Caught out by the severity of this year’s funding crisis, many heads and governors have been forced into short-term economies or to spend any reserves they have.

Even well-run and successful schools with rising rolls have felt the pinch.

So far most have resisted making staff redundant. As The TESSHA staffing survey last week showed, more have resorted to the expedient of not replacing staff when they leave.

The worry for heads and governors is that falling back on reserves, leaving the roof to leak or hoping the right staff will go voluntarily are not sustainable strategies.

Nobody knows if the extra pound;400 million the Government has found for school budgets next year will be enough to make up for this year’s cuts and next year’s cost increases. The Department for Education and Skills has no idea how many schools are already in the red or have blown their reserves to stay solvent.

Many more schools may soon have to consider compulsory redundancies to ensure they can cover the curriculum. There is even evidence in The TESSHA survey that some schools are having to dismiss experienced staff to take on cheaper ones - a problem that could get worse as more teachers move on to and up the upper pay spine.

Sheelagh Tickell, head of Goathland primary in Newcastle upon Tyne, had to make four teachers redundant at the end of last term, because of a “massive” budget cut as well as falling rolls. Three went voluntarily, but one redundancy was compulsory.

“I’ve been a head here for 14 years and last year was the worst year of my teaching career. Having to go through compulsory redundancy with all the nominating and staff filling in skills audits was horrendous. The staff understood, but it was very unhappy last term. They felt sorry for those who were going who didn’t particularly want to go.”

Employment laws mean it is difficult to make quick savings this way. Even if a school budget is set by the end of March, it is hard to complete the formal procedures by the end of May, meaning the employee stays on the payroll until December. By this time schools need to sack two members of staff to save one full salary - another reason to contemplate the worst sooner.

But how well-prepared are heads and governors to tackle the fallout from all this?

David Hart, general secretary of the National Association of Head Teachers, says some head- teachers are buckling under the strain, just as the Government says they should focus on leadership and the quality of teaching and learning.

“The reality is they have spent a great deal of time balancing their budgets, or creating deficit budgets and negotiating with their local authorities, and preparing recovery plans.

“In a significant number of schools, heads feel that the back end of the spring term and the whole of the summer term has been taken up by one subject.”

The Secondary Heads Association is getting an increasing number of calls as a result of the crisis. “The proportion of heads and other school leaders who are distressed and tired and have had enough is going up,” says Martin Ward, SHA’s deputy general secretary.

At Driffield school in the East Riding the leadership team is facing even longer hours on top of an already crippling workload as four senior staff, including two assistant heads, have not been replaced. Head Michael Chapman says: “It’s crisis management of the worst kind, and that’s what makes us particularly angry and frustrated because we take great pride in our strategic planning.”

The crisis has also left school governors reeling, just as their management role comes under greater focus in the new Office for Standards in Education inspection framework from September. For many it will be the first time they have had to steer a school through a budget crisis.

Paul Black is a school governor who has published a training course on coping with redundancy in schools. He says: “When we get involved in school governance, you don’t go in expecting to have to wield the axe over individuals’ livelihoods and jobs. That can be a traumatic shock.”

Carol Woodhouse is treasurer of the National Association of Governors and Managers and governor of a small Devon primary that has seen its budget cut. She says: “You’re promised you’re going to have an increased budget and then you find out that you’ve got a decreased budget. You’re left saying what faith have we got in the Government when it makes statements about increased funding for schools?”

The National College for School Leadership is investigating the need for extra targeted training in strategic financial management for heads, which may be available online by next spring.

NCSL chief executive Heather Du Quesnay says good leaders will rise to the tough challenge.

“Great leaders are very good at turning adversity into opportunity. If we let it become a calamity, the people who suffer ultimately are the children.”