Schools are facing an anxious wait to see whether or not they are still in line for hundreds of millions of pounds to transform school buildings.

Oxfordshire County Council submitted an initial £80m bid to make wide-ranging improvements to four schools under the Government’s Building Schools for the Future programme, in what promised to be the start of the costliest programme of school building in the county’s history.

The county had been encouraged to bid years earlier than initially planned after a change to Government guidelines, designed to take into account condition of buildings, GCSE performance and “the relative deprivation levels” of the area.

But County Hall has been alarmed by a new report from the National Audit Office, which warned that the Government programme underestimated the cost of rebuilding or refurbishing secondary schools across England by up to £10bn.The Parliamentary spending watchdog also found that the work was almost two years behind schedule.

The NAO report said the Government was “too optimistic in its assumptions of how quickly the first schools could be delivered.” By December, only 42 of the planned 200 schools nationally had been built.

Michael Waine, the council’s cabinet member for schools, feared that there was now a real risk that Oxfordshire might never see the money, despite the fact that the council has just set aside £4m in the recent budget to “plan and prepare” for the rebuilding programme.

He said: “It’s very worrying. We were invited by the department to put in a renewed expression of interest, which we did in good faith. We have put into the county budget a sizable sum of money to cover the planning and preparation work. Now we need to see the colour of the Government’s money.

“We are unsure about the future until we get further guidance, but there will be a lot of anger if the programme is cut.”

Oxfordshire had been expected to receive the first slice of funding as early as 2010.

The initial bid had been for £80m to make wide-ranging improvements to Cheney School, Oxford School and Iffley Mead Special School, along with Banbury School.

It was envisaged that further bids could secure investment totalling £400m in local secondary schools.

The county is submitting a detailed strategy for school buildings, which it is hoping will meet strict Government criteria. It is expecting to hear back from the Government by the end of next month.

A spokesman for the Audit Office said: “The extent to which problems in the finance markets will affect Buildings Schools for the Future is still unclear.”

The impact of the economic downturn is likely to be magnified because local authorities who submit successful bids are then expected to work with a private company in a local education partnership.

But Andrew Smith, Labour MP for Oxford East, said the recession made it even more vital to push ahead with the school building scheme.

He said: “It's absolutely essential this programme goes ahead. The current economic situation, when so many people have lost their jobs in the construction industry, actually makes it all the more important that the programme is accelerated and expanded to benefit children and employment.”

Money for the building programme is being distributed in “waves”, with some parts of the country being promised their funding before others. North Oxfordshire has been placed in waves ten to 12, while the rest of the county is in waves 13 to 15. Since the programme has only just reached wave six, Oxfordshire could be years off receiving a single penny of funding.