Calls to scrap NAPLAN testing have been rejected by Federal Education Minister Simon Birmingham, who says it provides transparency and reassurances to parents.

What is NAPLAN: The National Assessment Program tests the literacy and numeracy skills of students in years 3, 5, 7 and 9

The National Assessment Program tests the literacy and numeracy skills of students in years 3, 5, 7 and 9 Students cannot pass or fail the assessment

Students cannot pass or fail the assessment The annual testing is designed to help governments and schools gauge whether students are meeting key educational outcomes

New South Wales has become the first state to call for the test to be dumped, with State Education Minister Rob Stokes demanding it be replaced as a matter of urgency.

Mr Stokes said the test was being used dishonestly as a school rating system, and had sprouted an industry that extorts money from desperate families.

He said the assessment, for students in years 3, 5, 7 and 9, was being used to rate students, not track their progress.

"You now have an industry that's grown up alongside it, where teachers are being encouraged to teach to the test rather than the curriculum," he said.

"It's become a vehicle for edu-businesses to extort money out of desperate students and their family.

"When you now have private schools marketing their NAPLAN success, that points to the failure of NAPLAN, and it's time we had discussions about replacing it."

NSW Education Minister Rob Stokes said families are under enormous pressure to pay for NAPLAN tutoring. ( AAP: Brendan Esposito )

Mr Stokes said the test had been "used and abused" and was not useful as it did not take into account any differences between different schools and communities.

He said abandoning NAPLAN would be in line with David Gonski's recent review of the sector, which called for teachers to focus on individualised learning.

Birmingham: NAPLAN incredibly valuable

Senator Birmingham said NAPLAN was discussed at a meeting of education ministers in Adelaide today, but stressed it would not be dropped.

"I know that many parents find NAPLAN incredibly valuable in giving them a clear and transparent update on the literacy and numeracy skills of their child," he said.

"We need to make sure that level of transparency is still available in the future to Australian parents."

But Senator Birmingham did acknowledge there were some concerns about the test and said a review was already being planned.

He said the Government was open to ensuring NAPLAN results were "reported in a better way".

Opposition Leader Bill Shorten cautioned against Mr Stokes' call for NAPLAN to be scrapped, saying there was merit in a review.

"I can see the pluses and the minuses," Mr Shorten said.

Victorian Education Minister James Merlino said NAPLAN was close to 10 years old and a review would help ensure it was working as intended.

"It's absolutely timely that we review it and not just in terms of reporting, but also the content as well," Mr Merlino said.

South Australian Education Minister John Gardner said he did not support Mr Stokes' position, but admitted improvements could be made.

"NAPLAN was designed to be a tool to assess an individual student's progress, first and foremost," Mr Gardner said.

"I think that we do possibly need to do something to get back to that primary purpose."