In a letter released a day before Tony Blair was due to give a speech to new headteachers, Jeremy Beecham, chairman of the Local Government Association, said most of the attacks on councils were based on fiction not fact.

It had been reported that Mr Blair would lambast local education authorities for wasting money on red tape and would attack teachers and councils unwilling to embrace change.

The letter is addressed to the leaders of the three main political parties. The Conservative party’s new education policy, contained in The Common Sense Revolution, is to take all schools out of LEA control, and, at a fringe meeting at the party’s conference in Blackpool, Chris Woodhead, the Chief Inspector of Schools, said: “We need to continue the drive that began in 1988 with local management of schools.”

But it is the motives of the Government that are giving council leaders most concern.

One insider said: “We hear all this criticism of local education authorities. This is coming not just from the Department for Education and Employment but Downing Street. Is it an attempt to discredit LEAs so they can take schools out of their control?”

The letter says: “Claims that councils are holding back large amounts of cash from schools and maintaining bloated bureaucracies are completely unfounded. At most, local education authorities spend 3 per cent of the budgets on central administration - with many spending as little as 1.6 per cent.”