AUSTRALIA spends a higher proportion of public money on private schools than other developed countries except Chile and Belgium, according to the latest global education snapshot.
The report also found that while Australian graduate teachers are paid relatively well, their salaries slump compared with teachers in other OECD nations as they gain experience.
In 2009, Australia spent 6 per cent of its gross domestic product on education, which was below the OECD average of 6.2 per cent and placed it 18th out of the 31 nations.
The report comes as Prime Minister Julia Gillard attempts to thrash out a new school funding deal with the states amid a debate over government spending on private schools.
She is proposing the Commonwealth and states spend an extra $6.5 billion a year on education, contingent on reforms to improve teacher quality and student performance.
Her ''legislated goal'' is for Australian students to be ranked in the top five countries in maths, reading and science by 2025, positions currently occupied by Finland, Shanghai, Hong Kong, Singapore and South Korea.
School Education Minister Peter Garrett said Australia was performing only slightly above the average in areas such as student-teacher ratios and secondary school completion rates. ''Although we are doing well in some areas, we still have a lot of work to do to reach our goal.''
The OECD report found 68.6 per cent of public expenditure on schooling in Australia in 2009 went to the state system, compared with 99.2 per cent in the US, 88.1 per cent in Finland and 85.2 per cent in Korea. The average was 85.8 per cent.
Ms Gillard recently promised that every independent school would receive more money and defended big private schools as a ''great example'', while Opposition Leader Tony Abbott suggested private schools were getting a rough deal.
Dr Ben Jensen from the Grattan Institute said most school systems did not put public money into private schools.
''Australia is quite rare in the world - it doesn't mean it's good or bad - it's just not common,'' he said. It was now the accepted wisdom that independent and Catholic schools received government funding and this was unlikely to change.
Australian Education Union president Angelo Gavrielatos said the proportion of funding on public schools had been in decline since 2003. He hoped this would begin to turn around under the new funding system.
According to the report, the salaries of beginning Australian teachers were competitive, with primary and lower secondary graduate teachers the ninth highest paid. However at the top of the pay scale (a level Australian teachers reach after about 10 years) they came in 18th.
By comparison, primary teachers in Korea started out near the bottom of the pay scale, but its top teachers are the second highest paid.
However Finland, where students consistently top world tables, lagged behind Australia for teacher salary at every level.
The report said in addition to basic pay scales, school systems were increasingly offering additional payments or other rewards, such as a reduction in teaching hours.
From 2014 in Australia, teachers who are accredited as highly accomplished will be eligible for a one-off bonus of $7500 and lead teachers a $10,000 bonus.
The figures show Australian teachers had some of the heaviest teaching loads. Senior secondary teachers had the fifth highest teaching load, with 803 hours a year (145 more than the average). Teachers in lower secondary school taught about 819 hours, more than 100 hours more than the average.
Australia had an average primary school class size of 23.7 students. China had the biggest primary classes, with 37.4.
With CRAIG BUTT