Only half of schools are using the sort of tests that are "absolutely critical" for monitoring children's progress, the Education Review Office says.
Chief review officer Nicholas Pole told Parliament's Education and Workforce Select Committee on Wednesday that schools should be using standardised norm-referenced tests that showed how well children were achieving compared to others of the same age nationally.
"We've got national tools like PAT and e-asTTle which give you a good insight but around half of schools are using those tools, the rest aren't. Parents are hugely frustrated with 'where does my child actually sit' and what should be going on."
Pole said schools that did not use standardised norm-referenced tests would be able to identify their highest and lowest performing pupils but would not know how they compared with children at other schools.
"In a school you might be able to see the top group versus the bottom group but you don't know where your top group is relative to other kids," he said.
Teachers needed good assessment so they knew which children needed the most help, Pole said.
At a national level, education agencies and the government needed assessment data so they knew which groups of learners or schools needed more support.
Pole said assessments should be linked to the curriculum so it was clear how children were progressing in their learning.
"Across our system many teachers are struggling with the curriculum. If you think of the primary school, you're teaching across eight key learning areas, that's a lot of information. Some teachers do that really capably, others struggle on a daily basis and then struggle to mix the curriculum and the assessment together," he said.
Pole said New Zealand school principals had a bigger job than principals in almost any other country.
"Our research showcases that principals in Aoteaora probably have one of the biggest load of any principal, school leader across the globe."
He said principals had a huge effect on school quality and it was strongest in schools where principals were in classrooms observing and mentoring teachers rather than in their offices struggling with administration.
Earlier, Pole told the committee safety checking was the most common shortcoming among under-performing early childhood centres.
He said reviewers found unacceptable risks in about 12 percent of early learning services and the major fault among those centres was failure to check the identity of staff members or to police vet them to ensure they were fit to work with children.
Pole said teachers had to be vetted every time they moved to a new job, and sometimes services hired new staff before the process was complete.
"Services all of a sudden have someone leave, they're desperate to get new staff, they clearly cut corners, take someone on and hope the vet will come through," he said.
In Australia, Pole said teachers were vetted once and carried that approval with them if they moved jobs.