Retention payments less effective than previously thought

As the government pushes forward with its goal of recruiting 6,500 new teachers, new analysis from the NFER looks into the effectiveness of retention payments for early career teachers.

The study, funded by the Nuffield Foundation, evaluates five retention schemes introduced since 2018. These include the Maths and Physics Retention Payment (MPRP), Teacher Student Loan Reimbursement (TSLR), Maths Phased Bursary (MPB), Early Career Payment (ECP), and the more recent Levelling Up Premium (LUP). 

The study finds that while retention payments likely have a positive impact, the evidence is weaker and more uncertain than earlier evaluations suggested.

For example, earlier studies found significant effects from the MPRP and MPB schemes. But this new analysis reports smaller impacts and, in the case of MPRP, no statistically significant effect. Even the Levelling Up Premium, which offers up to £3,000 per year, was associated with only a modest reduction in teachers leaving.

Overall, the retention schemes reduced the leaving rate by just 0.7 percentage points — a figure not strong enough to conclude the policies are definitively effective.

One clear takeaway is that bursaries — upfront financial incentives for new teachers — appear to offer more value for money than retention payments. Simulations show they produce a larger increase in teacher numbers for the same investment.

However, retention payments can still play a useful role where bursaries have already reached their practical limit. For subjects like maths, physics, computing, and chemistry, bursaries are nearly equal to starting salaries — a ceiling the Department for Education has historically avoided exceeding. In these cases, retention payments might be the only available lever to boost teacher supply.
No Evidence of Target Groups That Respond Better

The study also looked for demographic or contextual patterns that might help fine-tune future schemes. It found no strong evidence that retention payments work better for specific groups, school types, or regions. That means future designs should focus on broader considerations — such as subject shortages, alignment with existing bursaries, and supporting schools facing the steepest recruitment and retention challenges.

The report recommends that the Government should maintain a policy of teacher retention payments focussed on shortage subjects, as the impact of eliminating retention payments could lead retention to worsen. Sustaining them long-term as an offer for future early career teachers could also prompt additional recruitment benefits. Alongside, the Government should retain a policy of raising bursaries for subjects experiencing teacher supply challenges where bursaries are low and maintain high bursaries for shortage subjects, raising them over time with the level of the teaching starting salary.