Parents and staff at the Small School in Hartland, Devon, set up in 1982 and said to be the first of its kind, have set up a committee to investigate grant-maintained status.

They say becoming grant-maintained will provide greater financial security. The school, which has 35 pupils aged 11-16 and the equivalent of five teachers, survives on donations from parents, trusts and foundations.

Three similar small schools - Oaklands School in Goole, Humberside, Orchard Open School in Crowborough, East Sussex, and Orchard School in Corsham, Wiltshire - have recently closed through lack of funds.

The Devon school is backed by the Human Scale Education group, which says small schools should be supported by public money.

It wants the Government to adopt the system operating in Denmark, where any group of at least 12 parents receives 85 per cent of the costs of running their own school if they can raise the rest themselves.

Two weeks ago parents succeeded in keeping open the 13-pupil village school in Priors Marston, Warwickshire, by raising Pounds 40,000.

The Green School in Aberdeenshire also opened this term, dedicated to environmental principles and supported by parents. Another school is planned to open in Kingston upon Thames in January.

Human Scale Education says most small schools are deterred from applying for grant-maintained status because it is costly and time-consuming. It recently set up a group, the Third Sector School Alliance, to campaign on behalf of schools run by religious groups, Steiner schools and small schools wanting to become state-funded.

This week Labour said it would support moves by parents to keep small schools open. Education spokesman Peter Kilfoyle said: “If there is sufficient demand and resources can be found locally, I see no objection to people keeping these small schools open.”

Human Scale Education says allowing parents to start their own schools would encourage choice in education. The group’s national co-ordinator Fiona Carnie said: “At the moment there is no choice.”

The staff and parents at the Small School will decide in November whether to go ahead with the application to become grant-maintained.

Parent Alan Boyd, who is carrying out research on grant-maintained status for the school, said: “We would fit very well into the state system and if we were to receive state-funding it would give us more security and we could increase our spending.”