Councillors have still to decide how to pay for the running of two schools on one site following their merger.

Councillor Vanessa Brown, who forced a rethink over the merger of Goldstone Primary School in Hove, gave a cautious welcome to new plans for them to be run on one site.

However, she is still concerned about where Brighton and Hove City Council is going to find the money to build new classrooms.

The council's Conservative spokeswoman for education was responsible for having the plans called in for reconsideration by city education bosses.

The revised plans bring the cost of building work down from £2.1 million to £1.8 million.

They include reducing the number of new classrooms from eight to six and providing a smaller school hall.

She said: "I am delighted that the education directorate has taken the situation seriously and have looked into it again.

"I am particularly pleased for the parents, governors and staff who were badly let down by the council.

"However, I am tempering that with caution until I know exactly how much money is needed and where it is coming from."

The new school has been operating on two sites since Goldstone Junior and Knoll Infants Schools merged in September.

Parents were promised the two schools would move on to the Goldstone site in Laburnam Avenue, Hove.

The council planned to sell the Knoll site for housing to pay some of the costs but the land value was underestimated.

At the time it was believed to be worth about £750,000, which left a hole in the council's calculations which the Government refused to fill in the form of grants.

The council has now revised its estimate of the value of the land but has refused to reveal how much it is now worth on the grounds that it is commercially-sensitive information.

A new value of about £1.2 million for the site has been estimated and this will be disclosed during the private part of the council's children, families and schools sub-committee on Monday.

Coun Brown said: "I am seriously concerned about the amounts of money that have been bandied about.

"The value of the land has apparently increased considerably, although I am not prepared to discuss the figure contained in the confidential part of the committee report.

"I want to know exactly how much it is worth and where the rest of the money is coming from.

"The parents and the school have already been totally misled and let down by the council and I don't want that to happen again."

David Hawker, Brighton and Hove's director of education, said he hoped the school would be operating on a single site from September 2004.

He said that if all goes to plan, building work on the new classrooms could begin early next summer.

Hove MP Ivor Caplin, a former pupil at Goldstone Junior School, said he was prepared to speak to Education Secretary Estelle Morris to help get the open space around the Knoll site released.

Government policy is to preserve as much open space around schools as possible and if it refused to release the land the site's value could be affected.