National Report on Schooling in Australia 2009

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 2009.
 
The SES approach to school funding involves linking student address data to Australian Bureau of Statistics national Census 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 the information in the latest Census of Population and Housing. Schools therefore had their SES scores recalculated for the 2005–2008 and 2009–2012 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 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 2005–2008 and 2009–2012 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 either on their SES score, are funding maintained or 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 41 in the 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, 2009 calendar year

       

Catholic schools

Independent schools

Income source

Per capita amount ($)

% of total income

Per capita amount ($)

% of total income

     Australian Government grants

6,918

56.7

5,895

35.0

 

     State/Territory grants

2,069

17.0

1,799

10.7

 

Total government grants

8,988

73.7

7,694

45.7

 

Private income

3,208

26.3

9,127

54.3

 

Total

12,196

100.0

16,821

100.0

 

Notes:

Components may not add to totals due to rounding.

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.

Capital expenditure excludes loan principal repayments.

Expenditure of system offices is allocated across the schools in proportion to enrolments.

Source: Department of Education, Employment and Workplace Relations, Non-Government Schools Finance Questionnaire, with unpublished Calendar Year Implicit Price Deflator from ABS, Cat. No. 5206.0, Australian National Accounts: National Income, Expenditure and Product, March 2011

See also Additional Statistics, Table 41

 

Per capita expenditure

Details of expenditure in the non-government sector are also available in Tables 41 and 42 in the Additional Statistics, while Table 8.7 summarises the total per capita expenditure. Recurrent expenditure calculations are a mixture of cash and accrual based expenditures, including debt servicing of loans for capital and operating purposes. It excludes user cost of capital, loan principal repayments, and government subsidies for transport-related costs that are included in government school recurrent costs, but includes capital-related expenditure, which is not included in the government school recurrent costs.

 

Table 8.7               Non-government schools per capita expenditure, by affiliation, Australia, 2009 calendar year


 

Per capita expenditure ($)

 

Catholic

     

Primary

 

10,383

 

Secondary

   

13,555

 

Combined

   

15,022

 

Independent

     

Primary

 

14,490

 

Secondary

 

21,089

 

Combined

 

17,038

 

 

Notes:

Components may not add to totals due to rounding.

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.

Capital expenditure excludes loan principal repayments.

Expenditure of system offices is allocated across the schools in proportion to enrolments.

Source: Department of Education, Employment and Workplace Relations, Non-Government Schools Finance Questionnaire, with unpublished Calendar Year Implicit Price Deflator from ABS, Cat. No. 5206.0, Australian National Accounts: National Income, Expenditure and Product, March 2011

See also Additional Statistics, Table 42

 

Total recurrent expenditure on non-government school education from both the Australian Government and State and Territory governments in 2008–09 was approximately $6,850 per student. Australian Government expenditure was $4,903 per student, or 71.58 per cent of this total. State and Territory recurrent expenditure was $1,947 per student, or 28.42 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, 20082009 (%)

 Total government recurrent expenditure per 1

State and Territory recurrent funding to 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 2009.
 
New South Wales, Western Australia and the ACT allocated funding based on the former Australian Government Education Resources Index (ERI).
 
In 2006, the Victorian Government implemented a new funding model for their non-government schools. The model included both core and needs-based funding related to factors including socio-economic status, disability, Education Maintenance Allowance eligibility, rurality 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 single funding rates for primary students, secondary students and students attending remote schools.
 
Table 8.8 below outlines total Australian, State and Territory recurrent expenditure on non-government schools in 2008–09.
 
Total recurrent expenditure on non-government school education from both the Australian Government and State and Territory governments in 2008–09 was approximately $8.084 billion. Australian Government expenditure was $5.787 billion, or 71.58 per cent of this total. State and Territory recurrent expenditure was $2.297 billion, or 28.42 per cent of the total.

 

Table 8.8               Australian, State and Territory government recurrent expenditure, non-government schools ($'000) (200809 $)

 

Australia

Australian government specific purpose payments  (excluding capital grants and  including National Partnership payments – Literacy and numeracy)

5,786,659

State and territory government recurrent expenditure

2,297,440

Australian, State and Territory government recurrent expenditure

8,084,099

 

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, 2011, Table 4A.7

See also Additional Statistics, Table 47