Labor and Australian Democrats Report
PREAMBLE
Education, particularly the education of
our children, is the keystone of the structure that makes up Australian
society. How schools are funded, and the values that are reflected in the
policies and rhetoric surrounding schooling, provide the background against
which school education takes place. The young people of Australia grow into adulthood in a world
crucially shaped not only by their parents, but by the education they receive
at school and the social and ideological context in which this is
embedded.
Therefore government policies on school education shape in a
fundamental way the perceptions of young people, and their families, about
their future and their place in Australian society. Through the way we value
principles of excellence, equality and fairness in the provision of education
we create the basis for young people's understanding of their society and their
nation. From the point of view of Opposition and Australian Democrat senators,
it is the centrality of education in the acculturation of young people that
underlies this Inquiry and informs this minority report.
Labor, supported by the Australian Democrats, is committed
to providing additional funding to needy non-government schools. However, this
should be balanced by commensurate increases for government schools. The
Government's new SES model, moreover, provides the most substantial increases
to the wealthiest non-government schools.
The central place of education in society should be
reflected in a policy approach that is inclusive, even-handed and, most
importantly, equitable. In a multicultural society, there must be
acknowledgement of the desires of many families to educate their children in
schools sensitive to their religious and cultural needs. Government schooling
aims to be universal in terms of values. However, Catholic, other Christian
denominational, Jewish, Islamic and other schools are now part of the fabric of
our education system, and in some cases have long been so. For many years in
the latter half of the twentieth century the destructive ‘State Aid’ debate
divided the Australian community. Based on religious intolerance and
sectarianism, this controversy dominated many aspects of discussion and thinking
about school education, crowding out other, more constructive and creative
contributions.
The settlement reached following the Karmel Report in the
mid-seventies constituted a major step forward. It showed the growing maturity
of Australian society and our increased willingness to treat equitably
Australians of all backgrounds and creeds. It was a crucial post on the road
to multiculturalism. That settlement, that consensus, is now at risk.
The Government's proposed new funding system for
non-government schools has divided the community in a way unseen since those
pre-Karmel days. It is more than a major change to a funding formula: the
planned system transforms the very basis on which funding is made available to
the non-government sector, and is directly relevant to the quantum of funds to
be available to government schools. This Senate inquiry provides the
opportunity to review the Government's plan as set out in this bill.
Labor recognises that the bill must pass through Parliament.
The form in which it is passed, however, is a matter for the Senate to decide.
The Government's majority report
In introducing fundamental changes of this moment, it might
be expected that the Government would provide cogent argument, well supported
by accurate information. In fact, the majority report of the Committee is
characterised by factual errors and logical non sequitur.
The first is the matter of consultation with the states. As
the state officials appearing before the Committee have made clear,
consultation on the detail of the Government's proposals was effectively
limited to a single briefing session, lasting no more than two hours, with each
state government. Prior to these meetings, the Government's discussions were
principally with representatives of non-government systems. The Government's
claim that extensive consultation took place with the states is denied by at
least four state governments.
The Government has claimed repeatedly that it has
substantially increased funding for government schools. This is untrue. In
quoting figures on its funding increases for the government sector, the
Government invariably omits to mention that the amounts provided are not
adjusted for inflation: they represent raw figures only and should be deflated
in order to be meaningful. In fact, when adjusted for indexation and for
enrolment growth, even the current bill does not provide more than an average
$4,000 per school. Conversely, the Government argues that the high-fee elite
schools currently located in Categories 1-3 have not had any Commonwealth
funding increases for the last fifteen years. However, these schools have
received grants adjusted for enrolments and indexed by means of the generous
AGSRC (Average Government School Recurrent Costs) index. The ‘increases’, when
afforded to government schools, count for the Government as ‘increases’. while
similar adjustments made to non-government school funds are ‘no increases’.
This is at best disingenuous.
The Government also claims that there is ‘little evidence of
disagreement’ about the proposed SES model. This is entirely false. The
Committee heard evidence, and received submissions, from several major
stakeholders in school education, and from the majority of state governments,
expressing serious misgivings and concerns about the model. The comments of
the representative of the National Catholic Education Commission are noted
later in this Report.
Other claims on the part of the Government on the impact and
effect of the SES model are similarly inaccurate and misleading. For example,
the Government [Government report 2.10] claims that the SES model was first
developed in 1973. The model as contained in the bill varies in statistically
significant ways from its predecessors used to identify educational disadvantage.
Indeed, the Government rejected the suggestion that the model used in
connection with the Commonwealth's former Disadvantaged Schools Program be used
for the new system, on the basis that it was unsuitable.
The Government misleads once again when it says [Report
2.14] that the elite schools will receive only 13.7 per cent of AGSRC.
Currently, 61 schools receive this minimum amount: under the planned SES
system, only seven will have their grants limited to this extent. In all, the
wealthiest 61 private schools will enjoy a windfall gain of over $56 million
per annum.+
Most striking, however, is the Government statement that the
Committee ‘received no evidence that the SES model gives disproportionate
benefit to so-called “wealthy” schools’. The Committee, on the contrary,
received much evidence along these lines. This evidence is summarised in
Chapter 1 of this minority report.
Outcomes for individual schools and the Government's intentions
Debate over this bill has been hindered by the Government's
refusal to provide detailed information about the effects of the new SES system
on funding levels for individual schools. The Opposition has repeatedly
requested that this information - initially the results of the 1998 simulation
study and later the actual allocations for 2001 - be provided to inform
Parliament in its consideration of the bill. This reluctance on the part of
the Government has delayed the finalisation of this report: it has also
suggested that the Government expected the results to be controversial.
In fact, in the view of the Opposition and the Australian
Democrats, the Government's objective in imposing this particular funding model
is to ‘redress’ what it regards as a funding imbalance between the low-fee,
resource-poor non-government schools, on the one hand, and elite, high-fee
schools on the other. This model was created deliberately to change the
balance of funding between these two kinds of schools, and thus in general
terms to reverse the policy priorities of the previous Government with regard
to non-government school funding. A further aim is to alter the relativities
in the funding quantum applying to each sector - in favour of non-government
schools. Thus the bill provides for substantial increases in funds flowing to
the non-government sector, but it also shifts the balance of funding within
that sector.
