After an animated debate, which saw the Church and conservatives pitched against educationists and the Government, the House of Lords voted to keep Section 28 of the Local Government Act 1988. The clause, which outlaws the “promotion” of homosexuality in schools, has been criticised for hampering teachers’ efforts to deal with homophobic bullying. The Lords defeated the Government by a majority of 45, despite a last-ditch attempt by Education Secretary David Blunkett to win round the peers. He promised new guidance to ensure that children are taught about “the importance and nature of marriage and family life in bringing up children”.

If the Lords continue their opposition then it is unlikely that ministers will be able to force through legislation before the next election.

Speaking in the debate, the only openly homosexual peer, Lord Alli argued: “I believe hatred exists because we teach our children to hate. We divide our children by the use of moral codes.”

However, Baroness Young, who led the opposition in the Lords, pointed to “appalling material” which was available to children before Section 28 was introduced.

With ministers already feeling uncomfortable about sex, the last thing they needed was a row over drugs. However, drug tsar Keith Hellawell’s admission that resources would be targeted at tackling “hard” drugs such as heroin and cocaine rather than cannabis, prompted outcry from the Tories. William Hague said that those caught in possession of drugs within 400 yards of a school should normally be jiled.

“Let’s have tougher sentences. Let’s lock away criminals who sell drugs to children and keep them there,” he said. The Conservatives also called for heads to be allowed to draw up their own anti-drugs strategies, without pressure from the Government not to exclude pupils.

Mr Woodhead, who last week said he did not believe Section 28 caused teachers a problem, was in the news again this week with the publication of his sixth annual report.

Although it was his most positive report yet, he drew attention to a “growing” gap in achievement between improving and failing schools.

The literacy and numeracy strategies had helped primary schools improve but this only showed up the poor progress of older children, Mr Woodhead said. He pointed out that after three years at secondary school, one in three still failed to reach the expected level in literacy and numeracy.

Teachers were praised for a “steady” improvement but local authorities and teacher training were again criticised. Only nine of 41 LEAs inspected by the Office for Standards in Education have been judged to give effective support to schools - a record Mr Woodhead described as “bleak”.

However, those hoping to see widespread privatisation of failing schools and LEAs suffered a setback this week when it was revealed that Rams Episcopal Church of England school in Hackney is to be given a “fresh start”. The failing Hackney school had been the first to be handed over to a private contractor in an attempt to raise standards.

Despite paying education consultants the Centre for British Teachers pound;80,000 to turn the school round, ministers have decided to close it and reopen it under a new name.