Sheffield's youth service has been combined with the careers service and with "Connexions", a confidential advice and information service for teenagers, under the umbrella of the Sheffield Futures charity.
As a charity, Sheffield Futures has access to funds, such as the Lotto, not available to local government. It has been able to increase its budget from pound;10 million to nearly pound;12 million and wants to expand the staff from the present 700.
Jim Reid, the charity's chief executive, said: "It was very brave of the city council. The youth service was close to the hearts of councillors. It's a jewel in the crown because of its Ofsted reports, but they believed in this so much that they decided on the merger."