Government Announces Up to £6,000 Retention Payments for FE Teachers in Critical Subjects

Targeted incentive scheme aims to retain skilled educators in STEM, construction, and early years education

The Department for Education has announced details of its targeted retention incentive scheme, offering payments of up to £6,000 to eligible further education teachers in critical subject areas. The initiative aims to strengthen workforce retention in sectors facing acute skills shortages.

The scheme provides financial incentives to FE teachers in their first five years of practice who teach in seven priority areas: building and construction, chemistry, computing and digital technology, early years education, engineering and manufacturing, mathematics, and physics.

Payment Structure and Eligibility

Payment amounts range from £2,000 to £6,000, determined by the employing institution and the number of weekly teaching hours. Teachers working 12 or more hours per week are eligible for £4,000 to £6,000, while those teaching between 2.5 and 12 hours weekly can receive £2,000 to £3,000. Higher payments are available for teachers at institutions serving a greater proportion of disadvantaged students.

To qualify, teachers must:

• Be in their first five years of FE teaching (having started during or after the 2021-22 academic year)
• Be directly employed by an eligible FE provider in England
• Spend at least half their timetabled hours teaching eligible courses at Level 3 or below
• Hold or be working toward a teaching qualification
• Be on a permanent or appropriate fixed-term contract

Application Timeline

For the 2025-26 academic year, applications will open on March 2, 2026, with a deadline of May 31, 2026. Claims will be verified by employers and the Department for Education from April 13, 2026.

Eligible Subjects and Courses

The scheme covers a comprehensive range of qualifications including:

• STEM subjects: A-levels, GCSEs, and vocational qualifications in chemistry, physics, and mathematics
• Computing: Digital technology qualifications, T Levels, and apprenticeships
• Engineering and Manufacturing: Sector-specific qualifications and T Levels
• Construction: Building and construction qualifications and T Levels
• Early Years: Specific practitioner and educator qualifications and apprenticeships

Financial Considerations

The government will cover National Insurance and basic rate Income Tax on payments. Recipients who are higher-rate taxpayers will need to pay additional tax through PAYE. The payment does not contribute to pension schemes but will count toward overall income for benefit and tax credit calculations.

Supporting Workforce Development

The initiative forms part of the government’s broader strategy to address skills shortages in key sectors of the economy. By targeting retention in the early years of teaching careers—when departure rates are typically highest the scheme aims to build a more stable and experienced FE workforce.

Eligible FE providers include statutory FE colleges, sixth-form colleges, designated institutions, and 16-19 academies and schools across England.

Teachers unsure about their eligibility are advised to consult their employers, with a full list of eligible providers and courses available through the Department for Education.