Next month the Department for Education and Skills will announce the second round of achievement awards. Last year, governors at 6,800 schools were given money to pass on to staff - around pound;5,000 for an average-sized primary and pound;25,000 for a secondary. The exercise cost pound;60 million, but ran into difficulties almost as soon as it was launched.

“It was a lottery,” says Tony Neal, president of the Secondary Heads Association and head of De Aston school, Lincolnshire (which won an award). “This was meant to motivate teachers. But because of the random way it was distributed it has succeeded in demotivating them, even in some schools that benefited.”

Problems for the DFES began when officials informed 300 schools that they had been given the awards by mistake; 300 others were told that they should have been given an award.

This could have led to divorce in Lancashire, where Jack Hatch, head of St Bede’s primary in Bolton was given an award while his wife Barbara, head of Wigan’s Bedford Hall Methodist primary, was told that her award letter had been issued in error.

“I couldn’t believe they could treat people this way,” she says.

Worse was to come. Schools were supposed to qualify for an award if they had demonstrated significant improvement; schools coming out of special measures were given awards, for example. Awards were also intended to recognise excellence.

Estelle Morris said that the achievement awards were intended to “celebrate success”. But despite the department’s intention to reward excellent schools, their number-crunchers managed to miss Shropshire’s Thomas Telford, praised in the media as the most successful state school in the country with 100 per cent GCSE passes at A* to C for the previous year.

Beacon schools also missed out on awards, as did many schools commended in the chief inspector’s report, published just weeks before the DFES made its announcement.

In Coventry, teachers at Sowe Valley primary received a personal letter of congratulation from chief inspector Mike Tomlinson praising their school as “particularly successful”. As a result the DFES invited the school to apply for beacon status. But there was no achievement award.

“Apparently we were good enough to light the way for others, but not good enough to receive any money for doing so,” said the teachers in a letter of protest to The TES.

Tony Neal of SHA attacks both the methodology and the rationale behind the awards.

“The notion that pupils are going to go into their exams keen to do well because their school will get an award - that’s ridiculous,” he says. “And the selection criteria were little better than a random sample. It was literally the case that if you happened to have a strong cohort you were likely to win. A school got an award if it happened to do quite well the previous year or particularly badly three years before.”

Mr Neal said the schools were divided into categories according to the proportion of their pupils with free school meals. Those with the best test results in each group were successful. As a result, schools that recruited the most youngsters on to their free meal register received the awards.

This methodology has been attacked by Professor Harvey Goldstein of London University’s Institute of Education, a critic of the Government’s use of free school meals data. He says that many successful schools were ignored because the DFES did not take into account pupils’ prior attainment.

Even the distribution of the money was controversial. Governors were given a free hand to distribute it, with one proviso: that the cash should go to staff and not towards a new library or computer suite.

Mr Neal’s governors decided to pay both new and former teaching and non-teaching staff, as well as contractors working regularly at the school - leading to awards of just under pound;300 each for full-timers.

“Do you reward the teachers who actually taught the children, or the current teachers? What about teachers who have left the school?” asks Mr Neal. “Last year it was possible for a teacher to move from a school that won an award to another school that also won - and get two awards or none.”

The DFES line on the awards is tinged by hurt feelings. Only teachers, one gets the impression, could complain about pound;60m being slipped into their back pockets.

For this year’s awards there will be a single category - to recognise school achievement as a whole for either high or improved results. Special schools and city technology colleges will be eligible.

“This means that schools like Thomas Telford will now be eligible for an award,” says a DFES spokesperson. More detailed guidance to governors will include suggested models for distributing cash, a list of frequently asked questions, and a flowchart.

But the main complaint - the criteria used to judge performance - has not been addressed. Free school meals will remain part of the formula used by the department.

“Free school meals is the best available indicator of socio-economic differences between schools,” says a DFES spokesman. “We are committed to converting the scheme to a value-added basis. But this cannot be done at present because national pupil-linked data are not available.”

phil.revell@ukonline.co.uk