Nothing sums up the difficulties of dealing with playground racism like the case of the 10-year-old schoolboy who, in 2006, was hauled before judges for calling a fellow pupil “Paki”. Everyone from the local authority to the Muslim Council of Britain intervened, pressing for the case to be thrown out. And that’s not to mention the judge presiding over the case, who protested that, “nobody is more against racist abuse than me, but these boys are in the playground,” before sniffing and saying, inevitably, that the school’s overreaction was “political correctness gone mad”. The Crown Prosecution Service dropped the charges and the boy received a formal warning.

It’s easy to dismiss such incidents as tabloid rabble-rousing, but murmurs of dissent are beginning to emerge about the ways schools deal with events such as these on a daily basis, particularly in primaries where it is difficult to draw the line between speech crime and playground spat. Was the prosecution nothing more serious than the authorities doing their duty under the Race Relations (Amendment) Act 2000? Or was it a sign of a moral panic over racism rampaging unchecked through British schools?

The latter may seem foolish. But the Government has made it clear that in the wake of the Race Relations (Amendment) Act, all racist incidents must be investigated and reported, so racism in the playground is clearly alive and kicking.

Figures show that 95,000 racist incidents have been recorded in schools by local authorities since mandatory reporting began in the early Noughties. There were 4,410 temporary and permanent exclusions as a result of racist abuse in the year 2006-07 and 350 of them occurred in primaries. Anti- racism days and lesson plans are a familiar part of teachers’ armoury as they strive to stamp out inter-racial bullying in Britain’s increasingly multi-ethnic classrooms. But could government policy actually be hindering their efforts?

Adrian Hart, an anti-racism campaigner, thinks so. The Brighton-based film-maker is writing a book called The Myth of Racist Kids and believes that schools’ reporting duties have led them to ramp up playground name- calling, forcing children to brood over differences they would otherwise shrug off.

“I do think there’s something corrosive in the idea that small children can be racist and their arguments can be criminalised,” he says. “Every day these children are living out a model of multi-ethnic interaction in our playgrounds. We’re watching diversity going on under our noses and we’re crushing it by our obsession with identity politics.”

Discussing the concept of racism with children as young as four risks confusing and upsetting them, Adrian says. He cites the example of a six- year-old girl, told to him by a colleague, whose parents were called into school after she told a fellow pupil: “We don’t want to play with you because you’re black”.

It turned into a saga that was upsetting for her and the victim. She was going round saying: `What is racism? I’m so sorry I’ve done racism’,” he says. “Teachers should be dealing with these issues the way they’ve always done, by explaining why the word is hurtful. But keep it in the bounds of common sense.”

His point tallies with a line taken by the Department for Children, Schools and Families, which told The TES Magazine: “racially motivated incidents must be thoroughly investigated, but . schools need to deal with those involved in a sensitive way and exercise common sense.”

Adrian doesn’t view himself as a curmudgeonly conservative fuming about political correctness. He supports multiculturalism; he just thinks schools are going the wrong way about it. In this respect, his views echo those of Kenan Malik, the Indian-born broadcaster and senior visiting fellow at the University of Surrey who, despite facing daily intimidation himself in the Sixties, believes importing legalistic reporting policies into primary schools is damaging.

“I wouldn’t want anyone to go through what I went through,” says Kenan. “But we live in a different Britain today. If normal childish behaviour is treated as a huge incident and reported not just to the school, but to the council, the risk is it becomes something dangerous and threatening to children, and that’s not helpful either for them or society.”

So how did we get here? Racist incident reporting was a reaction to the uproar surrounding the murder in 1993 of Stephen Lawrence, a black teenager in south London whose killing sowed the seeds of the 2000 Race Relations Act. The police’s response, which failed to result in a successful prosecution, led to accusations of institutional racism and a bid to stop future incidents of racism being swept under the carpet.

In 1998, the Government created a new category of “racially aggravated offence,” which incurred longer sentences than previously, and in 2004 published Schools’ race equality policies - from issues to outcomes, requiring schools to investigate and report all racist incidents to the local authority. The definition of racism, coined in the influential Macpherson Report, was: “any incident perceived to be racist by the victim or any other person”.

