Prime Minister Scott Morrison says a school funding deal could be secured within weeks, despite scrapping a planned meeting with state and territory leaders next month.
The prime minister will chair the Council of Australian Governments meeting on December 12, rather than as scheduled on October 4.
School funding was due to be a key agenda item, as well as hospitals and indigenous disadvantage.
Mr Morrison told a drought strategy meeting in Canberra on Wednesday - at which he announced an October 26 summit - he wanted to focus on rebuilding rural communities.
"Frankly, I think this (drought) is what we need to focus on as a country right now," Mr Morrison said.
"We'll have our COAG meeting at the end of the year and the issues that were going to be germane at that meeting around education they are being addressed very well by the education ministers and the treasurers."
Labor deputy leader Tanya Plibersek later told parliament the COAG cancellation confirmed the government was "too busy fighting itself to govern for Australians".
Mr Morrison said in response, he understood issues around school funding were set to be resolved by the education ministers and treasurers before October 4.
"Those issues do not require a special meeting in October."
Shadow treasurer Chris Bowen said the deferral of the COAG meeting showed the "policy chaos" at the heart of the Morrison government.
"It's now September, and school principals don't have their budgets for next year because of the dysfunction in the school funding model which this government has imposed," Mr Bowen said.
Victorian Premier Daniel Andrews was among those contacted by Mr Morrison.
"They've obviously got a few issues to deal with up there, and that's obviously best if the meeting's put back from their point of view," Mr Andrews told reporters in Melbourne.
The states are also still working on plans for energy prices and reliability despite the federal government scrapping the National Energy Guarantee.
An Adelaide summit on October 2 and 3 aimed at reducing violence against women is set to go ahead.
Australian Associated Press