Education and lifelong learning minister Jane Davidson this week announced that pound;5.6 million currently allocated for both groups of teachers will, from 2005-6, be used for the induction and early professional development of NQTs only.
Headship training programmes will be funded instead from an "additional" Pounds 1.55m budget held by the Welsh Assembly government, drawn from elsewhere in the education budget.
The move was welcomed by Wrexham and Denbighshire councils. TES Cymru reported last month (December 17) how both authorities had stopped funding applicants for the national professional qualification for headship (NPQH) because large numbers of NQTs had absorbed all the cash. NQT induction is a legal requirement, whereas the NPQH does not become compulsory for first-time heads until September.
Concerns were raised that, in some areas, only applicants able to fund themselves would be able to undertake the NPQH and progress to headship.
Gethin Lewis, secretary of the National Union of Teachers Cymru, welcomed the announcement. Last term the union called for a delay in making NPQH compulsory until funding was resolved.
Mr Lewis said: "We are also glad the pound;1.1m for heads is going to be held directly by the Assembly - it's ring-fenced money.
"We oppose the principle of teachers having to pay for their own professional development."
In a package of measures affecting school leaders, Ms Davidson announced a major review of the Assembly's headship programme.
The quinquennial review will be led by David Stone, headteacher of Corpus Christi high school, Cardiff, who is being seconded to the government's teaching and leadership division.
The review will take account of new national standards for heads in Wales, due to be launched next January, and Estyn and other evaluations of leadership programmes, including those for newly-appointed and serving head.
Meanwhile, the CELT Consortium of Welsh universities and advisory services has had its contract for delivering NPQH in Wales renewed. And up to pound;750,000 of the pound;1.1m for headship programmes will go on the next NPQH recruitment round, in the run-up to the qualification becoming compulsory.
Ms Davidson said: "We have reached a significant point in leadership development in Wales. Over the next 12 months I will build upon the resounding success of the headship programme, achieved over the past five years, and seek to develop a structured framework of continuous professional development for all teachers in Wales."
More than 650 aspiring heads have successfully achieved the NPQH, with around 200 currently working towards the qualification. Wales should have around 1,500 NPQH graduates by 2010.