Prime Minister Julia Gillard wants state and territory leaders to sign up to a new school funding model by the first half of next year, as part of a plan to propel Australia's education system into the top five internationally by 2025.

Under the changes, there would be extra money for schools in disadvantaged areas and tougher entry requirements for people wanting to study education at university.

Ms Gillard's response to the Gonski review of school funding does not detail how much extra money the Government is prepared to commit, but she has accepted the review's overall recommendation of a new funding model.

Under the proposed scheme, schools would be given a base funding amount depending on how many students they enrol.

It would then be topped up with additional funds if the school is in a rural or remote area, teaches children with limited English skills, is a smaller school, or enrols students from low income families.

There would also be extra funds for schools that teach Indigenous children or students with a disability.

Ms Gillard says the plan would require an extra $6.5 billion based on the Gonski report's findings, and would need to be shared between federal and state governments.

"You'll see me asking the states and territories to share my passion for improving our schools and putting our children first," Ms Gillard told journalists at the National Press Club.

"I will personally lead these discussions and my aim is to settle the funding model through COAG (Council of Australian Governments) processes.

Ms Gillard has indicated she wants to conclude negotiations with state and territory leaders by the first COAG meeting next year, but says she won't be "held to ransom" by jurisdictions that are not committed to reform.

The Federal Government is proposing a six-year transition to the new funding arrangement, starting in 2014.

The Prime Minister wants Australia's school system to be ranked in the top five internationally by 2025 in reading, science and maths, and has called on the community to join her in this quest despite the "tough budget choices" that will be required to achieve it.

"I want each of you - the whole nation - to join me in this crusade to change children's lives," she said.

"I want us to commit to fund Australian schools in a way that puts a child's needs at the heart of our funding decisions."

As part of her discussions with the states, Ms Gillard says she will insist on new measures to boost the quality of school teachers - including annual performance reviews.

In addition, those wanting to study education at university will have to be in the top 30 per cent in numeracy and literacy tests, and student teachers will have to get at least a term of classroom experience before being allowed to graduate.

"Under our plan, you will need to be at the top of your class to get in to a university teaching course," Ms Gillard said.

"Instead of new teachers floundering or drifting away from teaching, they will be equipped for the classroom though practical experience during training and two years of support once in school."

Every school will be required to develop an "improvement plan", and there will also be breakfast clubs and after hours activities for students.

Sorry, this video has expired Christopher Pyne has labelled Julia Gillard’s response to the Gonski review 'all feathers and no meat'

Another delay

The Government plans to introduce legislation into Parliament by the end of the year to begin the changes, but the Coalition has already dismissed the Prime Minister's announcement as a "promise on the never never".

"Parents want to know what governments are going to do for their children today and tomorrow - not in 2020, not in 2025," Opposition education spokesman Christopher Pyne told reporters in Canberra.

"There are children who haven't even been born, yet the Prime Minister is expecting us to believe will benefit from a policy that's being announced today, that won't have its full effect until 2020 and won't be tested until 2025.

"I doubt she'll be the Prime Minister in 2025."

The Greens have expressed similar concerns about Ms Gillard's plan, arguing there is a "whole generation" of children who will miss out.

"We feel that aiming to be in the top five by 2025 is actually not ambitious enough," Greens' schools spokeswoman Penny Wright said.

"This new fairer funding model is exactly what Australian children need, but it will be a tragedy if none of the kids at school today see the full benefit of it."

The Australian Education Union (AEU) strongly supports the new funding model, but it too is disappointed by the proposed timeframe.

"The urgent need for additional resources was clearly established by the Gonski Review and all ways to speed up the transition should be considered," AEU federal president Angelo Gavrielatos said.

However he is urging state and territory leaders to quickly commit extra funds to help lift student performance.

"Any state Premier who refuses to sign on to this reform is ultimately expressing to its citizens that they don't value education and they don't value the children of their state."