Schools may lose more thanpound;80million set aside for them to buy software and online services if they do not spend the cash by August.

Heads have spent just pound;16m of the pound;100m allocated by the Government under its electronic learning credits scheme, The TES can reveal.

Schools now have until August 31 to spend the rest of the money - or forfeit it. Bill Gibbon, deputy general secretary of NAACE, the information and communications technology advisers’ association, urged heads to seek advice on products and to “spend the money wisely before they lose it”.

His appeal follows a similar reluctance by schools last year to spend the first instalment in a pound;330m e-learning credit scheme, which runs until 2006.

Ministers have set a series of staggered targets for spending the cash and last year schools struggled to spend the first pound;30m. Only pound;10m was spent three months before last August’s deadline, but a last-minute spending spree by heads meant nearly pound;29m was eventually used.

The cash has been allocated by the Government to help the software industry to compete with the BBC’s free digital curriculum materials, which are expected to be launched in 2006.

Schools each receive around pound;1,000 in credits plus pound;10 per pupil to spend on educational materials through the Government’s curriculum online website. The Department for Education and Skills confirmed that just pound;16m of this year’s allocation had been used at a recent meeting with key ICT suppliers.

Companies are confident most of the pound;100m will be spent by the August deadline but concede the amount which remains is worrying.

Ray Barker, director of the British Educational Suppliers’ Association, said: “It’s certainly a challenging amount but I am sure it will be spent this year.”

He said that in the past 12 months schools had been preoccupied with financial difficulties and the impact of the workforce agreement. Lewis Bronze, chief executive of Espresso Education, a supplier of software to schools, said he hoped schools would not throw away the money on outdated or unsuitable products.

Jim Donnelly, headteacher at Litherland high school in Sefton, Merseyside, is the IT advisor for the Secondary Heads Association.

Mr Donnelly said he was optimistic that schools would spend their credits, but they would probably leave it until the final weeks.

“I get something in my post every day from one company or another telling me I should use my credits or they will go to waste,” he said.

“The difficulty with the credits is that, although they are a good idea, they are not part of the normal way a school buys things.

“How it should work is that every head of department should be going onto the Curriculum Online website, finding resources that are approved and then ordering them with the credits.

“But auditors don’t tend to be happy for schools to operate like that.”