The result is not simply a reclassification of the
wealthiest schools, rendering them eligible to substantial additional funding,
but also a comparative redistribution in levels of Commonwealth support among
non-government schools. It is this shift that has had the regrettable effect
of reigniting resentments within the private-school sector. At the same time,
the Government's plan has inflamed the dormant State Aid debate, on the funding
by government of non-government schools. The consensus that has existed for
over 25 years has evaporated. This bill is unfair, unjust and divisive. Of all
that will flow from the Government's 2000 Schools Funding Bill, this is
possibly the most damaging outcome of all.
Chapter 1 - The SES Model
1.1
The Government claims that the SES funding index
provides ‘ a more equitable way of distributing recurrent funding’ [MINCO,
quoted p.5 of Govt Report], and that the SES system meets the criteria it has
determined as essential to any future funding system: equity, transparency,
simplicity, flexibility and cost. The new model fails on all of these counts.
It is clearly inequitable in that it leads to disproportionate and
overly-generous increases in funding to elite schools; it is unpredictable
because it increases, or fails to increase, a school's funding without apparent
regard to the actual needs and circumstances of the school. The SES model is
exceedingly complex, rather than simple, and establishes 65 separate funding
levels and three bases on which funding will be allocated. It excludes 65 per
cent of non-government schools in Catholic systemic schools. Finally, the
model fails on the criterion of cost due to the absence of an approach based on
proper planning of provision and due also to the fact that very substantial
increases are handed to the wealthiest schools Thus the model fails on the
Government's own stated criteria.
1.2
The SES funding model purports to assess the
needs of a school according to a measure of the socio-economic status of
parents rather than of the school’s income from private sources, as currently
measured by the ERI (Education Resource Index) method. What is purportedly
assessed, therefore, is the relative capacity of non-government school
communities to support their schools financially, without any account taken of
the accumulated value of the school’s resources, including its financial
reserves and endowments. Opposition senators accept, in some measure, the view
expressed in the majority report that changes and accretions to the ERI model
over a number of years have blunted the original intention of the ERI as a
school resource measure. What they do not accept is the view that the ERI model
is fundamentally unsound or incapable of reform. Nor do they accept that the
Government's SES model, as presented, is a perfect measure of need; or that
schools' income, particularly when that income is very high, should be totally
excluded from judgments about appropriate levels of Commonwealth funding.
Furthermore, the SES model proposed by the Government is based on a Simulation
Study and a validation study (carried out in 1998) that are problematic in a
methodological sense; and it leads to outcomes for individual schools that are deeply
inequitable.
1.3
Over 90 per cent of non-government schools
participated in the 1998 simulation project on an SES model. As noted below,
the ambiguous attitude of the Catholic systemic schools to the SES model casts
doubt upon its validity. Technical issues have been raised by the Committee in
a number of submissions. It is clear that the SES model has been adopted mainly
for the purpose of validating a policy of ensuring increased levels of funding
to former Category 1 schools, whose previous funding levels were set at modest
levels, and maintained in real terms, over a number of years.
Reservations of state governments
1.4
Doubts about the fairness and validity of the
SES funding system comes from state education departments.
1.5
In its submission, the New South Wales
Department of Education and Training listed a number of technical problems
inherent in the funding model chosen by the Government. The claim was made that
the bill’s proposal to fund non-government schools on an SES index alone,
without regard to a school’s resource capacity, was itself flawed. In summary,
the key problems identified were:
- The Commonwealth’s SES index does not measure
the actual relative SES of each student in a school. Instead it ascribes an SES
standing to each student on the basis of the average SES score of the Census
Collector District (CCD) of the student’s address. It is likely that families
in low SES areas able to select non-government schools (particularly those with
high fees) are more advantaged than others in their immediate community;
therefore the SES scores will be a distortion of the real relativities.
- While Census Collection Districts cover a
relatively small number of households, they may still cut across a range of
comparative SES levels. This is particularly the case in sparsely populated
rural areas where Collection Districts are relatively large. In such districts
it is not unlikely that a relatively affluent individual will draw a
substantially higher level of government funding to a well resourced school on
the basis of the low socio-economic status of other people in their district
who could not themselves afford the fees at such a school.
- The Commonwealth’s SES index does not allocate
money based on actual need, but merely distributes a large proportion of all available
Commonwealth government funds among non-government schools. Need is not
measured against the whole community, but only relative to other students in
non-government schools. Thus the model does not provide an adequate measure of
community needs.
- The SES approach provides a range of incentives
for non-government schools to pursue practices designed to maximise a school’s
funding, but which are not in the interests of achieving a balance of quality
school provision across the community.
1.6
The Queensland Education Department saw a
problem arising from the fact that ABS Collection Districts which have large
proportions of households with similar measured characteristics will tend to
have the lowest or highest scores. By contrast, areas with mid-range index
values tend to contain a broader mix of individuals and households. A false
assumption was perhaps being made that non-government schools attract students
from all SES groups within a collector district, and therefore distortion is
likely through high SES families sending their children to non-government
schools and lower SES families sending their children to government schools or
some categories of non-government schools.[1]
1.7
A detailed technical analysis of the SES funding
model was included in the submission from the Victorian Department of
Education. In the view of the Victorian Minister for Education, there is not
yet sufficient evidence to demonstrate that the SES model is, as is claimed of
it, a fair and equitable needs-based system for determining recurrent funding.
