Two top independent schools which have had their government funding lowered say the cut was "substantial" and they have to relook programmes and staffing to see where they can save on costs.
This could mean cutting back on overseas trips at Raffles Institution (RI) and Hwa Chong Institution (HCI), and reviewing the need for additional staff.
The schools could even turn to alumni for help in running enrichment programmes.
"It is an opportunity for us to relook everything," said Mr Chan Poh Meng, who took over as headmaster of RI last December.
The Straits Times reported yesterday that six independent schools have had their funding cut. This was on the basis that they used to receive funding on both their Integrated Programme (IP) and Gifted Education Programme, but now have had the IP portion of their funding cut.
All schools, including independent and mission schools, were also told to moderate the raising of funds for campus upgrading.
In a statement yesterday, the Ministry of Education (MOE) said that it regularly reviews the funding of schools to ensure that they are adequately funded and that the resources are well spent.
It also revealed for the first time another major change in the funding formula for independent schools.
"Previously, every independent school was given the same amount of grant per student. It resulted in schools with large enrolments receiving disproportionately high funding relative to schools with lower enrolments," it said.
"The new funding formula, which has both a fixed and variable component, seeks to provide more equitable funding to the schools."
Taking into account all the funding changes, it clarified that only four independent schools will have their funding cut this year, and by no more than 3 per cent.
Three independent schools will see an increase in funding of about 5 per cent, while another three will get between 1 per cent and 3 per cent more.
RI and HCI did not want to reveal by how much their budgets were cut, but Hwa Chong principal Hon Chiew Weng said it was a "challenge". He and his teachers are reconsidering the cost of running some programmes.
"For example, some immersion programmes which are run overseas can perhaps be run regionally, or in Singapore," he said. "For some programmes, we use outside vendors. We are looking at whether our alumni or older students can run these for us."
At RI, Mr Chan highlighted its gap semester programme as one area the school will review. The scheme, which began two years ago, allows Secondary4 students to take nine weeks off school to pursue projects of their choice, such as a work stint, an overseas trip or a community initiative. On average, about 10 per cent of the cost is subsidised by the school.
RI also has several centres, such as the E.W. Barker Institute of Sports, which give students the chance to take special electives like sports psychology and medicine. "We have to ask ourselves if these programmes really do meet the objectives we have in mind and whether we can achieve the same outcomes in a more cost-effective way," said Mr Chan.
He added that his school will consider carefully before hiring more teaching or support staff.
Most parents interviewed or who gave their views online said the latest measures helped narrow the gap between rich and poor, but some argued that schools should be allowed to keep the extra facilities paid for by alumni.
"I went with my son to an independent school Open House last year and only then did I find out that they study in air-conditioned comfort," said shop manager Florence Kee, 39, who has two children in primary school. "I was also blown away by the facilities. But I also thought how unfair it was to everyone else."
But a board member of a leading school disagreed.
"I believe that facilities such as swimming pools make it easier to deliver an all-round education," he said. "If the schools can raise the money for such facilities, then MOE should allow it."