Despite improved access and comparatively high levels of funding, the quality of education remains "a central concern", Treasury said in its 2011 medium-term budget policy statement (MTBPS), tabled in the National Assembly on Tuesday.
"South African learners fare poorly in global benchmarking exercises," the document says.
"Challenges include inadequate management, inappropriately trained teachers, insufficient time on task, and a lack of basic resources in poor schools.
"Low levels of achievement in literacy and numeracy – illustrated by learner performance in the annual national assessment conducted for grades one to 6 in 2011 – are symptomatic of these problems."
The document says the government recognises the need to improve the quality of education at all levels, enhancing the skills base and contributing to a productive labour force.
Projected spending on education over the medium term is estimated to increase at an average annual rate of 6.7%, reaching R231.7-billion by 2014/15.
Spending increases have enabled a broadening of access to education, according to Treasury.
In 2007, the introduction of no-fee schools began to remove the burden of paying school fees from the poorest learners.
In 2010, the policy was extended from the poorest 40% of learners to the poorest 60%, and as a result, 8.1-million learners in 20 000 schools did not have to pay school fees.
Over the next three years, funding will be reprioritised to challenges in education.
Annual national assessments of literacy and numeracy will continue and be extended to grade nine in 2011/12.
More than 9 000 student teachers are currently enrolled in the Funza Lushaka bursary programme, with many focusing on science and mathematics tuition.
School infrastructure will be improved in poor schools and access to grade R will be expanded.
Government will continue to enhance skills development by strengthening further education and training (FET) colleges, with support for tuition, machinery and equipment.
The links between sector education and training authorities, the national skills fund and FET colleges will be enhanced.
In addition to allocations for higher education institutions, the science and technology vote provides for funding of advanced research and postgraduate bursaries.
Over the medium term, more funding will be provided to expand post-graduate programmes and academic centres of excellence.
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