Ministers have told local authorities that from April they must delegate at least 85 per cent of their schools’ budgets and they want councils to push the percentage even higher.

But Michael Mahoney, head of St Ivo, a 1,820-pupil comprehensive in St Ives, Cambridgeshire, said: “More delegation will crucify schools. Don’t talk to me about giving me more money when all you are really doing is giving me more responsibility.” He is running the school on an overdraft agreed with Cambridgeshire Council.

The Audit Commission has already warned the Government to think again about passing more money directly to schools.

In a report published last year, it said ministers needed to assess whether it was in the public interest to hand over more cash to heads and governors.

The first signs that ministers may be prepared to backtrack over increasing delegation in the face of mounting ostility appeared last week.

A senior civil servant at the Department for Education and Employment told the Society of Education Officers that the only firm target was the minimum 85 per cent delegation for 2001-2 “Provisionally, ministers have suggested that it should be 87 per cent for 2002-3 but that will need to be reviewed,” she told the SEO meeting in Leeds for its winter conference.

The Government is planning to separate school and council funding in a shake-up of local authority finances. According to last November’s report, more than 1,400 heads said they were happy with levels of delegation. Ten years ago, heads controlled 5 per cent of the schools budget, now they control 82 per cent. Day-to-day financial control in most schools is sound, although up to 15 per cent of schools have major weaknesses.

Primaries tend to have little more than half the level of administrative support available to similar-sized secondaries. Many heads felt they would gain nothing from more delegation.