This report examines the historical and present situation in New Zealand regarding school fires and arson. The Ministry of Education has been installing combined security and smoke detection alarm system in schools since 1991 as a measure to protect schools from fire and arson. The costs and benefits of this system are compared to an automatic sprinkler system. The security and smoke detection alarm system provides early warning in the event of a fire. Since the installation of these systems there has been a reduction in the cost of fires. This system is relatively inexpensive compared to an automatic sprinkler system. An automatic sprinkler system provides not only a warning device but also a suppression mechanism that acts to extinguish or control the fire while it is still very small. Water is applied directly to the base of the fire resulting in very little fire damage compared to the major losses in a building protected with a security and smoke alarm detection system. The best strategy to further reduce fire losses in New Zealand schools is to progressively install automatic sprinkler systems in new and existing buildings.