Local authorities are required to assess children's eligibility on a case-by-case basis, but a rising number are refusing to statement all but the bottom 1 and 2 per cent of the ability range.
Statements are legally binding documents that guarantee special needs children extra funding and support. "If a child has needs that require monitoring, the law is clear they must be assessed, but what we are seeing in more and more cases is an arbitrary blanket approach," said Roger Inman, chief executive of the Independent Panel for Special Education Advice.
"We're not talking about a few bad apples. This problem is systemic," he said.
The panel has investigated 27 councils for such breaches in the past three years and this month lodged a formal complaint against Northumberland. The authority has restricted statements to the bottom 1 and 2 per cent of the ability range and delegated special needs funding to schools, leaving many teachers struggling to cover provision.
Hexham middle school has been left with a pound;50,000 shortfall and says that provision for non-statemented children could suffer as a result. "The lump sum we've been given is just not enough," said Bill Wilson, finance administrator.
Northumberland declined to comment.
Councils have argued the moves reduce bureaucracy and promote the Government's policy of inclusion, which urges them to educate special needs children in mainstream schools where possible.
However, they are under a legal obligation to produce statements where appropriate, and have been warned against imposing unlawful restrictions on who can receive them by the Department for Education and Skills.