The new model does not take into account any measure of absolute SES and takes
no account of school community assets. It assesses only relative SES. The
result of this is that the SES scores obtained for non-government schools may
or may not be representative of an overall perspective on the SES of school
communities; and the use of an Index has intentionally produced fine
distinctions between schools where these may not reflect reality. As the
submission explains:
In real terms, and because of the relative nature of the scale
(it orders schools from lowest to highest), it is impossible to determine
whether such fine distinctions are warranted or to quantify what a single point
change in score means. For example, a school with an SES score of130 does not
have twice the SES status of a school with an SES status of 65. Similarly, the
socio-economic difference between two schools with SES scores of 90 and 100 is
not necessarily the same as the differences between two schools with SES scores
of 120 and 130. The use of the generous single point funding continuum (linear)
is therefore quite arbitrary and questionable as are the actual cut-off scores
for funding eligibility (85 and 130). In this respect it is particularly
difficult to determine whether or not it can reasonably be established that an
SES Index of 96 is broadly equivalent to ERI category 11 (as has been proposed
for Catholic systemic schools). A broader category approach, as employed by the
ERI may be more appropriate...[2]
1.8
The view is expressed that the application of
the SES model may result in substantial anomalies in funding within the
non-government sector. Documents produced to the Senate by the Minister confirm
the advice in the Victorian government submission.
1.9
The Northern Territory Department of Education,
having stated its view that the SES model is an improvement on the ERI, then
expresses in its submission some concerns about SES methods. One concern is
that the cut-off at 70 per cent of AGSRC and at the score of 85 will result in
some schools in particular ABS collector districts being under resourced. More
than 27 per cent of Northern Territory collector district schools have a score of less than 85, compared
with less than 12 per cent nationally. The submission argues that if the SES is
an appropriate measure of disadvantage then the full range of scores should be
used to compensate disadvantaged students. As it stands, it is not clear why
there is a cut-off point at 70 per cent, unless it is an arbitrary spending
limit.[3]
Opposition and Australian Democrat senators note the similarities in concerns
expressed by such different jurisdictions as Victoria and the Northern Territory, and express the view that similar concerns exist across the
country.
1.10
The view of the Northern Territory Education
Department is also close to that of the National Catholic Education Commission
(outlined in next section) in regard to the desirability of using more than one
measure (that is, SES) to assess the needs of schools. The Department was not
convinced by DETYA’s assertion that the Index of Relative Socioeconomic
Disadvantage (IRSED), used for the Literacy and Numeracy program, was an
inappropriate measure of relativities because it did not effectively measure
relativities at the upper end of the SES spectrum. The attitude of the NTDE is
probably understandable in view of its distance from cities where high-fee
schools flourish. The NTDE submission also recommended that the Index of
Educational Resources (IER) should be used for the purpose of measuring the
relative economic resources amongst areas, an appropriate measure for funding
schools according to need.
There have been several trial indexes made in the SES simulation
project and all the dimensions of education, occupation and income in the indexes
were treated as having equal weighting. ...Whether this arrangement is
statistically sound should be tested. The Committee may wish to consider
whether the Index of Relative Socio-economic Disadvantage (IRSED) is a better
measure for this purpose.[4]
Catholic systems
1.11
A number of serious issues arise in connection
with Catholic schools and systems. The first set of concerns goes to the role
of the substantial national Catholic system in the simulation study that
preceded the final formulation of the SES model, and the subsequent decision to
effectively exclude Catholic systemic schools from the SES system
1.12
Since Catholic schools make up 65 per cent of
all non-government schools, their participation in the simulation exercise,
coupled with their withdrawal from the funding system on which the simulation
was based, casts a shadow over the reliability of the simulation as an accurate
predictor of the SES model that eventuated. Doubts about the accuracy of the
simulation study in predicting final outcomes for individual schools have been
vindicated by the actual results, which in some crucial groupings of schools
vary in the amounts to be allocated: see Section XX below.
1.13
The position of the National Catholic Education
Commission (NCEC) in relation to the SES model of funding is especially
interesting. Aware of the likelihood of the introduction of SES for the 2001-04
quadrennium, the NCEC negotiated with the Government an arrangement which would
maintain current funding levels. Although Catholic schools participated in the
pilot study referred to, aimed at laying the basis for SES funding, they later
opted not to participate in the scheme.
1.14
As the submission from the Victorian Department
of Education, Employment and Training pointed out, the allocation of Catholic
systemic schools to a single SES score of 96 (broadly equivalent to ERI 11) has
important and serious implications for the validity and relevance of the SES
model. Its development was based on 2 262 participating non-government schools,
over two thirds of whom were Catholic systemic schools.[5]
1.15
While the NCEC submission made clear its support
for the passage of the bill, its own position in relation to SES was made
equally clear.
In extensive consultation with the Commonwealth on the mechanism
for determining funding arrangements for Catholic school systems, prior to the
finalisation of this legislation, The NCEC argued consistently that a
combination of measures of need should be used. These include recurrent and
capital resources, geographic spread, the necessity to provide a wide range of
central services, the socio-economic status of the populations served by the
schools, and the need to make reasonable provision for the establishment of new
schools in areas of need and demand.[6]
1.16
A representative of the NCEC reiterated this
position to the Committee on the first day of its public hearings, stating that
the SES model is not itself sufficient to assess the relative needs of schools,
and that it needed modification.[7]
This position had the support of the Independent Education Union of Australia,
representing teachers in Catholic schools.
Our position is, rather, as Father Doyle put it this morning:
that there be some mixed index which relies on some of the improvements that I
think an SES model brings, but with some incorporation of other indices for a
more composite model. I would point to the fact that our union supports the
mechanism used by the Victorian Catholic Education Commission to distribute
both state and federal grants across its schools. That was an SES measure
largely, I believe, used by DETYA in its modelling. It was the one place where
there had been some evidence of its operation. But, as I understand it, it does
not operate as a pure SES model. As was explained this morning, matters of
rurality, Aboriginality and the rest of it are added into it, as well as size,
disabilities and the like. We support that approach. Our position is not that
the Commonwealth should not have engaged in the inquiry that it did or should
not have brought SES measures to bear; we are saying that they are
insufficient.[8]
1.17
On the other hand, the NCEC has always placed a
high value on its operational independence and on its ability to make its own
systemic financial adjustments based on the relative needs of Catholic schools.
Thus it sought, successfully, an effective exemption from the SES system,
preferring the negotiating of a block grant that would provide it with
additional funds but retain its administrative autonomy from the Commonwealth.
