MINISTERS are considering guaranteeing every school in the country a minimum rise in funding to avoid a repeat of this year's crisis.
Local education authorities already get a minimum rise in budgets but, The TES has learned, ministers are now discussing extending this "funding floor" concept to individual schools. The idea has been raised in ministerial meetings with teaching unions and local government representatives in the past few days.
The move would further restrict LEAs' freedom to control their own finances and be seen as a major step to direct funding of schools from Whitehall - a move already hinted at by the Department for Education and Skills.
David Hart, National Association of Head Teachers, general secretary, said the change would give schools a "sporting chance" but would not let Government off the hook over funding.
But Graham Lane, education chair of the Local Government Association education, said LEAs must be allowed to set school funding floors; setting a national level for schools would only create more problems.
Tony Travers, a local government funding expert from the London School of Economics, said: "I think in the Government's own terms the move would be very wise but from a local government point of view it is another step towards nationalisation."
The news came as Edenham high, Croydon, sent 720 pupils home on Wednesday afternoon because it could not afford supply cover for absent teachers.
Jonathan Parker, the head, said he might have to repeat the move once a month depending on staff sickness.
Education Secretary Charles Clarke's bid to ease the crisis by allowing schools to dip into capital funds to pay staff had not resolved his problems. Mr Parker said he faced a pound;220,000 deficit, but his capital budget was only pound;90,000.
Last week Mr Clarke announced that schools would be able to borrow from other schools' reserves and set deficit budgets. He said he would give "sympathetic consideration" to LEAs asking for a relaxation of rules on how they distributed funds to schools.
But local government leaders said this amounted to an instruction to schools and councils to make-do-and-mend.
Mr Clarke was also criticised by finance professionals. In an unusually strongly worded statement, the Chartered Institute of Public Finance and Accountancy warned that the relaxation of capital spending rules "cut right across good accounting practice" and could damage investment in the fabric of Britain's public services.
But the last-ditch effort to avoid redundancies was welcomed by most unions. Only the National Union of Teachers was hostile, accusing ministers of "getting their sums wrong".