The Belvedere School, run by the Girls Day School Trust and Sutton Trust, will end selection, admit boys and almost double in size within two years, if talks are successful.

Children on Merseyside will be the first to benefit from the private-style teaching, in a move that ministers hope will prompt other leading independent schools to join the controversial programme.

Ministers are likely to use the school to try to win over critics of academies. One government source said that essentially it was “nationalising a private school”. Labour MPs are divided over the move, with some welcoming it but others saying that the choice of academy status would be divisive and that independent schools that join the state sector should be subject to local authority controls.

The Belvedere, a 125-year-old independent school, is set to undergo a radical change under the proposals, starting with an end to all fees and academic selection from 2007.

The 600-pupil school will specialise in modern languages and be open to all girls in Liverpool aged 11-18, reserving 10 per cent of places for those with an aptitude for its specialism.

The sixth form, which will be open to boys, will be vastly expanded — at a cost of “a few million pounds” — to include several hundred pupils. Class sizes will also increase slightly.

Sir Peter Lampl, chairman of the Sutton Trust charity, which supports under-privileged children, said he welcomed the chance to extend the school’s high-quality education to the whole of Merseyside’s children.

“My main objection to city academies has been on the grounds of their high capital cost,” he said. “I have for some months let the (Education) department know that I would be prepared to help in the setting up of a low-cost academy. This would create a low-cost academy from a school with a high academic reputation which has recently had its most successful GCSE results thanks to the Open Access Scheme.”

Companies, charities and the wealthy generally invest £2 million to sponsor an academy — where average building costs reach £25 million — and are given control of the governing body in return.

To some, the Belvedere is already halfway there. Since 2000 the school has operated a unique “needs-blind” admissions system, with only 30 per cent of parents paying the full £6,930-a-year fees. The other places are fully or partly funded.

The scheme costs both charities £2 million a year to operate. This summer it paid off with record GCSE results, when the first cohort of girls selected on ability alone passed 63.2 per cent of all their examinations with A* or A grades.

With 19,100 pupils at 25 schools in England and Wales, the Girls Day School Trust (GDST) is the largest provider of private schools in Britain and in a good position to share best practice. “The Open Access scheme has been so successful that we wondered how we might extend it and this goes a long way to broadening its impact,” Sue Bridgett, a GDST spokeswoman, said yesterday.

Although academic selection would end at Belvedere, negotiators hope an expanded sixth form would maintain standards.The Government intends opening at least 200 academies by 2010, in traditionally deprived areas, despite opposition from backbench Labour MPs and teaching unions.

In September Mr Blair said that his goal was to “escape the straitjacket of the traditional comprehensive school” and offer “genuinely independent non-feepaying state schools”.

Government advisers hope achievement levels at state schools will be raised. Last year more than 10 per cent of GDST A-level students gained places at Oxford or Cambridge. A government source said: “We believe having more high-quality non-selective free places in the state system is a good thing, particularly in areas where academic achievement has been too low. This, alongside ceasing academic selection and adopting fair admissions, is key to any private school joining the state system, as we set out in the White Paper.”

Although a number of private schools have already joined the state sector, this is the first major independent school. Terms of the deal are not yet known, but as an academy the sponsors will be liable to pay 10 per cent of the capital costs, while all other costs will be paid for by the taxpayer.

Times recommends

• Students to rate lecturers online
• Students face big rise in university fees
• Queen’s English Society boss’s poor spelling