Bills Digest No. 30  2000-01 States Grants (Primary and Secondary Education Assistance) Bill 2000


Numerical Index | Alphabetical Index

WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

CONTENTS

Passage History
Purpose
Background
Main Provisions
Concluding Comments
Endnotes
Contact Officer & Copyright Details

Passage History

States Grants (Primary and Secondary Education Assistance) Bill 2000

Date Introduced: 29 June 2000

House: House of Representatives

Portfolio: Education, Training and Youth Affairs

Commencement: 1 January 2001

Purpose

To provide Commonwealth assistance to the States and Territories for government and non-government schooling for the 2001-2004 quadrennium. It succeeds the States Grants (Primary and Secondary Education Assistance) Act 1996.

Background

History

A common claim is that, constitutionally, school education is a state responsibility. However, the Commonwealth Dept. of Education, Training and Youth Affairs describes school education as 'a shared responsibility, with the State, Territory and non-government school authorities having primary responsibility for funding.'(1) Commonwealth involvement in education has been allowed since the 1946 referendum amended Section 51 (xxiiiA) of the Constitution to give the Commonwealth power to make laws 'with respect to the provision of...benefits to students' in all States of Australia.(2) Supplementary funding to, and through, the States can also be made by Specific Purpose Payments under Section 96 of the Constitution 'whereby the parliament may grant financial assistance to any State on such terms and conditions as it sees fit'.(3) Specific Purpose Payments have been made since 1964 when the States Grants (Science Laboratories and Technical Training) Act was enacted, enabling capital grants to both government and non-government schools. Commonwealth recurrent grants to non-government schools followed in 1970 and to government schools in 1974. Commonwealth financial assistance now includes targeted assistance.

Since 1964, Commonwealth expenditure for schools has increased markedly with $4.8 billion the total contribution to government and non-government schools in 1999-2000.(4)

Basis of policy commitment

The Commonwealth Programmes for Schools Quadrennial Administrative Guidelines, approved by the Minister, state:

A fundamental principle underlying the Commonwealth's role in school education is to support the right of parents to choose the educational environment which best suits the needs of their child, whether the school of their choice is in the government or non-government sector. Choice in schooling leads to diversity which, in turn, allows freedom of expression, accommodates diverse beliefs and values, stimulates innovation and promotes greater accountability for schooling outcomes to parents and to the wider Australian community.(5)

The Bill continues to implement the Government's policy in schooling aimed at giving families 'greater choice in selecting which school best meets their children's needs'.(6) The Government's choice and equity policy was first implemented in the States Grants (Primary and Secondary Education Assistance) Act 1996. Firstly by the abolition of the New Schools Policy which lifted restrictions on the number of new non-government schools; and secondly by the introduction of the Enrolment Benchmark Adjustment (EBA) scheme which changed the formula for funding to government schools. These initiatives are widely interpreted as Government support of the non-government sector at the expense of government schools.(7)

The Bill implements a number of decisions made in the 1999-2000 budget. Specifically, it provides a new Socio-economic status (SES)-based model for funding to non-government schools. The Government describes the proposed SES model as 'needs-based funding for non-government schools'. 'To ensure that parents at all income levels have greater educational choice, the Government has decided that funding to non-government schools serving the neediest communities should be significantly increased.'(8) It is debateable how effectively the SES model will achieve this. Evidence presented to the Senate Employment, Workplace Relations, Small Business and Education Legislation Committee suggests that wealthier non-government schools will receive higher funding than poorer schools, including Catholic systemic schools.(9) Catholic systemic schools will not be funded by an SES rating but will have a system funding level which preserves their year 2000 funding categories. Such an agreement honours the Government's 1998 election commitment to the Catholic systems.

Current situation

The Bill succeeds the States Grants (Primary and Secondary Education Assistance) Act 1996 which provided Commonwealth funding for schools for the period 1996-2000. It authorises continuing Commonwealth funding for both government and non-government schooling for the 2001-2004 quadrennium. The financial assistance of $18 billion in final 1999 prices is provided in three forms-general recurrent grants, capital grants and grants for targeted programs. The majority of Commonwealth funding for schools comes under the ambit of the Bill which has a similar structure to the States Grants (Primary and Secondary Education Assistance) Act 1996. The main changes are:

  • Introduction of a Socio-economic (SES) funding model for non-government schools
  • Provision for year 2000 funding categories for Catholic systemic schools
  • Provision for funding maintenance for non-government schools disadvantaged by the move to the new SES model
  • Establishment grants for new non-government schools
  • Provision for non-government schools to receive recurrent funding for distance education students
  • Strengthened accountability and reporting arrangements which makes funding conditional on education authorities agreeing to report on student outcomes against performance indicators and targets, and
  • Changes to targeted programs aimed at improving accountability, permitting greater flexibility and improving outcomes for educationally disadvantaged students.