1.18
In fact, the NCEC considers that it would most
likely have been better served by the retention of the current ERI system (with
indexation), or, better still, the application of the SES index to each of its
schools individually:
I think the maintenance of the ERI system, plus the continuing
betterment factor, would have been...somewhat to our advantage. In terms of the
pure SES aggregation, that would have been to our greater advantage[9]
1.19
However, by the end of the next funding period
(2004), the ERI model would again have proved most advantageous:
If the new funding quadrennium period had been on the ERI plus
betterment, we would have been advantaged at the end of the quadrennium funding
compared to a pure SES model aggregated for Catholic schools[10]...
1.20
However, it seems that a large number of schools
currently outside the Catholic systems have sought to join them in the light of
the funding these systems are to receive under the new arrangements. These
schools would presumably benefit financially from the classification of the
Catholic systems - except for that of the ACT - at the relatively generous
level equivalent to the ‘old’ Category 10:
Senator Allison - There has been a suggestion made that the SES
legislation will, in fact, bring a number of independent Catholic schools into
the system. Is that your expectation? How many of them are out there to be
brought into the fold, as it were?
Rev Doyle - I think there are...about 70.[11]
1.21
Finally there is the question of the quantum of
funding itself that the NCEC will receive under its revised funding
arrangements. It appears that the Catholic systems collectively will receive
in round figures $100 million per annum in extra funds. This was confirmed by Rev. Doyle in the
Committee hearing of 22 August 2000:
Senator Carr - My advice was that it was $100 million. Is the
broad figure that you have been given consistent with that figure?
Rev Doyle - Yes.[12]
1.22
This increase in funding, unlike the increases
applying to schools subject to the SES system, will not be phased in over four
years: instead it will be provided in full from 2001. However, the extra funds
available per capita to Catholic systemic schools will be on average $157 per
student. This compares very unfavourably with the growth in per capita funds
for most elite non-government schools, which will reach almost $1000. This
raises the issue of equity and fairness: this is discussed in the next section.
The SES model and elite, high-fee schools
1.23
On three occasions the Senate ordered the return
of documents detailing the effects of the proposed SES system on individual
schools. The Government refused to provide this data from the 1998 simulation
study, and finally complied with the third Return to Order motion on Tuesday, 3 October 2000. This belated response
has hindered the Committee in finalising its Report.
1.24
The Committee learned from these documents that
the earlier estimates of grant increases to high-fee schools, made by
Opposition senators and members on the basis of averaged data supplied in the
simulation study report, often fell short of the real amounts that will be paid
to these schools. Representatives of independent schools associations appearing
before the Committee had suggested that the early estimates were overstated.
However, the final outcomes for elite Category 1 schools of applying the SES
formula to their enrolments produced resulting funding increases that were
unexpectedly high. It appeared that a large number of wealthy non-government
schools - those normally regarded as socially and academically elite schools -
were to receive funding increases of up to $2,000 per secondary student, and a
little under that amount per primary student. Since many of these schools have
high enrolments, particularly at secondary level, this led to substantial
dollar increases for many of these schools in a year of full funding (2004).
1.25
For example, the following twelve high fee
non-government schools would share an additional $27 million between them:
Trinity Grammar School, Sydney |
$3.1 million |
Newington College, Sydney |
$1.8 million |
The King's School, Parramatta |
$1.5 million |
Wesley College, Melbourne |
$3.9 million |
Caufield Grammar School, Melbourne |
$3.6 million |
Haileybury College, Melbourne |
$2.9 million |
Ivanhoe Grammar, Melbourne |
$2.4 million |
Geelong College |
$2.3 million |
Geelong Grammar School |
$1.7 million |
Mentone Grammar School, Melbourne |
$1.6 million |
Scotch College, Melbourne |
$1.0 million |
St Peter's College, Adelaide |
$1.5million |
1.26
In the case of Geelong College, for
instance, its $2.3 million results from its additional $2 039 per student
(average). This is in dramatic contrast to most low-fee non-government schools
where increases amount to as little as $7 per student. Altogether, the 61 most
highly-endowed, high-fee Category 1 schools in the country will receive an
extra $56 million.
1.27
Some results of the new allocative mechanism are
particularly unexpected. An example is the positioning of the elite and
exclusive Geelong Grammar School: this school charges annual
tuition fees of $11,360 and boarders' fees of $20,000. It boasts facilities
including an equestrian centre, a country campus at Mt Timbertop, a
newly-opened Arts and Ceramics Centre and a completely refurbished and recently
expanded Technology Centre. The school is completely computer networked. Yet,
according to the SES index, Geelong Grammar School is
nowhere near the top of the list in terms of assessed advantage: 217 schools
are placed higher. Despite its expectation of a substantial increase in
Commonwealth support under SES funding, the school raised its fees in 2000.
1.28
In view of the public uproar which has resulted
from the release of this information about elite schools' funding, it is
perhaps not remarkable that details of school grants should have been provided
so begrudgingly by the Government. Nonetheless, while it may be accepted that
the scores that were requested in two separate Returns to Order may have been
delayed due to the onerousness of the task necessary to prepare them, it must
surely have occurred to the Minister to anticipate that this data would be
requested. Furthermore it should have been anticipated that the information
asked for would include the SES scores for each school. The processes of a
Senate inquiry into legislation is always likely to reveal more about
government agendas than ministers might consider reasonable.
1.29
The attitude of Opposition and Australian
Democrat senators is that any additional Commonwealth school funding should go
to those schools most in need. There has never been any suggestion that the
schools listed above have been schools in need of assistance. Their ability to
attract high fees, the generally superb facilities they provide and the
well-resourced curriculum they offer are evidence of this. The new funding
arrangements do not address the real concerns of the vast majority of schools
across the country, which in many cases is how to compensate for the lack of an
educationally encouraging environment in many low-income households. Thus there
is a crucial need, in schools serving comparatively poor communities, for easy
access to school computers. This challenge is more important than support for
schools which are able to boast of ‘a laptop for every student’. In a budgetary
climate when every dollar counts, the effective targeting of school funding
should be an obvious goal. Such is not evident in this bill.
