THE education system is facing a funding gap of £350 million by 2020, it has been warned.
Head teachers have been told that the overall education budget has fallen behind the rate of inflation since the 2000.
School governors and principals say they are already facing a critical situation due to budget cuts.
Education Authority chief executive Gavin Boyd has been meeting principals to discuss finances.
He said the EA would need £2.19bn by 2019/20 to meet demand from schools. If its budget remains flat at £1.82bn, that would mean a gap of more than £350m, he warned.
The funding crisis facing schools could be resolved by undertaking a `Bengoa-style' review of education, according to Alliance assembly member Chris Lyttle.
The Bengoa Report made recommendations on how to improve the health service.
Mr Lyttle said it could provide the basis for a similar comprehensive review of the education system.
"I have been inundated with contact from school principals, teachers and parents about the serious impact the school funding crisis is having on our children's education," he said.
"This includes excessive class sizes, reduced range of subject choices, inadequate Special Educational Needs assistance and poor building maintenance.
"There have been numerous independent reports and recommendations into the education system here but they have not been adequately implemented. It is now clear we need a comprehensive review of these recommendations and implementation of reform if we are to arrest the ongoing impact of this funding crisis on our schools."