Non-government school funding

Since 1985, non-government schools have received Commonwealth General Recurrent Grants based on an assessment of need measured by the Education Resources Index (ERI). In 1998, 2,519 non-government schools, 1,555 of which were Catholic systemic schools, received Commonwealth funding based on their ERI level. In 1997, the Commonwealth Government conducted a review of the ERI. The subsequent consultation report considered that the ERI mechanism was flawed, that it failed to address relative need in an equitable way and, through its complexity, lacked transparency, predictability and flexibility. The report concluded:

Recognising that public funds are not unlimited, a funding system should ensure the economic distribution of available resources, encouraging private investment in education and discouraging the substitution of public for private funding.(10)

The ERI in effect discouraged non-government schools from generating their own funds by assessing a school's funding rate according to the level of funds raised.

The report recommended the investigation of alternative methods of funding, including a model based on the socio-economic status (SES) of a non-government school community. Subsequently a simulation exercise to test the validity and feasibility of an SES approach was conducted and published in 1998.(11) In the 1999 budget, the Minister for Education, Training and Youth Affairs, Dr Kemp announced the abolition of the ERI and the introduction of non-government school funding 'based on the Socio-economic Status (SES) of school communities.'(12)

The new SES funding model will assess need according to a measure of the SES of a school community. It intends to reflect the capacity of a school community to support its school. The process will involve collecting and linking students' home addresses with their Australian Bureau of Statistics Census Collection Districts, which typically comprise about 250 households. An SES index will then be applied to calculate an average SES score for each school community. The dimensions in the SES index will include occupation, education, and a broad household income measure. The lower the SES score of a school community the lower will be its capacity to support its school and the higher the contribution from government funds. All schools with an SES score of 85 or below will receive maximum Commonwealth funding for each of their students- 70 per cent of the Average Government School Recurrent Costs (AGSRC) which is 14 per cent higher than the current ERI maximum funding rate. Schools with SES scores 130 or above will receive a base entitlement grant for each of their students. The minimum entitlement is to be set at the current secondary non-government school rate of 13.7 per cent of the AGSRC index. This represents a 1.7 per cent increase in funding for the most privileged non-government primary school students.

The Government has given an assurance that no school will be financially disadvantaged by the move to the new funding system, consequently there will be a net increase in funding to all non-government schools. These increases will be phased in over the next quadrennium of Commonwealth funding for schools, 2001 to 2004. The assurance that no school will be financially disadvantaged by the move to the new funding system means that some schools, despite an SES score inviting reduced funding, will have their year 2000 per capita entitlements maintained in real terms. DETYA estimate that this assurance would cost $181.3m of the $561.3m additional funding required for non-government schools under the SES funding proposal.(13)

The proposed SES funding model, following abolition of the New Schools Policy and the introduction of the Enrolment Benchmark Adjustment Scheme, has further stimulated the questioning of the Commonwealth Government's commitment to the government school system. Critics of the Government's policies argue that there has been erosion of Commonwealth funding to government schools and an increase of funding to non-government schools. Analysis of the estimated total specific purpose payments to the states for schools through to the out-years of the forward estimates supports these claims.(14) DETYA has agreed that the percentage share of Commonwealth expenditure on government schools will decline from 43 per cent in 1996 to 35 per cent by 2004.(15)

In response, Dr Kemp's 1999 Budget media release stated that 'over the next four year funding period (quadrennium) Commonwealth spending on government schools will increase by almost $1 billion over the previous four year funding period'.(16) This amount refers to the compounded total increase in funding for government schools in the 2001 to 2004 quadrennium over the previous quadrennium. The spending increase includes supplementation for movements in the AGSRC, additional funding for new and existing targeted programs, and increases in per capita funding for shifts in enrolments. Dr Kemp further claims that 'Commonwealth payments to the States for government schools have risen 18 per cent in real terms since 1995-96'.(17)

Main Provisions

Part 1 of the Bill (clauses 1-10)

Clause 3 sets out a simplified outline of the Bill and subclause 3(3) states that payments may be authorised only for the purposes in Parts 5 to 14.

Part 1 provides definitions for the purposes of the Bill and for the Minister to be able to make determinations as to levels of education (clause 6) and to approve guidelines for the determination of an SES score. Guidelines approved by the Minister are disallowable instruments (subclause 7(2)).

