Minister for Education Mary Hanafin has moved to defend the €80 million in State support for fee-paying schools.
Her comments come amid allegations that some schools in this sector are cherry-picking students - and doing little for those with special needs.
In a statement last night, the Minister pointed out that the State has traditionally paid the salaries of teachers in fee-paying schools.
But the Labour Party has demanded a review of State funding for these schools and said new regulations were needed to prohibit schools from cherry-picking students or brushing aside those with special learning needs.
Ms Hanafin said if fee-paying schools were to close and the pupils were to move to the non-fee-paying sector, the cost to the State would be higher. Whether children attend fee- paying or non-fee-paying schools teachers would have to be paid.
Yesterday, new Department of Education figures revealed how special needs provision in Dublin second-level schools is concentrated in poorer areas, with some fee-paying schools doing little to accommodate pupils with special needs.
Jan O'Sullivan, Labour's education spokeswoman, says the Minister should introduce regulations under Section 33 of the Education Act, which address the restrictive admission policies of some schools.
She accused the Minister of failing to follow up on her predecessor Noel Dempsey's promise to carry out a review of State support for fee-paying schools.
Sinn Féin's education spokes- man Seán Crowe said education apartheid is being reinforced in this State while the Government stands idly by. He also severely criticised schools that are cherry-picking pupils.