Pyne abandons Gonski reforms amid $1.2b funding shortfall

EDUCATION Minister Christopher Pyne has revealed a $1.2 billion shortfall in education funding, forcing him to abandon Labor's school reforms.

But while Mr Pyne said the Coalition remained committed to the same "funding envelope" that Labor set aside for schools, the money will run out beyond 2014.

Mr Pyne said while the same amount of total funding would be delivered over four years, the Coalition would create a new funding model from 2014 onwards.

He said the total budget would still be $1.2 billion short of previous estimates, and he would not be implementing the Gonski reforms, describing them as "an incomprehensible mess".

Mr Pyne said he was originally told about the funding shortfall "at the election", but waited until days before a meeting this Friday to announced the funding shortfall.

He said he had been working in the meantime to arrange new funds beyond 2014, under a Coalition education reform plan, but state governments already signed on to reforms said they learnt about it through the media.

Mr Pyne said he was working with the Queensland, West Australian and Northern Territory governments, as well as the Catholic and independent schools, to find a way forward.

While he said before the election that the Coalition and Labor were on a "unity ticket" on education, and no school would be worse off under the Coalition, he said the funding cut had forced his hand.

Mr Pyne refused to comment on whether he went to Treasurer Joe Hockey to seek reinstating the $1.2 billion shortfall, which he said had been returned to consolidated revenue, out of reach of the education portfolio.

The comments follow revelations the government does not intend to complete funding agreements signed with New South Wales, Victoria and South Australia under Labor's reforms.

NSW Premier Barry O'Farrell on Tuesday lashed out at the Commonwealth over the deal, saying he would hold the new government to the previous agreement.

He said he was concerned Mr Pyne was "dictating terms through the media", saying he had heard nothing of the changes until it was reported in the newspaper.

Mr Pyne said while funding was secured for now until the end of next year, he would be proposing a return to the Howard Government's approach to education funding that would take effect from 2014 onwards.

Opposition Leader Bill Shorten said Mr Pyne and Prime Minister Tony Abbott, who has been silent on education funding this week, were "doing something different in government" to what they promised in opposition.

Greens Leader Senator Christine Milne said a return to a Howard-era education system would see the "inequality" of the education system return.

She said the issue was critical both for the nation, and the government, as it went to public trust in the government, a key part of the Coalition's attacks on the previous government in the lead up to the election.

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