The Education Act of 1914 has been described as “the resultant of three forces: an agitation by primary teachers, which had the sympathy of the Department, for a national grading scheme and a centrally controlled inspectorate; a vague yet powerful public opinion in favour of local control, reinforced by the still substantial political influence of the boards; and the powerful opposition of secondary school interests to unified local control over the three main branches of school education,” (Webb: Control of Education in New Zealand, p. 89).

Despite the recommendations of the Cohen Commission, the Education Act of 1914 made no provision for the unified local control of primary and post-primary education. In the primary field, the powers of education boards were curtailed and those of the central Department strengthened. The control of the primary inspectorate passed from the boards to the Department, and a system of grants instituted under which boards were obliged to use moneys for the purposes for which they were granted. Grants to school committees were so regulated that boards became intermediaries in making available sums over which they had no influence. The committees ceased, however, to have important administrative functions and tended to be concerned with the day to day care and management of the school buildings and grounds. In this restricted sphere, the committees were free to develop what has become their principal function, of relating the life of the school to the life of the community.

The centralisation of the primary inspectorate enabled the institution of a national grading system for teachers, which by 1920 had become the basis for all general appointments in the primary teaching service. Thus, within a few years from the passing of the Education Act of 1914, education boards had little voice in formulating educational policy; had lost their discretion in the appointment of teachers; and were able within restricted limits only to determine the use of their funds.

Following the passing of the Education Act of 1914, the secondary and technical school authorities lost a degree of autonomy. Once the free place system became general, the boards became more dependent on grants distributed by the Department. Regulations which prescribed the courses of instruction together with requirements of certain examinations set limits to the exercise by post-primary school authorities of their right to determine courses of study in their schools. A national salary scale followed regulations in 1920 for the classification of post-primary teachers. In consequence, a new basis for financing post-primary education became necessary. Post-primary school boards were reimbursed the salaries of teachers and were granted a capitation grant for administrative costs. Any income received from public endowments was deducted from the latter grant. The boards' public endowments were, however, nationalised in 1949.