The SNP Government has made a fresh move to breathe new life into its concordat agreement with local authorities by offering to retain councils' share of public spending in return for a few political favours.
The deal will involve an independent review of the 2001 national teachers' agreement, starting in January. The Convention of Scottish Local Authorities has already tabled a "wish list" with the Government, including a two-year pay standstill for teachers and a controversial freeze on new entrants to the chartered teacher scheme, which The TESS understands ministers will accept.
In a statement to Parliament on Wednesday, Finance Secretary John Swinney pulled a rabbit out of the hat and revealed he had struck a deal with the leadership of the Convention of Scottish Local Authorities.
In return for maintaining local government's share of the overall Scottish budget, and accepting a continuation of the council tax freeze, Mr Swinney said he would expect councils to provide places for all probationer teachers who will be looking for jobs next August, maintain pupil:teacher ratios in P1-3, create a new pound;5 million early years and early intervention fund, and support the implementation of Curriculum for Excellence.
The announcement that the Government will now simply expect local authorities to maintain ratios in P1-3 is a significant departure from the previous emphasis on reducing class sizes in these stages.
Mr Swinney said the deal with the authorities, which also affects other services, would reduce their funding by 2.6 per cent next year. But it was a "conditional" agreement: if it was not accepted by the 32 councils, the cut would be 6.4 per cent, in line with the funding reductions for other "non-protected" services.
Pat Watters, Cosla's Labour president, said the settlement was not "brilliant", but it afforded "a significant level of protection for local government compared to other parts of the public sector".
Michael Russell, the Education Secretary, said: "The agreement with Cosla on teacher employment is a significant achievement. The 2,800 probationary teachers leaving education training this year will have the same number of job opportunities available to them."
Mr Russell, who admitted in September that the loss of teachers' jobs caused him more "heartache" than any other issue, added: "More jobs will also be created so we can make a significant contribution to tackling longer-term teacher unemployment."
Cosla wants some leeway to unlock the resources tied up in the teachers' agreement. In addition to stalling the chartered teacher programme, it has proposed a two-year pay freeze for teachers from 2011-13, an increase in probationers' contact time with pupils, supply teachers to be paid at the bottom of the pay scale and the removal of salary conservation for some teachers.
Mr Russell is likely to accept those, but he is understood to have set his face against another of Cosla's demands to increase teachers' class contact with their pupils. He believes they need the time they have to implement Curriculum for Excellence.
In his statement, Mr Swinney also pledged to retain the same number of university and further education college places next year.
But, while maintaining the mantra that he has sought to protect "frontline services", he also announced cuts to the budgets of the Scottish Funding Council, the Scottish Qualifications Authority, Learning and Teaching Scotland and Skills Development Scotland.
Despite the hobbling of these key support agencies, Mr Russell said this would be "without detriment to access to higher or further education, the number of core university and college places, the implementation of Curriculum for Excellence or support for the unemployed."
Other priorities outlined by Mr Swinney include the continuation of education maintenance allowances for pupils to stay on in school or college, although they had been expected to follow the cuts announced south of the border, and the pound;1.25bn school building programme being co- ordinated through the Scottish Futures Trust.
Mr Swinney blamed the Westminster Government for cutting Scotland's devolved budget by pound;500m on day-to-day revenue spending and by pound;800m on capital projects.