Even struggling schools in the borough do not receive enough help in raising standards, according to inspectors from the Office for Standards in Education and the Audit Commission. Yet the local authority's inspection and advisory service costs nearly twice as much per pupil as that in other inner London boroughs.
Ministers demanded action within a week. They want most or all of the council's education services to be privatised: Islington, meanwhile, proposes a joint-venture company involving business and councillors. Both schemes would mean that the education authority effectively ceases to exist.
Schools themselves are not criticised in the report, published yesterday. Inspectors say they are having some success in raising standards despite challenging social circumstances. Their progress, however, varies markedly.
Seven out of 70 schools have been declared to be failing. While the best has GCSE results that almost reach the national average, at three others fewer than one in five pupils achieves five good GCSEs. Only five of the 20 schools visited, none of them primary schools, had received effective help from the authority.
The inspectors say: "The schools feel that they need and do not receive effective support from the local education authority. They are right."
They reserve their most trenchant criticism for the inspection and advisory service, which costs pounds 48.98 per pupil compared with an average of pounds 27.39 for other inner London councils. "Overall this is an expensive service which has delivered too little of value in the past. Where help has been most needed, it has often been least effective," they say.
The council's weaknesses, the report argues, are so "long-standing and fundamental" that inspectors do not believe the authority is capable of remedying them. People have lost confidence in local schools, and many of the brightest pupils move to schools elsewhere at the age of 11.
The borough's politicians are at least partly to blame. They "oscillate between expressions of support for schools and vilification of them". Council officers have also failed to offer much-needed leadership.
Maintenance of buildings and grounds, promotion of national initiatives in literacy, numeracy and information technology, and school target-setting are all weaknesses. A few services such as finance and personnel are better.
The report accepts that Islington officers are beginning "to define ways forward" but it doubts whether the council can achieve more than "limited, piecemeal improvement".
Estelle Morris, the schools standards minister, made clear yesterday that she expected the council to bring in consultants by next week to draw up specifications for outside organisations to run all or most of its services. Tendering will begin in September. "This is a watershed for Islington. This damning Ofsted report must be the lever for a complete overhaul of Islington's education service," she said.
The council has proposed a new board to replace the education committee as the main policy-making body. Elected councillors would be a minority of its members, who would include heads, governors, parents and business people. Islington wants private partners to join a joint-venture company to run all the remaining services: the council would have only a minority stake.
Leisha Fullick, the chief executive, said: "We acknowledge that mistakes have been made and that we have failed to deliver the high-standard education service that parents rightly expect. We accept the analysis of the Ofsted report and are already working on proposals to implement radical measures to address these concerns."