The David Gillespie Blog

The education Minister thinks some private schools are over-funded.  He’s wrong.  They all are.

According to the latest figures we have available, Australian taxpayers spend $12 billion a year propping up the businesses we call private schools.  That is more than we spend on unemployment benefits and sickness allowance combined and it is about 12 times as much as we spend on the ABC and SBS.  And that’s just for recurrent expenses. We also generously hurl another billion in their direction so they can build capital facilities that taxpayers don’t own and are not permitted to use.  Since most of these businesses are also tax exempt those numbers are just the tip of our generosity.

The spin masters employed by these private businesses often run the line that they are doing taxpayers a favour by taking their money.  They point out that while it does cost taxpayers $9,327 per student per year to educate one of their clients, it would cost the government $13,783 to do it in a government-run school.  My goodness golly gosh they’re generous, they’re saving us $4,456 per student. Except they aren’t.  More than half ($2,386) of that ‘saving’ is notional because it is for depreciation of the school assets owned by the public schools.  The school doesn’t see a cent of it in its operating budget.  Not one teacher is paid with it.  Not one book is purchased with it.  But that notional expense is included in the calculation for the government-run school and not for the privately-run school.

Once you drop that accounting trickery out, the gap narrows considerably.  In 2014 it cost the taxpayer just 18% less to have the child educated ‘privately’ .  And that gap has been closing very quickly.  In 2009 it was 28%.  At that rate of progress it should cease to exist at all in the next 5 or 6 years.

Even though are getting relatively less and less government money, it is the government-run schools taking on the more challenging task educationally.  They teach 7 times as many students classified by the ABS as living ‘very remotely’ and 4 times as many students classed as being ‘remote.’ When it comes to children with special needs, once again it is those same schools doing the heavy lifting, educating 3.3 times as many children with a disability as their ‘private’ brethren.

And unlike government-run schools, privately-run schools are largely exempt from the provisions of Australia’s discrimination laws. They are permitted by law to pick and choose who they will and will not be bothered trying to educate.   In New South Wales for example they can refuse to teach (or employ) people on the basis of marital status, sex, disability, transgender or homosexuality.  Queensland is less discriminatory.  Here schools can only pick and choose on the basis of not liking someone’s religion.

But let’s not fall into the trap of arguing about the pennies and ignore the pounds.  The real question is why is the taxpayer contributing anything all?  The taxpayer provides a fully funded secular system open to all comers.  People can choose not to use the system, but if they choose to opt-out why does the taxpayer owe them anything?  If I choose not to take the bus to work, I don’t get to ask the government to buy me a car.  If I choose not to use a public swimming pool, I don’t get to ask the taxpayer to build me one.  If I choose to employ a security guard I don’t get to send the taxpayer a bill for the police time I am saving them.

Meanwhile our results in benchmark tests continue to slide.  Our rankings on international comparative tests have been dropping like a stone.  We now rank 14th (out of 32 OECD) countries behind Poland, Germany and Vietnam.  Worse, analysis of the numbers shows it is the private schools which are letting us down the most.

Usually when taxpayers subsidise something it is to gain a collective benefit.  We subsidise child care because the government wants parents to work.  We subsidise medical treatment because we want our population to be healthy and we subsidise local manufacturing because we want to keep those skills in Australia.  There is however no reasonable justification for the extraordinary public funding of private choices in Australian education.  It doesn’t save money, it doesn’t improve results, it divides our education system along class lines and it entrenches legally justified discrimination.

So, Minister, let’s not fret too much about who is on the ‘hit-list’ and who isn’t.  Let’s put them all on that list and get on with using that $12 billion a year to fix our education system.

Also published in The Courier Mail

Want to save the taxpayer $11 billion a year?  De-fund the ‘private’ school system.

Malcolm Turnbull is digging around in the back of the couch looking for loose change tax savings while the Australian taxpayer pours billions into our privately run education system.  If things are really that dire, perhaps it’s time to seriously contemplate the Sacred Cow (or is it Elephant?) standing in the middle of the room.

In 1963 (and for the century before that), the Australian taxpayer contributed nothing to private education. This was very intentional choice.  We had decided that the taxpayer funded, church run system we had before that was an inequitable, rolling disaster which educated only the rich and everyone else be buggered.

We thought that probably wasn’t a solid foundation for new egalitarian nation, so we purposefully decided to wrest control from the various churches and instead fund a high quality, public, secular, free education available to everybody.  You could opt out but that was a choice you made, and paid for, yourself.

