Education Minister Hekia Parata announced on Wednesday an extra $60 million would be invested over the next four years to boost new teacher recruitment and training, and a postgraduate qualification for all trainee teachers would be introduced along with a new pre-principalship qualification.
However, Ms Parata admitted trade-offs were required in the current economy, and there would be a $43 million cap on the number of teachers through increased class sizes.
Changes to teacher-pupil ratios included a standardised years 2 to 10 class ratio of 1:27.5.
Otago Primary Principals' Association president Brent Caldwell said the public needed to understand that the staffing ratio was a formula by which staffing was allocated to schools.
"This is the reality already and the change to ratios may increase some class sizes beyond 30 per class.
"In many schools, the flexibility to provide non-teaching roles, enrichment programmes, additional arts, cultural experiences and special needs support will be threatened," he said.
University of Otago College of Education senior lecturer Darrell Latham said his concerns, aired in the Otago Daily Times recently, had proved true with Ms Parata's announcements.
Increasing class sizes was a "retrograde step" and would negatively affect the underachieving "tail" the minister was always saying needed more help, he said.
"It's really going to have a big impact on the children who are the most vulnerable."
As he had indicated previously, performance pay was coming, but it was a cost-cutting measure, not an opportunity to improve the quality of teachers.
Teachers were already very well scrutinised by parents, pupils and principals, not to mention through NCEA and national standards results.
There was also a formal appraisal system.
"Teachers are probably the most scrutinised profession that currently exists."
Teaching was built on collaboration and introducing an element of performance pay would need to be "extremely carefully" done.
"The devil will be in the detail," he said.
College dean Prof Lisa Smith said until she received more detail, it would be difficult to comment on the effects the minister's announcement would have on the college of education or beyond.
"We do want to note that our graduates have an excellent record of employment and we expect that to continue," she said.