Clarke locks horns with No 10 over 'academy' schools

Tony Blair called two cabinet heavyweights into Downing Street yesterday for a summit to settle a dispute over the growing involvement of private companies in the running of inner-city state schools.

The argument between the Prime Minister on one side, and the Deputy Prime Minister, John Prescott, and Secretary of State for Education, Charles Clarke, on the other, is seen by some Whitehall insiders as a symbolic battle over control of Labour's programme for the next five years.

Education is to be the next party battleground. The Conservative leader, Michael Howard, launches his party's education policy on Tuesday, and Mr Clarke will present Labour's five-year plan to Thursday's Cabinet, and announce it in Parliament the following week.

Tony Blair is keen to fight the general election on a "radical" manifesto that will promise more public-sector reform with greater emphasis on personal choice. He has been persuaded by his education adviser, Andrew Adonis, to include a promise to create 200 "academy" schools - a new type of semi-independent state school - by 2010. So far, 12 have been opened, and another 40 to 50 are planned by 2007.

Mr Prescott has objected that the proposal undermines local councils, which would have to relinquish control of 200 schools to make way for the new institutions, which will be run by the Government.

The schools are also a drain on the education budget because in most cases they involve constructing new buildings from scratch at an average of £25m each.

Mr Clarke has resisted setting a target as high as 200 because of the cost, and because he believes the "academy" model should be used to revive education in the inner cities, but is not needed in the prosperous suburbs. But his office insisted that the disagreement was "practical" rather than a deep political one.

An adviser said: "It's like a bazooka approach. Where a school is absolutely awful, and the local authority agrees to close it down, we throw a whole load of money at it and create a school that pupils will want to go to. It's not the solution for every area."

Labour MP Ian Gibson condemned the drive for more academy schools yesterday as a "step towards privatisation. No educationist I know has made the argument that this is the way forward."

Education ministers are also preparing for a big political argument about what to do with disruptive pupils.

The Conservatives will confirm on Tuesday that their policy is to give head teachers the right to expel disruptive children, abolishing the current appeals panels. They will produce polling evidence which suggests that almost three-quarters of teachers (72 per cent) believe heads should have the final say on expulsions, while only 13 per cent support external panels.

The same poll also suggests that an overwhelming majority of teachers think they have too much paperwork.

The shadow Secretary of State for Education, Tim Collins, said: "This poll confirms that teachers are crying out for fewer targets, less interference and the final say on disciplining troublemakers."

The panels were set up by the Tory government in 1988, but reformed by Labour to increase the number of teachers who sit on them. The Department for Education has warned that if there is no appeal system, parents of expelled pupils may go to court.

David Miliband, the Schools minister, dismissed the Tories' proposal as "a half-baked U-turn that will end in costly court cases."