Supply teachers once had a dismal reputation, but now private agencies work hard to provide the right teacher to fill the gap, writes Lucy Hodges.

Almost 10 years ago to the day, three education experts were sitting discussing London's education problems over a bottle of whisky. Conversation turned to the capital's supply teacher crisis. Each day hundreds, if not thousands, of teachers were absent. Filling the gaps was a nightmare for schools.

They couldn't be sure supply teachers requested would turn up or that they would be a suitable or competent substitute. "The local authority divisional offices provided a poor service by and large," says Chris King, one of the whisky drinkers, then a senior teacher at a school in Southwark. "I had teachers coming from the divisional pools that I would keep in the staff room because they were safer there than in front of a class."

In short, supply teachers had a dismal reputation. The Inner London Education Authority was in the throes of being abolished and Mr King discovered the successor authorities had no plans to replace the supply teacher pools which existed in each ILEA district. Why didn't he and his friends provide an alternative?

Thus was born the first private teacher supply agency, Timeplan, now one of the largest in a burgeoning market. Today it has its head office in Finchley, north London as well as satellite offices in Essex, Sidcup, Brighton, Wimbledon, Hemel Hempstead and Solihull. In addition, it has outposts abroad - in Brisbane, Sydney, Melbourne, Auckland, Montreal, Cape Town and Durban.

Scottish teachers are found jobs in schools in far-flung parts of the globe while fresh-faced Antipodeans and South Africans come to this country to hone their skills on British schoolchildren. At the same time, many newly qualified teachers in the United Kingdom choose to work for agencies to gain experience of different schools and to keep their options open before settling down.

Other teacher recruitment agencies have followed suit. Today the specialist teacher supply market is thought to contain at least 50 companies, to be turning over more than pounds 60m a year and employing more than 10,000 teachers a week. None of the firms will say how much profit they make. "We make the same sort of profit as any of the other employment agencies," says Mr King.

Money is made on volume - on the sheer number of supply teachers placed each day in schools all over the country, according to Capstan Teachers, another of the big agencies. The firms work on smaller margins than other sections of the recruitment industry. The usual commission for placing a teacher in a permanent post is almost 10 per cent of salary and can sometimes be as little as 3 per cent. For an office secretary it is more like 17 per cent.

Capstan is an example of how the market has grown during the 1990s. Started by Ray Mercer in 1993 on the pounds 40-a-week government enterprise allowance scheme and his business partner John Heffernan, who had pounds 2,000 in savings, it now employs 70 staff and has a turnover of pounds 15m.

When the pair started out the banks wouldn't help them, so they raised a car loan of pounds 4,500. Today they are placing 1,000 teachers a day to work in schools and have offices all over the country - in Newcastle, Leeds, Sheffield, Manchester, Liverpool, Birmingham and London.

The revolution has gone hand in hand with a new culture in education brought about by local management of schools, introduced by a Conservative government in 1988. This gave head teachers more control over how they ran institutions. Local education authorities could no longer tell schools how to spend their budgets, and schools became responsible for their own spending. The result was that increasing numbers of heads chose to recruit supply teachers from agencies because it was often cheaper and/or more efficient.

"Before this service existed, supply teaching was often nothing more than a stop gap with any teacher being drafted in," says Paul Howells, managing director of LHR Education, another big player which was established in 1990. "This left the pupils facing not just a change of teacher but often a gap in subject continuity. We make sure that, in virtually all cases, there is a specialist in front of the class. For example, 90 per cent of subject skills are matched and other specialist needs, both those of the pupils and the school, are taken into account."

It has not all been plain sailing. In London competition between agencies is ferocious. The teacher shortage has forced some firms to raise teacher pay rates which puts pressure on other companies to follow suit. Historically, teaching unions, notably the National Union of Teachers, have been hostile to private supply agencies which they regard as threatening the pay and conditions of their members.

But a softening in their line has been detected recently. Capstan has struck an agreement with the NUT saying they will strive to pay teachers within the agreed pay and conditions document. However, even Capstan isn't able to buck the market in London where the presence of a pool of Australians and New Zealanders have kept pay rates below agreed levels.

A more pressing concern is the standard of vetting. A number of the bigger agencies would like to see proper government regulation of the industry to ensure checks on teachers' identities, criminal records, training and employment are carried out thoroughly.

Hugh Baldry, principal lecturer in education at South Bank University, worries about some of the smaller agencies. But the larger ones do a good job, he says. They provide support to schools and sort out problems if they arise. If trainee teachers at South Bank are not sure about where they want to work, Mr Baldry advises them to work on supply. "What happens is that they soon find a school they like and which likes them, and they take a permanent job there."