Headteacher Iain Hall approaches his Year 10 students with a display of curious body language. He stands in front of the tiered seating in the hall that his willpower has built, gives a small stamp of his shiny-shoed foot, folds and unfolds his arms, peers through and then removes his rimless glasses. Hands plunged into well-cut pockets, he is disappointed to hear that Rachel’s life plan is to marry a rich man. Looking at the students, addressing them full-on, one hand freed for benevolent gesturing, he segues into a careers talk about why anyone would want to be a dentist (his was forever struck by the sight of Gran’s teeth in a glass), or a painter and decorator (his was rescued by a house painter while on the run from a young offenders’ institution), or a photographer (one he met was lifted on to the roof of a car as a lad by a snapper from the Express, who later sent him prints of the Liverpool football team on the team bus). The talk is moving, short. He returns to Rachel. “You may meet your rich man. Or you may not,” he says, in the mildest of rebukes. Hard work is the key, he tells them. And faith. “Hold that dream.”

This headteacher suffers the confusion of address that afflicts the recently ennobled. “Sir Iain Hall”, as the head of year introduces him. “Mr Hall”, some students still call him. Others opt for “Sir Hall”. Or, my favourite, “Sir Sir”. But the question of why the 58-year-old was knighted in the new year’s honours list remains unanswered. He hopes it is for his lifetime in teaching. “I’ve done 21 years as a headteacher. We deserve for someone to say well done.” Indeed. But the suspicion lingers that it is for this building that he’s standing in, that Sir has become “Sir Sir”.

Parrs Wood technology college, in the south of Manchester, is a hybrid institution. With spreading playing fields below the flood plain of the Mersey - here in misty, tree-lined mufti - it is on a major intersection. On the edge of the city, it draws its 1,850 pupils both from “piano and pony” suburban comfort and deprived estates. The new-build main school faces a vision of Georgian elegance, in the form of the listed Parrs Wood house. With its comprehensive intake, muscular exam results and high pastoral standards it may, for the moment, be the most modern school in Britain, if a fusion of architecture and attitudes comprises modernity.

Six years ago, things were rather different. Rows of buckets defended rooms against leaky roofs, and the school was prey to thieves and vandals. “You only had to lean on a wall to go through it,” says Sir Iain. He and his governors - faced with a rotting Sixties structure, a messy site that included empty premises, and the certain knowledge that the education authority lacked the funds for rebuilding - decided to do it their way. An advertisement in Estates Gazette, offering land in exchange for a new school, attracted 37 interested parties to hear the presentation. “We only had a small room with an overhead projector and a few slides,” says Sir Iain. And a prime commercial site on the only major road between Manchester airport and the city centre.

In the end, two companies slogged it out, designing a school in exchange for the strip of land fronting the main road. Sir Iain was involved with both bids, amending the specification - and developing a reputation as an educational futurologist. He enjoyed it, he says. “It isn’t often that you get a chance to design and create and build a school.”

In October 1996, the Parrs Wood governors chose the plan put forward by Harrogate-based company Thornfield Developments. More work followed, as the head asserted the school’s interests - push-button tap by push-button tap, suspended ceiling by suspended ceiling. The deal was struck on the basis of design, not budget. “There were issues,” he says. “Our interests were opposed, basically.” The architects, Edmund Kirby, alerted him to quality issues he might have missed, and the city council provided invaluable legal muscle and procedural expertise.

The new premises opened last spring, since when Parrs Wood and all who sail in her have been sailing on the crest of a wave, with continuing good exam results, no permanent exclusions for three years and twice as many applicants as Year 7 places. Teacher recruitment is a non-issue and a recent Ofsted found “no extensive areas of the school’s work which are unsatisfactory by national standards”. “The ability to turn vision into practice is excellent,” inspectors gushed, after spending a few days in the newly completed pound;11 million school with its acid yellow and electric blue breeze blocks and lockers for all, its carpet-tiled IT suites and canteen modelled on a motorway service station, because that’s what students said they wanted. And all this at no cost to the Government. Back in Whitehall, it must seem like a fairy tale.

The “leisure centre” that was the developers’ pound of flesh backs on to the school. It’s a dispiriting collection of ubiquitous brands - Burger King and Pizza Hut, Mega Bowl, UGC, and something called Buckingham Bingo. The glass from the bus shelter lies shattered on the puddled pavement in front of a smoke-filled amusement arcade. “This is the cost,” Sir Iain acknowledges. He spots a Year 7 trudging homewards in lesson hours and makes a pincer movement, which results in the boy suddenly walking in the other direction, Sir Iain’s arm clamped kindly across his shoulders. Students are not allowed into the complex in school hours but trips to Burger King or the cinema have been built into the rewards system.