His definition has taken a beating, especially in the primary sector, where playground disagreements can be highly subjective and applying the term “racism” to young children courts controversy. In July, guidance published by Jane Lane, an early years researcher, came in for a drubbing when she appeared to suggest teachers should scan nursery pupils for signs of prejudice, which might be signalled by something as innocuous as a dislike of spicy food. Today Jane insists her research was misinterpreted, but she stands by the idea that young children can be racist, although she says it’s important to deal with any incidents sensitively.

“The research evidence of the past 40 years shows that children at the age of three can notice differences in skin colour and many young children learn prejudiced attitudes before they go to school. They don’t tell us what they’re thinking most of the time, so they could have horrendous ideas and we wouldn’t know. But the problem is the word engenders such fear and guilt. If you say children are racist it antagonises people. You have to monitor it in a supportive and not a blaming way.”

Jane emphasises the importance of investigating incidents before reporting them - what appears to be a child singled out because of their skin colour could be a normal, although unfortunate, example of playground cruelty.

It’s a potential source of confusion that’s all too familiar to Anne Phipps, the headteacher of Bedenham Primary School in Gosport, Hampshire. She says the Daily Mail accused her of launching a “race probe” against a four-year-old boy who had spat at a black pupil. But she says her actions were misreported.

“The child came in upset and felt singled out because he was black,” she recalls. “There was a discussion between me and the other children who’d been there and I realised that wasn’t the case.”

A nursery nurse spoke to the four-year-old child - without mentioning the word racism - and talked to him about being kind. “I’m a primary head and I dealt with it in a way primary children can understand,” says Anne. “I followed the correct procedure and believe I did the right thing.”

What happened next though showed the antagonising power of the R-word. The child’s parents, alarmed to hear that their son had been suspected of racism, spoke to the press. “How can a four-year-old be racist?” asked his mother Sarah Smith, 35. “His best friend at nursery was a boy of Indian background - colour doesn’t mean anything to him.”

It’s an understandable reaction from parents. The word, at least in the adult arena, is such a toxic term that its appearance can destroy reputations and careers at a stroke and those accused of it - from Jade Goody, the Celebrity Big Brother star, to James McGrath, the Tory adviser sacked earlier this year - can expect little mercy.

In the playground the stakes are less high, but children, picking up on adult anxieties, are usually appalled at the thought of having “done racism”, and the temptation among staff can be to deal with race-based incidents as though they were on a different level of seriousness. The question is, are they?

According to one south London-based ethnic minority achievement officer, the answer is a resounding yes. She asked not to be named - her council has strict protocols about speaking to the press - but said that the abuse and prejudice black schoolboys have to put up with on a daily basis makes stamping out playground racism a priority.

“In my area, you have the white working class alongside Somali immigrants and all hell has broken loose,” she says. “There are Union Jacks hanging from every window, an active BNP and the black boys are being harassed by their neighbours and called nigger on the street.”

She cites one example of a group of Somali boys who had water poured over them by an upstairs neighbour while they were playing in the garden. “The result is you have some very angry and defensive boys. They feel they’re not being listened to,” she says.

She believes the problem, if anything, is that racist incidents are under- reported. Teachers can feel uncertain about how to deal with, or even recognise, childhood racism, and where the situation is ambiguous - for example a white child refusing to sit next to a black pupil - may decide that the safest option is to leave well alone.

Her criticisms echo a 2005 Ofsted report that condemned schools’ enforcement of racial equality policies as patchy. Heads need to send out a clear signal by practising a zero tolerance policy, she believes. “They should involve all communities in drawing it up, so everyone has a stake in it. It shouldn’t just be a paper exercise for Ofsted.”

