Otago Secondary Principals Association secretary Gordon Wilson said the 1% increase would not cover the increased costs schools had experienced over the past year.
''So, as a group of schools, we are unhappy with the overall increase. We do acknowledge that [operations funding] is not frozen, but the general increase is below what we had hoped from the budget.
''We won't be able to continue the education that we've been used to if the Government is not putting the same amount in when we adjust everything for inflation and cost increases.
''If we want the same level of education, someone else has got to pay. And that could very well be the parents.''
It is a situation foreshadowed by Green Island School principal Steve Hayward earlier this year.
Mr Hayward said the 1% increase meant schools would have less money to pay for the increasing costs of things like electricity and teacher aides.
Teacher aides were owed yearly wage increases, and if the school could not find the money, it would have to reduce the number of hours teacher aides worked with pupils. That would have a negative impact on pupils.
''The money is not going as far as it used to. We're going to have to go to the parents,'' he said.
''Parents will have to pay more or the quality of education will suffer. I can't see how we can carry on doing what we're already doing.''
Education Minister Hekia Parata yesterday announced extra funding for 2421 schools to help support pupils at risk of underachieving.
''This extra funding represents a 1% increase to the $1.35 billion in operations grants funding for 2017. So let's be clear, there is no funding freeze.''
The increased money was being targeted to those pupils at risk of underachievement.
These were pupils from families on long-term welfare. Evidence showed they were one of the biggest groups at risk of not being successful at school, she said.
''Working together with the Ministry of Social Development, we have identified around 133,000 students in this situation, attending all but 15 of our smallest schools.
''That means that 99.4% of eligible schools will be getting extra funding.''
Schools were notified yesterday of the exact amount they would be receiving in the targeted funding.
Ms Parata said they would receive $92 per eligible pupil, as opposed to just $16 under a blanket distribution.
Overall, this meant some schools would receive a few hundred dollars, while others would get up to $57,000. One exception was one school receiving $109,000, which reflected the challenges its pupils faced.
Low-decile schools, and regions with large numbers of pupils ''at risk'' of educational underachievement, would benefit most from the targeted funding increase.
Alongside the targeted funding, schools were also told yesterday what their share of the operations grant funding would be for 2017.
However, this was only an initial indicator, and would not be finalised until schools filed their March 2017 roll returns with the Ministry of Education, Ms Parata said.
