David Blunkett, the Education and Employment Secretary, was expected to announce on Thursday that pound;100 million will go directly to schools and pound;100 million will be spent on skills training.
Another pound;40 million goes to Wales, Scotland and Northern Ireland.
Part of the schools money will be allocated to education action zones. Ministers intend to increase the number of action zones to be created this financial year from five to 25, and there may be an increase in the amount of money provided to zones to encourage innovation.
Existing spending plans allow for five zones to be created in September, with 20 more to follow in 1999.
The decision has been taken to extend the plan for 25 pilot zones, but it remains unclear how many zones ministers want to see in operation during this Parliamentary term.
Mr Blunkett said: "The education action zones will be at the heart of our drive to improve standards and provide innovation in areas of significant educational disadvantage. With pound;10 million extra, we will now be able to establish 25 action zones by January 1999."
The rest of the pound;100 million will be capital for school building work. The Government estimates that pound;35 million will be enough to deal with the problem of outside lavatories in 600 primary schools.
The money will be used to either build indoor lavatories or provide covered walkways.
There is to be pound;40 million for building classrooms to accomodate the extra teachers in infant schools expected in 1999-2000. Another pound;15 million is being allocated for replacing inefficient heating and boiler systems in schools.
An announcement on the distribution of the pound;100 million provided for skills training is expected on Monday.
* action zone reluctance, page 8