School funding has been a hot topic since the Federal Government announced plans to change how much money it gives to schools around the country.
But do you understand how our schools get their money? Here are some jargon-free facts to clarify how it works.
(And seriously, we promise we won’t mention Gonski.)
Most of the money comes from the states
The majority of funding for Australian schools — in fact, about three-quarters of it — comes from the state and territory governments.
Most of the money goes to public schools
Most of the money in the pot goes to public schools — but the proportion going to private schools has climbed in recent years.
But more Commonwealth money goes to private schools
The recent debate about school funding has focused on how Commonwealth Government money should be spent.
There’s a big difference between where the Commonwealth’s education funding goes compared to state and territory money:
- Three in every five dollars of Commonwealth funding goes to private schools.
- Nearly all state and territory funding goes to public schools.
Why do private schools get public funding?
In some countries, like the US, students in private schools get almost no money from the public purse.
And in countries like Canada and New Zealand, the proportion of government money going to private schools is much lower than in Australia.
The reason why Australian governments fund private schools is historical.
The post-war baby boom put huge strain on both public and Catholic schools, the latter of which had traditionally educated children from poor families.
The Catholic school system was near to collapse, while rest of the private school system survived based on their fees and other private income.
Glenn Savage, a senior lecturer in education policy at the University of Melbourne, says the federal government decided that if it did not provide funding to the Catholic sector it could collapse, and that would see a huge flood of students into a government system that was already stressed.
“That solution was put in place in the 1970s and it has had ongoing repercussions that we have never moved away from,” he said.
Private schools educate lots of children
Fifty years later, the Catholic school system educates about 20 per cent of children at all levels and other private schools have 14 per cent of students, with the rest in public schools.
Seventy per cent of primary school students go to public schools, but the number of secondary students in public schools has now fallen below 60 per cent.
That means that overall, more than one third of Australian students are in private schools, one of the highest rates in the OECD.
Private schools have more money to educate their students
The Federal Government works out how much money to give each school based on the amount it would cost to educate a child.
In 2018, that is $10,953 for a primary school student and $13,764 for a secondary school student, with extra loadings for disadvantages.
Government schools get the full amount and private schools get a percentage based on how much the government thinks the school can raise for students’ schooling from parents and other sources.
Catholic schools get the majority of their funding from the government, whereas other private schools get most of their funding from school fees and other private income.
Are some schools getting more than their fair share?
There are two main reasons why there are inequalities in the funding system and the first is to do with politics.
Because the amount of money private schools get from the Commonwealth is based on the capacity of parents to pay for their children’s education, that amount is based on students’ addresses — which comes down to their socioeconomic status. That system has been in place since 2001.
But Dr Savage says successive governments of all stripes, starting with John Howard’s government, have promised that no school would be worse off as a result of the funding model, thus distorting the system.
This in effect means that if a school was getting more than it deserved based on parents’ capacity to pay, it still got to keep that amount — and that amount continued to increase under a process called indexation.
Different governments have promised to iron out those problems, with the Turnbull Government promising it will be done within 10 years.
The Government’s announcement that 24 private schools will have their funding reduced breaks the “no school worse off” approach that has been in place since 2001.
Money is not always distributed equally
The second reason some schools get more than their fair share is to do with how the money is distributed after governments hand it over.
Even though the Commonwealth government decides how much money each school should get, it doesn’t get to decide how much actually goes to each school.
The Commonwealth gives the total amount to the state and territory governments and organisations like the Catholic education system — which then distribute the money to individual schools.
Those systems do not have to follow the Federal Government’s defined amount that goes to each school, they just need to distribute the money on a “needs basis” according to their own formulas.
That means there are eight different state models, eight different Catholic system models and lots of other models in the other private school systems for distributing Commonwealth money.
The Catholic school system has come in for criticism for giving more money to wealthy schools at the expense of poor schools.
Jim Hanna, media manager for the Catholic Education Commission in NSW, says the funding model’s use of socioeconomic scores to work out parents’ capacity to pay is “flawed”.
He says families below the designated socioeconomic rating for an area tend to send their children to the local government school or a low-fee Catholic school.
“All families in that area are deemed to have the same capacity to contribute. It would be like basing income tax rates on postcodes rather than individuals’ income. We don’t think that is fair.”
He says the Catholic education system moved money to Catholic schools in some wealthy areas because they wanted to keep local Catholic schools in all areas affordable for most families.
Dr Savage said the Catholic school system had “cherry-picked” evidence of Catholic schools that would lose money.
“It’s a weak argument because they are saying they want to maintain a weak and possibly unfair system,” he said.
“The only schools that will lose money under the reform are those that are overfunded in relation to their [socioeconomic score].”