David Blunkett, the Education and Employment Secretary, wants the private sector, schools and local education authorities to work together on the Pounds 3 billion repair and maintenance backlog.
He believes partnership is the most cost-effective means of solv-ing the problem which has dogged schools for decades.
"Improving the quality of school buildings is essential if we are to succeed in raising achievement," Mr Blunkett said this week. "A decent environment in which to work can contribute to the motivation of pupils to succeed and will be tangible evidence of our commitment to invest in their future."
The idea, contained in Labour's manifesto, is part of a wider shake-up by the Government of the troubled Private Finance Initiative which aims to involve the private sector in public projects.
Mr Blunkett's announcement came as local authority leaders revealed their own solution to the problem - lottery cash.
Dave Wilcox, education vice-chair of the Local Government Association, said there was a crisis in schools which would not wait for deals to be struck between the private and public sectors. "Building partnerships takes an awful lot of time - and I am not aware that the private sector is champing at the bit to get involved in the PFI."
He is preparing a motion for next month's meeting of the Council for Local Education Authorities urging that a one-off payment of lottery money should be used to repair school buildings.
Mr Wilcox said: "It is now easier to get a new school sports hall when you have got classrooms propped up with pit props than a new classroom. It is ludicrous."
The idea is certain to upset councils which have nostalgically clung to the old method of Treasury-sanctioned borrowing to finance building. But Mr Wilcox said the general public should be asked what they think lottery cash should be spent on. "Let's put a questionnaire on the back of the ticket."
The PFI, introduced by the last government, has been slow to get going in local authorities and especially in the schools sector.
Geoffrey Robinson, the Paymaster General, this week announced plans to breathe new life into the initiative by setting up a Treasury task force to speed up and cut the cost of the PFI.
The PFI had been criticised for generating huge tendering costs for both the Government and the private sector.
At the relaunch of the initiative this week, Mr Robinson said schools had been identified as a priority for the PFI. To date Dorset and Manchester are well advanced with plans to replace individual schools, according to Mr Blunkett.
Projects covering groups of schools, such as one for catering services in the south London borough of Lewisham, are also understood to be making good progress, And he said: "We are keen to encourage substantially more initiatives where local authorities group schools together to make partnerships attractive to the private sector."