Failing schools with falling rolls could be first in line for closure under recommendations made by an Assembly committee.

A report by the cross-party enterprise and learning committee appears to suggest that schools branded failures by Estyn, the Welsh inspectorate, should face the axe.

The committee was responding to plans to tackle rising surplus school places in Wales, which cost Pounds 30 million a year. It is estimated that excess places will reach 100,000 by 2016 if action is not taken.

The report says: “Where Estyn reports that a school has failed its inspection, and should the organisation of school provision in the area be a factor, a reassessment of provision within a local authority should be triggered automatically.”

A committee source said their recommendation was not necessarily for authorities to close poorly performing schools, but that they should ask why they are failing.

But Dr Philip Dixon, director of teachers’ union ATL Cymru, said the recommendation was deeply unfair, and the meaning clear.

“I think the clear tenor of this is that where a school is failing, there’s your answer to surplus places - get it out of the system.”

He said it was important to look at the reasons why a school was failing, as well as mitigating circumstances, such as poor leadership.

There are 22 maintained schools in Wales in special measures or in need of significant improvement.

Plans to overhaul inspections in Wales by 2010 will offer struggling schools greater support, according to Dr Dixon.

Elsewhere in the report, the committee concluded there was “lack of leadership, prudent planning and effective implementation” in school reorganisations across Wales. It also asked the Assembly government to promote good practice to local authorities on consulting local communities over closures.

The report is the second to criticise school reorganisation plans.

In November, the government’s rural sub-committee uncovered “deep public suspicion” of the way local authorities handled closures.

Tensions rose again this week following claims that Carmarthenshire County Council had worked secretly on reorganisation plans for 18 months before putting them out for public consultation.

Powys Council has been singled out for the positive way it dealt with school changes in the Ystradgynlais area. But the committee also said that “educational effectiveness” in Powys had not been the driver for closure, and maintained that educational quality came first.

Darren Jones, Powys school modernisation manager, said the creation of a new board helped assuage public fears. “Each school has a representative on the board, as well as voluntary and youth groups, social services and council members.”