The Government is to spend €35m this year replacing school prefabs with permanent classrooms in almost 200 schools.
The initiative, which was contained in the Programme for Government, will result in savings of around €5m and create an estimated 700 construction jobs.
The Department of Education will pay more than €29m in prefab rental this year.
Around one third of the 586 schools currently renting prefabricated buildings will be eligible.
However, the INTO says the initiative did not go far enough.
The union said there were over 2,000 prefabs in use in schools all over the country.
Fianna Fáil Education spokesman Brendan Smith said the Government is adopting the strategy of the previous Fianna Fáil government in reducing the use of prefabs in schools.