Higher pay for some teachers might be seen as an olive branch. But the devil will be in the detail.
The majority of employees will receive a 1% pay increase, government sources told the BBC, with pay restraint remaining central to the government's deficit strategy.
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The NASUWT union said teachers had suffered a real terms pay cut of thousands of pounds since 2010.
Amid suggestions of a rift in the coalition over the issue, Deputy Prime Minister Nick Clegg said the settlement was affordable and the government should be "as generous as it can be", where possible, to public sector workers.
The move will be announced on Thursday as part of a pay settlement for nearly a million public sector workers.
"What makes the situation even worse is that even when the Review Body recommends a percentage award, schools are not obliged to pay it."
Will it depend on some teachers not getting the minimum 1%? Or will it mean capping pay for head teachers? Or will it be left to heads to come up with their own funding arrangement?
Nicky Morgan said the best-performing teachers deserved recognition
Teachers received a 1% rise last year in line with the two-year pay cap across the public sector introduced in 2012. The 1% cap is to be extended to 2016-2016.
Education Secretary Nicky Morgan said this flexibility was possible because of the "strong economy".
This follows a recommendation from the School Teachers Review Body that the maximum award in the main pay range for teachers, currently ?32,187 in England and Wales bar London, should be allowed to rise by 2% next year.
"There is a teacher recruitment and retention crisis caused by the coalition's relentless attacks on teachers' pay, pensions and conditions of service," said its general secretary Chris Keates.
Labour has backed the 1% pay cap, which has been strongly opposed by the unions, but accused the Conservatives of planning "extreme cuts" after the election.
Schools in England and Wales are to be given the power to hand top performing teachers a pay rise of up to 2%.
The Lib Dem leader told the Daily Mail online that "quite a fierce debate" had taken place in government over the issue and suggested that the scope to reward the best teachers had been "resisted" by the Conservatives.
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The exact pay of teachers in the maintained sector is set by schools but within nationally agreed levels.