The funding wars between the Federal Government and the states have intensified, with Victoria claiming the Federal Government is "holding a gun" to its head over the future budgets of schools.

Key points: The new federal Education Minister wants states and territories to sign a funding deal

The new federal Education Minister wants states and territories to sign a funding deal He has sent a letter threatening to withhold funding

He has sent a letter threatening to withhold funding The Victorian Education Minister has fired back, calling it an "unprecedented and clumsy threat"

Victorian Education Minister James Merlino blasted what he described as a "clumsy and unprecedented threat" by the Federal Government which has demanded a fresh national agreement on schools funding be signed without delay.

Mr Merlino took the extraordinary step of publicly releasing a letter from Federal Education Minister Dan Tehan, which warns the Commonwealth would be unable to fund public and private schools in early 2019 unless a deal is signed by December 7.

"Should a bilateral agreement not be in place by this date, the Commonwealth will be unable to make the first 2019 payment to the relevant state or territory, including with respect to government schools," the letter said.

"In these circumstances, I would seek your assurance that the Victorian Government would make up any shortfall experienced by the non-government sector to ensure that schools do not face undue financial stress."

But Mr Tehan said it was Victoria that was jeopardising the funding negotiations.

"The letter has been leaked for political purposes," Mr Tehan said.

"No other state or territory minister has had a problem with the letter.

"I have held bilateral discussions with four of the states within the last 24 hours, with three more tomorrow [Friday].

"The only minister who has refused to set a time for discussions has been James Merlino. He wants to play politics."

The Commonwealth was very close to signing school funding deals with the states before it announced it would pour billions into the private sector.

That deal threw the negotiations into chaos, and Mr Merlino has now issued a furious broadside.

"Only weeks ago, before the Liberal Party's internal chaos erupted, there was a different minister sitting in Mr Tehan's chair, so it is hardly surprising he hasn't got his head around the issues yet and doesn't understand where negotiations are up to," Mr Merlino said in a statement.

"Now he is rashly demanding the states and territories immediately sign a deal, essentially holding a gun to the head of states and territories by inventing deadlines.

"If Mr Tehan were serious about education he would work with states and territories to provide fair funding for every child rather than come up with solutions that pit one sector against the other."

Dispute centres on the share each government will pay

Victorian Education Minister James Merlino said the letter was a "clumsy threat". ( AAP: Glenn Hunt )

The Victorian Government is due to enter caretaker mode ahead of a state election in a few weeks' time and has previously indicated it would not be in a position to sign a school funding deal before then.

Bilateral agreements must be in place to allow federal money to state and non-government schools to flow.

The federal dispute with Victoria centres on the percentages that each government will chip in to meet what is known as the Schooling Resource Standard (SRS), a measure of the cost of education for each child regardless of where they are educated.

The Commonwealth primarily funds private schools and has agreed to fund 20 per cent of the cost of public schools.

Victoria is raising its contribution to the SRS to 75 per cent in line with last year's amendments to the Education Act, and the Commonwealth has promised to fund 20 per cent of the SRS for all state school students.

That leaves a 5 per cent shortfall, and Victoria is pushing the Commonwealth to increase its share.

"The carelessness with which [Mr Tehan] has ruled out funding the final 5 per cent of the Schooling Resource Standard shows complete ignorance to the inequality set out in his own legislation," Mr Merlino said.

The flashpoint comes as the Federal Government is battling two other states — New South Wales and Queensland — over bilateral school funding agreements.

Both states are demanding more money for their public schools in the wake of the $4.5 billion deal for Catholic and independent schools announced by Prime Minister Scott Morrison last week.

NSW Education Minister Rob Stokes said on the ABC's RN Breakfast on Thursday morning he wanted every state school student to receive the same amount of extra funding as that being offered to private school students.

He put this figure at $7 billion nationally.

The letter was sent to all state and territory education ministers.

Labor's federal education spokeswoman Tanya Plibersek characterised the Government's handling of the issue as "bully boy tactics".

"This is a new low even for Scott Morrison — holding Australian schoolchildren to ransom," she said.

"Parents and teachers are right to be furious."