1.30
The striking fact about the SES system outlined
in the Bill is that it provides
funding increases to wealthy schools at a rate overwhelmingly disproportionate
to the apparent needs of these schools, or of the families that they serve.
The stark truth is that the largest increases will go to the wealthiest
schools, while the schools currently listed in Categories 11 and 12 under the
ERI system - classed as the most disadvantaged - will in many cases receive no
increase at all. Their current funding levels will be maintained in real
terms, thanks to a "no disadvantage" clause contained in the bill.
1.31
The technical problems associated with the SES
model, and outlined above, provide the explanation for this anomalous result.
The indirect nature of the SES measure applied to students' families is
a major cause of the problem. Since the enrolments of the elite schools
represent a very small minority of total non-government enrolments - let alone
of total government and non-government school enrolments - then it follows that
these families, patronising elite schools, are atypical rather than
typical. They are very often atypical not only of the population at large, but
also of the neighbourhoods in which they live. While some live in wealthy
suburbs, many others live in mixed or middle-income neighbourhoods whose
average SES score is lower than that of the student and family in question.
Parents' decisions to send their children to an elite private schools are often
the result of a perception that the government schools in their own local area
are inadequate in terms of resources, subject offerings and so on. Some make
the decision for social reasons, including a desire for their children to mix
with those of similar socioeconomic backgrounds as themselves. Thus these
families single themselves out.
1.32
A further anomaly exists where schools have
unusually high boarding student populations. An example here is The King's
School, Parramatta, which will
receive $1.4 million in extra funds from this bill. About 400 of this school's
1100 students are boarders, whose homes are mainly in rural areas. The
application of the SES model to these schools nets a result that is lower in
SES score than might be expected, because the students are very likely to be
from wealthy families living in areas where unemployment and disadvantage are
otherwise high.
1.33
By definition, those choosing expensive private
schools can afford to pay high tuition fees. The extra funding of $1,000 to
$2,000 per student provided under the SES arrangements will do little, if
anything, to reduce high fees, since most elite schools charge fees many times
higher than these amounts. A family unable to pay $10,000 per year is just as
unlikely to be able to pay $8,000. What these increases to elite schools do,
in policy terms, however, is to signal that the Government supports and
encourages the idea of elitism in education, and to implement a perverse
‘equity’ principle which undermines the needs basis of funding private
schools. Government resources, under this bill, would go more uniformly to
privileged as well as needy schools. The Government's message is clearly
political.
Transparency and simplicity of the model
1.34
Evidence put before the Committee points to
serious concern about the transparency of the SES system. In its submission
the Australian Education Union points to the complexity of the planned system,
pointing to the fact that there will henceforth be three funding regimes for
non-government schools - those funded accorded to the SES system; schools that
are ‘funding maintained’ at 2000 (ERI) levels, indexed annually; and finally
those schools within Catholic systems. As the submission states:
There will some 65 different levels of funding! (46 SES, 18 ERI,
including previous guarantees, and Catholic systemic), with a separate rate in
Primary and Secondary, plus a special rate for special education (70% of AGSRC
[average government school resource cost]) and Distance Education (13.7% of
AGSRC). That is 170 different pay rates. So much for simplicity![13]
1.35
The model also lacks transparency. The mere
fact that the ‘SES index’ will apply to only a minority of non-government
schools - because a majority are either in the Catholic system or will be funding
maintained - gives lie to the assertion that the new system is fairer. The fact
that it will not be applied to all, but to a minority, when it purports to be a
comparative measure, begs the question of what is being compared, and whether
the comparison is valid. Given the outcome of the application of the model,
skewed as it is in favour of the wealthiest high-fee schools, there is clear prima
facie reason to doubt its accuracy and fairness.
1.36
In summary, Dr Kemp's SES model
fails to deliver either a rational or an equitable system of funding
non-government schools. In particular, it fails to acknowledge and account for
the differences in school populations between those elite schools catering to
wealthier groups in Australian society, on the one hand, and those attracting
more representative social groups on the other. In applying an undiscerning
model in an undifferentiated manner to all non-government schools, the
Government's SES sytem cannot and does not deliver a fair deal in the
non-government sector. The increased funding allocated by the Government is
not apportioned according to the actual needs of schools. It is also provided
against a background of funding starvation for government schools. Thus this
SES system is profoundly unfair, unjust and divisive. It does not address the
real need of Australia's
schools.
Chapter 2 - Ministerial Powers
2.1
The Committee was struck by the conflicting
evidence given by Commonwealth and State officials over the extent of
consultation over the development of the SES funding model. This highlighted
the extent to which relations between the two tiers of government have broken
down in recent years over issues which cannot be properly resolved due to the
absence of agreements made in good faith.
2.2
The Commonwealth may have discretionary funds at
its disposal owing to vertical fiscal imbalance, and the States and Territories
may be, as Deakin once predicted, 'chained to the chariot wheels of the federal
government', but the Commonwealth controls no schools and is a step removed
from the realities of school administration. Opposition senators note with
alarm the tendency of the current Minister to adopt a rigid and doctrinaire
approach to schools policy in the circumstances where State and Territory
goodwill and cooperation are required for the success of any educational
advance.
2.3
Evidence was forthcoming from the NSW Department
of Education and Training to the effect that no consultations had taken place
about the terms of the bill, but a briefing lasting about an hour and a half
was given. Victorian officials reported a two-hour discussion with DETYA
officers. Queensland officials
advised that:
The first indication we had of the existence of the bill was
some time after it was published on the Net. I could not be sure of the exact
date, but we—as previous people I have heard have indicated—accessed it through
the Net. As for the consultations that were held by DETYA, we were alerted that
they were in progress by being advised by Victoria that they had in fact
already met with DETYA officials. We then had a meeting approximately two weeks
ago. We think it was on 11 August. It was not so much consultations as an
explanation of the provisions of the bill. ... There has been a little bit of
difficulty on our part in preparing a view on those things, but I would have to
say that the submission probably fairly accurately reflects our point of view.