Part 2 of the Bill (clauses 11-31)

General provisions relating to grants for government schools (clauses 12-17)

Major provisions include:

  • The Minister must not authorise grants to a State for government schools unless there is a Commonwealth/State agreement. The agreement must include a requirement that the State makes a commitment to the National Goals for Schooling and to achieving performance measures and targets as set out in regulations (Clause 12). An agreement will be subject to conditions relating to financial accountability and educational accountability.
  • States must report on expenditure annually to the Commonwealth. The Minister may require States to repay unspent funds (Clause 14).
  • States must report on progress towards achieving performance targets (Clause 15). Paragraphs 15(c) and (d) have more stringent requirements than under the existing States Grants (Primary and Secondary Education) Act 1996. In particular under the Bill the Commonwealth Minister can require reports addressing the requirements for performance information that is set out in the regulations. Under current arrangements the Commonwealth Minister and the State Minister agree to the kind of report and the matters that were to be reported on. Paragraph 15(e) provides that where a State fails to achieve a performance measure or target set out in the regulations, the Minister may ask the State to take specified action and report on the action taken.
  • Pursuant to clause 16 the Minister may determine that States repay amounts to the Commonwealth if States fail to fulfil certain conditions. These conditions include that the money is spent for the purposes determined by the Commonwealth Minister (paragraph 12(1)(c)), the conditions set out in clause 14 as to a certificate of compliance, and the conditions on accountability and reporting set out in clause 15.

General provisions relating to grants for non-government schools (clauses 18-25)

Major provisions include:

  • The Minister must not authorise grants to a State for a non-government body unless there is an agreement between the Commonwealth and relevant authority. The non-government school must be on the list of non-government schools (Clause 18).
  • The agreement must include a requirement that the relevant authority makes a commitment to the National Goals for Schooling and to achieving performance measures and targets as set out in regulations (Clause 19).
  • Relevant authorities must report on expenditure annually to the Commonwealth. (Clause 22).
  • Relevant authorities must report on progress towards achieving performance targets (Clause 23). Paragraphs 23 (c) and (d) are more stringent than in the States Grants (Primary and Secondary Schools) Act 1996 in that a report must address the requirements for performance information that will be set out in the regulations. The Minister can determine dates for when an authority must provide the report. Paragraph 23(d) enables the Minister to direct that where an approved authority fails to achieve a performance measure or target set out in the regulations, the Minister may ask the relevant authority to take specified action and report on the action taken.
  • The Minister may require a relevant authority to repay unspent funds if it does not fulfil a requirement set out in the agreement. (Clause 24).

The Department of Education, Training and Youth Affairs (DETYA) reports

The Government envisages that the performance measures and targets will be national measures and targets agreed by State and Commonwealth education ministers through MCEETYA. The measures to be used to report outcomes in a nationally comparable way would be those developed through the MCEETYA National Education Performance Monitoring Taskforce. ... The vehicle for national reporting on the outcomes of schooling will be the National Report on Schooling... It is envisaged that the requirement to report against the Year 3, Year 5 and Year 7 literacy and numeracy benchmarks would be included in the Act from the outset, via the regulations.(18)

Although the Bill envisages that the National Goals for Schooling are to be prepared by the Ministerial Council on Education, Employment, Training and Youth Affairs (MCEETYA) (paragraph 19(a)), performance measures, including performance targets are to be set out in the regulations as in force from time to time (paragraph 19(b)). This means these will be determined at the Commonwealth level.

Part 3 of the Bill (clauses 32-34)

Lists of non-government schools and approved school systems

Part 3 of the Bill deals with lists of non-government schools and approved school systems. Grants for non-government schools are conditional on schools being included in the appropriate list (Clause 32). The Minister is required under clause 33 to keep a list of non-government schools for which financial assistance may be provided under the Bill. There are substantial details set out in subclause 33(3) as to what is to be on the list for non-government schools. The details required are generally the same as those required under the current Act. The new additions include a school's SES level; approval for distance education and the name of a school's approved authority. The Minister is not required to publish all details contained on the list. However the Minister must, as soon as practicable after 1 July each year, publish in the Gazette the name of each school on the list, and the funding level of each school except Catholic systemic schools. (Subclause 33 (4))

Clause 34 requires that the Minister keep a list of approved school systems containing the name of each approved school system and the funding level of each approved Catholic school system. The list, including the name of each systemic school in each approved school system, must be published in the Gazette. Individual Catholic schools, but not their levels of funding, are gazetted, presumably because they receive Catholic systemic levels of funding.

Part 4 of the Bill (clauses 35-52)

Varying lists of non-government schools and approved school systems

Clauses 36 and 37 specify the reasons the list of non-government schools and approved school systems may be varied. Variation to the lists is to be by Ministerial determination, and there is no requirement that a variation is to be gazetted.

