The primary teachers union says it's big concern is underfunding for schools following the Government's announcement that the controversial decile system will be replaced with a new rating system for funding.
The decile system ranks schools from one to 10 depending on how rich the local neighbourhood is.
"Some people mistakenly see decile as a proxy for quality of school. We need to shift away from that as a country," said Education Minister Nikki Kaye in announcing the decile system will be scrapped.
Instead, schools will be provided with a risk index which will see funding targeted towards schools with children most at risk of not achieving.
"This data will be provided to the Ministry of Education in an anonymous way, and to schools. They will only get just the funding and the number of students that are impacted," Ms Kaye said.
The unions are largely welcoming the idea, but worry about the funding.
"Our big concern is obviously the underfunding that we have currently in the system. And that's what we really want to see addressed," said Lynda Stuart, NZEI president.
Labour's education spokesperson Chris Hipkins says he thinks schools might be a bit worried "about what a risk index looks like and what's that going to do for their public image".
Ms Kaye said about 16 factors will be used to make funding decisions, including "fathers offending, beneficiary dependent, New Zealand born versus migrant born".
The minister hopes to have the new system in place in two years and is promising to work with the education sector to get it right.
The aim is to remove the stigma associated with the decile ranking system and ensure the right funding goes to the right child at the right time.
Ms Kaye said the Government wants to shift to a system where parents access Education Review Office reports and strategic plans to better know how their children are doing.
The minister is promising no one will lose out and says in fact some schools and children will get more money.