Heads say councils deprive schools of £100m in state aid

Fifty local councils are underspending on school services by a total of more than £100m a year, a new survey suggests.

The results, to be published today, show one in three of the country's local education authorities is spending less on its schools than the amount allotted by the Government.

Leaders of the National Association of Head Teachers, which ran the survey, are asking ministers to use sweeping new powers to force the local authorities to spend more on the service. David Hart, the union's general secretary, said: "The underspend is either because they want to keep their council tax down or they are diverting education cash to other spending departments, say housing or social services.

"The Government has taken new powers which permits the Secretary of State for Education to force an authority which is underspending to increase its funding ... I would certainly recommend that ministers now use these powers in the case of those who are significantly underspending."

His association has published a list of the 10 councils that are spending between £1.9m and £10.8m less than the Government's recommended figure per year. Top of the underspending list is Bromley council, south-east London, which the union survey says is spending £10.8m less than its recommended figure. The council disputed the figure yesterday, saying the budget figures omitted capital spending plans. It is currently spending £12m on building a new primary school and other improvements.

Graham Lane, chairman of the Local Government Association's education committee, said many councils were having to divert spending to social services, where allocations failed to cover local needs. He saidcouncil budgets now only covered "about 60 per cent" of what was spent on education in a given area because extra finance was available through grants for specific projects.

Mr Hart called the school funding system "an absolute lottery", adding: "The enormous disparities that exist are totally at odds with the need for all schools to deliver a national curriculum."

The survey also revealed a disparity in funding per pupil in different local education authorities with most money (£4,066) being spent in Hackney, east London, and the least (£2,531) in Solihull.

A spokesman for the Department for Education and Skills said that while it had powers to set a minimum budget if an authority's budget was "seriously inadequate", it would not be doing so.The association's survey had failed to take account of differences in education authorities' circumstances.