Helen is the opposite of a burnt-out head. Drive, vision, personality, intellect, qualifications, management skills, formidable achievement, solid experience and comparative youth - she has them all. So what is she worth in the job market? Not much, although that may be about to change.

There are schools all over the country which badly need someone like Helen, a charismatic 38-year-old with a leadership style which inspires her staff and earns the veneration of parents and governors. Having turned round what was once a mediocre school so successfully that now it could practically run itself, she has taken on a wide range of extra-school activities, from leading community projects to lecturing undergraduates. But she would like to be able to concentrate again on what she does best, which is pulling a school up by its bootstraps.

As things stand Helen will probably never apply for another headship, unless one comes up in her own authority where everyone knows how outstanding she is. The problem is pay. Keen to ensure that she is not distracted by financial worries - and aware that, with a young family, she has to employ domestic help - Helen’s governors have rewarded her achievements by repeatedly raising her pay. She is now receiving well over the top of the scale for the job.

The chairman of governors says: “She deserves it. Apart from the way in which she has raised aspirations and achievements at the school, she more than pays for the extra salary in purely financial terms. Her management skills mean we get better value for money, and we have more and more children whose parents are attracted to the school by her personal reputation.

“We have to recognise that she has a high market value, and we don’t want her tempted away by another school.”

But perhaps Helen’s governors need not worry too much on that score. Most of the country’s governors are just as convinced as Helen’s that the greatest asset a school can have is an able and experienced head. But few of these other governing bodies, it seems, believe at present that it is necessary to pay well to get one.

Look at the headship vacancies in The TES. Double the number for secondary heads at the start of this year and up by more than a quarter for primary. Yet, even now, only a small proportion of the posts are advertised at the full salary range for the size of the school. Some specify a part of the range, nearly always at the lower end, but more and more offer a fixed spot salary, often the lowest permissible. That would appear to rule out applications from the very people the advertisements often suggest they are seeking - heads who have proved their ability to run schools of the same size well.

You might think that this is part of the price of governor power; that the professionals at county hall are looking on helplessly while penny-pinching amateurs insist on getting heads on the cheap.

Nothing could be further from the truth. Most local authorities offer advice on the level of starting salaries, and most governors follow that advice: many education departments freely admit that they bring heavy pressure on governors to pitch salaries low. Some try to dictate a figure for every vacancy: although a governing body can ignore the authority and offer what it thinks fit, few are prepared to do so.

Helen works for one of the minority of local authorities which believe that in education, as in other fields, you tend to get what you pay for. It does not urge governors advertising a vacancy to offer high starting pay, but does point out that there is competition for experienced heads, and provides details of the salaries being paid in comparable schools, many of them at the top of the appropriate scale. At the other extreme is Carmarthenshire, whose director, Keith Price Davies, says that the authority has a simple way of establishing the right salary for a vacant headship: “We tell the governors what the assimilation point is.”

Until 1991 the salary of every head in the country was fixed by the size of the school. Then the 14 groups were merged into six, and a continuous pay spine introduced, divided into overlapping salary ranges for heads (and deputies) in each of the new groups. Existing heads were moved to a point on the spine corresponding to their former fixed salary - called, for the purpose of the exercise, the assimilation point.

So Carmarthenshire is telling governors that applicants should be offered salaries based entirely on the size of the school, without regard to the difficulties of the job or the quality of the candidate. Mr Price Davies says that governors rarely question the figure.

Birmingham and Manchester also use the assimilation point, but as the basis for a more sophisticated approach called jobweighting.

Manchester tells governors they should add spine points to the basic figure to allow for specified factors which increase the responsibilities or the difficulties of the post, including split sites, community use, and a high proportion of pupils on free meals. It provides them with a great deal of data on salary levels in and around the authority, and on recent appointments. The city’s assistant education officer, John Bedford, says: “If a governing body looks at all the facts and then decides to offer a higher figure than we suggest, that’s fine. What we are concerned with is that they should think it through, know why they’re doing it.” Most candidates are deputies already working for the authority; the city’s long, narrow shape means that teachers tend to live in suburbs at the same end as their schools and so heads are often reluctant to move. “And people just don’t come here from other parts of the country,” he adds.

Mr Bedford believes that there is little advantage in offering salaries a few points higher to attract better candidates. “To enlarge the field it has to be close to 10 points difference,” he says.

Birmingham, like Manchester, has no long tradition of respecting governors’ views; neither city bothered to appoint individual governing bodies until it was forced to by legislation. But Birmingham is the more prescriptive of the two: it does not leave it to governors to weight the assimilation point, but supplies them with a salary figure which has already been adjusted.

Manny Lewis, assistant director for personnel and staffing, is opposed to posts being advertised on a salary range. “That opens the governors to being forced into negotiating with a candidate,” he says. “They are lay people, and it is very difficult for them to argue with a candidate who is already earning a high salary. But that high salary may not represent exceptional quality; heads are good at arm-twisting their governors, who don’t like to refuse them pay increases.”

Neighbouring Dudley, an authority not noted for keeping its schools on a loose rein, takes the opposite view. It encourages governors to offer the full salary range, and to pay what they think the candidate is worth. That, says Geoff Smith, Dudley’s education officer, is the only way to find out who is available at what price.

“Our governors are highly responsible and usually have worked out what they think the school can afford. But if the interviews produce someone who is exactly what they need they are able to make an appropriate offer. It is naive to think that there isn’t a market in heads. They are no different from the rest of us, and quality commands a price.”

Governing bodies in Hereford and Worcester, another of Birmingham’s neighbours, invariably offer a spot salary or a low segment of the range.

The county education officer, David Stanley, says he leaves it entirely to them how they advertise a post. “We have a large number of small schools, and governors are very careful in the way they spend money.”

But he says - echoing the comments of chief education officers in other rural shires - that there is no shortage of high quality candidates, many of them experienced heads seeking to move out of inner-city jobs - because his county is such a pleasant place to live and work in.

So far, says Mr Stanley, there has been no sign that the new restrictions on early retirement have affected the supply of headteachers. “But,” he adds, “like every authority in the country, we are watching the situation very closely indeed.”

Many employers view the new deadline for early retirement with unease; some fear it may well bring about a rush for the exit followed by a crisis in recruitment. But, meanwhile, many are still trying to recruit on the cheap.