Public schools in Canberra will receive extra Commonwealth cash, putting pressure on bigger states holding out for a better funding deal.
The federal government will increase its percentage of funding in the ACT to 22.5 per cent in 2026, up from 20 per cent.
It equals an extra $110.5 million between 2025 and 2029, bringing the Commonwealth's total contribution to more than $1 billion across the five years.
Funding will be tied to school performance, including identifying and helping struggling students in their early years, whole-of-school support systems and tackling bullying.
The Australian Education Union has joined some of the other states in pushing for more federal funding so teachers can properly implement the 10-year Better and Fairer Schools agreement that aims to increase education standards.
Education Minister Jason Clare has struck updated funding agreements with Western Australia, Tasmania, Northern Territory and the ACT, with NSW and Victoria holding out for an increase to 25 per cent.
"This is great news for ACT students, families, teachers and school communities and is an important step in building a better and fairer education system," Mr Clare said.
ACT Education Minister Yvette Berry said the extra funding would boost school quality in the territory and help set children up for success.
It would help deliver more school psychologists and mental health professionals, reduce teacher workload to help improve wellbeing and safeguard the delivery of evidence-based literacy and numeracy teaching, she said.
