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THE British school that produced actor Michael Caine and playwright Harold Pinter has earned itself a ''hit squad.''

At least, that is what some teachers at the venerable all-boys school are calling it. Last week Britain's education minister, Gillian Shephard, ordered a drastic overhaul of the Hackney Downs School in East London, one of the city's seediest districts. The move - the first of its kind in Britain - has provoked a nationwide controversy, similar to an ongoing American debate over how to beef up public schools.

A team of five, which is led by the head of another London school and includes two business executives, will be racing against the clock starting in September. They estimate they have two years to prove the 120-year-old school can be saved.

Prof. Michael Barber of Keele University in Staffordshire, one of the team's experts, says American experience shows it takes about five years to turn a school around, ''but you can change the culture and atmosphere within a year or two.''

There are nearly a hundred other schools in England and Wales that the government has identified as ''failing pupils and their parents,'' which are likely to be given similar treatment by government-appointed teams.

But critics say that bringing in a gaggle of experts may not bring results. Pat Corrigan, a Labour Party member of the local council that supervises state-run schools, calls the decision ''disastrous'' and ''ill-conceived,'' saying the community should be allowed to handle the problem. Simon Jenkins, a leading newspaper columnist, has a similar view. Sending in an emergency rescue team is ''like sending the United Nations into Bosnia,'' he says.

Hackney Downs is not typical of English schools, most of which score reasonably well under a government policy begun in the late 1980s that measures schools according to government-supervised performance tables.

Peter Mortimore, director of London University's Institute of Education, says it is one of a minority of schools that have ''fallen low for a variety of reasons, only partly social.'' He says 1966 was a turning point for Hackney Downs - the year the school became ''comprehensive,'' or state-run, forsaking its narrow curriculum and traditional discipline, which included corporal punishment, for wide-ranging topics geared to progressive educational thinking.

AT about the same time the neighborhood began to change radically: With an influx of immigrants, Hackney gained a racial mix of children from the Caribbean and Asia. At a recent count, students at Hackney spoke 27 different languages.

In the streets around the school, you are likely to be served fruit by a trader from Bangladesh, offered a necktie by a shopkeeper from Turkey, or pestered to buy crack cocaine. Unemployment rose in the area because of a recession in the late 1980s, and local police say street crime has steadily risen.

Student unruliness at the school reflected the trend: In 1994 inspectors reported that ''a constant undertow of poor and bizarre behavior, and in some cases, total disorder, makes all classes difficult.''

Amid rising community challenges, the school's board of governors clashed repeatedly with the local educational council, which at one point said it planned to shut down the school.

A teacher at Hackney Downs blamed political wrangling for a downturn in the school's fortunes in the late 1980s. ''One group wanted to shut us down, the other to keep us open,'' the teacher said. ''This led to unrest among staff and also among the pupils. The process has not been helped by us having had four acting head teachers in the last two years.''

Now Hackney Downs can made a last grasp for survival. Putting the school on the road to recovery, says Mr. Mortimore, ''will not be easy, but not impossible either.'' He notes that the school's head is acting on the 1994 report, and plans to shut the school were dropped.

Yet educators and officials face a deeper question beyond how to help British schools thrive. They must decide what they want struggling schools like Hackney Downs to become.

The educational system in England and Wales is diverse. ''Public'' schools, where parents pay for children's education, jostle with comprehensives like Hackney Downs and ''grant maintained'' schools that began life as private institutions but now accept government funds.

Most experts say that while public schools often have smaller classes, they cannot guarantee a high-grade education. Nor, according to Ted Wragg, a leading professor of education, can parents be sure that a grant-maintained school will be better than a comprehensive. He says one vital factor is indefinable: ''getting the right mix between teaching standards, pupil commitment, and local community support.''

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