When Middlesbrough took over from Cleveland council two years ago it inherited a policy of giving all four and most three-year-olds, free pre-school education.
Of the 3,124 children registered in nursery schools fewer than 100 are in the private sector.
Despite this strength, the authority feels there is still work to do in providing good quality after-school care. And that is where the private sector comes in.
John Stead, Middlesbrough's assistant director of education, says that many families cannot afford to pay for extra care, so the council has decided to work with private and voluntary nurseries.
"When we took over Cleveland we were in the fortunate position that most four-year-olds were provided with nursery places through the state sector," he says. "So we have been trying to work with the private and voluntary sectors."
"Some parents can afford for their children to be looked after by childminders, but in the poorer areas of Middlesbrough parents rely on care provided by the private and voluntary nurseries. We hope to build on this."
* PARTNERS DESPITE LOSS OF CUSTOM; Manchester
Private and voluntary nursery schools in Manchester have given up providing places for four-year-olds, according to Vicky Rosin, head of the council's early years and play division.
Ninety nine per cent of the city's four-year-olds are in state nursery schools. So the voluntary and private sectors are largely involved with after-school care, extended day care and with planning for three-year-olds, said Ms Rosin.
"The legacy of the nursery voucher system means that practically all four-year-olds are being taught in the maintained sector. All primary schools in Manchester, with the exception of two, have a nursery class," she said.
Patricia Stubbs runs the Humpty Dumpty nursery, a voluntary centre for two to five-year-olds. She said that most children left the school when they reached the age of four.
"For the first time in four years only two of our 20 children are four," she said. "Most parents take their children out of our centre at that age not because they are unhappy with our service, but because they can get a free place in the state sector."
Yet Ms Stubbs, who also sits on the local early years development plan committee, said the voluntary and state sectors were still partners.
"We may suffer because we cannot compete with the free places provided by the authority, but this doesn't mean they don't appreciate the service we provide. They continually consult us on their development plans which shows how much they value our work."
Next April the Government's new Standards Fund will give pound;30,000 towards Manchester's early years work. Matched by another pound;30,000 from the council, the money will be distributed equally among the private, voluntary and state sectors in a bid to raise standards in after-school care.
A joint training programme to promote similar teaching methods across the sectors is also on the agenda.