The sole problem, the Office for Standards in Education concluded, was cost. Like Rolls-Royce cars, the service would be beyond the means of most.

In a report published this week, inspectors said that the authority was not wasteful but added: “The quality of service found here is dependent on... resourcing not replicable elsewhere.”

The Corporation is unique among English councils: the non-political unitary authority for the Square Mile, maintaining the ceremonial functions of the City and duties of a port, health and police authority.

It took over responsiblity for education and the 200-pupil Sir John Cass’s Foundation school from the Inner London Education Authority a decade ago and since then results have improved dramatically.

Inspectors said that the school’s performance had gone from “mediocrity to a point where the school deserves the Beacon status it has”.

Sir John Cass - one of the most visited scools in the country - serves a largely Bangladeshi community and many pupils enter with little or no English.

By the end of key stage 2 their performance across the curriculum is well above average national levels.

Inspectors now suggest that the authority should revise targets for literacy and numeracy. The 1998 figures already exceed the targets which were set for 2001 and 2002.

They said the authority knew the school well but not in a cosy way and praised its work on literacy, backed by an ethnic-minority achievement grant, as “excellent”.

Truancy at the school is rare and there have been no permanent exclusions in recent years. There have, however, been problems with extended holidays to Bangladesh.

The principal education focus for the Corporation is lifelong learning, adult, youth and community education - which means providing services for a working population of 300,000.

Inspectors said it tried to be “a good neighbour” and was involved in the Hackney education action zone and the Excellence in Cities programme.