HACKNEY’S pound;1.3 million school improvement service will be in private hands by July 1 - with the troubled London education authority picking up the bill for its pains.

Almost two years after the newly-elected Labour Government first pledged to get tough with failing local authorities Education Secretary David Blunkett gave the go-ahead to put one service out to tender now and another next year.

He was accused of a massive “U-turn” by Liberal Democrats after his forceful pronouncements earlier this year. The Local Government Association said that two years of tough talking had led to piecemeal action that could have been taken in 1997.

Mr Blunkett’s actions also angered the National Union of Teachers, which represents most of the council staff affected. General secretary Doug McAvoy wrote to Mr Blunkett to complain that the union was not consulted.

Hackney’s ethnic-minority achievement service will be contracted out in April 2000, against the advice of consultants KPMG who said no decision should be taken until after that date.

As three-quarters of Hackney pupils are from ethnic minorities, Mr Blunkett decided its work was indivisible from that of the school improvement service.

Hackney Lib Dems group leader Kevin Daws said: “He wants us - the authority he says is no good - to sort it out before they put it out to tender.”

Mr Blunkett has accepted KPMG’s advice that the finance, personnel and IT support services should stay with the council.

Mr Blunkett’s action was officially welcomed by Hackney Labour councillors. However, Mr Daws said: “This is a political decision not based on educational needs.”

The action falls well short of the wresting of control predicted when Mr Blunkett sent in a hit squad to Hackney in September 1997.

LGA education spokesman Graham Lane said: “Putting parts of the education service out to tender is just piecemeal. We’ve always said they need a holistic approach.”

Mr Blunkett wrote to the 10 firms and local authorities on his list of LEA contractors, inviting them to bid by June 4 to run both services.

The authority has been told the pay, terms and conditions of staff already in post will be protected. Hackney has made a strong representation that any additional costs or payments to contractors be met by the Department for Education and Employment.

But a DFEE spokesman said: “If an LEA is failing to provide a service to a sufficient level, we have said we will find somebody else to do it for them. It is right for them to foot the bill for that - it wouldn’t have happened if they’d been providing the service sufficiently in the first place.”