But in an Office for Standards in Education report published last week inspectors praised the authority's relationship with schools.
They also described the council's spending per pupil as "well within the acceptable range and satisfactory to the Department for Education and Employment".
The local authority's first inspection report, says the county should improve the monitoring and appraisal of individual teachers' performance.
It says: "The pattern that emerges from inspection judgments is that Rutland's primary schools require some improvement, particularly in the quality of education provided.
"Nine of the 18 schools required some improvement in order to become good schools and three retired much improvement. Progress is slowest in information technology."
Inspectors also advised the council to set higher standards for the three secondary schools which it will become responsible for with the abolition of grant-maintained status.
At its launch three years ago Rutland said it would adopt a non-political approach to service delivery. OFSTED says that its education officers are respected among teachers.
Rutland has argued that the money it is allocated for education has been inadequate because of the poor economies of scale in a county with a population of 34,000. Its education budget was 5 per cent above its allocation during its first year, 1997-98.
By the end of 1999-2000, it is expected to have spent 15 per cent over its education allocation, partly due to the return of former GM schools to local authority control.
The authority has higher-than-average central administration costs per pupil because of its small size, at pound;56 per head compared with the unitary authority average of pound;54, but OFSTED says this is acceptable.