They said that rises over the past 11 years had put teachers and heads at the top of the town-hall pay league. Increases in pay had totalled 102 per cent for teachers and 114 per cent for heads since 1986, even outstripping the police.
In the meantime, repeated shortfalls in education budgets had forced councils to increase class sizes, pushing up teachers' workloads and driving down morale, said Graham Lane, education chairman of the Local Government Association (LGA).
He condemned the Teachers Pay Review Body for ignoring the financial position of councils when recommending pay rises for teachers, and called for direct national negotiations on classroom pay and conditions to improve classroom morale.
Mr Lane said: "Teachers have had a few extra quid a week for teaching in some instances quite considerable extra numbers in the classroom."
Proposals from the LGA and the Local Government Management Board, which represents council employers, were sent to ministers yesterday. At present the seven-member pay- review body is enshrined in law.
Local-government leaders want to replace it with direct annual talks with teacher unions.
Alternatively, council leaders suggest, the Government could set up a new wages council bringing together employers and unions, or move to bring teachers and employers into the existing review body.
Most teaching unions back the review body, although the largest, the National Union of Teachers, said it had been disappointed with its performance.
Mr Lane attacked the current review body for being out of touch with schools.
"With the exception of one member, I do not know what knowledge of education any of these people have," he said.