Sir Andrew Foster’s characterisation of FE as education’s “neglected middle child” rings true: it is starved for attention between its brainy older sister University and its cute and helpless little brother School.

And FE’s reaction has parallels with a family dynamic, too: like some middle children, colleges strive to win the favour of mum and dad in Government by being obedient, studious and receptive to every parental decree, rather than the alternative strategy of picking up a drug habit and bringing home unsuitable men.

So it can be reliably predicted that every Government announcement will be welcomed by colleges, adapted to, and adopted, however grudgingly. But the announcement by the 157 Group that it will form one of the Government’s first employee-led mutuals still came as a surprise (page 29).

It was enough of a surprise that the Conservative-Liberal coalition had found its political compass momentarily reverse-polarised as it championed the co-operative movement, which is decidedly socialist in its origins. (Although shorn of worker ownership, as seems likely in the new public sector mutuals, the idea is rather more in keeping with Cameron’s vague notion of the big society.)

There is much that could go wrong with the 157 Group’s proposal: the lack of detail creates innumerable hiding places for devils, and the whole concept rests on the group of colleges bamboozling exam boards into reducing their charges.

If it were that simple, it is unlikely that awarding bodies would have been able to extract ever-greater fees over the last decade. Yet somehow they managed it.

Nevertheless, of all the parts of the education system, it is the middle child which is most at ease with competition. Colleges offering adult education and training have more significant private competition than either universities or schools.

So perhaps it also has a better sense where markets are failing, and the market for exam boards looks like one such case. In any case, they are a curious hangover from the early days of public education, when universities were the only institutions with the track record to guarantee educational standards. They established satellite bodies to set exams for schools and, later, colleges. Other countries seem to muddle along without them, with state or local authorities responsible for setting exams.

And the one potential advantage of having a range of providers - that they will undercut each other financially - does not seem to have materialised. But anyone with experience of markets knows that you do not always compete on price.

The customer in this case, however, is not a student seeking the most respected qualification available or an employer looking for guarantees that a job-seeker has been tested fully. It is a bulk-buying educational institution who may find it hard to resist the prospect of better success rates.

If the annual handwringing over grade inflation has any basis in fact, this is the root cause. As a result, we have a layer of government bureaucracy to regulate a swarm of private companies competing for public sector cash, without offering much of the ruthless efficiency for which capitalism is famed.

Any attempt, however quixotic, to shake up this unwieldy arrangement is welcome. Michael Gove may want the state to withdraw completely from the business of exam criteria, but his colleagues in the Cabinet Office are giving some of its employees an outside chance to get a grip on it.

E joseph.lee@tes.co.uk.