Change of funding level of non-government school

Clause 38 allows for a review of a school's funding level where the school considers its SES score has been incorrectly determined or circumstances have changed which affect the SES score, such as a significant new intake of students. An approved authority can apply to the Minister to vary the list to change the SES funding level. The Minister may determine a different funding level and make appropriate variations to the list of non-government schools. If the Minister is not satisfied that the SES funding level was not determined correctly, or there is not a significant change in the school's circumstances under subclause 38(3) then he or she must refuse the application. The Minister must give notice in writing of such a refusal.

Change of approved authority

Clauses 39 to 42 provide that a new body can apply to be approved as the approved authority for a non-systemic school. The application must set out details of the school or of the school system and of the new body, and it must state whether the new body agrees to fulfil obligations of the existing authority that have not yet been fulfilled.

Change in systemic status

Clause 43 provides that an authority of a non-systemic school can apply to become a member of an approved school system. Clause 44 enables a school to apply to cease being a member of an approved school system. In the former case, the authority must provide evidence to the Minister including that the authority agrees to fulfil the obligations that have not been fulfilled (paragraph 43(2)(d)). The Minister must not approve the proposal unless the agreement is varied to prove that the authority will fulfil the obligations (paragraph 43(4)(b)). Similar requirements apply when a school ceases to be a member of an approved system and in both cases the Minister must make appropriate variations to the list of non-government schools (subclause 43(5) and subclause 44(5)).

Changes to schools or education provided

In this Division of Part 4, an authority of a school can apply for variation of the list of non-government schools to take account of a location proposal or an new school proposal (subclauses 45 (1) and (3)). A location proposal relates to a change to the level of education at a location, or at another location or a change to the way distance education is provided. A new school proposal can arise from a school being formed as a result of amalgamation, or as a result of separation of schools into two or more schools, the establishment of a new school, or an existing school that is not already on the list of non-government schools. The Minister must be satisfied of the matters provided for in clause 47 before making a determination to vary the list.

Miscellaneous

In the event that the Minister does vary the list of non-government schools because of a school being formed by amalgamation, separation, being a new school, an existing school being added or a school ceasing to be a member of an approved Catholic school system, he or she must determine the school's SES funding level, and vary the list to include that funding level (subclauses 49 (1) and (2)).

Part 5 of the Bill (Clauses 53-54)

Grants for education at government schools

Clause 53 empowers the Minister to make recurrent grants to the States. Such grants must be no greater than the sum of the amounts calculated by multiplying the number of primary and the number of secondary government school students by the respective per student amounts. There is no specific reference to the Enrolment Benchmark Adjustment (EBA) in the Bill, however the words 'not more than' in Clause 53 enables the application of the EBA. Advocates of the abolition of the EBA recommend an amendment to Clause 53 to the effect that Commonwealth funding for government schools be equal to the amount prescribed by the funding formula.(19)

Clause 54 provides that the Minister can by determination, authorise payment of financial expenditure to the States for capital expenditure for a program year, of amounts totalling not more than the amounts set out in the Schedule 3 table. Currently the amount of $219.9m is earmarked for each of the years 2001-2004.

Part 6 of the Bill (Clauses 55-75)

Grants for non-government schools

Clauses 57-63 provide for grants for general recurrent expenditure to schools with SES funding levels. SES funding levels are worked out on a school by school basis (whether the school is in an approved school system or not). Clauses 59-61 and clauses 67-68 meet the Government's promise that the Bill guarantees financial security for all non-government schools, none of whom will be disadvantaged by the move to the new SES funding method. If the SES per student amount is more than the year 2000 per student amount, the higher funding will be phased in over the quadrennium at the rate of 25 per cent of the increase each year. If the SES per student amount is less than the year 2000 per student amount, the school is not disadvantaged. Such schools will be funded at year 2000 levels, with the year 2000 dollar rates adjusted annually in line with the latest Average Government School Recurrent Cost (AGSRC) figures. Clauses 62, 63, 69 and 70 introduce recurrent funding for distance education students receiving that education from non-government schools.

Approved Catholic school systems

Clause 72 provides for general recurrent grants for approved Catholic school systems in each State and Territory. Under clause 127, which takes effect from 1 January 2001, all Catholic systems (except in the ACT) will have a system funding level of 56.2 per cent of Average Government School Recurrent Cost (AGSRC). The ACT Catholic system will have a system funding level of 51.2 per cent of AGSRC. This essentially preserves their current funding categories in the year 2000. The separate treatment of the Catholic school systems relates to the 1998 agreement to recategorise all Catholic school systems to category 11 and the ACT Catholic system to category 10 under the current Education Resources Index (ERI).

Grants to provide establishment assistance

Clause 75 enables the Minister to make a determination authorising payment for a State to provide establishment assistance if the Minister has varied the list of non-government schools in relation to the school if it is a new school under paragraph 45(4)(c) of the Bill or if it is a new school that had applied for the variation after 11 May 1999 under the existing Act.

