Students allege they have been locked in time-out rooms, physically restrained, bullied and struck in the throat.

They also say they have been denied access to the full academic curriculum, only been allowed to attend school part-time and barred from enrolling at mainstream schools.

Figures obtained by The Age reveal that in the two years to June 30, the Department paid $260,000 to students with a disability who alleged discrimination.

But despite making these payments, which are often confidential, it denies the bulk of the discrimination allegations levelled against it.

It conceded in the Federal Court last year that many of these cases lacked merit and said the allegations were often cut and pasted from previous pleadings.

It also said it “only chooses to settle the cases because they are expensive to conduct, because the compensation paid is less than the costs of conducting the case, and because the Department would usually be unable to recover its costs if successful''.

But Federal Court judge Justice Bernard Murphy said while some cases lacked merit “it beggars belief that every discrimination case brought against the Department is unmeritorious''.

A “next friend”, such as a mother or father, pursues the compensation on behalf of the child with a disability.

Federal Court statistics obtained by The Age reveal that Victoria appears to have more of these "next friend" cases involving the Education Department than any other jurisdiction. Since 2015, there have been 19 of these cases in Victoria, compared to four in NSW and one in South Australia.

In these cases, the Federal Court has not been asked to determine whether the allegations are true, but has been asked to approve the settlement.

The payments are held in trust in a Supreme Court fund and used for children's ongoing needs.

A department spokesman said litigation could negatively impact students’ school attendance, participation, relationships with school staff and general wellbeing.

“The department puts the needs of the child first by considering the immediate and long-term impact of litigation proceedings on a students’ education and wellbeing,” he said.

He said the department had channels to resolve complaints at schools and supporting students with additional needs was a “fundamental part of building an equitable and excellent education system”.

The $260,000 figure also includes settlements reached in the Victorian Civil and Administrative Tribunal, the Australian Human Rights Commission and Victorian Equal Opportunity and Human Rights Commission.

Since 2000 there have only been nine cases that have proceeded to judgment in a court, and of these, only two were partially successful.

Sharlene Gray took legal action on behalf of her son after discovering he was being locked in a small room at his Melbourne school. She reached a confidential settlement with the department in 2017.

She says her son, who has autism and had meltdowns at school, was repeatedly restrained by teachers and also punched in the throat by a taekwondo trainer.

“Nobody in the Education Department would listen, and I wanted things to change,” she said.

Disability advocate Julie Phillips, who supports the majority of Victorian families seeking redress, said students with a disability continued to experience shocking levels of discrimination in the state’s schools.

“They fling this money at families but never address the problem,” she said.

She said the department’s belief that many of the pleadings look the same is “probably true”.

“It is the same thing happening over and over again.”

She estimates the department is spending millions of dollars on lawyers every year.

"This money would be better spent in schools," she said.