AAP/Stefan Postles

It was the messiest back down imaginable but Tony Abbott knew he had no choice. The row over school funding had turned into a hurricane blowing away his credibility on the key question of trust.

So Abbott has dramatically walked away from positions that Education minister Christopher Pyne stated last week and he himself put as recently as Sunday.

The retreat followed some hasty negotiations to get in-principle agreements from Western Australia, Queensland and the Northern Territory – the jurisdictions that hadn’t signed up to Labor’s new funding arrangements - so the federal government could declare it had national agreement.

Pyne last week said Labor in the forward estimates had ripped out $1.2 billion from the proposed new funding (the slice for those jurisdictions that hadn’t signed), leaving only $1.6 billion in extra money. This was what the Coalition would deliver, he said, plus throwing in $230 million for next year to be shared between the non-signatories. He also said he would unveil in 2014 new arrangements to apply from 2015.

This tore up Abbott’s core election promise to match Labor’s $2.8 billion over four years.

Things got worse for Abbott on Sunday when he refused to stick with his and Pyne’s election guarantee that no school would be worse off and claimed people had misunderstood what the Coalition had said (despite a string of explicit quotes that showed there was no misunderstanding).

But by this time it had become obvious to those within the government that this was a crisis running out of control. Attempts to manage it incrementally had failed.

The attacks from the Coalition states of NSW and Victoria, which had done deals with the Labor government, had been highly damaging, especially with Abbott’s first meeting of the Council of Australian governments looming at the end of next week.

Also, at some point later a lot more money would have to be put in. There was no practical way that funds could be removed from NSW and Victoria, while Queensland and WA would demand additional money in future years.

Worst of all for the government, Labor had Abbott cornered on broken promises.

The only way out was backwards, however difficult, embarrassing and financially costly that might be.

The talks with Queensland, WA and the NT have been rudimentary – just enough to get them on board. And why would they not agree? They are now being promised all the original money with no strings, except some weak moral pressure not to reduce their own funding for schools.

The $1.2 billion will be found from within the education portfolio. Parents, teachers, and students will not be caused particular difficulties by the savings, according to Abbott. We’ll find out in the mid-year budget forecasts who will feel the pain.

The government says no school will be worse off “because of anything that the Commonwealth does”. What the states do is another matter.

While the government walked backwards it tried unconvincingly to maintain it was standing in the same spot all the time, promises always intact. Abbott said that Pyne had done the deal with the non-signatories, so now the government was putting in the $1.2 billion. Simple as that. Pyne in a later TV interview described today as “quite a good day at the office”. Colleagues feeling the heat in the electorate might be shaking their heads.

It is still unclear how the whole mess was allowed to happen in the first place. One suggestion is that it started with Pyne wanting to play politics with what Labor had done in the forward estimates and then later to be seen to fix the situation. Or maybe the government just wanted to throw off any trace of Gonski and save some money too.

At the end of it all, the government is back where it started, with Abbott and Pyne looking as though they have been very dodgy.

It is true the government now has all states in some sort of model. It is a model that is all give by the federal government with no responsibilities imposed on the states. The latest deals do not require undertakings by the states and the government has always planned to remove accountability requirements from the legislation to which the other states signed up.

The Abbott government doesn’t believe in imposing conditions on the states because it says they should be treated like “adults”. A better concept is that there is a strong case for taxpayers knowing they are getting value for their money.