Some people did opt out.  If you were Catholic (and listened to the Pope’s edicts on education) you sent your kids to a Catholic school.  You paid the freight yourself and hoped for generous donations from nuns who worked for room and board, the Church and congregations.   And if you were filthy rich you might also get your chequebook out and pony up to the high-end (usually protestant) equivalent.  But neither of you would be getting a penny from the taxpayer to assist you with your choice.

A very similar system operates today in the US, UK, New Zealand and well, pretty much everywhere else.  It is also the system we use for most other public services.  If I choose not to use public transport, I don’t get to have the taxpayer buy me a Porsche.  If I choose not to rely on the police for security, I don’t get to bill the taxpayer for a security guard.  And if I prefer not to use a public pool, I don’t get help to build my own.

But now in Australia things are very different.  Because of our designed-to-fail Federal-State funding system and constant pork-barreling by both sides of politics, the taxpayer has been steadily tipping more and more into the ‘private’ education sector.

Now the taxpayer pumps an eye-popping $11 billion a year into schools run by private entities (about 10 times what we spend running the ABC and about the same as we spend on unemployment and sickness benefits).  And that does not count the charitable tax breaks and exemptions most of them also enjoy.

Besides operating expenses, that money is splurged on private assets like swimming pools, libraries, computer labs and sports fields, the likes of which most public schools can only dream about.  And sometimes, as with the recent case of the Malek Fahd Islamic School, apparently not spent on education at all.

But there is something even worse than spending $11 billion a year buying other people swimming pools and hypoxic simulated altitude-training environments (that you’re not allowed to use).  And that is doing it while delivering a worse result than when you didn’t spend any money.

Consistent testing tells us a modern Australian student is performing at a level about a quarter of a year behind their 1964 peer.  And if that’s not bad enough, that same student is now more than two years behind the highest performing school systems in the world.  All Australian schools performed terribly in the latest round of international comparative tests. But our best private schools did even worse than everybody else. The rest of the world has rushed forward while we have drifted backwards.

Not only have taxpayers gained nothing for their extraordinary generosity, they have ended up with a system in deep trouble.  But we knew that would happen.  It’s one of the reasons we stopped doing it the first time around.

Defunding the private education sector is not something you could do next Tuesday afternoon, but it is something that could be easily implemented with appropriate notice.

It would not destroy the religious education sector and it would not overwhelm the public sector.  But it would slowly reverse the exodus of easy-to-teach kids, cost less, restore equity and likely improve everybody’s results.  How do I know?  Well, we’ve been there, done that and bought the T-Shirt, once already.

Also published in The Courier Mail

Photo by Thomas Hawk

Australia is sleep walking into a privatised education system that will deliver massive inequity, steadily declining results, and cost vastly more. Last week the Federal Treasurer gave us a giant shove further down that road. In deciding to remove $5 billion from the State Education budgets, he is telling the States (who run the government schools) to make do with less. The inevitable result of this will be to accelerate the rush to private education and ultimately, the destruction of our once great school education system.

According to the APC (Australian Productivity Commission) in 2012 Australian Taxpayers spent $8,546 per student per annum on educating children in non-government schools. And according to the ABS (Australian Bureau of Statistics) taxpayers spent $11,980 per child in government schools. Neither number includes capital expenditure, which was about the same per child in both systems. In other words, the average non-government school student costs the taxpayer 71 per cent of the average public school student.

And therein lies the core argument for boosters of private education in this country (unfortunately including our Education minister). You see, the argument goes, children at non-government schools are actually saving the taxpayer money. They are transferring the cost of their education from the community to their parents (and church congregations presumably). They are choosing to participate in a user-pay community. And even if it does only amount to a 29 per cent saving, they are doing us all a favour.

But those average numbers hide some pretty big gotcha’s for the public system. The government schools are overwhelmingly the ones providing education to Australia’s most remote students. They teach 7 times as many students classified by the ABS as living ‘very remotely’ and 4 times as many students classed as being ‘remote.’ When it comes to children with special needs, once again it is the Government schools doing the heavy lifting, educating 3.3 times as many children with a disability as their non-government brethren. Unlike public schools, non-government schools are exempt from the provisions of Australia’s discrimination laws. They are permitted by law to pick and choose who they will and will not be bothered trying to educate.

Educating the hard-and-expensive-to-teach students is undeniably a task that is increasingly falling to government schools but strangely it is in the non-government sector that the costs (to government) are exploding.  Over the decade prior to 2012, per student government recurrent spending on government schools increased by just 19 per cent. At the same time government funding for ‘private’ students increased by 28 per cent (both numbers after inflation).

