Funding for the pound;2 million-a-year scheme is set to dry up at the end of March, and organisers say they have been unable to secure an undertaking from ministers that it will continue.

Since it began in 1989, almost 250,000 teachers have been placed in businesses within their areas.

The aim of the service is to keep schools up-to-date with advances in the workplace, offering teachers the opportunity for professional development in a business context and equipping them with the know-how to motivate and inform pupils.

Paul Tunstall, a science teacher from Langdon School in Newham, east London, set up an engineering project at his school following a placement at the offices of London and Continental Engineering.

He said: “The company is building a new railway station at Stratford as part of the rail link between St Pancras and Dover, and the pupils will see it going up. By making the contact with the firm, they will know exactly what is going on and it may even lead some of them to consider a career in engineering.”

Generally, teachers were placed for periods of time ranging from a few days to two weeks, although in some cases secondments lasted for up to a year.

Government money was mainly used for providing cover for absent staff, insurance and administrative costs.

The funding crisis also places in doubt the future of some of the smaller Education and Business Partnerships, which were set up to co-ordinate the scheme and help schools and colleges prepare young people for a working life.

John Botton, past chairman of the national EBP network, said: “All the evidence shows that teachers are the second biggest influence over children’s careers after their parents and, therefore, they must have the right understanding of what the world of work is about.

“It is ironic that the Government is unable to give any undertaking on the future of this programme, at a time when ministers are placing so much emphasis on basic skills.”

In a letter to the EBPs, Stephen Byers, the school standards minister, said Labour believed in the value of the scheme and its benefits to schools and the professional development of teachers.

He said that the Department for Education and Employment was still considering how it might support continuation of the scheme.

David Hart, general secretary of the National Association of Head Teachers, who has been a strong advocate of the service, said: “This threat has come at a time when it is generally accepted that we need to improve the quality of the careers advice and make sure that our 16 to 19-year-olds are achieving the appropriate qualifications they need for work.”