The private company which runs Bradford schools is to receive more than £670,000 despite missing more than half its targets.

And Education Bradford could receive almost all of its maximum £1 million bonus while achieving less than 50 per cent of its goals.

The targets set for the company, run by Serco, were lowered last year by Bradford Council.

Now an MP and a Councillor have claimed the company is getting a cash reward without significantly raising standards.

A Bradford Council report published yesterday reveals the private firm will receive a bonus payment of at least £673,750 and this could rise to £901,250 for its performance.

The report will be debated by a education committee next week.

Councillor Phil Thornton, chairman of the Young People and Education Improvement Committee, said he was concerned Education Bradford had missed two thirds of the overall targets for raising performances in standard assessment tests sat by seven, 11, 14-year-olds and GCSE students.

He said: "These targets were supposed to be challenging, but it looks like it is just about making sure they get more money."

MP Terry Rooney said: "Education Bradford is being rewarded for failure.

"They are getting paid for the process and not for achievement.

"They have failed consistently to raise standards since they took on the contract and Bradford Council should consider its position."

The targets the company has to achieve were lowered last year to make them "challenging but realistic".

Instead of comparing Bradford's performance against the national average, pupils are now measured against 12 similar authorities.

The company has been set the target of getting Bradford into the top quarter of a league table of the 12 authorities.

Education Bradford receives bonus points for achieving this across a variety of different performance areas including results in GCSEs and standard assessment tests sat by seven, 11 and 14-year-olds.

It is also measured against targets for reducing exclusions, bullying, racism and bringing schools out of Ofsted categories of concern.

Each point the firm achieves triggers a payment of £17,500 and the company can receive a maximum of £1m of tax-payers money in bonuses.

The Council report reveals Education Bradford has hit 21 targets and missed 28 last year.

There are still five remaining targets which have not been decided which could earn Education Bradford a further £227,500 and a total of £901,250

Although councillors claim the targets have got easier, this figure will be less than the company received in 2004 when it was paid a bonus of £907,662 for hitting 31 out of 75 targets.

An Education Bradford spokesman said: "We were set very challenging targets and there are clear signs of progress even though not all the targets have been met.

"Bradford performs well compared to the 12 comparator authorities. We are aware that there is still a long way to go, but we do not want to lose sight of the progress being made.

"Standards in Bradford schools continue to rise at a faster rate than nationally. Bradford's average for five A*-C grades at GCSE was the best ever, rising to 46.6 per cent in 2005 compared to 39.8 per cent in 2004.

"The number of schools coming out of OfSTED categories has increased leaving seven in category compared to 14 in December 2004."

Anthony Mugan, head of Bradford Council's Education Client Team, said: "The new targets are challenging based on the aspiration of Bradford aiming to be in the top quarter of similar authorities.

"2005 saw some of the fastest rise in GCSE results in the country and Bradford's best ever results for primary schools at Key Stage Two."