In fact, bearing in mind that his school, the Sidney Stringer Community Technology College, is within a few hundred yards of Coventry’s notorious Hillfields estate, its glowing report from the Office for Standards in Education is a remarkable achievement.

But four years ago a gang of well-organised and occasionally brutal drug-dealers stepped up their trade on the street which separates the school from Hillfield’s high-rise flats.

Since then six people have been murdered within yards of the school gates and others have been abducted from the area and have not been seen since.

The consequences for the school have been disastrous. As it has become synonymous with the criminal violence, its intake has plummeted.

This has led to a cash crisis which, according to the TES survey published last week, has hit many schools.

Most headteachers have been forced to cut spending on repairs, curriculum development, books and equipment to try and protect the staff.

While the survey findings have produced further ammunition for those pressing for extra spending on education, Mr Kershaw says his problems can be eased by changing the current funding formula for a school losing pupils through no fault of its own.

Prior to 1992 Sidney Stringer attracted around 180 new pupils a year. By September 1994 there were only 117 arrivals and the year after a mere 90.

Because funding for staff, equipment and building is linked to the number of children attending a school under the local management scheme, the impact of the neighbourhood’s drug problem has been felt in the classroom. Since 1992, 46 teachers have left, including 11 last term. Classes have grown from 20 pupils to an average of 30.

Mr Kershaw believes his problems highlight the need for a more flexible LMS scheme. “I don’t disapprove of LMS, but there are insufficient mechanisms to allow authorities to find the means quickly and sensibly to respond to urgent issues.

“There needs to be a national rethink about policy towards a school with a problem not of its own making,” he said.

The effect of the pounds-for-pupils LMS scheme has now reached the point where the curriculum will soon have to be cut. Mr Kershaw fears pupil performance may slip and the school will find itself demoted in league tables.

He said: “As the school grows smaller your curriculum, at some point, must begin to narrow. Because the investment in a child is over a five-year period we’ve been fine up to now, but we will see the effect on performance soon. ”

The recently-published OFSTED report praised the school for improving the performance of its children. Many of his new pupils come from deprived backgrounds and 85 per cent are from ethnic minorities.

Mr Kershaw believes their poor standards of numeracy and literacy when they arrive at Sidney Stringer could be improved if the curriculum allowed primary schools to focus on the basics.

Sidney Stringer, which is funded as a technology college by the Department for Education and Employment, has built many strong links with industry through Coventry 2000, a well-connected charity for education and training. It has one of the most advanced information technology systems in any British school.

The school has raised Pounds 1 million over the past five years, reflecting an increasing reliance on charity worth an estimated Pounds 77 million to Britain’s schools.

Nevertheless, the fear remains that all this good work could be undone. The college has no money to invest in buildings, the library and the curriculum.

Mr Kershaw, who has been the head for 10 years, says he has tried everything to win back pupils.

To be sure of the reason why the school was failing to attract so many new pupils, staff went out into the Hillside community to talk to parents.

Mr Kershaw said: “We went and knocked on every door in the neighbourhood to find out why they were not sending their children here. They told us: ‘We know what a good school it is, but you don’t know how dangerous it is.’ “But no matter how hard you try to explain that nobody’s ever been hurt and that the children don’t get approached, they have a different perception that’s very difficult to change.”

The school has worked with the police against the drug dealers, whose methods have become so sophisticated that police say it is difficult to gather evidence to take them to court.

Parents are not the only ones to have voted with their feet. Since the dealers moved into Victoria Street, known locally as “the front line”, 100 of the 120 shops have moved out. Community leaders fear that if any more follow it could become a no-go area.

Mr Kershaw has now set up the Hillfields Partnership Programme to help the community of 12,000 to overcome the problem of drug dealers.

He concedes that no amount of extra funding will solve the school’s problem in the absence of a tougher approach to the dealers who have wrecked the community.

He believes his school, and many other inner-city schools, would be best served by a Government prepared to make life more difficult for drug dealers.