Key elements of School Sport Partnerships network will be retained despite education secretary's previous insistence they were not delivering
Michael Gove has been forced to backtrack on his plan to abolish dedicated funding for school sport after cabinet colleagues convinced David Cameron the move was unwise.
The government will conduct a major U-turn in the next few days on a policy that provoked furious opposition from headteachers, sports stars and pupils across England.
Key elements of the School Sport Partnerships (SSPs) network will be retained despite the education secretary's previous repeated insistence that they were not delivering and would be scrapped.
In a deal to be announced imminently – which ministers hope will defuse the row – many of the 450 partnerships will be given a temporary reprieve, probably until after the 2012 Olympics in London.
The move will enable them to continue helping England's 20,100 schools increase pupils' participation in sport, especially competitive interschool sport.
However, at least some of the network's 675 staff will lose their jobs and some of its infrastructure will be dismantled as part of the deal, which has been thrashed out in intensive discussions involving Gove's Department for Education (DfE), the culture secretary, Jeremy Hunt, and the health secretary, Andrew Lansley.
Hunt has played a key role in convincing No 10 that simply letting the SSPs disappear through lack of funding from next April, as Gove intended, would jeopardise young people's involvement in physical activity and undermine the UK's pledge to use the 2012 Olympics to increase sports participation.
The government will not be reinstating the £162m-a-year DfE grant, which the previous government introduced, and which Gove said on 20 October would cease at the end of March 2011 as part of the widespread cuts unveiled in the comprehensive spending review.
Instead Gove, Hunt and Lansley have each found money from within their existing budgets for a new source of funding for schools to provide sporting opportunities.
Sources involved in the talks said it would amount to significantly less than £162m – "a matter of tens of millions of pounds in total from 2011 to 2015". That money will be closely tied to Hunt's idea of an annual "schools Olympics" and Gove's insistence on greater participation in competitive sport.
One participant in the talks said Gove had made a mistake by announcing the end of funding for SSPs before a replacement system of school sports provision had been finalised.
The DfE is likely to confirm details of the revised plan on Monday. Whitehall sources said the continuing outcry over school sport had to be ended before Cameron staged a high-profile visit to the Olympic Park in east London next week to turn on Christmas lights at the Olympic Stadium.
Downing Street officials had been keen to agree a deal on school sport before then so Cameron could talk about 2012 legacy issues without being challenged about the threat to the SSPs.
Cameron told MPs on 1 December that he had ordered a rethink, soon after scores of elite sportspeople – including Olympic gold medallists such as Kelly Holmes, Denise Lewis and Darren Campbell – criticised the plan as ill-conceived and likely to fuel childhood obesity.
Each of the 450 SSPs employs a full-time partnership development manager, some of whom have already been put on notice of redundancy since Gove's surprise announcement on 20 October.