Hundreds of school staff could face redundancy as rising costs and the recession put pressure on budgets, heads have predicted.
They believe there could also be cutbacks in extra services in schools such as counselling and support workers because of a lack of cash.
Headteachers say that 200910 will be a critical year because of rising wages, increased by the national job evaluation scheme, new rules that stop teachers providing regular cover for sick colleagues, and government orders to make efficiency savings. As The TES reveals today, some schools say they expect to be in the red by a quarter of a million pounds next year.
They believe the budget problems are exacerbated by significant regional differences in school funding that favour London and other urban centres and lead to some areas getting almost twice the amount of cash to spend on each pupil.
Many secondaries in Devon, one of the poorest education authorities, expect to be in the red by a total of Pounds 9 million next year, according to research by the county's secondary heads' association.
A government review into the problem is ongoing. The F40 group of the 40 worst-funded local authorities met PricewaterhouseCoopers, the accountants carrying out research for the study this week.
Three-year spending plans were meant to create stability, but heads trying to balance the books say they also have to cope with regular government policy changes that affect what they have to fund.
Count the pennies, pages 22-23.