflated chief executive salaries,” previously denouncing such pay as a “scandal.” Leora Cruddas, chief executive of the Confederation of School Trusts, has said trust boards must be mindful that executive pay involves public funds and should represent value for money, while also noting that large trusts are complex organisations that should attract and reward the best leaders.
Teacher pay implications
Teaching unions will be closely watching the report of the schoolteachers’ review body (STRB), expected to be unveiled later on Wednesday, and the government’s final decisions on teacher pay for next year. The DfE recommended to the STRB that teacher pay should rise by 6.5% spread over three years between 2026-27 and 2028-29, with higher awards in the second two years. The unions, however, are concerned that schools may not receive any additional funding to cover these pay rises. Phillipson suggested in her remit letter to the STRB that schools could use budget “efficiencies” to find the money. The National Education Union has argued that a 6.5% increase over three years would amount to real-terms pay cuts. Analysis also suggests that local authority-maintained schools retain teachers better than academies, with academies and free schools having higher rates of teachers leaving the profession.
