A Tory MP, Laurence Robertson, raised the matter during education questions in the Commons.

Laurence Robertson: "Will you address this?"

"Kent benefits just purely in educational terms to the tune of �26.5m per year. Oxfordshire benefits to the tune of about �8.2m a year just purely in educational terms and yet Gloucestershire, which neighbours Oxfordshire, loses out something like �2m because of this scheme," he said.

His complaint related to what is known as the area cost adjustment in the amount of money the government thinks councils need to spend for specific purposes - the standard spending assessment.

The Education Minister Estelle Morris said this was an inequality that had been going on year after year.

'Valid objections'

"Your government failed to even tackle the issue," she said. "We have begun to look at it and I very much hope that in the next few years we can work with local authorities to bring about a better formula.

"We all accept that there are valid objections to the current system including the area cost adjustment. We will be looking at proposals for reform over the next three years."

George Stevenson: Minister accepted his constituency suffers

A Labour MP, George Stevenson, welcomed the extra money the government was putting into education but renewed that attack.

"This situation, coupled with the serious anomalies in the additional educational needs formula, means that ... many local education authorities are at a serious disadvantage," he said.

'Perpetuating injustice'

"The three-year plans of the government in this regard are not bringing stability but actually are perpetuating injustice. Will you at least look at measures that could be taken in the interim that will mitigate this serious situation?"

Ms Morris said she was working with the Department of Environment, Transport and the Regions to address this "serious issue".

"Your area of Stoke-on-Trent and surrounding Staffordshire has suffered for too long in terms of an unfair formula, but it is no good changing it and not getting it right this time round," she said.

"It is right that we work with local authorities to get an agreement about how we can move forward. Work has been carried out. We were not able to reach an agreement this year, but we will continue to look at what is an important issue."