City education officials are understood to be furious after the Government announced it was concerned at the "rate of progress" in Leicester's schools.

Schools Secretary Ed Balls said on Tuesday that he would "do whatever it takes" to improve standards – including the possibility of stripping Leicester City Council of control.

But there is disagreement between the Government and Leicester officials over whether schools should become academies, and some people suspect this is the real reason for Mr Balls's announcement. Councillors now want city schools to work together to raise standards, while the Government favours bringing in private sponsors to run the weakest schools.

Leicester's branch of the National Union of Teachers described the Government's actions as "bullying" the council.

Assistant secretary Peter Flack said: "This is punishment for the council not agreeing to open academies.

"It's a clear case of the Government bullying the local authority if it doesn't do what it wants.

"It's disgraceful behaviour by a discredited Government.''

The Government has told councils to come up with "radical solutions" to improve results of National Challenge schools – those where fewer than 30% of pupils achieve five good GCSEs including English and maths.

It is believed the Government favours closing Fullhurst College, in Braunstone, and Babington College, in Beaumont Leys, and re-opening them as privately-sponsored academies. Initially the city council agreed this was the best option, but now it is looking at alternatives.

Councillor Vi Dempster, the city's cabinet member for education, said it was important for the council and the Government to work together to come up with the best solution.

She said: "In December I said we were looking at academies but since then there has been some fantastic partnership work between schools and that gives other options in terms of local solutions, and we need to look at what is best.

''We are exploring alternatives to academies and it's our responsibility to build on work already done by schools in partnership."

A letter written by Mr Balls, received by leading members of the council on Tuesday, congratulated education bosses for recent improvements, including the large reduction in schools judged to be failing.

But he released comments to the press later in the day threatening to take power away from the city council if exam results in Leicester did not improve.

Schools Minister Vernon Coaker said: "The evidence shows that academies are working.  Last year the percentage of pupils getting 5 A*-C grades at GCSE (including English and Maths) increased by 4.3 percentage points compared with 2.5 per cent points nationally.  Academies are also popular with parents, with more than three applications for every place.

"We do not force academies on anyone. All academies proceed after consultation with parents and with the agreement of the local authority and DCSF. We do expect local authorities to provide robust solutions for the most vulnerable schools, and expect them to consider a range of solutions that will secure long lasting improvements, including academies, national challenge trusts, trusts and federations to ensure better outcomes for more young people."