David Blunkett, the Secretary of State for Education, said several authorities would find rises above 1.5 per cent "very difficult to handle".
In a letter to the school teachers' pay review body, Mr Blunkett warned that increases which were not "affordable" would have to be phased in. Teachers' leaders reacted angrily, saying a failure to offer an above- inflation pay rise would damage morale and threaten the Government's pay reforms.
Mr Blunkett said some local authorities would receive above-average increases. He added: "Other LEAs who face equal pressures have grant increases which would make a pay award much greater than inflation very difficult to handle."Mr Blunkett has already announced average increases in local education budgets of 5.4 per cent. But in Newcastle, he said, education spending would rise by 3.47 per cent, while the figure would be 3.44 per cent in Sunderland and 3.67 per cent in Middlesbrough.
Thousands of teachers stand to gain pay rises of up to 10 per cent under plans to introduce a performance-related pay "threshold" for experienced staff. But the pay review body will determine across-the- board pay rises for all staff.
Graham Lane, education chairman of the Local Government Association, said: "The 3.6 per cent increase last year was really a problem. If there is a rise this year of anything over inflation then there will be problems."
Phil Willis, the Liberal Democrat education spokesman, said: "What does this say to our teachers in the week before Christmas? Thanks for all your efforts - now be prepared to take a pay cut in the new year."Reuse content