Schools will benefit from real terms spending increases for the next four years, Gordon Brown revealed this week, signalling that education will remain a priority under his premiership.
The Chancellor used his Budget speech to preview an education comprehensive spending review for 2008-11 amounting to an average annual, above inflation, funding increase of 3.3 per cent for schools in England.
This would bring per pupil funding up to pound;6,600 by 2010-11, and increase "education spending to the highest level ever".
John Dunford, Association of School and College Leaders general secretary, said: "On the face of it, this appears to be a good deal for education.
However, as with previous Budgets, we will need to see the small print before we can calculate the real effect that this will have on school and college bugets."
The Chancellor said every school in England would become an extended school and that he would raise the number of free hours of nursery education for three and four-year-olds from 12.5 to 15 a week by 2010.
Trailing yesterday's green paper on raising participation, Mr Brown restated his commitment to making 18 the compulsory age for education and training by 2013. To help, he announced funds to allow 50,000 16-to 17-year-olds to receive a "training wage" in return for gaining skills. The consultation paper proposed a sanction "as a very last resort" for young people who refused to engage in education or training. It also stressed that participation must lead to attainment.
The deal makes education a relative winner with an extra pound;4.2 billion a year in the UK in an era of much tighter public spending.
But it amounts to annual real terms rises of just 2.4 per cent, well the below the average of 5.3 per cent between 1999-2008, that UK education has become used to.
The Chancellor said he was "continuing to narrow the gap in investment per pupil between state and private schools". But as with a similar comment he made last year, there was no timescale, making the goal of equalising the sectors a loose aspiration rather than a firm commitment.
There was good news for academies as Mr Brown said he would change VAT rules so that they could hire out their sports facilities to local communities without financial penalty. Local authority schools are not affected.
Overall, the package will mean education spending will have risen to 5.6 per cent of the national income by 2010, compared to 4.5 per cent in 1997.
The Institute of Fiscal Studies predicts it will continue to lag behind health increases when the rest of the comprehensive spending review is announced this summer. But the Department for Education and Skills has done better than the Home Office, which will suffer a spending freeze, and 10 other smaller departments which face spending cuts.
Leader, page 26