The OECD issued a report on education in Sweden after the Scandinavian country asked it last year to review the school system.

According to the OECD’s PISA education survey, no other country has seen a steeper fall in its education performance. Over the past decade, Sweden has declined from average to significantly below average.

In 2012, the most recent test, Sweden was ranked 28 out of the 34 OECD countries in maths, 27 in reading and 27 in science.

A particular problem is school discipline, which has worsened. Swedish students are more likely to arrive late for school than any other OECD country. There is also a significant achievement gap between native-born pupils and immigrants. Almost half of immigrant students perform below the baseline in maths, compared with less than a quarter of native-born students.

Launching the OECD’s report in Stockholm alongside Swedish education minister Gustav Fridolin, Andreas Schleicher, OECD director of education and skills, said: ‘Sweden should take advantage of the broad consensus among teachers, schools and politicians of the urgent need for reform.

‘Agreeing a national education strategy with clear priorities and responsibilities and stronger accountability will be critical to promoting long-term quality and equity.’

Among the OECD’s recommendations is a call for a funding review. ‘The current funding mechanisms are not meeting the objectives of improving quality while maintaining equity,’ the report said.

It set a range options Sweden could adopt to ensure more consistent and equal funding. These included using earmarked funding, defining criteria for municipalities and schools and student funding formulae.

Other recommendations include improving the quality and attractiveness of the teaching profession and strengthening the support schools offer disadvantaged pupils.