Schools which take on pupils from struggling South Shields School will be given the chance to bid for extra cash.
The school, which is facing closure after failing to become an academy, has seen its problems worsen as parents seek alternatives for their children.
Now South Tyneside’s Schools Forum has made funds available to help other schools in the borough cope.
Teresa Race, South Tyneside Council’s strategic finance manager, told a meeting of the forum: “There’s a consultation on the future of South Shields School and we’ve seen quite a large movement of pupils from the school.”
“That will impact quite a lot on the amount we have to pay to those schools.
“I’m recommending that we move the allocation from the falling rolls fund that we don’t need, to the growth fund.
“If schools where pupils are going to, feel they’re not getting enough from the criteria of the growth fund, we’ve got a method of contacting schools to determine whether we would allocate over and above what we normally would.”
According to a report prepared for councillors last year, 129 transfer requests had been submitted by parents by November i the ‘vast majority for Boldon and Mortimer Schools’.
Growth and falling rolls funds are used to help schools deal with unexpected increases and decreases in pupils numbers.
They are not intended to support schools which are in general financial difficulty.
The South Tyneside growth fund currently holds £325,447 and the falling rolls fund has about £250,000.
Members of the Schools Forum agreed to combine the two for the rest of 2018/19 to help schools deal with pupil pressures, should they feel the need to apply.
Coun Ed Malcolm, South Tyneside Council’s cabinet member for innovation and resources, said: “If we’re not using the falling rolls fund, it sounds sensible to transfer that to the growth fund because there will be some demand on that.
“As long as we can clarify that it is for one year and we would have to revisit it, I think it is sensible.”
The school is facing the prospect of closure on August 31, 2020 following its failure to convert to an academy.
At the start of the current academic year the school had about 550 pupils roll and was predicted to be less than half full by 2020/21, if it stayed open.
James Harrison , Local Democracy Reporting Service