Helen Liddell, the Education Minister, has instead invited the Scottish Council for Educational Technology to establish a working party as part of the Government's new technology drive. The minister has already committed Pounds 62 million to install computers in every school within four years.
But Ann Hill, association chief executive, said: "I do not understand the need for another working party. The Scottish Office has been involved in our scheme and already had an evaluation of it."
Undaunted, the association is to launch its own Furbie Foundation next month with backing from Scottish Power and other major players in business and finance. Around 3,000 unwanted computers are awaiting a new life in schools and more are promised. Two primaries and a secondary have piloted the scheme.
A similar project has been running in the Netherlands. Ironically, the Dutch computers were overhauled by a technology firm based in Dumfries, the SSBA headquarters.
The foundation computers will cost Pounds 195 with software and come with a three-year guarantee.
Mrs Liddell met the school boards last week but rejected advances to back the foundation. The Scottish Office wants to ensure schools across the country benefit from the scheme and establish minimum standards for refurbished machines.
A spokesman said: "We're looking at things on a bigger scale than the SSBA and we have to be consistent with the National Grid for Learning. There are also issues around procurement related to Government. We have to be open and transparent."
The first overhauled computers will be in schools by the spring.