LYME'S Woodroffe School may be forced to cut teaching staff after being ordered to repay debts of around £260,000 to the county council.

The 900-pupil comprehensive got in the red last year after its £1.25 million buildings programme ran massively over-budget.

Dorset education authority bailed them out with a loan but stressed at the time that it was cash desperately needed by other schools in Dorset.

Now Woodroffe has been told the cash must be repaid over the next five years.

Much of the money will come from capital grants the school receives from the Government - and Woodroffe has no problem with that.

But for three years from 2003 the school will be required to hand over between £40,000 and £50,000 from its revenue account towards the loan - money which it uses for the day-to-day running of the school on staffing, lighting and heating, etc.

Headteacher Kerrigan Redman and his governors say pupils could suffer as a result and claim the education authority is being unreasonable.

They had asked to delay the repayment plan while the school pursues a legal case which could produce the cash.

A report before the county's audit committee explained that the school was currently considering legal action against its professional advisers in respect of the overspend on the building project - which included a new sports hall and drama studio.

The report added: "The school continues to ask for a delay in the requirement to start paying back the loan from its revenue funds.

"It argues this on the grounds that repayment of the loan would require reductions in teacher staffing with an adverse effect on the quality of teaching and learning and at a time when a financial settlement in the school's favour (as a result of legal action) could render such a course of action unnecessary."

But director for Education David Goddard said that Woodroffe students should not suffer as a result of the pay-back deal.

"Woodroffe ran into difficulties largely not of their own making," he said.

"They owe us the money and we have been talking to them perfectly amicably about a repayment plan which we have now agreed and which will not damage the school.

"It has required some difficult budgeting for the school but we do not believe it will have an adverse affect on pupils."

But Mr Redman said taking cash from their revenue account was bound to hurt the school. The most likely result would be a cut in staff.

And he said Woodroffe had been unfairly criticised for the way it handled the building project.