Department for Schools, Children and Families officials have highlighted 37 schools in 32 council areas where they believe progress to improve schools is too slow.
In the letter Balls reminds the councils that they have a number of powers within the National Challenge programme to intervene, such as issuing warning notices to schools.
He says in the letter: "Issuing a warning notice is a mechanism to set out formally the local authority's concern and by requiring a response from the school, provides it with an opportunity to demonstrate that it can in fact make the necessary improvements.
"If the school is not able to do this, the local authority then has a clear basis for action and can instigate formal intervention if appropriate."
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