Stephen Byers, the Schools Standards Minister, said every head teacher would have control of a bank account and complete power over their school's day to day budget. The change will transfer an estimated pounds 600m per year out of the control of elected councils into the hands of heads. Local authorities will face severe limits on their powers over schools and ministers will be able to cap the amount of money they spend on administering education.
The move will revolutionise the way schools are run, in effect offering all schools the freedoms of grant-maintained status championed by the last Conservative government.
Mr Byers told the National Association of Head Teachers Conference, in Eastbourne: "This is schools' money and schools should have the benefit of that money and they should have control of how that money is used."
In the past, local authorities have come under fire for holding back from schools substantial proportions of their education budgets. Instead of having to vote to opt out of council control, all schools will be given the automatic right to manage almost every aspect of their affairs.
A consultation document proposes giving head teachers powers to run school catering, repairs, payrolls and finances as well as buying in educational advice from outside experts. Local authorities will retain powers to allocate school places, control school expansion, run special needs education and employ local advisers to ensure government targets are met.
Mr Byers said head teachers would be able to seek out the best deals on the open market, potentially releasing millions of pounds to spend in the classroom. The new arrangements will be brought in next year.
The School Standards And Framework Bill will create three new types of school - foundation, community and voluntary - to replace the current distinction between county, grant-maintained and church schools.
David Hart, NAHT general secretary, welcomed the announcement, but warned of possible redundancies if schools chose to drop council services.Reuse content