A school was ordered to pay nearly £20,000 in fines and legal costs today after a pupil lost all but two of her fingers in an art lesson.

The penalty was increased on the Giles foundation school in Boston, Lincolnshire, because staff failed to report the "catastrophic" incident, involving plaster of paris, to the Health and Safety Executive.

Boston magistrates heard the schoolgirl, whose identity has not been revealed, was one of a group on a BTec course who were making sculptures of their hands.

They had been told to work clay round their fingers to make a mould, which they were then to fill with liquid plaster of paris mixed with water in a bucket.

Instead, the girl – referred to as Student X – plunged her hands into the bucket up to the wrist and kept them there as the plaster set. The court heard chemical reactions in the process could reach 60C in large quantities of the plaster, and the student suffered "terrible burns".

She underwent 12 operations by plastic surgeons but was left with no fingers on one hand and two on the other. It was the doctors who informed the HSE about the tragedy, six weeks after it had happened.

The incident, which saw desperate pupils, staff and paramedics try to free the 16-year-old from the quick-setting plaster, has led to a national drive for closer HSE links with schools.

Jo Anderson, prosecuting for the HSE, told Boston magistrates: "The message we want the public to understand is that risk assessments in educational establishments must not be viewed as burdensome but instead paramount to pupil safety."

She was also scathing about the "unacceptable" lack of safety provisions at Giles, which was described as "outstanding" in most categories by an Ofsted inspection in September 2006.

She said another student had made the same mistake at an earlier lesson but had not kept her hands in the plaster for long.

She told the court: "Student X soon realised that she could not remove her hands. They were literally being burnt as the plaster was setting around them."

Other students used a hammer to try to break the plaster away but neither they nor the emergency services could free her. Power tools were eventually used at Nottingham city hospital, more than 40 miles away, to remove the plaster.

The governing body of the school, a specialist visual arts college with 960 pupils, admitted breaching health and safety regulations and failing to report the incident to the HSE. The school was fined £16,500 and ordered to pay £2,500 in costs.

Anderson said: "The governors were not meeting the most basic of legal requirements. I do not believe this was a terrible accident. It could and should have been avoided if the governing body had monitored health and safety."

"It was clear there were no such systems and procedures. There was no way the student could or should have known of the catastrophic consequences.

The class had failed to observe guidelines on plaster of paris, which state clearly that it should only be handled using goggles and gloves.

In a statement issued after the sentencing, the HSE said: "Today we have heard the dreadful consequence of not carrying out proper risk assessments in the classroom. It is simply not acceptable that pupils in a classroom setting are not informed and prepared for the risks involved in handling hazardous substances. "