Here is an example of the unfairness in the funding of private schools in Australia. Blessed Sacrament School is a private primary school in the Sydney suburb of Mosman. The families of the students of Blessed Sacrament have the equal highest SES score (soci0-economic status) of any school in Australia. Blessed Sacrament shares that title with its near neighbour The Mosman Church of England Preparatory School. Both schools have an SES score of 135.
If Blessed Sacrament was like most other private schools in Australia then it would receive annual funding from the Federal Government that is based on its SES score. It would then receive $1330 per student per year. But instead Blessed Sacrament receives $5450 per student per year because it is one of the schools that has a special deal with the Federal Government.
Armadale Christian College, a private school in the Perth suburb of Bedfordale, is not part of the special deal for some private schools. It has an SES score of 97 and consequently it receives annual federal funding of $5,334 per primary school student. The SES scores of private schools are similar to IQ scores in the sense that 100 is the average, 130 is very high and 80 is very low.
The funding of these three real schools, two in Mosman and one in Armadale, demonstrates the inherent unfairness of the current system for funding private schools. Among the 2720 private schools in Australia, the school with the equal highest SES score in Australia receives more federal funding per student than a school with a lower than average SES score.
Now consider the two schools in Mosman. Because the Mosman Prepatory School is not part of the special deal that some schools have with the Federal Government it receives $1330 per student, which is $4,000 per year less than Blessed Sacrament — a school in the same suburb with the same SES score.
The special deal that some private schools have with the Federal Government is called ‘maintained funding’. There are 1075 private schools that have maintained funding status versus 1646 schools that receive SES based funding. In 2011 the maintained funding schools received $615 million of extra funding because of their special funding status. Most of that extra money goes to schools with an SES score of more than 110.
The fact that this inequity is not widely known shows how poorly organised the 1646 SES funding schools are in their lobbying of the federal government and also how politically connected the 1075 maintained funding schools are. The funding of private schools by state governments is only a fraction of the federal funding, but it does not exhibit the unfairness of maintaining funding.
Compared to the billions that are doled out to farmers, manufacturers and others by the Federal Government in special deals the extra $615 million for the maintained funding class of schools might not seem so bad. But it is a lot of money and it is does represent a fundamental inequity in the system. The special deal, which gives a school with an SES score of 135 more federal funding than a school with an SES of 97, makes the funding system regressive.
The Gonski Inquiry into school funding recognised that the current arrangement for funding private schools are fundamentally unfair. Recommendation 4 of the final reports states that “From 2014, non-government schools should be funded by the Australian Government on the basis of a common measure of need that is applied fairly and consistently to all.”
Unfortunately, Prime Minister Gillard has now promised that the funding of every school will increase every year. That promise makes it very expensive to eliminate the existing inequity in current school funding arrangements. The special deal cannot be eliminated by decreasing the funding of some schools and increasing the funding of others. All schools have to be better off. Equity can only be achieved by bringing all schools into the special deal, and that will be expensive.
Consider the two schools in Mosman again. If the funding of Blessed Sacrament cannot go down, then funding of Mosman Prepatory must go up by $4,000 per student per year to put the two schools on an equal footing.
Because the Government has promised to increase funding for all schools but has not promised to eliminate the unfairness in the system, we should expect that the annually increasing funding promise will be kept, but that the elimination of unfairness will not happen. There will instead be some policy fudge that involves a continued special deal for a select group of private schools.