While equating racist name calling with playground slurs such as ginger nut and fatty might seem logical, in reality few if any people are murdered or attacked for their hair colour or weight. By contrast, in England and Wales there were nearly 5,000 racist or religiously-motivated assaults that resulted in wounding and more than 26,000 cases of racial or religious harassment in 2007-08. For all that Britain is a more tolerant country than it was 30 years ago, in our pressure-cooker inner-city areas, especially in the wake of the London bombings, people are still abused and beaten because of their colour.

That is why some commentators, such as Louis Kushnick, a professor of race relations at Manchester University, are angry that schools’ racist incident policies are being criticised at all. “Do we want a society characterised by stupidity, bigotry and ignorance? Or do we want our children to be at ease with the world?” he asks. “If we don’t raise our children to be decent human beings, they’ll bring into school what they’re consuming elsewhere and no one will challenge it. If you demonise Muslims every day in the media, then children will pick it up.”

Racist incident reporting is crucial to addressing these issues, Louis says. “If you don’t have monitoring you have no way of identifying the scale of the problem. And if you leave it up to schools, there’s no reward for flagging it up.”

But how should primary schools intervene in the wake of a bust-up? Berenice Miles, author of Racist Incidents and Bullying in Schools: How to prevent them and what to do when they happen (Trentham Books), says the important thing is to remember that every situation is different. “Talk to the child, explain why their behaviour is wrong and hurtful and support the child who is upset,” she says.

Children should know that racist behaviour is taken seriously, but deal with incidents in the classroom where possible, Berenice maintains. “Although if a child is consistently unkind, it may be worth having a word with the parents,” she adds.

In common with other educationists, Berenice advises that primary schools back up their anti-racist policies with classroom work. She recommends persona dolls - a slightly smaller-than-life toy, made to resemble a child - for their ability to tease out children’s preconceptions without forcing them to engage in an adult dialogue about race.

Sue Evans, a reception teacher at Phoenix Primary in Greater Manchester, used a black persona doll called Isaac to help children think about a racist incident in which a white mother had been charged after racially abusing a Muslim family outside the school gates. The bust-up, she says, made her class subdued and anxious.

“The girl involved was quiet and confused, the little Muslim boy was weepy and withdrawn and the children were blaming him for everything. The persona doll allowed them to talk about stuff they had heard at home somewhere they knew they wouldn’t get shouted at,” Sue says.

Isaac was introduced to the class gradually, and in circle time Sue revealed he’d been shouted at in the street and asked them why they thought it had happened. “They said things such as: `Because he’s brown’ or `Because he’s got black curly hair’. I asked them: `How would you feel? What would you do?’ They said they’d go and help him, so we did a role play acting it out.”

Rob Berkeley, deputy director of the Runnymede Trust, an independent think-tank devoted to the cause of promoting racial justice in Britain, says follow-up work in the wake of a suspected racist incident is crucial: “Sometimes it seems like reporting for reporting’s sake. If local authorities see patterns of racist incidents occurring, that should trigger intervention - not so everyone can blame the school, but so it can be dealt with.”

Racism, particularly in primary schools, remains a difficult issue, especially when the moral weight of the word is enough not just to bruise the egos of those involved, but to put pressure on teachers’ confidence to deal with the incidents satisfactorily.

There will always be those who think dubbing four-year-old children racist is heavy handed, especially at an age when most are still struggling to understand moral boundaries. On the other hand, racism in adults can be dangerous and even lethal and if schools aren’t the place to stamp it out, where is?

The answer, according to some experts, is to make a measured response, within the law, that doesn’t risk criminalising pupils or attributing adult motives to their sometimes childish actions.

“I don’t think it’s helpful to call a four-year-old racist,” says Rob. “But there will be another child on the receiving end whose self-esteem and learning will suffer. It is difficult to talk about racism without blame. But there has to be some way of addressing that.”

RACISM IN SCHOOLS TODAY

“Any incident perceived to be racist by the victim or any other person” - definition of a racist incident according to the 1999 Macpherson Report.

95,000 - The number of racist incidents recorded in schools since reporting began.

4,410 - Temporary and permanent exclusions in schools as a result of racism in 2006-07.

26,000 - Cases of racial harassment in England and Wales in 2007-08.