Our concern was that we were advised verbally by DETYA officials at that
meeting that, whereas consultations were guaranteed through their briefing
material with non-state systems, and we would be included in terms of
administrative consultations over administrative guidelines, there really was
not any sort of iterative process over the substantive provisions of the bill
that were being considered. So clearly it was not a consultation meeting. It
was a meeting to provide us with information on the intent of various aspects
of the bill.[14]
2.4
DETYA responded with an account of several
rounds of consultations on the ERI review and meetings on the SES. Opposition
senators do not dispute the facts provided by any of the witnesses, noting only
that the differing accounts might be explained by conflicting state and
Commonwealth perceptions of their role and, in particular, the attitude of
state officials in dealing with 'Commonwealth incursions' into state areas of
responsibility.
2.5
Two main issues of contention are discussed
here: the accountability provisions contained in the bill and the enrolment
benchmark adjustment (EBA). All states expressed reservations about at least
one of these issues, and for some states they were all matters of dispute with
the Commonwealth.
Accountability
2.6
Opposition and Australian Democrat senators do
not deny the importance of ensuring accountability for Commonwealth funds
expended. Ensuring accountability for the proper expenditure of funds
appropriated by Parliament and passed on to agencies outside the Commonwealth’s
administrative ambit has always been a matter of concern. Commonwealth funds
appropriated under State Grants Acts have traditionally presented fewer
problems because in most instances the responsibility for ensuring
accountability is passed to state and territory governments and legislatures.
Any other course of action would be ruled out on administrative and
constitutional grounds. The Commonwealth cannot, in any practical way, monitor
state expenditure and insofar as Commonwealth funding is subsumed into state
funding, there are constitutional impediments in attempting to do this.
2.7
That has been the view until now. Clause 16 of
the bill, in conjunction with clause 12(3), provides for the state to report to
the Commonwealth Minister any information that the minister considers
appropriate. This information includes details of all state program expenditure,
even when this expenditure derives from state sources. For all practical
purposes, funds directed to schools are not identified by their source. A
school principal in receipt of literacy program funds will not know what
proportion of it originates from a States Grants payment, as distinct from an
appropriation of a state parliament. Yet the Minister has power, under the
proposed legislation, to reduce or delay funding if a state does not fulfil the
financial accountability provisions. The Committee heard evidence from NSW
officials on the impracticality of this approach, evidence which also indicates
the extent of state concerns about the direction of administrative policy in
Commonwealth-state matters.
We note in this bill that there are some significant increases
in the Commonwealth minister’s powers and discretions for accountability and
reporting. We would want to continue to work constructively with the
Commonwealth and other states in developing appropriate and targeted reporting
in national forums such as the Ministerial Council on Education, Employment,
Training and Youth Affairs. From the Commonwealth’s point of order, it depends
how these provisions are implemented, but it could distort the Commonwealth’s
responsibility for schooling.
From the Commonwealth’s point of view, it depends on how these
provisions are implemented, but it could distort the Commonwealth’s
responsibility for schooling. The Commonwealth is unable to deliver on accountability
in relation to individual schools. It does not have the power or the
infrastructure to do that. It has a danger of being superficial and potentially
damaging. The Commonwealth cannot directly support schools, which ought to be
the main thrust of accountability frameworks—to support schools and improve
their teaching and learning. We fear that the
Commonwealth will be unable to be rigorous if these accountability provisions
are provided directly, and they will be unable to do it in a rigorous way in
their measures of school performance. This is a state responsibility. So we ask
for a better understanding of schools and systems and the foundations for a
true partnership between us in the interests of all schools.[15]
2.8
Opposition and Australian Democrat senators take
careful note of these views because they reflect a breakdown of trust between
the states and the Commonwealth that has occurred only recently. The Opposition
cannot be accused of failing, when in government, to vigorously pursue a
Commonwealth policy agenda in school education matters, and to work with state
governments to promote these policies. What it did not fail to do was to
consult states and territories on all matters of mutual concern, and work
through MCEETYA to ensure a properly agreed and understood policy agenda. While
Opposition and Australian Democrat senators accept the assurances of DETYA
officials in their defence of their processes, it is perhaps more telling that
state perceptions of this process should be at such variance with those of the
Commonwealth.
2.9
The submission from the South Australian
Minister for Education and Children’s Services has expressed disagreement with
the proposal that state authorities will be required to provide the
Commonwealth with disaggregated data to identify schools having problems in
meeting performance targets. The minister informed the Committee that a
regulation having this effect would be considered unreasonable and contrary to
the policy of the South Australian government on the publication of ‘league
tables’. The Minister indicated that the scope of regulations to be made under
the act was causing some disquiet in his department, but he had been reassured
by DETYA promises of consultation.[16]
In view of other consultation experiences associated with this bill, the
Committee will be taking a close interest in the degree of consultation over
the regulations, and in the regulations themselves, which are subject to
disallowance by the Senate.
2.10
The Minister for Education in Western Australia was slightly more
forthright on this issue. Expressing his concern about the accountability
mechanisms contained in the bill, the Minister stated that no decision had yet
been made by MCEETYA on whether to introduce performance targets or measures.
He advised that MCEETYA had previously decided that the National Report on
Schooling in Australia was to be the primary educational accountability
mechanism for government and non-government systems to the Commonwealth,
although this was currently under review. The submission concluded:
The Bill, therefore, pre-empts the outcome of inquiries and
considerations that are currently under way under the auspices of MCEETYA. In
other areas, it moves away from previous decisions of MCEETYA. Western
Australia believes it to be inappropriate to proceed with these proposals
while national processes remain incomplete.[17]
2.11
Opposition and Australian Democrat senators
concur with this view. MCEETYA agreement is necessary at the very least in
circumstances where accountability processes are imposed by the Commonwealth to
educational services which are only part-funded by the Commonwealth. In answers
to questions on notice, DETYA officials have gone to some lengths to stress
that the regulatory regime to be established by this legislation will be the
subject of consultations within MCEETYA. Opposition and Australian Democrat
senators consider that these assurances need to be placed in the context of
‘consultations’ taken in regard to the provisions of this bill.
