Schools with large bank balances at the end of the financial year should beware. Some councils are planning to follow the example of Norfolk, which is clawing back pound;3.5 million from budgets to distribute to others in the county.

Responses from 40 local authorities to a TES survey show that at least 15 others plan to use powers which came in last year to prevent schools squirrelling money away.

Headteachers in Norfolk say the budget clawback means that they may have to make staff redundant, with some schools losing more than pound;100,000.

Paul Stanley, head of George White middle school, Norwich, was one of 200 of the county’s 450 heads who received a letter from the council. He said he will lose pound;117,000.

“My emotions have gone from jaw-dropping disbelief to downright anger,” he said.

“For the authority to think it can send out this kind of letter to schools on a Friday saying we want pound;117,000 back without consideration for staff, pupils or parents well, it beggars belief. I had seen myself as having a long-term future in Norfolk, but I am going to have to reassess that now. I am not sure I want to work for an authority that can do this.”

Elaine Aylmer, head of Heartsease first school, Norwich, said her school, which has six teachers and seven support assistants for its 130 pupils, is facing a pound;28,000 loss.

“That equates to a teacher,” she said. “In principle, I think most headteachers would support moves to stop schools squirrelling money away, but the problem this time is that the cuts are based on budgets that are already six months or more out of date.

“Now they are in the position where the local authority is clawing money back that has already been spent. Schools will have to lose staff to balance the books.”

Even headteachers who benefited from the clawback complained that it had been poorly handled.

Paul George, head of St Augustine’s RC primary, near Norwich, said his school was pound;6,000 better off. But he said he was “not happy that it has been taken from a school which may really need it”.

Norfolk council said that schools had been warned and consulted twice on the matter over the past two years.

Paul Fisher, assistant director of children’s services, said that schools in the authority were keeping pound;29.5m in their balances of which pound;26m was held for “reasonable” purposes and pound;3.5m was not. “The money schools are given each year is meant to be spent on the pupils in school that year,” he said.

The Association of Teachers and Lecturers said headteachers should be prevented from hoarding the estimated pound;1bn that lies unused in school balances.

Derby, Leeds and Nottingham city said they were also in the process of challenging schools about surpluses, with Nottingham city aiming to redistribute more than pound;1.6 million.

Other local authorities which said they would introduce claw-back schemes over the next two years included: Cumbria, Dudley, East Riding, Essex, Havering, Milton Keynes, Plymouth, Portsmouth, Poole, Redcar and Cleveland, and York.

* michael.shaw@tes.co.uk