This paper uses one national case to illustrate how diverse ideological agendas of central state agencies contest the discursive space within which major education policy reforms are developed. In Aotearoa New Zealand in 1988, "self-managed" schools were promoted ostensibly to allow parents more say in their children's education and local school administration. The "Tomorrow's Schools" reform policy texts included an existing social democratic partnership rhetoric, positioning principals as professional leaders working collaboratively with elected parent boards of trustees. However, the new ideology of "parental choice" of school within a local schooling marketplace, underpinned by a chief executive or market managerial model of principalship, was later operationalised through mechanisms of "steerage" from the centre. To explain this shift, we examine selected policy text pre-cursors to the reforms and identify how contrasting forms of "principal" and "teacher" identity emerged within social democratic, neo-liberal and market managerial ideologies. We further show that while radical (Treasury) market liberal arguments for labour market deregulation and consumer choice failed to gain widespread support, the State Services Commission preferred market managerialist strategies for promoting public accountability of schools (based on aggregate student achievement outcome data and centrally determined national educational priorities) were successfully embedded during the 1990s. (Contains 107 footnotes.)