Treasury's education options appal union

The Treasury has tagged performance pay for teachers, increasing class sizes and charging parents more for early childhood education as options to slash millions from education spending.

The suggestions have been greeted with horror by a primary teachers' union, which says the Treasury is out of touch with reality.

In its long-term fiscal report, the Treasury said education spending had doubled to $11.5 billion since 1994. Spending had climbed about 6 per cent a year, but this had to be reduced to 2.8 per cent. It has advised the Government it had a wide range of options to cut spending, including:

Increasing class sizes, which would mean hiring fewer teachers.

A more flexible remuneration system to reward quality teaching.

Shifting more of the cost of education services from the Government to tertiary students and families.

Education Minister Anne Tolley said she was still considering the report. "We haven't taken any advice as a result of the Treasury report."

During the lead-up to the Budget, Mrs Tolley ignored advice from the Treasury against pouring more than $35 million into private schools.

But Frances Nelson, president of NZEI, which represents thousands of primary school teachers, said the options were worrying.

"They may well look right in terms of dollars and cents, but in terms of quality teaching they don't stack up. Treasury does not have a lot of experience about the reality of schools. I would be very concerned if any of these options got traction."