Budget Review 2013–14 Index

Marilyn Harrington

The 2013–14 Budget’s estimates and projections for school education are premised on all state and territory governments signing the National Education Reform Agreement (NERA) which will implement the Government’s National Plan for School Improvement (NPSI) from 1 January 2014.[1]

The Australian Government’s additional NPSI contribution of $9.8 billion will be phased in over six years from 2013–14 to 2018–19.[2] The Budget shows most of this additional funding will be provided in the last two years of the implementation period—$2.8 billion (28.6%) of the additional funding will be provided from 2013–14 to 2016–17.[3]

The immediate impact of the additional NPSI funding on the forward estimates is therefore small. In 2013–14, the Australian Government will provide an estimated $13.8 billion for schools, of which $473.4 million (3.4%) will be additional NPSI funding.[4] This funding, which is from the Budget’s schools sub-function, does not include National Partnership (NP) funding for schools—an estimated $547.6 million in NP funding is included in the ‘School education–specific funding’ budget sub-function.[5]

Total expenses in the schools sub-function will grow by an estimated 8.5% in real terms from
2012–13 to 2013–14, and by 16.4% in real terms from 2013–14 to 2016–17.[6] However, this growth is not uniform as the following table shows:

Real growth in school education sub-function, % change^(a)

2013–14	8.5
2014–15	2.5
2015–16	6.4
2016–17	6.7
Percentage change 2013–14 to 2016–17	16.4

(a) Parliamentary Library estimates. Prices adjusted for inflation by the CPI to June 2013 prices. Index for June 2012 as published by the Australian Bureau of Statistics (ABS). Out-year index numbers calculated using Treasury estimates of CPI growth.

Sources: Australian Government, Budget strategy and outlook: budget paper no. 1: 2013–14; ABS, Consumer Price Index, Australia, March 2013, cat. no. 6401.0, ABS, Canberra, 2013.

The historic pattern of school expenditure will remain. The Australian Government will continue to provide the majority of its funding to non-government schools and state and territory governments will provide the majority of their funding to government schools. In 2013–14, the Australian Government will provide an estimated $4.9 billion (35.3% of funding in the schools sub-function) to government schools and an estimated $8.9 billion (64.7% of funding in the schools sub-function) to non-government schools. There is a slight shift in these proportions by 2016–17 when an estimated 37.8% of funding will be provided to government schools and an estimated 62.2% to non-government schools.

Government school expenditure is expected to grow by 10.0% in real terms from 2012–13 to
2013–14 and by 24.6% in real terms from 2013–14 to 2016–17. The 2013–14 Budget also estimates a 7.08% growth factor for government school funding under the current funding arrangements (comprising growth in average government schools recurrent costs (AGSRC) and enrolments), which is more than the 2012–13 budget estimate of 6.63 %.[7] Without the Government’s projections for AGSRC, it is difficult to account for this increase. However, it may be the case that the increase is due to enrolments. The Budget’s government school enrolment projections for 2013 show a small increase of 1.4%.[8] This is supported by Australian Bureau of Statistics resident population estimates that also show that the 0–4 age group, which is the cohort now entering school, grew by an estimated 2.2 per cent from 2007 to 2011.[9]

The growth in non-government school expenditure is expected to be 7.9% in real terms from 2012–13 to 2013–14 and 11.8% in real terms from 2013–14 to 2016–17. Overall, non-government school expenditure is ranked ninth, above higher education expenditure, in the Budget’s list of top 20 programs by expenses in 2013–14.

See also the Budget Review article, ‘School education: the National Plan for School Improvement’.

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