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The prime minister has today promised to "release the grip of state control" to bring about a transformation in public services.
Outlining his vision to decentralise and modernise public services, David Cameron said there would be a new "presumption" allowing private companies and charities to bid to provide almost all public services.
Ministers are set to outline the changes in a White Paper within the next fortnight, which would allow non-public providers to run schools, hospitals and council services.
Outside providers would be offered payment-by-results contracts, increasing their income as the quality of services improves.
Writing in the Daily Telegraph, Cameron said opening up the public services to the private sector was an important part of the Big Society programme.
The coalition hopes the plans would see a cut in bureaucracy, improve quality and save money.
"I would argue that our plans to devolve power from Whitehall, and to modernise public services, are more significant aspects of our Big Society agenda than the work we're doing to boost social action," said the prime minister.
"We will soon publish a White Paper setting out our approach to public service reform.
"It will put in place principles that will signal the decisive end of the old-fashioned, top-down, take-what-you're-given model of public services.
"And it is a vital part of our mission to dismantle Big government and build the Big Society in its place."
TUC general secretary Brendan Barber said the prime minister was pursuing a "naked right-wing agenda" which would take the country back to the most divisive years of the 1980s.
"The prime minister has been telling us that the cuts are sadly necessary, not a secret political project to destroy public services," he warned.
"Yet today's proposal to privatise everything that moves is exactly the kind of proposal that voters would reject if put at an election.
"What is particularly laughable is the idea that this will reduce bureaucracy.
"Privatisation replaces democratic oversight and accountability with a contract culture that is a job creation scheme for lawyers.
"Voters and service users lose their say in what will be a get even richer quicker scheme for the companies that win contracts."
Christine Blower, general secretary of the National Union of Teachers said the plans were "purely ideological", with a focus on "dismantling coherent public provision in favour of private profit".
She said: "The demonising of local authorities, their 'grip' and the 'damage' done by them, betrays a wilful ignorance of the great benefits they bring.
"What the prime minister seeks is nothing short of the end of state education and coherent public services."
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