2.12
The Minister for Education in Tasmania expressed her concern that the
use of the Commonwealth’s unilateral power was inconsistent with the national
collaborative framework underpinning the National Goals for Schooling.[18] The Minister was disturbed by
the provision in the bill which gives powers to the Commonwealth minister to
determine the performance measures or targets through regulations where
‘reasonable progress’ has not been achieved in meeting goals. The Minister
pointed out in her submission that the performance measurement proposed was
resource intensive and therefore reduced the allocation of resources for
delivering the very services that are subject to measurement. Opposition
members of the Committee express their doubts about the capacity of DETYA to
handle the workload of compliance monitoring that is proposed in this bill,
given the reduced levels of staffing that department has been subjected to in
recent years.
The Enrolment Benchmark Adjustment (EBA)
2.13
While the exercise of the Minister's unilateral
power through regulations still remains within the Senate's power to withhold,
the exercise of the Minister's disclosure in the Enrolment Benchmark
Adjustment has been acted upon with vigour. It provides some indication of
what may be in store in the form of Commonwealth regulations.
2.14
The Enrolment Benchmark Adjustment followed the
1996 budget, providing for a reduction in Commonwealth recurrent funding when
the proportion of students enrolled in non-government schools increases,
compared with a 1996 benchmark. This 'adjustment' takes place even when actual
enrolments in government schools rise: despite national enrolment growth in
government schools of almost 27,000 since 1996, the Government has withdrawn
almost $28 million in funds under the EBA. The New South Wales Department of
Education and Training estimates that the EBA will result in a cumulative loss
of about $100 million in funding to NSW government schools in 1998-2002, with
an estimated loss of $50 million per annum by 2003.
2.15
In presenting their cases to the Committee,
officers of the NSW Department of Education argued that EBA was
implicitly provided for in S.53 of this bill, which states:
The Minister may make a determination authorising payment of
financial assistance to a state for recurrent expenditure for a program year of
an amount which is not more than the amount worked out using the
formula.
2.16
NSW officials had some strong words to say about
the EBA:
We know that there is very
little support in the education community for the use of the EBA to enable the
under payment of grants struck by parliament to particular states and
territories on the basis of enrolment proportions rather than numbers of
students in schools. The New South
Wales government believes that
this policy is, at best, inept and, at worst, unprincipled, ungenerous and
unworthy. The responsibility for providing a compulsory period of schooling for
all rests with the states and territories. It is through their systems of
public schools which are open to all children and young people regardless of
their family background or circumstances that Australian governments guarantee
universal education. Being open to all children and young people places on
public schools a complex web of challenges, pressures and obligations. States
and territories have looked to the Commonwealth to complement and generally
support their own efforts in meeting these challenges, pressures and
obligations. They have done that ever since the Commonwealth assumed a
significant role in schools funding in the 1970s.
2.17
Opposition and Australian Democrat members of
the Committee regard the application of EBA as a stick with which the Minister
punishes the government schools for their failure to maintain their enrolment
share in the face of competition with non-government schools. The Minister
would have it that the funding reduction is intended as an encouragement for
them to do better.
2.18
Labor is committed to the abolition of the
Enrolment Benchmark Adjustment. A policy device such as the EBA has no place in
an equitable education system.
Chapter 3 - The plight of Government Schools
3.1
Commentators on this bill, and witnesses before
the inquiry, have noted the propensity of the Minister to strike out in
directions which have re-opened debates (and often old wounds) closed long ago
and to make assumptions that solutions evolved over time can be dispensed with
at no cost to either social harmony or the common good.
3.2
The Minister has created unnecessary disturbance
with his declaration that the Commonwealth has a particular responsibility for
non-government schools, while government schools are primarily the
responsibility of the states. As a narrow statement of constitutional
fact, this may have some academic validity. As a statement from a Commonwealth
Minister in the process of making policy on school funding it is dangerous
nonsense. The Commonwealth holds the financial levers of the nation in a way
unimagined in 1901 and the states have been reduced to mendicant status. The
ability of the states to fund government schools entirely from their own
resources was severely strained as long ago as the 1960s. Beginning in 1964,
Commonwealth grants have supplemented the states' own appropriations to the
point where, by 2000, the Commonwealth provides 35 per cent of the total cost
of running government schools.
Marginalising government schools
3.3
The current bill calls into serious question the
commitment of the Commonwealth to the National Goals for Schooling developed in
1989 and reaffirmed in 1999. There was an agreement that these goals would be
pursued through government, Catholic and independent schools. It was believed
that an acceptable accommodation had been reached with regard to funding needs
of schools with the passing of sectarianism and recognition of the
Commonwealth’s role to financially support all sectors, systems an schools on
the basis of need.
3.4
There is now an unavoidable public perception
that the Commonwealth has pursued a policy which favours the non-government
sector, particularly the elite schools. Opposition senators identify three
main elements in this policy:
- A new policy which provides an establishment grant of $500 per
student in the first year, also available in the second year, with additional
support funding available in the event of severe financial hardship through the
Schools Transitional Emergency Assistance program. This policy provides the
competition considered desirable by the government to encourage a drift away
from government schools. This grant is not subject to a means test.
- Greatly increased support for high fee schools, as described in
Chapter 1 whose newly established campuses are finding a resurgent market in
today's smaller families with sufficient disposable income.
- Declining support for the government school sector, and the
application of the EBA as further discouragement in the expectation that a
gradual shift in enrolments to non-government schools will further reduce the
need for government expenditure on education. As the Minister has stated on
several occasions, the bill will have the effect of reducing educational costs
overall. This is because parents of students in the non-government sector
would contribute substantially to the cost of educational provision.