Part 7 of the Bill (Clauses 76-79)

Grants to provide strategic assistance to improve student outcomes

The aim of this Part is to provide funding to improve the learning outcomes of students who are educationally disadvantaged. This includes students with disabilities, Indigenous students, students of low socio-economic background, children with other than English background or geographically isolated students (clause 76).

Clause 77 enables the Minister by determination to authorise payments to a State for government schools and non-government schools to improve the learning outcomes of these students. The amount must not be more than the amount set out in Part 1 Schedule 8 Column 2 (namely 'grants for strategic assistance' which for the year 2001 is $267.3m).

Similarly, by way of determination, the Minister can authorise payment under clauses 78 and 79 by way of a formula which is the 'strategic assistance amount' set out in Part 2 of Schedule 8, columns 2 and 3 multiplied by the number of students with disabilities. The amount per student for government schools is $102, and for non-government schools is $522.

Part 8 of the Bill (clauses 80 -83)

Grants for education in country areas

Under this Part of the Bill the Minister may make determinations for payments for recurrent expenditure or for capital expenditure (approved by the Minister) for students at government and non-government schools in 'country areas of the State' (clauses 80-83). The amount specified for both categories of schools in column 3 of the table in Part 1 of Schedule 8 for each of the years 2001-2004 is $18.7m.

Part 9 of the Bill (clauses 84-85)

Grants to foster literacy and numeracy

Clause 84 establishes the purpose of this Part which is to help students acquire appropriate literacy or numeracy skills. These are students likely to be at risk of being ill-equipped for further education, training or employment on leaving school.

The Minister may approve a project to assist in the development of these skills, if that is the sole or principal purpose of the project, and the project is carried out in Australia (subclause 85(1)). The Minister can also by determination, authorise payment of financial assistance for expenditure on an approved project, and for publicity associated with the approved project (paragraphs 85(4)(a) and (b)). The amounts to be paid must not be more than the amounts set out in the table in column 4 in Part 1 of Schedule 8. These are $8m for the year 2001, $1.1m for the year 2002, $1.0m for the year 2003 and Nil for the year 2004.

Part 10 of the Bill (clauses 86-88)

Grants for special education at non-government centres

For the years 2001-2004 the Minister may authorise the payment of an amount of no more than $23.3m (Column 5 Schedule 8 Part 1) for the purpose of this Part. This will enable payment to be made to non-government centres which provide education, therapeutic and other essential services and capital facilities to improve the education of young people with disabilities. A centre is a non-government body that is not conducted for profit, and that is not a school.

Part 11 of the Bill (clauses 89-92)

Grants to foster the learning of languages other than English

For each of the years 2001-2004 the Minister may authorise the payment of an amount of no more than $18.2m (Column 6 Schedule 8 Part 1) for the purpose of this Part. This will enable payment to be made to government and non-government schools and centres to improve the learning outcomes of students learning languages other than English. The provision includes institutions that are not government schools that are conducted by or on behalf of the Government of a State (paragraph 90(2)(a) and (b).

Part 12 of the Bill (clauses 93-97)

Grants to foster the learning of Asian languages and studies of Asia

For the years 2001-2002 the Minister may authorise the payment of an amount of no more than $26.6m and $25.6m respectively (Column 7 Schedule 8 Part 1) for the purpose of this Part. There are nil payments for the years 2003 and 2004. The object of this Part of the Bill is to foster the learning of Asian languages and studies of Asia. The Minister can authorise payments to government and non-government schools under clauses 94 and 95 respectively. Clause 96 allows the Minister to approve a project if the sole or principal purpose of the project is to foster the learning of Asian languages or the study of Asia. The Minister may by determination authorise financial assistance for expenditure and advertising of an approved project. Publicising a project can be by disseminating information, conducting seminars in connection with the project or carrying out other related activities in connection with the project.

Part 13 of the Bill (clauses 98-100)

Grants for teaching English to new arrivals

The Minister may authorise payment of financial assistance to government and non-government schools under clauses 99 and 100 respectively. The amount authorised is calculated according to the formula of the English as a Second Language (ESL) new arrival amount ($3 547 in Schedule 8 Part 3) by the number of new arrivals in government or non-government schools. This amount has been allocated for each of the years 2001-2004. An 'eligible new arrival' is defined in clause 99 as a person whose first language is not English, and who satisfies criteria set by the Minister and to whom one or more of the following applies:

  1. the person is an Australian citizen
  2. the person holds a visa (other than a temporary visa) under the Migration Act 1958
  3. the person is included in a visa (other than a temporary visa)
  4. the person is not an Australian citizen, but has a permanent home in the Territories of Christmas Island or Cocos (Keeling) Islands
  5. the person satisfies criteria determined by the Minister for the purposes of the subparagraph. (subparagraph 99(3)(c)).