That means that if current funding trends continue, it is inevitable that the taxpayer contribution to private schools overtakes the contribution to government schools. And that is notwithstanding that the Government schools are the ones educating the vast majority of the children with special needs, in remote locations or with behavioural difficulties.

The small and decreasing taxpayer ‘saving’ is the reward we have reaped for the decision to destroy the equity (and the achievements) of our education system. In the half century since Australian taxpayers started funding private education choices, our school education has been progressively failing.

Even though we now pay five times as much (after inflation) to educate a student, by the time that student reaches Year 9 they are 3 months behind where the same student was in 1964. And if that’s not bad enough, when we compare that same student to the world’s highest performing educators, we find they are more than two years behind. The leaders in education (a group that used to include us) have marched forward and we have slid slowly backwards.

Some people might be able to justify that destruction if the privatised part of the system was setting the world on fire. Unfortunately not even that is true. All Australian schools performed terribly in the latest round of international comparative tests. But our best private schools did even worse than everybody else.

And while (after adjusting for socio-economic disadvantage) all Australian schools performed equally badly overall, there were significantly less really high performing students in the nation’s private schools. There were no changes in the numbers at those levels in government schools. If private schools are supposed to cultivate the best and brightest, those results suggest they are failing dismally.

The privatisation of education, just like the privatisation of healthcare, results in islands of underperforming privilege amongst a sea of despair and it drags the whole system down. We have systematically created a school education system which performs worse for everyone (even the better off) than the system it replaces. That’s quite an achievement, but it is not irreversible. We can return to a high equity, high performance system. Unfortunately it appears the current Government is hell-bent on doing exactly the opposite.

Also published in The Courier Mail

Letters to the editor in response appear here.

Image courtesy of Stuart Miles / FreeDigitalPhotos.net

Tony Abbott’s hand-picked head of the Audit Commission, Tony Shepherd wants to end middle-class welfare but the Family Tax Benefits he’s targeting are just a sixth of the value of the annual subsidy paid to ‘private’ schools. In 1963 Australian taxpayers contributed less than a brass razoo to private education. Now we pay over $10 billion per year in recurrent funding. On top of that we taxpayers build fabulous facilities on private property (with capital funding) that very few of us have the right to access. It’s time the Audit Commission looked at the real middle class welfare, private schools.

Educating the children of prisoners (or guards) was not a priority in the early Australian colonies. And because it was charitable work, it was left to the churches to do with as they pleased.

As the population changed from largely prisoners to largely free colonists and the demands for education increased, the churches were able to negotiate significant government aid for their efforts. Unfortunately this resulted in a large amount of competition (and school choice) for easy to reach students in the cities and no education for everyone else.

In Australia, the market can deliver most things efficiently in the cities. But huge distances mean no profits to private providers and consequently no services for the rest of us. That particular ‘market failure’ is exactly why Australia found it necessary to have a state funded bank, a state funded telecommunications company and a state funded broadcaster.

Towards the end of the 19^th century, the Australian colonies solved this problem in schooling by withdrawing their funding from church run schools and investing in their own ‘state schools’. The aim was to provide a free education to every citizen no matter where they lived (or what brand of religion they favoured).

The Catholics opted out and decided to run their own schools (on a shoestring) and there were a few Anglican secondary schools who continued to rely exclusively on private fees. But for almost a century, Australian governments refused to fund private choices about school education. And for almost a century we had a high equity, secular education system which was the envy of the world.

It was mostly fear of an electoral backlash that kept the politicians at bay. But when Sir Robert Menzies won the 1963 election with a promise to fund science blocks in non-government schools, the can was open and the worms tasted freedom. There was no backlash. The electorate no longer cared.

There is no better way to target a marginal parliamentary seat than selectively distribute largess among school communities. School funding is the laser guided vote buyer. The pollies had entered pork barrel heaven. And Australia has incessantly increased funding to ‘private’ schools ever since.

But the annual funding is just the tip of the money-berg. In addition to the cool $10 billion the taxpayer forks out every year to run ‘private’ schools, we are buying Olympic swimming pools, cricket ovals that the ICC would envy, fabulously appointed gymnasiums, fantastic science facilities and computer labs to die for.

The total bill for all this extra taxpayer generosity between 2005 and 2010 was just a smidge under $5 billion (on top of the $10 billion a year in running costs).

Over the same time frame we invested about $10 billion in government school infrastructure. And while those ratios are roughly in line with the respective numbers of each, they don’t take account of the fact that after the money is funnelled through the state government bureaucracies, $1 buys you about 60c worth of building work in a state school.

