Executive Committee of Education exercised its powers to create new regulations paving the way for the establishment of a new system of education in Sri Lanka. The new system was expected to ensure that education was provided with equal opportunities for all children in the country, irrespective of social class, economic condition, religion and ethnic origin. Whilst the education in vernacular schools had been free prior to the reforms due to government grants to cover the cost of teaching and local philanthropists providing the buildings, equipment and the books, it was not standardised. In 1942 a special committee was appointed with Kannangara as chairman to report on the status of education in the country. Among the recommendations for providing "lasting value to the nation" given in the report, which was published in 1943, were that
Education should be free from the Kindergarten to the University.
The mother tongue should be used as the medium of instruction in the Primary Schools.
English should be taught in all schools from standard III.
A curriculum for the child which would develop its "head, heart and hands" should be introduced. In other words, the education of the emotions is as necessary as the education of intellect and practical ability for the well-being of the child.
Kannangara proposed that central schools be modelled upon Royal College, Colombo, one of the leading schools in the country.
As Minister of Education Kannagara was placed in charge of implementing the recommendations. Among the reforms he introduced, which came into operation on 1 October 1945, were to make education free of charge for all students, to ensure that every student was provided with instruction in the religion of his/her parents, to prevent teachers from been exploited by managers of schools by having their wages paid directly by the government and to make adequate provisions for adult education in the country.
He also established a series of central schools (Madhya Vidhyala), modelled on Royal College, Colombo, in locations outside major cities. These took high quality secondary education to the rural outstations of the country. His objective was to create a central school in every electorate in the country, and as such, while in 1941 there were three central schools in the country; by 1945 the number had increased to 35, and to 50 by 1950. First Central College established in Akuramboda, Matale.In 1943 Kannangara also launched an annual scholarship program, which provided the opportunity for the 20 best performers of the scholarship exam to get free board and lodging in Central School hostels. During his 16-year period as Minister of Education, he also upgraded ancient pirivenas, educational establishments for Buddhist monks, and established the University of Ceylon, the first University in Sri Lanka. Further, Kannangara took steps to abolish the two tier school system, where English was taught to privileged students and the vernacular language was taught to the rural masses. While he laid emphasis on teaching Swabasha (native languages) in schools, he also advised that students should learn English to compete in the modern world