Almost a third of local authorities have been targeted by the Government for spending too much on red tape, and not passing on the increase in education funding to schools.

Education Secretary David Blunkett has set spending limits for next year which will require councils to devote less than pound;65 per pupil on central costs, pound;75 per pupil in London.

At least 80 per cent of the education budget must be given to individual schools, and there must be a 5 per cent increase in the delegated funding per pupil.

Councils failing to meet these targets will be forced to increase the amount they pass on under new powers given to the Secretary of State in the School Standards and Framework Act. DFEE figures for this year show 14 councils have failed on two counts.

Mr Blunkett said: “Ensuring the extra government funding for education is vital. I welcome the fact that well over two-thirds of LEAs are fully passporting the extra money to education. But I am concerned that 14 councils have not passed on even 90 per cent and a further 20 are passing on less than the full 100 per cent.”

The Department for Education and Employment has compiled a table, from figures provided by LEAs, which compares how much councils spend, per pupil, on central services and the amount of the total schools budget they pass on .

It also shows the amount per pupil spent on such services as special needs provision, transport and school improvement (the amount spent on education development plans).

Mr Blunkett said it illustrates a huge range in the amount spent on central administration, with pound;17 per pupil spent in Oxfordshire and pound;167 per pupil in Kensington and Chelsea. The average is pound;49 per pupil - well under the target.

The next phase of Fair Funding will require delegation of services including secondary-school meals, insurance and payroll.

Last week at the Conference of Local Education Authorities, Mr Blunkett told journalists that ministers would be prepared to ring-fence education spending to ensure that it was not spent on “roads and ice rinks”.

The Local Government Association rebutted the Government’s table and has produced its own, itemising where the money is being spent.

Gale Waller, deputy head of education, said: “The Government’s methodology has skewed the figures, because by comparing last year’s figure and this they are not comparing like with like. Local education authorities which are now responsible for a number of former grant-maintained schools will obviously have to increase central costs.

“Comparing authorities is also a nonsense because a small one will not have the economies of scale of a large shire council, but will have to do most of the same tasks. Our calculations show most councils spend less than 3 per cent on running the education service, and even the Government’s own calculations show the central costs are a very small proportion of the total.”

The London borough of Kensington and Chelsea was singled out for high spending at the centre, but Ms Waller said it is the 15th most deprived borough and spends 28 per cent above the amount the Government says it should spend on education.

Keith Mitchell, chief education officer of Durham, the authority which compiled the LGA table, has written to Michael Bichard, the DFEE’s permanent secretary, saying his calculations were highly questionable and have produced “mysterious and mischievous” figures.

Inspectors this week praised Durham, despite above average levels of central spending.

The Grant Maintained Joint Monitoring Group has also produced a table, based on a survey of 20 per cent of GM schools, showing that local education authorities are withholding more than pound;60 million intended for schools.

Funding doubts, 7 Leader, 14

THE OFFENDING LEAS (full tables, page 23)

LEAs which delegated less than 80 per cent of their schools budget to individual schools: Barnsley, Blackburn with Darwen, Blackpool, Brighton and Hove, Buckinghamshire, Cambridgeshire, Cornwall, Dorset, Gateshead, Greenwich, Hackney, Hammersmith and Fulham, Herefordshire, Haringey, Isle of Wight, Kensington and Chelsea, Leicester City, Manchester, Merton, Middlesbrough, Newcastle upon Tyne, Newham, North Lincolnshire, Peterborough City, Salford, Sandwell, Southwark, Torbay, Tower Hamlets, Wakefield and Westminster.

London LEAs which spent more than pound;75 per pupil on central administration: London: Camden, Greenwich, Hackney, Hammersmith and Fulham, Haringey, Harrow, Hounslow, Islington, Kensington and Chelsea, Lewisham, Merton, Southwark and Tower Hamlets.

LEAs outside London which spent more than pound;65 per pupil on central administration: Blackburn with Darwen, Bournemouth, Brighton and Hove, Bristol City, Bury, Dudley, East Sussex, Herefordshire, Liverpool, Manchester, Middlesbrough, North Lincolnshire, Redcar and Cleveland, Thurrock, Torbay and Wokingham.