The New Zealand Principals Federation has called on the Government to put a stop to more charter schools opening, after a troubled Northland kura had its contract terminated today.

President Iain Taylor, who represents more than 2300 principals from the education sector, said the closure of Te Pumanawa o te Wairua was a bold move and one he supported.

"Now it is time to reflect on why charter schools are not a good idea for New Zealand before we waste more precious resources on it"

"It's been an expensive exercise at Whangaruru."

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The school, which opened at the beginning of 2014 in rural Whangaruru, in Northland, cost $4.8 million over two years, with a peak roll of 60 kids.

"We said from the start there were flaws in the whole charter school system with no requirement to employ registered teachers and not enough public accountability," Mr Taylor said. "It is now clear from this example that they did not have registered teachers and the minister may never see the money for the farm either."

He said the federation wanted Education Minister Hekia Parata to support public schools and not charter schools.

Ms Parata announced today the Government had officially terminated the school's agreement. She said she informed Te Pumanawa o te Wairua trust board of her decision on Tuesday.

"Significant progress has been made in addressing the governance and management issues that caused me to issue the trust with a performance notice in February," she said.

"However, after considering the trust's response to my proposal to terminate the agreement, I have concluded that the educational challenges facing the school are too great to be overcome."

The minister said among the challenges were the Northland school's heavy reliance on third parties to take it forward, lack of internal capability, the difficulty of attracting suitably qualified teaching staff to Whangaruru and concerns over whether a viable student base exists for the kura.

Ms Parata says her decision is not a reflection on the trust board's efforts or capabilities.

"The current trust board has worked hard, been extremely professional and acted in the best interests of the kura's students throughout."

The termination will take effect on March 7. The ministry was working with the trust board, students and whanau to help the students to transition to other education options.

The termination was proposed at the end of last year after a review found the school had poor teaching, low achievement and an inadequate curriculum.

Before that the school had struggled with a range of issues including drug use, poor achievement, a falling roll and poor governance.

The school, located 65km northwest of Whangarei, was among the first tranche of charter schools.

The schools are funded by the Government but set their own curriculum, school hours, holidays and pay rates.

They were strongly opposed by opposition parties and teaching unions, but were implemented as part of the National Party's confidence and supply agreement with Act.

In December, Ms Parata said it was not yet clear if the money spent on the land and buildings -- about $1.8 million -- could be recovered.

Today, her spokesman said the land "will be the subject of a commercial negotiation process that is due to begin shortly".

Of the 40 students enrolled at the end of last year, three have moved to Australia, one has entered the workforce, and two have entered tertiary study.

"Potential alternate schools have been identified for the remaining 34 students. Now that decision has been confirmed, plans for these 34 will be finalised. Among other things, the plans will address transport options and support needs."

Te Pumanawa o te Wairua

• The school opened at the beginning of 2014 as one of the government's flagship charter schools.
• It faced an immediate range of issues including drug use, poor achievement, a falling roll and poor governance.
• After a special audit in February, the ministry of education advised the school's contract could be terminated.
• Education Minister Hekia Parata decided to keep it open until at least the end of the year after finding its students had limited other options should it close.
• The agreement was terminated in January 2016.