The main teachers' union in England is saying that the government is putting in jeopardy some of its "pet projects" by cutting education authority funding to pay for its controversial new performance pay system.

The National Union of Teachers found in a survey that many authorities said they would be unable to make bids for money from the Standards Fund because they would not be able to make their own contributions, as required by its terms.

The fund covers such things as school improvement and the literacy and numeracy strategies. The government provides part of the cost and local authorities have to match this.

But it emerged in November that the government was cutting �430m over two years from its estimate of what the authorities needed to spend on education - known as education standard spending or ESS - to finance the performance-related pay of teachers who opt to cross a new pay threshold.

The change was in the government's submission to the teachers' pay review body, in discussing its Green Paper proposals for pay reform.

"... the government has decided that ESS should contribute �150m and �280m in 2000-01 and 2001-02 towards supporting schools incurring additional teachers' pay costs following implementation of the Green Paper reforms," it said.

Small authorities hit hardest

Cambridgeshire, for example, said then that it would be able to increase its education budget by only �1.5m next year instead of the �3m it had planned. Staffordshire said it would lose about �1.7m.

The NUT survey was sent to 149 authorities and 52 responded.

Two thirds said they had not known they would lose funding. The union says they had been led to believe that the government was footing the cost of introducing the new pay system, which in part involves teachers being paid by their pupils' results.

The NUT says that the lack of flexibility in the budgets of the new and smaller unitary authorities means the impact of the loss is likely to hit their schools hardest.

"It is the government which wants payment by results for political not educational reasons," said the union general secretary, Doug McAvoy.

"To cause school budgets to be cut results in pupils and teachers suffering for the imposition of a pay structure which will further damage education and which teachers and schools do not want.

"The government insisted there was �1bn available to pay for this unwanted change. It should withdraw the proposal and enable schools to avoid the damaging cuts the government's sleight of hand over the funding of performance related pay will cause."