Headteachers have been advised not to take part in the Government's plans to "parachute" experienced staff into failing schools unless they are financially rewarded and given extra resources.
David Hart, general secretary of the National Association of Head Teachers, told conference delegates in Scarborough that heads should not accept the posting "unless the remuneration package was right, appropriate additional resources were available and he or she could be guaranteed a reasonably free hand to implement the necessary changes".
Mr Hart said heads and deputies were already vastly underpaid in relation to their responsibilities. On average a primary head is paid Pounds 30,000 and a secondary Pounds 45,000.
He said the pay of headteachers made it difficult to recruit and retain staff and had led to a dramatic increase in the number of heads and deputies taking early retirement.
This situation meant it was virtually impossible for problem schools to employ headteachers. "Governing bodies need to be able to offer attractive packages to attract the right quality of staff. School budgets make this impossible, " said Mr Hart.
The School Teachers' Review Body was blamed for ducking the issue of recruitment and retention of headteachers. Mr Hart said the Government must end the system of heads having to rely on governors finding extra cash from over-stretched budgets to pay for the quality leadership they want.
But the main message of Mr Hart's speech was the need for proper funding. He said after 18 years of neglect, a Pounds 4 billion investment in schools was needed. There should be a radical overhaul, with, for example, money from higher education being transferred to schools.
"To tolerate a situation where a primary school pupil costs Pounds 1,000 while a higher education student costs Pounds 10,000 is the education economics of the madhouse," he said.
"Adherence to economic policies, which cannot deliver the goods in the timescale so desperately needed by the education service, needs to be rethought," said Mr Hart.
He warned David Blunkett, the Education and Employment Secretary, who is due to address the NAHT today, that he could end up with egg on his face over plans to cut class sizes.
He said the money recouped from the abolition of assisted places would not be enough to reduce classes for key stage 1 children to 30 and below. While the NAHT supports many of the Government's initiatives, it is not impressed by its commitment to investment.
Mr Hart said schools face at least another two years of redundancies if the Government carries out its promise to stay within the tax and spending limits set out by the Conservative government. "Staff are being made redundant this year, they were made redundant last year and the year before that. Redundancies will continue unless funding is increased."
He said that if the Chancellor gets tough on public-sector spending in his forthcoming Budget, he would cause irreparable damage to recruitment and retainment.
Keeping to Conservative party's plans, as Labour had promised during the election campaign, implied a 7 per cent cut over two years.
"This will send shivers down the spines of parents, governors and teachers, " added Mr Hart.