The Prime Minister’s recent enthusiasm for grant-maintained schools has now to be translated by his policy-makers into initiatives that might revive schools’ interest in opting out.

In the past academic year, only 50 schools voted to opt out, and, without further incentives, the likelihood is that there will be even fewer this year.

Even the loyal Gillian Shephard, the Education and Employment Secretary, does not favour putting extra resources the way of grant-maintained schools, and the only options available may be giving such schools greater freedom over the pupils they admit, and the specialisms they can offer.

The task of producing a strategy is expected to fall to Dominic Morris, who took over as deputy head of the Number 10 policy unit earlier this summer; he replaces Nicholas True, an advocate of vouchers for nursery education.

John Major is due to round off a national tour in Birmingham with a meeting of grant-maintained school headteachers and governors. He could take the opportunity to propose new measures to give greater independence to grant- maintained schools, or he could announce measures to expand popular schools (see below).

The Government already has it in mind to allow grant-maintained schools to borrow money on the strength of the value of their assets and legislation is expected this autumn.

Grant-maintained schools are also to be encouraged to go into partnership with the private sector in order to raise funds to improve their facilities.

According to press reports this week, other measures could include allowing grant-maintained schools to change their admission polices without having to get agreement from the Department for Education and Employment, and modification of the right of local authorities to force opted-out schools to take pupils from other state schools.

However, such deregulation would require legislation and there may not be time for measures that would meet strong opposition from the other parties.

While the expansion of the grant-maintained sector is not one of Mrs Shephard’s priorities - she wants any moves in that direction confined to the debate on the content of the election manifesto - she admitted last week that a great deal of work is being done on the issue.

The Conservative party is struggling to find policies that will convince the voters it still has a radical agenda. There is internal debate on the wisdom of dispensing with ballots and compelling all secondary schools to opt out. It has attractions in that it could pave the way eventually for the goal long craved by the right-wing - vouchers that parents could redeem at the school of their choice.

The possibility of expanding the Assisted Places Scheme is also being considered, even though Mrs Shephard has consistently told the independent school lobby that funds are not available for any such move. It is being argued that expanding the scheme is better value than investing in state schools because no capital money is required. The present scheme - which subsidises fees at independent schools for bright children from low-income families - costs Pounds 105 million and pays for 33,000 places.

The manifesto groups are beavering away and preliminary reports of progress are likely to be discussed at Chequers in a couple of weeks. Dominic Morris, a career civil servant who has been in the Number 10 unit for number of years, will have to sift through various initiatives to find the “big idea”.

In the drawn-out pre-election campaign ministers will be required to weigh policy in terms of its impact on voters. The Prime Minister is looking for short-term gains, and that could put him at odds with Mrs Shephard.