The Otago Secondary Principals Association is angry the Government is injecting $2.6 million into Aspire Scholarships which will enable pupils from low income families to attend private secondary schools.
Association chairman Philip Craigie said Otago schools were still "lamenting the loss" of adult education courses, teacher professional development and therapy for special needs pupils as the Government cuts funding to focus on literacy and numeracy skills.
And there were many other programmes which had effectively been put to death as a result of government funding cuts, he said.
With that in mind, Mr Craigie said principals were particularly upset to hear the Government would now be providing $2.6 million to send pupils from low income families to private secondary schools.
"I don't think the Government is using taxpayers' dollars wisely. There's quality education for everybody in every centre in New Zealand.
"I don't think it's a good decision for New Zealand. If there are state schools that are deficient, that money would be much better spent on putting that right."
Mr Craigie said there were no private secondary schools in Otago or Southland.
The nearest are Rangi Ruru Girls School, St Andrews College and Christs College - all in Christchurch.
"The scholarships are not going to be any advantage to people in the South at all, and you've got to query whether it's an advantage to anyone."
Next year, 50 Aspire Scholarships will be available for year 9 pupils, 50 for year 10 and 50 for year 11.
This will increase to 200 in 2011, and 250 in 2012.
Successful applicants will receive up to $15,000 per year until they leave school to cover the fees of the independent school of their choice.
To cover other school-related costs, an allowance will be given of up to $1500 annually for items such as uniforms and school trips.
To be eligible, pupils must come from a household with an annual income less than $65,000 and a net worth of less than $150,000.
Associate Minister of Education Heather Roy said the creation of the new Aspire Scholarships was about enhancing choice and increasing the education opportunities available to pupils from low-income families for whom - due to associated costs - a private schooling is out of reach.
"It is not a reflection of New Zealand's state or integrated schools, and is no way meant to imply that the Government views private schools as being any better or any worse than public and integrated schools."
Mrs Roy said she would like to be able to give every child in New Zealand a scholarship to use at any school of their choice - whether it was state, integrated or independent.
However, that was not possible at present.
"Parents should be able to choose the sort of education that they feel will best suit their children's needs and learning style. Choice is key to ensuring quality education outcomes for children and the Government's Aspire Scholarships widen the range of opportunities available to students from low-income homes."