In 1964, DOGS, (the Council for Defence of Government Schools) was formed to protest the decision by the Australian Government to fund private schools. Their campaign against ‘schools with pools’ goes on to this day.

A favourite publicity stunt of the early DOGS protests was to turn up to the pools their money had purchased and ask for a swim. They were swiftly given the bum’s rush. These are not like other tax payer funded gyms, pools and libraries. These gorgeous facilities are not open to the public (that would be you).

Taxpayer funds have been used to significantly improve the value of private property and provide educational facilities that no government school could ever afford. Yet ordinary taxpayers are not allowed anywhere near them.

So the next time you peer over the hedge of the local ‘private’ school at the new Olympic pool, remember this was built using (upper?) ‘middle class welfare’. The Audit Commission will ruthlessly target all manner of what it deems to be unnecessary government spending but I guarantee you it will coyly avert its gaze from the ‘private’ school elephant wallowing in the pool.

Also published in The Courier Mail

Image courtesy of markuso / FreeDigitalPhotos.net

Education is a very big line item in State and Federal Budgets. And, thanks to incessant demands for smaller classes, it is getting bigger at an astounding rate. But rather than address the obviously impaired state of our education system, the Government’s plan is to send you the bill.

In 2011-12 Australian governments spent a tad over $47 billion on running the country’s schools. But only three quarters of that went to government owned schools. The remaining $10 billion or so went to ‘private’ (catholic and independent) schools. Governments are not normally big fans of throwing public money at private choices. If I hire a security guard because the local coppers are not doing the job to my liking, a request for funding from the government will fall on deaf ears.

Joe Hockey may think the age of entitlement is over, but when it comes to funding private educational institutions it is anything but. The average Australian ‘private’ school kid costs the taxpayer about 60% as much as they would if were in the other kind of government school.

From the government’s perspective that’s a great thing. And it’s getting better all the time. Australians are stampeding from state run schools.  But the enormous growth in non-government schools has not been spread evenly. The average growth of the sector over the 15 years between 1998 and 2013 was 30%. But the number of students attending Islamic schools tripled and the schools aligned under the banner of the CSA (Christian Schools Australia) exploded to over 55,000 students in 2013.

The parents rushing out of the public sector are not choosing an Anglican Grammar school or even the local Catholic, they are choosing small, strongly faith based, low fee, suburban independents. Anyone would think we had all suddenly become devoutly religious, but the research suggests that couldn’t be further from the truth.

In 2008, the ISCA (Independent Schools Council of Australia) commissioned a study to get to the bottom of why parents chose a ‘private’ school. The answers were (in order) ‘educational excellence, good teachers, a supportive environment and good facilities.’ Religion barely scored a mention at all.

The flipside to that survey is of course that parents think they will not be getting those things from a public school. Massive increases in teacher numbers (because of reductions in class size) since the 1970s, combined with significantly greater employment choices for women has meant that the academic aptitude of the average teacher has steadily declined. Over the same timeframe, the unionisation of the teaching workforce has meant that should a teacher be hopeless, there is nothing anyone can do about it.

Independent schools have more flexibility when it comes to hiring and firing teaching staff. And they play off that in their marketing to parents worried about dud teachers.

The better facilities are paid for using a fair chunk of the fees that the parents are paying (since the government is still picking up most of the cost for the actual education).

Because such a large proportion of government education spending is diverted to fund private choices, the public schools become progressively more and more decrepit. And so the vicious cycle continues.

If you love the purity of markets, then I suspect you will be saying ‘so what?’ You might be thinking the push to ‘private’ education is a good thing. The problem is that in Australia we already know how this story ends. And it doesn’t end well.

In the middle of the 19^th century almost all our education was publicly funded but delivered by churches. The result was a massively unequal society. Some communities were significantly overserviced, with schools competing with each other for the best students and those students receiving the very best education available. Other communities had a choice of just one school and most of the population had no access to schooling at all.

The solution was to bring in free mandatory secular education for all and to immediately de-fund the ‘private’ sector. By the start of the 20^th century, Australia was a shining beacon to the world. It had a high equity, high performance education system which anyone and everybody could and did access.

But we are on the fast train to inequity again. And as the studies have predicted, the more the tide of equity sinks, the worse our education results as a nation become.

Running away from the public system is not the solution to Australia’s education woes. It simply drives wedges into cracks in Australian society and replays the disaster movie our education system has seen once before. Any government that encourages that as a solution is looking after its bottom line not your child’s future.

This post also appeared in the Sydney Morning Herald