A report released Tuesday from the Organisation for Economic Co-operation and Development (OECD) revealed that Aussie students' ranking fell in all subjects, and that the test results were affected by Australia's equity issues. OECD is an organisation of the world's richest economies.

Aussie students' ranking fell in all subjects, from 15th to 19th in mathematics, 10th to 16th in science, and 9th to 14th in reading. The fall in ranking had been observed since 2009.

''We're being outperformed by a much larger number of countries now,'' said Sue Thomson, director of educational monitoring and research at the Australian Council for Educational Research.

The OECD report was based on the 2012 Program for International Student Assessment (PISA) result where more than half a million students from 65 different countries, ages 15 to 16, answered a two-hour exam.

PISA is a leading survey of education systems conducted every three years by OECD.

The PISA results among Aussie students showed a serious inequality within the country's education system. The same issue was highlighted by David Gonski's review of school funding where results showed that Aussie students belonging to the lowest socio-economic quartile are showing average academic performance, which was 2 and half years behind the performance of those students belonging to the highest socio-economic quartile. The same 2 and half years gap was seen between indigenous and non-indigenous students.

Meanwhile, the students from Shanghai topped the OECD 2013 results. From the PISA results, they showed a year ahead in terms of knowledge and skills compared to students in Australia, as well as from the United States, Germany and the United Kingdom.

The students from Shanghai scored the highest in mathematics with 613 points. This was impressively equivalent to an almost three years of schooling above the average as compared to 34 countries surveyed by OECD. Shanghai was six years advanced as compared to Peru.

Meanwhile, Singapore came second in mathematics with a score of 573, followed by Hong Kong, Taiwan, South Korea and Macau.

However, Gonski review panellist and former director-general of NSW education Ken Boston said Australia should compare itself to Canada

''Forget Shanghai and Finland. Canada is the country Australia needs to compare itself with because it is culturally similar. The key thing is that it has a higher performance than us overall and a lower correlation between disadvantage and performance.''