Alexander Downer, Australia's minister for foreign affairs, said the fresh funds would be allocated to the Education For All-Fast Track Initiative, which primarily aims to help low-income countries provide universal primary education by 2015.
"Our funding will help countries extend the reach of their education systems," he said in a statement.
Downer said the assistance will help developing countries in improving the management of their education systems by building the skills of administrators in financial management and procurement, and reforming teacher recruitment and deployment policies.
"At present many countries in the Asia Pacific are burdened by a shortage of resources, poor education policies and weak management. Often they only have enough funds to pay the salaries of teachers, leaving school buildings and educational materials under-resourced, " he said.
He said they are aiming to raise the number of children in school in the region by 10 million and improve the quality of education for 50 million children by 2010.
In the Philippines, Downer said they will fund essential infrastructure such as the construction of new classrooms and refurbishment of dormitories, toilet blocks, science laboratories and other school facilities.
Last week, the Australian government announced that it has increased its development assistance to the Philippines for 2007-2008 as part of its commitment to expand its investments on infrastructure and education.
Downer said they have allocated Aus$100.6 million (P3.9 billion) in aid for the period or an increase of Aus$31.8 million (P1.2 billion) from the allocation for 2006-2007.
"We will support investment in infrastructure, especially much-needed road improvements, and help the Philippines build a better education system for all children, with a particular focus on improving access to schools and better teaching in Mindanao and the Visayas," he said.
Australia is currently assisting the Department of Education in bringing basic education to the doorstep of villages populated by Muslims and indigenous peoples in Mindanao through the Philippines- Australia Basic Education Assistance for Mindanao or BEAM Project.
The project has so far helped build classrooms, supplied workbooks, paid salaries of teachers and provided training opportunities for teachers.
BEAM project, which mainly focuses on Early Childhood Education, was launched to "provide children in remote and economically- depressed communities a quality preparatory training for formal education."
The project ultimately aims to improve quality and access to education, thereby fostering peace and development in Mindanao.