DfE Launches Programme to Cut Costs and Curb Supply Agency Spending

The Department for Education has unveiled a new “maximising value for pupils” (MVP) programme aimed at helping schools and trusts reduce costs and improve value for money, including a major overhaul of spending on supply teacher agencies.

Beyond Staffing

Beyond staffing, the DfE plans to use the collective buying power of around 22,000 state-funded schools to secure better deals on areas such as energy, technology and learning resources. A pilot of the government’s energy-for-schools scheme reportedly delivered average bill savings of 36 per cent, while one trust saved more than £500,000 through improved contract management.

Financial Reserves

The programme will also focus on helping schools make better use of financial reserves and physical assets. New tools will allow schools to compare banking options, while updated guidance for academy trusts on managing reserves is expected in 2026.

School Minister

Schools minister Georgia Gould said the programme would help ease financial pressures on schools and trusts by tackling national cost drivers while supporting local action. “Every penny should be invested in helping children achieve and thrive,” she said

New Framework

Under the plans, schools will be expected to use a new national framework for agency supply staff from June 2026. Developed by the Crown Commercial Service (CCS), the framework will introduce negotiated caps on the fees agencies can charge, in a move ministers say will tackle excessive margins and poor practice in the supply market.

The DfE stressed the caps will apply to agency fees, not to the pay received by supply teachers themselves. For the first time, the government will also have visibility over how much of the overall cost reaches teachers.

Schools will be expected to use the framework unless they can demonstrate better value for money elsewhere. Suppliers are now being invited to apply to join the framework ahead of its launch.

MVP Programme

The initiative forms part of the wider MVP programme, which aims to ensure “every pound delivers for children” by addressing spending across four areas: commercial procurement, assets, workforce deployment, and capability development including digital and technology.

Agency supply spending alone reached £1.4 billion in 2023–24, while staffing costs account for around 80 per cent of school budgets. Alongside the new framework, the DfE is urging leaders to analyse workforce data closely, gather staff feedback and use its financial benchmarking and insights tool to compare costs with similar schools.

The department also signalled that trusts should review pay at senior levels, stating that executive pay must be “proportionate and justified”, while also taking longer-term action to reduce vacancies, turnover and retention pressures. A further toolkit sharing research and best practice is due in 2026.