This would appear to be a narrow class of eligible persons to whom the provision would apply. The definition of newly arrived person is subject to criteria to be determined by the Minister and the Bill does not state that such criteria or determinations should be published. Further there are additional criteria that the Minister may determine which a person must satisfy, that do not appear to be related to or qualified by any rationale in the Bill. The second reading speech and the Explanatory Memorandum are silent on this aspect of the Bill.

Part 14 of the Bill (clause 101)

Grants for national projects

Clause 101 enables the Minister to approve a national project if the sole or principal purpose of the project is to provide support for strategic assistance, schools in country areas, special education at non-government centres and languages other than English. The sum of amounts authorised must not exceed 10 per cent of the amount available for the program year under each of the clauses listed in subclause 101 (1). An amount authorised to be paid under this clause is taken to be an amount to be paid to the State for the program year under the particular section that the grants were authorised.

Part 15 of the Bill (clauses 102-118)

Miscellaneous Amendments

Under this Part of the Bill various regulation making powers are prescribed as well as provisions as to accountability of the Minister, ministerial determinations, delegation of powers, and the reduction of payments in the event of false or misleading statements.

Division 1 of this Part provides that regulations can be made to alter the Schedules to replace amounts specified for the Average Government School Recurrent Costs for primary and secondary education (subclause 102(1)). The Minister must consider changes to the figures in the Average Government School Recurrent Costs that have been published by the Ministerial Council on Education, Employment, Training and Youth Affairs or other prescribed body, before any regulations can be made ((subclause 102(2)).

Division 2 enables regulations to be made to replace recurrent grants ((clause 105)) and capital grants for government and non-government schools ((clause 106)) by way of formula. Prior to the Governor-General making any regulations the Minister is required to take into account any changes to the Average Government School Costs figures, and, for capital grants, changes published by the Australian Statistician to building prices, and wage costs.

Division 3 clauses 107 -109 allows the Minister to determine which amounts and at what times financial assistance payments are made.

Division 4 subclause 110(1) provides that if a statement is made that is false or misleading in a material particular and relying on such a statement, a excess payment has been made the Minister can make a determination reducing any amount payable by the amount of the excess to the State or the non-government body as appropriate.

Subclause 110(2) provides that if as a result of a false or misleading statement a school obtains a higher funding level for recurrent expenditure than, in the Minister's opinion, it should have received, the Minister can by determination vary the list of non-government schools setting out a different funding level of the school. There is no requirement for the Minister to publish that variation in the Gazette.

Division 5 makes appropriation from the Consolidated Revenue Fund for the purposes of the Bill.

Division 6. Determinations and approvals made by the Minister under the Bill are to be in writing and take effect on the day stated or when made or given (clause 113). The Minister is able to vary or revoke such determinations. Provision is made for when variations take effect (Clause 114). Clause 115 enables the Minister to delegate all his or her powers or functions under the Bill or an agreement, to the Secretary of the Department, or an SES employee in the Department. The Minister is also required for each year to report to Parliament as soon as practicable after 30 June, which must show the financial assistance granted for recurrent expenditure and by way of capital grant (clause 116).

The transitional provisions in Part 16 of the Bill have the effect of deeming determinations, approvals, declarations and lists made under the existing Act to be such instruments for the purposes of the relevant provisions under this Bill.

Concluding Comments

The Bill is the primary legislation for Commonwealth funding of government and non-government schools. It appropriates an estimated $18 billion in final 1999 prices for the 2001-2004 quadrennium and introduces a new method of per capita funding of non-government schools. Although schedules 1-8 appropriate funds for the programs legislated in the Bill, the financial impact of the new funding model is not evident. In his second reading speech, the Minister states the Bill 'supports the devolution of decision-making about education to where it belongs, to parents and communities' but again this is not evident. Indeed a major concern raised by the Sates is the increased power of the Minister in the changed reporting and accountability provisions. The Bill has received broad support from the non-government school sector, but the States, Australian Labor Party, Australian Democrats, Australian Education Union (AEU) and Australian Council of State School Organisations have expressed opposition to, or concern over, the following issues.

