A week after details of a confidential meeting between the Education Minister, Adrian Piccoli, and representatives of the Catholic and independent school sectors leaked, the government revealed wide-ranging cuts.

Funding for independent schools is to be frozen instead of being cut $67 million a year, as originally planned. The Premier, Barry O'Farrell, stepped out of a cabinet meeting yesterday to phone the Catholic Archbishop of Sydney, Cardinal George Pell, about the decision.

The decision means the planned cut of 8 per cent is reduced to 3 per cent - $116 million over four years. That will be matched by a $201 million cut over four years to public school budgets.

It would not be capped forever and the cap would not come into effect until July 1 next year, Mr Piccoli said.

''The intention of these changes is that the impact on non-government schools is the same as government schools of around 3 per cent,'' he said.

The Department of Education will shed 600 staff from state and regional offices and 800 TAFE jobs will be lost during the next four years. Another 400 jobs will go as a result of a new online management system, bringing the total from the department to 1800. Mr Piccoli said no public school teacher would lose their job.

TAFEs would also be forced to increase fees by 9.5 per cent.

As the Herald reported on Saturday, news of the cuts upset many Liberal MPs, who have been swamped with emails and calls from constituents.

Mr Piccoli was questioned for more than two hours at a joint party meeting yesterday. One source said the Londonderry MP, Bart Bassett, had told Mr Piccoli he should sack his chief of staff over the lack of consultation with backbenchers.

The Pittwater MP, Rob Stokes, was quoted as saying: ''I can't see why building the north-west rail link and keeping the [electricity] 'poles and wires' is more important than education.''

The Herald was told Mr Piccoli went into the meeting intending to announce the need for legislation to change the funding split between public and non-government schools. But when Mr Piccoli was questioned about this, Mr O'Farrell intervened to say it was ''not on the table''.

A government source said cabinet did not consider any such legislation. The MP for Riverstone, Kevin Conolly, called for a vote of the party room but Mr O'Farrell did not allow it.

The federal Opposition Leader, Tony Abbott, who phoned Mr O'Farrell on Friday to lobby him about the proposed cuts, yesterday encouraged his NSW MPs to lobby their state counterparts. He told a Liberal Party meeting he was concerned because the party had a proud history of funding independent and Catholic schools. ''It's in our DNA,'' he was quoted as saying.

The Mitchell MP, Alex Hawke, told the party: ''This wouldn't have happened if we had a Liberal in the education portfolio in NSW.'' Mr Piccoli is a member of the Nationals.

Geoff Newcombe, the chief executive of the Association of Independent Schools, said he was happy with the government's response to teachers and parents from Catholic and independent schools.

''We regret the fact that there has to be any cuts in education but we are slightly encouraged that the minister said it is a funding cap for four years. It seems a fairer approach to what we had before.''

The president of the NSW Teachers Federation, Maurie Mulheron, said the cuts had revealed the government's agenda behind policies to give schools more autonomy over budgets. ''This government is a disgrace,'' he said. ''It has no commitment to supporting quality public education.''

A Catholic bishop, Anthony Fisher, who is chairman of the NSW Catholic Education Commission, said the cuts were less than originally mooted. He and Cardinal Pell and many parents had lobbied the government.

''I think our message got through,'' he said. ''It was a good result even though there is still pain in it.''