Bright children from the poorest families appear to be the losers from the Government’s abolition of assisted places to independent schools.

As schools go through their first recruiting round since abolition, it is clear that few feel able to offer free places and that the level of bursaries from schools’ own funds is falling far short of the Government’s pound;140 million subsidy.

Up to 80 per cent of girls receiving government support at Bradford Girls Grammar, for example, received free education, but Lynda Warrington, the school’s head said that the school cannot afford to give free places to any child. She said: “It is those in most need of help who are going to be the most disadvantaged.”

The school would require pound;250,000 to educate just eight girls for their full seven years. She said: “To produce that kind of income would require a fund of millions. We just cannot raise it.”

Bradford Grammar, the town’s independent, academically-selective school for boys is also unable to offer free places, and can only fund 20 places through its own bursary support, compared to more than 30 government assisted places.

Leeds and Manchester Girls High School are both about to launch multi-million pound appeals to fund their own assisted places schemes. Manchester Girls has only been able to offer five or six assisted places of its own this year compared to 30 government assisted places in previous years.

Elizabeth Diggory, the school’s head believes, as do her counterparts in Bradford and Leeds, that Asian girls will be particularly badly hit as many “required high levels of assistance” under the government scheme for schooling that offered their one chance locally of single-sex education. Miss Diggory said: “The number of able Asian girls who can come to us is bound to be reduced. In many cases single sex education was a major reason for coming here.”

Mrs Warrington said her governors were prepared for the school to shrink in size to preserve its academic excellence. Manchester and Nottingham High Schools have already experienced a drop in pupil numbers despite their strong local reputations.

The social effects of the withdrawal of assisted places are emerging at a time when new research has shown that bright children from non-academic homes achieve more in selective or independent schools than their counterparts at comprehensives.

The research by Geoff Whitty of London’s Institute of Education, Sally Power of Bristol University and Tony Edwards of Newcastle-upon-Tyne shows that certain children from homes “without an educational inheritance” benefit from being in schools with “constant academic pressure”. For some, said Professor Edwards “it is easier to be clever in a school with a lot of clever children around”.

Past research by Professors Whitty and Edwards, showing that the assisted places scheme largely benefited the middle classes, fed into Labour’s decision to abolish it. But these new findings could prove embarrassing to ministers.

Manchester Grammar School, where 250 boys out of 1,500 are currently in receipt of state subsidy, is targeting former pupils in its bid to raise pound;10m to create a new kind of “free access” independent schooling, covering the fees of every pupil from a deprived background that passes its entrance exam.

The 25 members of the Girls’ Public Day School Trust, which includes Bath, Portsmouth and South Hampstead High Schools, announced a pound;70m scheme to rescue all 3,000 of their assisted places, while King Edward’s School and King Edward VI High School for Girls in Birmingham, part of the well-endowed King Edward VI foundation, can match the assisted places scheme from their own resources.

However, Dick Davison, deputy director of the Independent Schools Information Service, said in many cases schools would be forced to shift appeals from funding building improvements to school places.

Liverpool College aims to channel business-income gained from running courses and renting out its buildings. It believes it will be able to fund 100 of the 180 places formerly subsidised by the government. Mr Jon Siviter, the school’s head is also appealing to businesses on Merseyside to establish a pot of money that will fund scholarships to the best schools in the areas, both state and independent.

However, the independent sector does not underestimate the task of sustaining substantial levels of assistance. The many that do not enjoy large foundations accept that they face a hard choice: fill up their schools with fee payers and broaden their intake or shrink in size to preserve academic standards. Mr Davison believes many are choosing to operate on a smaller scale. This however, begs the question of viability.

He said: “Whether schools can do this will depend on size and the local competition. It is easier for a school of 900 to become 750 than a school of 500 to become 400.”

Some schools face an additional burden in fulfilling an obligation to fund children through to 18 that were offered assisted places in their junior schools and which the Government will only fund to the beginning of their senior schooling.

Already there are casualties. Trent College in Derbyshire has recently announced five staff redundancies which it directly attributes to its loss of assisted places along with the decline in boarding numbers. The King Edward VII and Queen Mary boys and girls’ schools in Lytham, Lancashire - where almost one in two pupils had assisted places - plan to merge by 1999. This will transform two schools of 500 with a three-form entry to one school with a four-form entry.

Newcastle-under-Lyme School, a 1,300-strong co-educational day establishment, is also planning for contraction from a 180-strong entry to 120. Wisbech Grammar in Cambridgeshire which had 300 APs, the highest in the country, opened a 100-strong junior school last year and claims its numbers are holding up this year, but the going is bound to be tough.

Although the Government included a clause in its legislation preventing the scheme from reappearing through the “back door”, Dulwich College, London, is involved in talks with local authorities, including Bromley.

Local councils are interested in the proposal to send children to Dulwich, provided they pass its exam, at the cost of educating them in state schools. The college, or better-off parents of children who come through this route, would then top up the difference.

CLOSING BURSARY LOOPHOLES

Many independent schools claim they have tightened up means-testing procedures for their own bursaries to close up loopholes alleged to have existed under the assisted places scheme.

A major criticism of the Government scheme was that it benefited children from middle-class homes with clever accountants, that a low income entered on Inland Revenue returns could hide substantial capital wealth.

A deputation of heads, who felt this reputation was harming an essentially admirable initiative,appealed to the last Conservative government to make changes, but they were unsuccessful.

Now schools like Nottingham High and Liverpool College say they have established more “sophisticated” procedures.

Jon Siviter, headteacher of Liverpool College said schools’ hands were tied in the past: “We couldn’t ask our bursars to go into people’s accounts. As long as the Inland Revenue approved them we felt obliged to offer a place. Now the letters offering our own assisted places are delivered by my wife just to check whether there’s a Merc in the drive. She has only found two dodgy houses so far.”

“Now the letters offering our own assisted places are delivered by my wife just to check whether there’s a Merc in the drive. She has found two dodgy houses so far” Back door route ? Dulwich College in south-east London is discussing a scheme with local councils for children to sit an entrance exam and attend the independent school at the state school cost