Introduction of a Socio-economic (SES) funding model for non-government schools

The major change in the Bill is the method of funding non-government schools. The aim of the restructuring of the Commonwealth's recurrent funding of non-government schools is to implement a more equitable and adequately resourced system for those non-government school communities in need. However, because of the assurance that no school will be financially disadvantaged by the move to the new funding system, there will be a net increase in funding to all non-government schools. The SES model guarantees all non-government schools will receive at least a minimum payment of 13.7 per cent of Average Government Schools Recurrent Costs (AGSRC). Schedule 1 lists the AGSRC amount for 2001 as $4,674 for primary and $6,294 for secondary. As many of the wealthier schools are operating at levels of per student expenditure well above the AGSRC, it may prove more equitable to remove or reduce the minimum entitlement. Such an amendment would alleviate the inequity whereby the 62 ERI Category 1 schools comprising 5.6 per cent of all non-government schools would receive an extra $50 million by 2004, and then similar amounts annually.(20) This would almost double their existing ERI category 1 funding by providing about $800 more for each student. By comparison, the 1561 Catholic schools, comprising 65 per cent of non-government schools, would receive an extra $100 million, about $157 more for each student. Although precise figures will not be available until the school census, a DETYA consultant has acknowledged the figures are 'probably a good estimate'.(21) DETYA also estimate that the 6,970 government schools would receive $106.4 million, ($4,000 per school) over four years. This would seem to contradict the Minister's claim that

Under the new arrangements general recurrent funding will be distributed according to need and schools serving the neediest communities will receive the greatest financial support. This means that parents at all income levels will now have a realistic capacity to choose the most appropriate schooling for their child.(22)

The SES model, unlike the previous Education Resources Index (ERI), takes no account of a school's total financial resources. The SES model will allow schools to increase their resources without prejudicing their SES rating. In the Minister's words, the Bill 'will not discourage private investment in education and schools will be able to raise private income without penalty'.(23) If the aim is to create greater choice and attract students from low income families to formerly unaffordable non-government schools, wealthier schools may opt to lower their fees. Melbourne's Wesley College, predicted to gain $2.5 million a year from the new funding, has said it would reduce the $11,000 a year student fees by about $200.(24) However, much larger reductions would be needed to make the school more affordable. The AEU has proposed an amendment to the Bill that would 'ensure the SES model of funding takes account of school private income and maintains full financial disclosure'.(25) The Australian Democrats have indicated they would seek a similar amendment.(26)

Establishment grants for new non-government schools

Since the Commonwealth Government abolished the 'New Schools Policy' in 1996, the registration of new non-government schools is dependent upon State and Territory approval. New non-government schools no longer need Commonwealth registration to receive Commonwealth funding and their financial viability receives less scrutiny. The provision, in clauses 74 and 75, for emergency assistance and establishment assistance for new non-government schools may result in increased reliance on high levels of government support. The Minister, however, sees such support as enabling new schools 'to be competitive with existing schools'.(27)

Provision for non-government schools to receive recurrent funding for distance education students

The AEU is opposed to the introduction of recurrent funding for non-government distance education. It claims there is no evidence of such a need and the funding will result in wasteful duplication of services and undermine efficient government provision.(28)

Strengthened accountability and reporting arrangements which make funding conditional on education authorities agreeing to report on student outcomes against performance indicators and targets

For purposes of accountability, the Bill treats government and non-government schools the same. This is welcomed by the AEU, however the AEU 'has considerable reservations about the accountability regime which Dr. Kemp is seeking to impose'. State Governments are concerned at the widening of the Minister's powers in Clause 12 (3) and (4) relating to conditions of financial assistance.(29) The Victorian Government supports the emphasis on the National Goals for Schooling agreed by MCEETYA:

but is concerned that the Bill, in many of its provisions relating to accountability and reporting, does not adequately emphasise or support the spirit of national collaboration inherent in this forum. By conferring strengthened and significant unilateral powers on the Commonwealth Minister in relation to accountability and reporting, the Bill raises a number of important issues concerning the ongoing significance of MCEETYA and its process for future Commonwealth/State collaboration....The new Bill fails to recognise the States' educational responsibilities and, as such, is unacceptable. The Bill should reflect an appropriate regard and respect for MCEETYA as the agreed national process, but fails to do so.(30)

The Bill does not specify the required performance measures and targets or how they might be derived. Significantly, the Minister would be able to determine such measures and targets unilaterally through regulations. Clause 15(b) which requires a 'report or reports, of a kind or kinds required by the Minister' further emphasises the unilateral rather than the collaborative approach of the current Act. Further, the Bill does not specify the types of action required by States and authorities that do not meet performance targets. DETYA has identified such 'remedial' action might be:

  • Undertaking particular agreed interventions
  • Reviewing and evaluating strategies and reporting plans for improvement to the Commonwealth, and/or publishing improvement plans within a given time
  • Submitting to independent review, for example, of capacity to make improvements in literacy and numeracy standards
  • Providing to the Commonwealth and/or publishing disaggregated data to identify schools having problems.(31)

State governments propose amendments which include provisions for agreement on the setting of measures and targets through the MCEETYA process and the removal of the unilateral powers conferred on the Commonwealth Minister.

Changes to targeted programs aimed at improving accountability, permitting greater flexibility and improving outcomes for educationally disadvantaged students.

