Canberra continues to lead the nation in the latest breakdown of literacy and numeracy performance although spelling is the city's weak point.
In a full breakdown of the 2012 National Assessment Program for Literacy and Numeracy, the ACT came top or equal top in 16 of the 20 areas tested.
The ACT was beaten by NSW and Victoria in writing in year 3, and came equal second with Victoria to NSW in spelling in years 3, 5 and 7.
In year 9 spelling, the ACT came equal first with NSW.
While the ACT was largely outranked by NSW in spelling, its mean scores in spelling across all year levels improved slightly on last year.
In all other tests across reading, writing, grammar and punctuation, and numeracy the ACT came first or equal first with NSW and was significantly ahead of the national mean - as it has done in every test since NAPLAN began in 2008.
ACT Education Minister Joy Burch said it was pleasing to see year 3 reading improve, with 96 per cent of students at or above the national minimum standard, compared with 95.6 per cent in 2010 and 94.4 per cent in 2008.
In the ACT and nationally, girls continued to achieve higher average results than boys across all literacy tests but boys achieved higher average results in numeracy.
In the ACT and nationally, English-speaking students continue to achieve higher average results in reading than students with a background other than English.
Students from Canberra and metropolitan locations continue to achieve higher average scores than those from provincial and remote locations and across all tests in the ACT and nationally, average scores were higher for students whose parents had higher levels of education and occupations.
The average scores of Aboriginal and Torres Strait Islander students were well below those of non-Aboriginal and Torres Strait Islander students across all categories.
Federal Schools Minister Peter Garrett said the report, which will form the bulk of new data revealed on the 2013 My School website early next year, showed that too many disadvantaged students were being left behind and provided "more evidence of the need for a new, fairer school-funding system" through the Gonski reforms.
"Coming a week after the disappointing results in the latest international tests in reading, science and maths, taken in late 2010, the report shows we have made improvements in some areas but there is still a lot of work ahead," Mr Garrett said.
Nationally, there was a 1.7 per centage point drop since 2011 in the number of students meeting the minimum standard in year 3 numeracy, and a 1.6 per centage point drop in the number of students meeting the minimum standard in year 7 numeracy.
Mr Garrett remained concerned about "appalling" statistics relating to indigenous performance, "in particular, for year 5 reading only 8.6 per cent indigenous students in very remote schools in the Northern Territory are reaching national minimum standards, compared to 94.1 per cent of non-indigenous students in these schools".
The average performance of indigenous students was around two to three years below the average performance of non-indigenous students in reading and numeracy. In the NT, the average performance of indigenous students in years 7 and 9 was around four years below the average performance of non-indigenous NT students in reading and numeracy.
The report also confirmed the close link between student results and their parents' education. Almost 98 per cent of students of parents or carers with a bachelors degree achieved the minimum standards, compared to 84.5 per cent of those whose parents achieved only year 11 standard.
The national report and more information about the tests are available on the NAPLAN website: www.nap.edu.au.