Recent moves in many parts of the world to restructure and deregulate state education have sought to link significant degrees of institutional autonomy with an emphasis on parental choice and competition, thereby creating "quasi-markets" in education. This paper discusses such developments as part of a neo-liberal project for education in two of the countries in which these policies have been taken furthest--England/Wales and New Zealand. It compares five aspects of policy in these two countries, namely school autonomy, diversity and choice, private sector involvement, privatization, and accountability mechanisms. It argues that the rhetoric of neo-liberal schooling policies is far removed from their reality, as governments confront the classic tension between fiscal imperatives and the need for legitimization. It points to the need for new political ways forward in a situation where the mainstream opposition parties currently tend to mimic the policies of New Right parties of government. (Contains 38 references.) (Author)