A head who authorised cash-in-hand payments worth almost pound;100,000 to people carrying out work at his school has been officialy reprimanded by the General Teaching Council for England.

John Hart, 56, former head of Egerton Park arts college in Denton, Manchester, admitted allowing workers to be paid for overtime and one-off jobs by cheque or cash when they should have been on the school payroll.

He also allowed Christmas bonuses of up to pound;500 to be paid to office workers, allowing them and the school to avoid tax and national insurance if the cash payment went undeclared.

The informal payments, prohibited by council guidelines, came to the attention of Tameside local education authority auditors when Mr Hart left the school in May 2002. Concerns were raised by the school’s bursar.

After the discovery, the council made a voluntary declaration to the Inland Revenue and a pound;55,000 settlement was agreed to avoid late payment and interest penalties for untaxed payments made over the previous 12 years.

While Mr Hart was head of the school, cleaners, security staff, odd-job men and pupils received pound;96,290.53 which would have been subject to between pound;25,000 and pound;35,000 in income tax.

An 80-year-old former caretaker was paid pound;5 an hour for picking up litter. A pupil received pound;500 for working in the school’s IT department during the holidays and security staff were paid for after-school events.

Brian Cheetham, principal auditor for Tameside council, said Mr Hart had told him he had set up the scheme because he had problems finding people to do cleaning and other work.

“The recipients of the cash in hand would have been unlikely to declare the payments to the Inland Revenue,” he said.

Mr Hart, who left Egerton Park in May 2002 to become head of Glossopdale community college in Derbyshire, admitted the allegations but said meticulous records of the payments had been kept and that no attempt had been made to hide them.

He said: “Our former caretaker, who is 80, had just lost his wife and came into the school for company more than anything.

“He offered to pick up litter for free, but I let him do it and gave him pound;5 an hour. I wasn’t going to take advantage of an old man.

“It is ridiculous to put someone like that on the school payroll as he may have felt obliged to come and do it.”

Mr Hart said it was impossible to pay pupils who worked with younger children in the holidays through the payroll or security staff called in for one-off jobs.

Cliff Anderson, representing Mr Hart, said: “Mr Hart doesn’t deny the cash payments were made. They were made innocently and possibly naively. There were guidelines produced by the LEA, but he does not recall reading them.

The process of cash payments had not been challenged by the LEA previously.

There was no conscious act to defraud the LEA or Inland Revenue.”

Mr Hart was issued with a reprimand that will remain on the register for the next two years.

Gail Mortimer, chair of the GTC panel, said: “The facts do amount to unacceptable professional conduct. Mr Hart failed in a key area of the responsibilities of a headteacher. He fell below the standard expected, although in reaching its final decision the GTC recognises there was no dishonest intention. His disregard of the local and national requirements is viewed seriously.”

A second allegation, that Mr Hart misled the school governors about the size of the school’s pound;138,000 budget deficit, was found to be unproven.

Mr Hart said: “This case confirms the complications of the job and how it is important that we have very clear training on financial matters. In future, I shall ensure I read all documents from the LEA relating to finance.”

A spokesman for Derbyshire county council said that while the hearing related to his previous school, the governors at Glossopdale would have to decide whether to take any further action.