Education secretary Michael Gove attempted to diffuse criticism over the latest survey figures by launching his department’s emergency funding programme for new schools in areas of greatest need on Friday.

The department also published provisional details on how £1.6bn spending on schools for the next two years will be split by local authority.

2013-15 Schools regional capital spend

An extra £982m investment in schools in England was unveiled by the Chancellor in the autumn statement and will be released to local authorities through the Targeted Basic Need Programme.

Local authorities will now bid for cash to build new academies, free schools or extensions to existing “good” schools in areas of acute need.

Contractors greeted the latest move as a step in the right direction. But also raised concerns about about faltering progress on procurement of 219 schools to be privately financed in the Priority Schools Building Programme.

Stephen Beechey, head of education at Wates, said: “The Priority Schools Building Programme is finally moving forward after several delays, with the winning bidders on the first two batches of schools announced earlier this year.

“This should provide several thousand more school places in key areas over the next eighteen months.

“However, the industry has been waiting since the start of 2012 for the Department for Education to make an announcement on the model which will be used to deliver the 219 schools earmarked for procurement under the private finance element of the PSBP – the vast majority of the 261 schools set for work under the Programme.

“We can see from today’s figures that over 4,000 primary and secondary schools across the country are already over-subscribed, and the situation is only going to get worse with pupil numbers set to increase over the next few years.

“It is therefore crucial to receive a final decision on the private finance element of PSBP as soon as possible to allow the procurement process to start.”

After several procurement delays, the latest timetable for procurement to start is this Spring.

Unveiling new funding allocations on Friday, Gove said the capital funding budgets had been carved up for the first time using the annual school capacity survey showing areas of greatest education need.

“Until now, we have not had detailed information about the specific areas within local authorities where the demand for school places is expected to increase. This meant that we could not target funding in the most effective way possible to meet pockets of demand within local authorities.

“As a result of these changes, the distribution of funding to local authorities for additional school places should be fairer, more accurate and better value for money. Some local authorities will see their funding go up, while others will see funding levels go down.”