The report notes the challenges of such an approach, but cites similar initiatives that are already running - and doing so within existing regulations.
This year a school-based programme for aspiring teachers started at Macleans College in East Auckland, a collaboration between the school and Victoria University.
Four trainees are based at the school throughout the year and are considered members of staff, joining a faculty and participating in the full life of the school.
The trainees access Victoria University's online Graduate Diploma in Teaching programme, including lectures and research.
They will not be teaching but complete a seven-week teaching practicum at Macleans and another seven weeks in another school.
Macleans College principal Byron Bentley said the school would continue to take university students on seven-week placements, which worked well.
"But we have thought for some time [that] the best way for aspiring secondary teachers to learn is in a school."
PPTA president Angela Roberts said increased training came with risks and would require extra resources in schools, meaning teacher trainees would possibly not be exposed to lower decile schools.
Pay for excellence, says Morris
Teaching excellence goes unrecognised because pay is not linked to performance, says the former principal of a top secondary school.
John Morris is the co-author of a NZ Initiative report on teaching quality with Rose Patterson, which argues the case for performance-related pay. The report, published today, proposes a performance-related pay system in which teachers would need to apply to ascend levels on a pay scale, moving up when certain standards were met.
Mr Morris said the standards would not be based on student achievement data but on factors such as contribution to the school as a whole. He said the Education Council of Aotearoa NZ (Educanz), which will replace the Teachers Council, was a strong candidate to articulate such standards.
Mr Morris is the chairman of the transition board overseeing the establishment of Educanz, and his comments have infuriated the PPTA union, who strongly oppose the proposed pay overhaul.
President Angela Roberts said she had written to Education Minister Hekia Parata calling for Mr Morris' resignation from the board.
Ms Parata said Mr Morris was well-respected and one of 11 people on the transition board. "I am confident that any potential conflicts of interest can be managed," she said.