Pupil places at over-subscribed schools should be awarded on the basis of ballots, a leading think tank has suggested.

A report published on Tuesday by the Social Market Foundation branded school catchment areas as "fundamentally unfair" and called for them to be scrapped.

There should also be a transport subsidy so that all parents have a real choice, added the study.

Under the proposals good schools would be encouraged to expand, gaining extra funds for each pupil attending its lessons.

And under-performing, unpopular schools would be "put under immediate pressure to improve".

The authors argued that the present admissions system has not raised educational standards because it guarantees schools an intake regardless of how badly they perform.

"It is also more likely to benefit the rich than the poor - middle-class parents can buy their way into a good school by moving into its catchment area; this is fundamentally unfair," added the report.

Changing existing admissions policies to the basis of a lottery would be "equal for all", said the SMF, as it would not advantage those who could afford to buy houses in the catchment areas for the best schools.

"Getting your child into a popular school is one of the most talked-about problems of our time," said Philip Collins, the think tank's director.

"A ballot for oversubscribed places is the best possible system: it will encourage higher standards, gives everybody's choice equal weight and is unquestionably fair."