New schools
3.5
It is generally recognised that the growth in
new non-government schools can only be achieved at the cost of declining
government school enrolment share. Thus the government schools provide the
recruitment pool for these new schools. The Catholic system has a generally
stable enrolment base and, as was made clear in the submission from the
National Catholic Education Commission, does not see itself as being in
competition with government systems. The development of a limited number of
Anglican community schools will see students withdrawn from government schools,
or at least a shift in enrolments away from government schools. At its public
hearing the Committee heard evidence from the executive officer of the
Australian Association of Christian Schools who anticipated an annual growth
rate in the establishment of new Association schools of between 5 per cent and
10 per cent. As he explained to the Committee:
The schools that I represent are two per cent of the school
sector in Australia. When you put two percent against the 20 per cent of the
school sector that is represented by the Catholic schools in Australia, we have
a long way to go in the Protestant area to achieve the same level of offering
that is available to Catholic parents. While it is an objective of mine to
achieve that level, I do not think it will be achieved in my lifetime.[19]
3.6
The problem of dealing with new schools was raised
in evidence by a representative of the Independent Education Union of Australia
who expressed concern about the disorderly way the Commonwealth was treating
this matter. Not to address the issue of new schools in some kind of strategic
way was to assume that the public purse was unlimited. The representative
stated:
We end up then with unholy competition between state and federal
levels of funding, and the EBA is a crude mechanism to try and do something
about that. It should be removed. What it does is to bring the state and
federal levels of government into a quite public and unpleasant kind of
relationship with each other as proportions of enrolments shift around. None of
this is the right way to go forward.[20]
3.7
The most serious threat to the government school
system as a result of Commonwealth policies that fail to support it is the
eventual likelihood that it will become marginalised. They would, as Dr Ken Boston has
speculated, ‘cease to become inclusive. They would no longer embrace a
cross-section of society. They would decline into a safety-net provision – a
lesser network of residual schooling for children of the disadvantaged and
unaspiring’.[21]
Declining financial position of
government schools
3.8
The Minister’s claims of increased financial
assistance to government schools avoids the issue of relativities in
expenditure increases. Commonwealth Budget papers show that, when this
Government came to office in 1996, 43% of Commonwealth outlays on schools and
Specific Purpose Payments to the States for schools was allocated to government
schools. By 2004, this will have fallen to 34%.
3.9
The decline in the Commonwealth commitment to
government schools is shown in the table below, derived from Table 2 in DETYA's
submission.
Estimated allocations
under the States Grants Programmes ($’000) (outturn prices) |
|
2000 |
2001 |
2002 |
2003 |
2004 |
Total Government Schools |
1,708,150 |
1,785,064 |
1,874,621 |
1,934,592 |
2,025,914 |
Total Non-government
Schools |
2,889,940 |
3,123,073 |
3,376,171 |
3,636,218 |
3,918,699 |
Grand Total |
4,598,090 |
4,908,137 |
5,250,792 |
5,570,810 |
5,944,613 |
Percent Total Government of
Grand Total |
37.1 |
36.4 |
35.7 |
34.7 |
34.1 |
3.10
Ministerial media releases issued at the time of
the 1999 Federal Budget referred a billion dollars extra in funding for
government schools. This amount referred to the compounded total increase in
funding for government schools in the 2001-2004 quadrennium, in comparison with
the previous quadrennium. However, after discounting these amounts for price
adjustments of 24.8%, and enrolment growth of 0.05%, the real increase in
monies to government schools is negligible. On the same basis of a 24.8% price
adjustment of 5.9%, the non-government sector will see a real increase of 7.9%.
3.11
There are other indications of further anomalies
unfavourable to government schools. Indigenous program funds for government
and non-government schools have been omitted from Table 22 in the DETYA
submission. What is proposed is a projected increase of 87.2 per cent in
Indigenous program funds for non-government schools and an increase of 6.2 per
cent in government school funds. Yet, 88.1 per cent of Indigenous students are
enrolled in government schools.
3.12
Opposition senators see less significance in
manipulation of funding figures by the Minister that they do of his rhetoric on
matters like ’freedom of choice’. Where the rhetoric flows the money follows
the same direction. The Government appears to believe that investment in
government schools will not bring the returns that increased funding of
non-government schools will provide, either in educational terms or political
terms. Opposition senators believe this to be a serious error of judgement.
Broadbanding of targeted programs and disability issues
3.13
Government schools will be most affected by
changes introduced in the bill to targeted programs. A new program, Strategic
Assistance for Improving Student Outcomes is mainly concerned with literacy and
numeracy outcomes. Currently, primary schools receive $89 for each special
education student, while secondary schools receive $126. Under new arrangements
all schools will receive a single grant of $102 per student. According to the
Australian Education Union (AEU) this may leave government secondary schools
worse off because, unlike non-government schools, they have not been given an
assurance, that they will not be worse off. The AEU also notes that because
this money is now to be pooled with the literacy and numeracy funding, the
make-up to non-government schools may come from the pool, leaving less for
government schools.[22]
3.14
Similar concerns were expresses by Dr Jim McMorrow from the
New South Wales Department of Education and Training who, while stating that
there was no general objection to broadbanding, said that stability and
security of funding were the main issues. He expressed a personal view that the
banding of literacy and numeracy funding with disability funding was a
potential problem. A reading of the bill suggested that these students were in
competition for funding. Much depended on the administrative arrangements that
would be worked out[23]
3.15
Opposition and Australian Democrat senators
anticipate that MCEETYA will take a careful watching brief over the
administration of special purpose grants.
CONCLUSION
This bill is an appropriation bill that expends $22 billion
of public money on Australian schools. The Parliament must pass a schools bill
by the end of 2000 to ensure that Australian schools have funds to call upon in
2001. The form of any such bill, however, is a matter for the Senate to
consider very carefully. Labor senators are of the view that the Government's
funding model is unfair, unjust and divisive. In the Committee stages of this
bill, senators should give serious consideration to the following issues:
- the equity of outcomes for individual schools under this Bill;
- the methodological soundness and adequacy of Dr Kemp's SES model;
- the balance of funding between government and non-government
school sectors, including the Government's shift of funds away from government
schools through the Enrolment Benchmark Adjustment;
-
the adequacy of funding for Catholic systemic schools;
- funding for the two sectors in Literacy and Numeracy, and in
Special Education; and
- the administrative arrangements associated with Commonwealth
distribution of funds to the states.
Senator Kim Carr (Deputy
Chair)
Senator Trish Crossin
Senator Lyn Allison
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