Parents are stigmatising schools by judging them on their decile, say Bay principals.
The decile system allocates funding to schools according to the proportion of students from low socio-economic areas, but principals say parents are erroneously the numbers to measure the quality of schools.
The Post Primary Teachers' Association (PPTA) has recommended a Government review of the system after concerns about misuse by parents, stigma attached to low-decile schools and imbalanced funding because high-decile schools have more fundraising capacity.
Dave Randell, principal of decile-eight Otumoetai College, said the system was "archaic" and a hangover from the 1980s.
He said about a quarter of his students were from well-to-do areas but a large chunk were also from low-income areas.
"We need to look at the whole profile of a school. There's got to be a better way of doing this," he said.
"Our decile rating doesn't address our school's needs. The system is archaic and needs a major review to address inequitable funding."
Merivale School principal Jan Tinetti agreed the decile system needed to be looked at, but said an equity funding system should remain. "I have had some parents that won't send their kids to us because we're a decile one. That's plainly not right - I've got fantastic teachers and programmes here, and we have high achievement because we work very hard."
Ian Leckie, the immediate-past president of the New Zealand Education Institute, agreed there was a stigma attached to low-decile schools. However, he would need to be convinced another system was fair.
Western Bay of Plenty PPTA chairman Graeme Bridge, from Aquinas College, said he wanted deciles to be hidden to prevent stigma.
Nicole Thompson-Connell enrolled her daughter Courtney, 6, in Otumoetai Primary rather than a nearer low-decile school.
"I reckon if it's a higher decile it's a better-run school with less bullying, because a low-decile school has kids from low socio-economic areas so it's kind of a given that the children can be a bit rough."
Education Minister Hekia Parata said it was fair to say decile ratings were sometimes mistaken as a measure of a school's performance. She had asked officials to look at the system and report back by the end of the year.
PPTA's problems with school decile ratings:
*Used by parents to decide where to send children, disadvantaging lower-decile schools.
*Low-decile schools are in a weaker fundraising position.
*Extra funding for lower deciles does not balance fundraising money gained by higher deciles.
*Misuse of school decile has created racial and class stigma.
*A large, middle-decile school may have just as many students in a low socio-economic group as a small, lower-decile school.