That Sir Iain had the guts to tangle with finance companies, property developers and builders and - backed by the town hall and governing body - came out on top, turns out to be a logical trajectory. Born into a “very ordinary” family in Liverpool, he was only eight when his father was killed in an industrial accident. With his mother left to run their sweetshop, his first business experience was as a child, helping out behind the counter and among the tables where customers could drink a cordial.

A bright boy, his primary school headteacher, Mr Cumberledge, singled him out for the most difficult mental arithmetic questions, and teachers gave him extra tuition. He took the 11-plus without knowing it; Mr Cumberledge called a whole-school assembly to announce that he had passed. He walks through the light-filled reception area, passing streams of green sweatshirted children as he tells his story. At the grammar school, they remarked that they’d never had a boy from his primary before. “Nothing was done with malice. I was suddenly surrounded by a lot of clever people, some of who had already done languages. There was competition.”

His mother remarried when he was 11 and, when not at school, he and his sister looked after the two resulting younger brothers. In a foretaste of what was to come, he and his mother campaigned for facilities in their under-resourced neighbourhood. “I raised funds through Saturday night dances, with the Merseybeats. I became a bit of an entrepreneur. We built a new youth club.”

He went to Liverpool University, to study maths and statistics, and on leaving began teaching at the Liverpool Institute grammar school. From there he went to a tough school in Kirby - “I actually started to learn to teach properly” - and left seven years later, as head of science. Deputy headship in Skelmersdale followed, then his first headship, amalgamating two inner-city Liverpool schools - John Hamilton and Lambeth. He has three adult sons; his marriage was a casualty of workload, he says. His partner of the past 10 years is a teacher in Liverpool.

Sir Iain came to Parrs Wood 11 years ago, after three interviews. “They weren’t sure I understood the context. And I wasn’t sure they understood what had to happen.” Popular with parents, Parrs Wood then was unpopular with the education authority, having acquired a reputation as a Tory favourite; in the early Eighties, Margaret Thatcher’s education secretary, Sir Keith Joseph, had championed it as a “school of proven worth” and saved its sixth form from a city-wide reorganisation.

Massive staff turnover followed his arrival; Sir Iain jokes that in a decade he went from being the youngest member of staff to the oldest. Now, his office walls bristle with cards and letters of congratulations on the knighthood; unopened bottles of champagne are lined up on a filing cabinet. “I’m not a person who celebrates,” I think I hear him say. He has had offers, but says he is staying at Parrs Wood.

The land swap is not Sir Iain’s first or last journey to the interface of education and commerce. The City Learning Centre on the school site bears witness to his negotiating skills; Parrs Wood house is now being transformed into a music centre on an “agreed borrow forward” with the local authority, and there’s a performing arts centre to get built, he says. Sir Iain’s restless entrepreneurial mind is even now raking over the fact that the leisure centre is short of parking space, and the school has a surplus.

No stone goes unturned; Fat Sam’s ice cream van pays pound;300 per term to sell lollies on site and, in the course of the day, an idea - providing those Year 11s without PCs at home with loaned reconditioned machines and an internet connection paid for and monitored by school - is funded (the chair of the PTA agrees to seed money), researched (with the school’s IT partners) and implemented (head of year instructed to mention it at parents’ evening).

Sir Iain’s can-do enthusiasm and desire to provide for his students is marvellous to behold. Parrs Wood, on the corridors, has the briskly energetic feel of a CTC. There is a student service desk opposite the reception desk, a video link for assemblies, whiteboards, big glass panels in classroom doors for observation. Senior teachers’ offices are placed “at every point of intersection”, says Sir Iain. The classroom walls are all designed to come down, in case that is necessary in the future. There are smaller rooms in the learning support unit and open stairs. Dubious homilies adorn the walls - “Defeat is not the worst of failures. Not to have tried is true failure”. Excellence is a habit.

As far as staff are concerned the knighthood is well deserved. “The best thing about him is he’s always on the dinner queue,” says one. “Everybody works hard, but he works hardest. And on a personal level, he’s a very supportive man.” Outside, the head in his navy overcoat sees students back into school after lunch. “Right guys, time. Find a bin for it. Last one past me’s in trouble.” His voice echoes off the brick and concrete and glass; it will echo through these children’s lives. “Come on. Even girls can run. What’s the dream? Hold on to the dream.”

Wendy Wallace is education feature writer of the year. wewallace@netscapeonline.co.uk