National Report on Schooling in Australia 2011

Funding Australia’s schools

8.4 Funding for non-government schools

Funding is provided to non-government schools by the Australian Government and by State and Territory governments.

Australian Government funding for non-government schools

The funding system introduced by the Australian Government in 2001 – based on the socio-economic status (SES) of each non-government school’s community – continued in 2011.

The SES approach to school funding involves linking student address data to Australian Bureau of Statistics Census of Population and Housing data to obtain a measure of the capacity of the school community to support its school.

Schools with SES scores of 85 and below are funded by the Australian Government at 70 per cent of Average Government School Recurrent Costs (AGSRC). Schools with scores of 130 or above receive 13.7 per cent of AGSRC. Funding for schools with SES scores within this range receive proportional funding based on their individual SES scores.

Those non-government schools, which, because of their SES score, were entitled to less funding under the SES system when it was introduced in 2001, had their general recurrent funding maintained at their year 2000 per student funding rate. This funding is indexed each year according to increases in AGSRC.

For each new funding period, all non-government schools have their SES scores recalculated according to updated student address data and the information in the latest Census of Population and Housing. Schools therefore had their SES scores recalculated for the 2005–08 and 2009–13 funding periods.

Those year 2000 ‘funding maintained’ (FM) schools that still had an SES score with a funding entitlement less than their current level of funding continued to have their funding maintained at their year 2000 per student funding rate with indexation.

Catholic systemic schools did not join the SES system until 2005. As a result of the ‘no losers’ commitment, FM arrangements were also created for these schools. Therefore, those Catholic systemic schools that had an SES score with a lower entitlement than previously funded had their funding maintained at their 2004 per student funding rates. This funding is indexed each year according to increases in AGSRC.

A transitional funding guarantee was made available under SES arrangements to schools that experienced a rise in their SES score between the 2005–08 and 2009–13 funding periods. These schools have had their funding frozen (with no adjustment for inflation) until the dollar amount associated with the school’s new (higher) SES score is equal to or greater than the dollar amount it received at its lower SES score. This additional measure, defined as a funding guarantee, is separate to funding maintained schools arrangements. Therefore, under the SES funding arrangements, non-government schools are funded on their SES score, are funding maintained or are funding guaranteed.

The non-government sector also receives funding for National Partnerships under the Intergovernmental Agreement (IGA) and in conjunction with the National Education Agreement (NEA).

Per capita income

Non-government schools derive their income from Australian Government and State/Territory government grants, fees and fundraising, including donations.

Table 55 in Part 9: Additional Statistics details this per capita income; some data are summarised as Table 8.6 below. The income shown in Table 8.6 funds both recurrent and capital applications.

Table 8.6 Non-government school per capita incomes, by source, Australia, 2011 calendar year

Catholic schools

Independent schools

Income source

Per capita amount ($)

% of total income

Per capita amount ($)

% of total income

Australian Government grants

7,708

56.5

5,918

33.2

State/Territory grants

2,331

17.1

1,967

11.0

Total government grants

10,039

73.6

7,886

44.2

Private income

3,600

26.4

9,962

55.8

Total

13,640

17,847

Notes:

Excludes amounts related to boarding facilities, and direct payments by the Commonwealth to students and/or parents.

Where figures have been rounded, discrepancies may occur between the sums of component items and totals.

Source: Australian Government DEEWR unpublished data, with unpublished Calendar Year Implicit Price Deflator from ABS, Cat. No. 5206.0, Australian National Accounts: National Income, Expenditure and Product, Mar 2011.

See also Part 9: Additional Statistics Table 55

Per capita expenditure

Details of expenditure in the non-government sector are also available in Tables 55 and 56 in Part 9: Additional Statistics, while Table 8.7 below summarises total per capita expenditure. The per capita figures reflect recurrent expenditure calculations which are a mixture of cash and accrual based expenditures, including debt servicing of loans for capital and operating purposes.

Non-government school per capita expenditure differs from government school per capita determinations outlined in Part 8.3 as it includes some capital-related expenditure such as interest subsidies for the debt servicing of loans, and excludes user cost of capital, loan principal repayments and government subsidies for transport-related costs, which, historically, have not been applied to the non-government sector.

Table 8.7 Non-government schools per capita expenditure, by affiliation, Australia, 2011 calendar year

Affiliation

Per capita expenditure ($)

Catholic

Primary

11,337

Secondary

15,019

Combined

16,292

Independent

Primary

13,049

Secondary

20,784

Combined

18,195

Notes:

Excludes amounts related to boarding facilities, and direct payments by the Commonwealth to students and/or parents.

Includes debt servicing of loans for capital and operating purposes.

Where applicable, expenditure of system offices is allocated across the schools in proportion to enrolments.

Where figures have been rounded, discrepancies may occur between the sums of component items and totals.

Source: Australian Government DEEWR unpublished data

See also Part 9: Additional Statistics Table 56

Total recurrent expenditure on non-government school education from the Australian Government and State and Territory governments in 2010–11 was approximately $8,092 per student. Australian Government expenditure was $5,871 per student, or 72.6 per cent of this total. State and Territory recurrent expenditure was $2,221 per student, or 27.4 per cent of the total. This is depicted in Figure 8.6.

Figure 8.6 Total government recurrent expenditure per student, non-government schools,
Australia, 201011 (%)

Figure 8.6 Total government recurrent expenditur

Source: Steering Committee for the Review of Government Service Provision, Report on Government Services 2013, Productivity Commission, Canberra, Table 4A.13

State and Territory government recurrent funding for non-government schools

As well as providing recurrent grants to government schools, all States and Territories fund non-government schools. State/Territory governments used a variety of mechanisms for allocating funding to non-government schools in 2011.

New South Wales, Western Australia and the Australian Capital Territory allocated funding based on the former Australian Government Education Resources Index (ERI).

Victoria included both core and needs-based funding related to factors including socio-economic status, disability, Education Maintenance Allowance eligibility, remoteness and indigeneity.

In Queensland, South Australia and Tasmania the allocation mechanism included standard and needs-based components. In Queensland, need is assessed by reference to a variety of factors, including the Australian Government SES scores and a school resource index. In South Australia, both school and student-based measures of need are used, but there is no reference to either the former Australian Government ERI or current Australian Government SES scores. In Tasmania, need is assessed by exclusive reference to SES.

The Northern Territory has separate funding rates for primary, middle and senior secondary students and students attending remote schools. There is also a separate grant for students with severe disabilities – a per capita arrangement based on identified students in independent schools. For Catholic schools the grant is currently based on one per cent of enrolments.

Table 8.8 below outlines total Australian, State and Territory recurrent expenditure on non-government schools in 2010–11.

Total recurrent expenditure on non-government school education from the Australian Government and State and Territory governments in 2010–11 was approximately $9.8 billion. Australian Government expenditure was $7.1 billion, or 72.6 per cent of this total. State and Territory recurrent expenditure was $2.7 billion, or 27.4 per cent of the total.

Table 8.8 Australian, State and Territory government recurrent expenditure, non-government schools ($'000) (201011 $)

Australia

Australian Government specific purpose payments (excluding capital grants and including the Smarter Schools National Partnership payments)

7,137,208

State and territory government recurrent expenditure

2,700,078

Australian, State and Territory government recurrent expenditure

9,837,286


Note: Australian Government specific purpose payments include recurrent, targeted and Indigenous program expenditure.

Source: Steering Committee for the Review of Government Service Provision, Report on Government Services 2013, Productivity Commission, Canberra, Table 4A.7