As part of the Heads of Agreement signed on Friday, the Commonwealth will provide an additional five per cent of the Schooling Resource Standard (SRS) to Victorian and South Australian public schools.

The agreements will lift the federal contribution up to 25 per cent by 2034, delivering an extra $2.5 billion for Victoria and $1 billion for SA.

In exchange, Victoria and SA will stop using what has been described as an “accounting trick” that allowed the states to claim four per cent of public school funding for indirect school costs such as capital depreciation.

The deals will be tied to a bilateral agreement that includes increased national targets for students leaving school with a Year 12 certificate, reading and numeracy skills and attendance rates.

“This will mean more money than ever for public schools but it’s not a blank cheque,” Prime Minister Anthony Albanese told the National Press Club on Friday.

“Our new funding is for real reform and it will deliver real results.”

Under reforms set out by the Gonski 2.0 review, states are required to fund public schools at 75 per cent of the Schooling Resource Standard.

Until this deal had been brokered, the Federal Government has chipped in 20 per cent, leaving a five per cent shortfall.

It reached deals with WA and Tasmania in 2024 to boost federal funding by 2.5 per cent, but other states have been holding out for a bigger slice of the pie.

Now only New South Wales and Queensland remain as holdout states, with the prime minister saying his government is working towards striking a deal with them.

Victorian Education Minister and Deputy Premier Ben Carroll said the Federal Government had backed down after 12 months of discussions.

“It’s been tortuous,” he told reporters in Melbourne on Friday.

“But it’s all been worth it ... there were times that I wondered if we’d get to the five per cent. In fact, we were happy to just roll over the existing agreement.”

The money will go directly to primary and secondary public schools and fund resources for students, teaching practices and more mental health support.

SA Education Minister Blair Boyer said the deal delivered on the original vision of David Gonski’s landmark 2011 review.

“In South Australia, when fully implemented the five per cent is worth as much as $248 million of extra funding for public schools every single year,” he said.

At a press conference in Adelaide, Boyer said it’s easy for politicians to talk about big figures that sound impressive, but that doesn’t mean much to parents, students or teachers.

 ”But if we want to put it into a little bit of context around what this means, it means for that kid who’s struggling with their reading, is more time out of the classroom one‑on‑one so they can get on top of it and continue with their schooling.

“To the child who might be neurodiverse, who might have autism, and they’re struggling with school, and their family are wondering how they are going to support them and what they will do later on when they get to high school, this is about more individualised support in the classroom and the school for them.

“My priority is – and has always been – that every child, no matter where they live, has access to a world-class education in a Victorian government school," Victorian Premier Jacinta Allan says.

“It means for that young person in a regional or a remote school, and we’ve got so many of those in our state, and they are wondering about how they might get the same opportunities that city kids take for granted, or the same subject choices that city kids might take for granted, it’s about making sure we can deliver on that.”

SA premier Peter Malinauskas said every week when out and about in the community, he hears from teachers.

“Teachers are under the pump. It’s a profession that has more demands on it today, not less. They are crying out for support. Again, this reform will heed that call and provide them the support they need to get to more kids early,” Malinauskas said.

The Australian Education Union hailed the agreements as “life changing” for students, teachers and support staff.

“Teachers, students and parents will finally see their public schools funded to the level needed for every child to reach their potential,” federal president Correna Haythorpe said.

“It is an absolute iron‑clad guarantee that our schools from now on will be receiving genuine funding every single year going forward.

“It’s not contingent on an election, it’s not contingent on a commitment, but it upholds the Prime Minister’s election commitment that we would have a genuine pathway, and this agreement today has cemented that in.”

Federal Education Minister Jason Clare added that part of the deal was an undertaking to provide more funding for mental health support at schools.

“You ask kids in high school what are the biggest challenges they face, they won’t say vaping, they won’t say social media, they’ll say mental health,” Clare said in Adelaide on Friday.

“Sometimes they’re not ready to learn, they carry a lot more in their school bags than just their lunch.

“And kids that have got mental health challenges are less likely to be at school, so more likely to fall behind, and so extra investment in mental health workers, in counsellors, in nurses, paediatric support in our schools, sometimes what’s called a full‑service school in some schools, can make a world of difference, not just in attendance, but in academic achievement.”

“...reaching a point like this ... takes a degree of collaboration, takes a degree of compromise. It's also taken a bit of holding out from both parties, but here we are, and it's a really big win for young people, for educators in our state..,” SA Premier Peter Malinauskas says.

However, not everyone has lauded the agreement.

Federal Shadow Minister for Education, Sarah Henderson, said the new funding deals raise more questions than answers.

“With New South Wales and Queensland left out in the cold, it is clear Labor’s school funding war continues with more than half of Australia’s government schools,” Henderson said in a statement.

“The Government has kept the details a secret which suggests it has done favourable deals with Victoria and South Australia at the expense of government schools in Tasmania, Western Australia and the ACT.”

Henderson said Clare, having failed to conclude an agreement with four states by the December 31, 2024 deadline, had been ‘sidelined’ by the Prime Minister.

“Mr Clare failed to get the job done and more than 1.3 million students who attend government schools in New South Wales and Queensland continue to pay the price,” she said.

Greens spokesperson on Primary and Secondary Education, Senator Penny Allman-Payne, said the agreement is a welcome step forward on public school funding from which teachers, parents and carers in Victoria and South Australia will take heart.

“Pressure works. Teacher unions and the Greens have been pushing Labor to increase the Commonwealth share of public school funding to 25 per cent and to eliminate the dodgy loophole that allows states to claim 4 per cent in non-classroom costs as part of their contribution.

Allman-Payne said despite these steps forward, it will be at least a decade until there will be 100 per cent minimum funding for all public schools in the country.

“Labor came to government promising to deliver 100 per cent funding to all public schools. If they’re saying that every public school in the country will be receiving 100 per cent of its minimum funding by 2034, that will have been a quarter of a century since Gonski.

“That’s two entire generations of schoolkids who will have never known what it’s like to attend a properly resourced public school.”

(with AAP)