Education bureaucrats were not directly involved in Prime Minister Malcolm Turnbull's idea to give the states full funding responsibility for public schools.
Department officials confirmed to a Senate inquiry hearing in Canberra on Friday, the suggestion was raised in Federation reform talks that stalled about a year ago but has not been discussed since.
Tony Cook, acting secretary of the department at the time, said the first he heard of about Mr Turnbull's idea was on the day it was revealed last week.
The department's primary role was to advise the minister, while the prime minister's department advised him on announcements.
Mr Cook cited a statement by Education Minister Simon Birmingham that said the government never proposed to abandon public schools.
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Labor senators noted that directly contradicted Mr Turnbull's position.
"I can't comment on that," Mr Cook said, prompting Labor senator Sam Dastyari to lampoon his answers as becoming "Monty Python-esque".
Alison Larkins, acting deputy secretary of the prime minister's department, said the idea was part of a draft federation options paper released in June 2015.
But she did not believe Mr Turnbull's comments about a possible shake-up to income tax sharing and schools funding represented a government decision.
