Critical inspections of education authorities have led the Department for Education and Employment to intervene in 11 councils. Private consultants and companies were brought in to run key services in authorities including Hackney and Islington.
But schools minister Estelle Morris said this week that all councils should be looking at how they can improe services via partnerships with organisations - both private and public. She announced pound;1.5 million for up to five pilot projects.
She said: "We are moving to a situation where an authority's role is as a facilitator of services, not always as a provider. What really matters to schools is the quality of the service.
"Authorities should not be waiting for an inspection or for the DFEE to intervene before looking at whether an outside provider can offer a better service and better value for money."