The damning report by the Office for Standards in Education on Quantock School near Bridgwater states that the school fails to meet legal requirements on health, safety and welfare. The technology workshop, the art room and the science room are described as “unsafe”, with unlabelled chemicals,and broken glass on the floor of the science room.

The school, which has 85 pupils between the ages of six and 17 and charges up to Pounds 2,750 a term, receives public money in the form of boarding school grants awarded by the Ministry of Defence for children of families in the armed forces.

The report will revive anxiety about the use of public money to subsidise substandard schools in the independent sector, much of which is uninspected. The Ministry of Defence gives service parents an “admissible schools list”, but does not vet the schools on it. Quantock school is on the list.

Inspectors comment that housemasters and mistresses have little training or experience in the needs of boarders, and that boarders are often left unsupervised. The boys’ did not have enough showers and rooms were too cold.

The report refers more than once to the lack of staff training in child protection issues. In November 1995, a national newspaper reported that Quantock school was being investigated by the local police because former pupils had complained about inappropriate relationships between pupils and staff, but no charges were ever brought. The OFSTED report, however, does not comment on these allegations and insists that the school “places great emphasis on moral education” and that relationships in the school are good.

Half the lessons observed in the junior school were unsatisfactory, and new staff receive “no proper induction to teaching or to boarding responsibilities”. The proportion of pupils gaining five A-C grades at GCSE is “well below the national average”.

Assessment is “superficial”, management is criticised, junior pupils do not achieve in line with their ability in English, French, maths or geography. Standards are better among the seniors, but “the weaknesses in French and English persist”.

Hilary Roe, recently appointed as deputy head, confirmed that it was the allegations made by former members of staff and press reports which had precipitated a full OFSTED inspection - now a rare event in the independent sector. She said that may of the problems identified by the report had been tackled and that parents who had seen it were nevertheless “very supportive” of the school. She said also that the low number of GSCE passes was explained by the number of Hong-Kong Chinese pupils who take GCSEs a year later.

Unlike failing state schools, Quantock will not be subject to special measures and is not required to publish its report for the parents (although it is doing so).

According to a spokeswoman for the Department for Education and Employment, the school has been sent a warning letter, but she said there was no prescribed timetable for improvement. The only sanction for failing independent schools is to be struck off the Government register; this has happened, but in most cases only when there has been a criminal investigation involved.

Quantock is one of only five independent schools given full OFSTED inspections last year; this year, it plans to do between two and four a term. An OFSTED spokesman said that this was unfortunate but resources were needed more elsewhere.

OFSTED has, however, investigated the quality of the private sector’s own inspection systems, run by the Headmasters’ Conference and the Girls’ School Association, and will report in March. But only academically successful independent schools are allowed to join the associations, so that the remainder receive little scrutiny from anyone.

Quantock school, like many small independent boarding schools, depends heavily on pupils from service families, who recieve a boarding school allowance from the Government.

Labour MP David Jamieson has argued repeatedly that these families are being duped into spending this public money on indadequate private schools which escape inspection.

Mr Jamieson, the MP for Plymouth Devonport, said on Wednesday: “If this was a state school, Gillian Shephard would be jumping up and down threatening to send in a hit squad.

“I will be asking the Education Secretary and the Armed Forces Minister whether they have ensured that this school is taken off the Service Children’s Education Agency’s admissible schools list.”

In 1994-95, the Government spent Pounds 107 million on boarding school grants for service personnel’s families.

No one at the SCEA was available for comment.