Splitting Ofsted into two - the Inspectorate for Education and the Inspectorate for Children's Care - would help focus and restore confidence in the inspectorate, the report states.

Graham Stuart MP, chairman of the committee, said: "Ofsted's reach is vast and its remit has grown substantially since its inception, but this has come at the expense of providing a more specialised service.

"We need a radical shift in how inspection operates in this country, with a more proportionate, specialist and focussed approach.

"Ofsted has, of course, made a great impact on the quality of provision across the country, but the evidence clearly shows that smaller, more focussed organisations could do even more so."

Other recommendations include a further focus on reporting on progress made per pupil across a full range abilities. In addition, the report warns that not enough inspectors have recent and relevant experience of the activities they are inspecting,

Responding to the findings, Ofsted Chief Inspector, Christine Gilbert, said: "There is much in this report that we welcome, particularly the recognition of the impact of Ofsted's work, our independence, and the important role inspection plays in improving quality.

"The question of 'who inspects?' is much less important than the quality of inspection and the impact it has on raising standards and improving people's lives. Ofsted is proud of the work it's done across the whole of its remit since it took on its present brief in 2007.

"Any proposal for further reorganisation needs to be very carefully considered and is ultimately a matter for the Government. There are issues about additional costs and a risk of distraction from the core business - namely continuing to deliver high quality, rigorous inspection which helps to drive up standards for children and learners everywhere.

"There are many constructive suggestions and observations contained in the report and we will now consider these in detail to continue to improve our work. We accept, for example, the concerns about the Voluntary Childcare Register and would welcome changes to the legislation under which that operates."

Baroness Sally Morgan of Huyton, Chair of Ofsted, said: "The Ofsted Board takes this report very seriously. We acknowledge, for example, the need for Ofsted to communicate more effectively about its work and to make its reports and information more accessible. That is why I have been so keen to launch a new website, which we will be doing within the next few months.

"The Board has been particularly interested in how Ofsted could do more to engage with parents, and this is reflected in the proposals published last month in relation to school inspections.

"Ultimately, the most important consideration is that inspection is of a high quality and continues to raise standards for children and learners."

Susannah Fairbairn