She also received $157,523 in outstanding holiday pay and payment in lieu of notice.
"While notice would usually have been worked out, the desirability of a timely leadership transition led the parties to agree that a payment in lieu of notice was appropriate," Mr Rennie said.
Ms Longstone began a five-year contact in November 2011, and left the role in December last year. Her official end date was February 8 this year.
Her resignation was announced by Mr Rennie on December 20.
He said they had reached a mutual agreement that she should resign, and he noted a strained relationship with Ms Parata.
Speaking from Mexico last night, Mr Key said much of the payout was part of Ms Longstone's contract which would have been paid regardless of the circumstances.
"A fair chunk of it is just what would normally have been paid and overall, given the ministry is of such critical importance, frankly I would rather have it right. I think we've got in the right space now."
Asked if there was any merit in changing contracts to help prevent such payouts, he said Ms Longstone's was not unusual.
"In the overall scheme of things here, you'd be at the pretty barer minimum. A lot of the payment here is part of the standard contract."
He said his bigger concern was that the appointment had not worked out.
"In the overall scheme of things, relative to the amount of expenditure undertaken, this was a small fraction. My view is that sometimes things just don't work out.
"This is a very important ministry, the Ministry of Education is critical to every family in New Zealand and we need to get it right. There was a breakdown in a number of relationships and I think we've made the right decision in terms of the State Services Commission deciding to reach an agreement with Mrs Longstone."
Asked if Ms Parata should take some culpability for it, he said there was always fault on both sides.
"It wasn't just with the minister, but it just didn't work. There's no point pointing fingers now, we've appointed Peter Hughes and its time to move on."
He would not say exactly what the problems had been.
"There were many examples were it just hasn't worked too well."
He said such employment issues were the exception rather than the rule and he did not think it should sound a warning against recruiting overseas people into high level public service roles.
Labour's education spokesman Chris Hipkins said the payout was outrageous.
"In reality, Lesley Longstone took the fall for Hekia Parata's incompetence, and National's unpopular policies. Taxpayers are paying a hefty price, just so that National had someone else to blame for the Government's stuff-ups in education."
Greens' co-leader Metiria Turei said the payout was the result of Ms Parata's inability to manage her education portfolio.
Long goodbye
$425,000 payout
$267,953 in severance - equivalent to six months' salary
$157,523 in holidays and payment in lieu of notice
13 months on the job
