As schools grapple with cuts, the Department for Education and Employment is to promote a way of finding “efficiency savings” in schools that has apparently delighted all the heads who have tried it so far.

Financial benchmarking, which means supplying clusters of similar schools with details of each other’s spending so they can share ideas on where costs can be trimmed or money used more effectively, was proposed earlier this year by the School Teachers’ Review Body.

It is widely used in industry and an article outlining the approach pioneered in secondary schools by Kevin McAleese, head of Harrogate Grammar School, appeared in The TES last November.

The DFEE has been encouraging 37 primary schools in five London authorities to try it out and has clearly met with some unaccustomed enthusiasm.

One head called it “the best local management of schools in-service training possible” after some schools discovered they spent 10 times more per pupil on water or 20 times more on cleaning than other similar schools.

Robin Squire, the education minister responsible for school effectiveness, told The TES: “This is one of those rare instances of a project which has been carried through not only with total amity with all parties but in which every single school and local authority involved has been delighted with the outcome. Most are looking for ways of taking it further.”

The DFEE approach to benchmarking reduces all school spending headings to a common cost per pupil basis to make comparisons between schools easier.

Mr Squire, a chartered accountant himself, said one of the “golden advantages” of benchmarking was that you did not need to be an accountant to follow it.

This week the department wrote to every local authority with details of the pilot scheme in an attempt to spread the benchmarking movement. A leaflet to every school pointing out the advantages is to follow soon.

Mr Squire said: “This is a perfect illustration of what a local authority can do in partnership with its schools and I know that the GM movement is also looking at ways they too can draw lessons from this project.”

The DFEE’s interest in benchmarking has raised the suspicion that it was looking for the lowest possible levels at which schools could be funded to provide scope for further cuts. But Mr Squire said: “Benchmarking is not a substitute for more or less funding. It is a way of using more effectively the money that is received and that would apply at any level of funding.”

“I plead guilty to wanting better value for money. The argument about funding is always with us.

“Perhaps more often we need to look at the output more than the input side, to use the economists’ jargon; if for a given level of funding you can get better output then that is something that the department is interested in and I can’t help feeling local authorities and schools are interested in as well.”