Parts 7-14 deal with provisions of grants to provide strategic assistance to improve student outcomes for educationally disadvantaged students in government and non-government schools. The Bill revises the structure of strategic assistance by combining existing literacy and numeracy grants with the special education fixed and per capita grants to form a new broadbanded program called Strategic Assistance for Improving Student Outcomes. DETYA supports the broadbanded structure, claiming it 'increases the focus on improving student outcomes, strengthens accountability arrangements as a condition of receiving Commonwealth funds and reduces the complexity of Commonwealth targeted programmes'.(32) Increased flexibility for education sectors to allocate funds comes with the requirement to report against agreed performance measures and targets with an emphasis on the outcomes, rather than the inputs, of targeted assistance. It is not transparent how this program will operate. The South Australian government points out that a 'clear distinction needs to be made between students with disabilities and students with learning difficulties'.(33) They are supported by Queensland, who recommend 'the literacy and numeracy grants to schools programs [and] the special education school support fixed grants and per capita grants be identified as separate programs.'(34) Queensland is further concerned by the changes in the wider definition of children with disabilities to include school age children with disabilities who do not attend school. 'The Bill may increase the cohort eligible for funding without any increases to the level of funding'.(35) In Schedule 8 Part 2, the Bill provides for an average special education per capita funding amount of $102 for Government schools and $522 for non-government schools. This reduces the existing grant for government secondary school students by $24, an example where the claim that 'no school will be worse off' does not stand.

Endnotes

  1. Australia. Dept of Education, Training and Youth Affairs. Annual Report 1997-98, p. 33.
  2. For a history of Commonwealth funding to schools see: Greg McIntosh, Commonwealth funding for schools, Background Paper no. 14 1994, Dept of Parliamentary Library.
  3. Catalogue of Specific Purpose Payments to the States and Territories 1996-97. Canberra: Dept. of Finance, 1997. p. 5
  4. Australia. Budget Paper No. 1 2000-01, p. 6-29.
  5. Commonwealth Programmes for Schools Quadrennial Administrative Guidelines, DETYA, 2000, Part 1.
  6. Dr. David Kemp. 'Major reform of non-government school funding' Media release, 11 May 1999.
  7. See for example: Clive Haggar, Branch President, Australian Education Union Canberra Times 7 February 2000; Executive Director of the Queensland Catholic Education Commission Courier Mail 5 February 2000; Canberra Times 1 April 2000.
  8. Dr. David Kemp. Choice and equity: funding arrangements for non-government schools 2001-2004, 11 May 1999.
  9. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. Professor Stephen Farish, Evidence to inquiry 23 August 2000.
  10. Australia. Dept of Employment, Education, Training, and Youth Affairs, Schools funding: consultation report, Canberra, 1997.
  11. Schools funding: SES Simulation Project report, DETYA, December 1998.
  12. Dr David Kemp 'Major reform of non-government school funding' Media release, 11 May 1999.
  13. Senate Estimates, Additional Information Received, Education, Training and Youth Affairs Portfolio, August 1999. Questions on notice. DETYA question E82.
  14. Australia, Budget paper no. 3, 1999-2000. p. 52.
  15. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. DETYA evidence 23 August 2000.
  16. Dr David Kemp, '$870 million more for education' Media release 11 May 1999.
  17. Dr David Kemp, The Age, 29 June 2000.
  18. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. DETYA submission to inquiry, p. 13.
  19. See for example: Senate Employment, Workplace Relations, Small Business and Education Legislation Committee, Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. New South Wales Dept. of Education and Training submission to inquiry, p. 9.
  20. The Hon. Michael Lee, Media Statement, 22 August 2000.
  21. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. Professor Stephen Farish, Evidence to inquiry 23 August 2000.
  22. Dr David Kemp, Second Reading Speech, p. 2.
  23. Dr David Kemp, Second Reading Speech, p. 2.
  24. Herald Sun, 24 August 2000.
  25. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. AEU submission to inquiry, p.6.
  26. Canberra Times, 23 August 2000.
  27. Dr David Kemp, Second Reading Speech, p. 2.
  28. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. AEU submission to inquiry, p. 8.
  29. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. NSW Dept of Education and Training, Submission to inquiry, p. 20.
  30. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. Victorian Government, Submission to inquiry, p. 2.
  31. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. DETYA submission to inquiry, p.14.
  32. Improving Student Outcomes: New Commonwealth Legislation for 2001-04. DETYA, p. 6.
  33. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. South Australia. Minister for Education, Children's Services and Training. Submission to inquiry.
  34. Senate Employment, Workplace Relations, Small Business and Education Legislation Committee. Inquiry into the States Grants (Primary and Secondary Education Assistance) Bill 2000. Queensland Government. Submission to inquiry, p. 7.
  35. Ibid.

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