Are private school parents discriminated against?

less policy discrimination against private schools than in the past means that school choice is more affordable than it once was

My analysis last week.

…I do admire the particular locution you’ve used – “less policy discrimination” is a fine argument-begging way of saying “more subsidisation”.

Derrida Derider’s response.

I was wondering whether anyone would pick up on the way I put that point. On the federal government’s school funding policy, students at private schools get subsidies at somewhere between 13.7% and 70% of the government school rate, depending on the (presumed) socio-economic status of parents. So parents choosing private schools are financially treated less favourably than parents choosing government schools. Why is this not discrimination?

Often governments give more to people who have less, as they do with private schools. This is generally not seen as discriminatory, but rather making up for the disadvantage experienced by one group. But on this logic, well-off families who send their kids to government schools should receive less as well. According to the ABS, 8% of kids at government schools are from high-income households, while 16% of kids at independent schools are from low-income households. So the ‘to each according to need’ is not being consistently applied in school policy, and is only applied at all for private schools.

Most private schools are at least nominally religious, and as I noted in my post last week, attitudes towards religion are the only major difference between the school aspirations of parents of children at government and private schools. So those who want their children to receive a religious education are treated less favourably than those who want their kids to have a secular education. If you read the history of public education in Australia this aspect was much more open in the 19th century than today – Protestants, particularly, wanted to diminish the strength of the Catholic Church.

I think current policies on education funding do discriminate against parents who choose private schools, treating them less favourably primarily because of their religion but also more generally for not sharing the ideology of public schooling. The question is whether there is a public policy reason for this discrimination.

There is one I have some sympathy for: that the current system costs taxpayers about $5 billion a year less than either a fully public system or a full voucher system that gives every child the same taxpayer subsidy. On the other hand, we could apply the federal funding system to all schools and either pay less overall or use the money saved by spending less on public schools in wealthy areas to spend more on schools for poor people, whether they were public or private.

In conventional social democratic terms, that would be more equitable and probably achieve better educational outcomes, particularly if combined with other reforms of the public schools as suggested (pdf) by my CIS colleague Jennifer Buckingham. In conventional market choice terms it would be better as well, since all parents would be able to ‘afford’ private schools if they wanted to. But don’t expect to see policy change any time soon – with this proposal we would add parents wanting to minimise spending on their kid’s education to those ideologically committed to state education to create a formidable obstacle to changing the status quo.

21 Responses to “Are private school parents discriminated against?

  • 1
    Leopold
    March 5th, 2007 21:38

    Yes… high income students in state schools get a 100% subsidy compared with 14% in private schools. Fair point.

    Politically difficult to make ‘equitable reforms’ in school funding though. In education generally – most people seem to retain the belief that ‘equal’ means ‘free’ in this area – especially when applying to their own children.

    A well-designed voucher system would surely be better than what exists though.

  • 2
    David Rubie
    March 5th, 2007 22:41

    What a strange world the CIS must be. The rich in society are so horribly discriminated against (the poor dears!). At the other end of the spectrum, the plebs are forced to eat the thin gruel of public education, denied the rich pudding of free-market choice. Whose fault is this? Those notorious baby eating trade unionists of course. Evidence? None tendered, it’s apparently either self evident or a very strong hunch. Andrew, you exist in a strange mono culture and you need to get out more.

    The other mystery of the ages (why secular education should be preferred over religious) is also lost on the CIS. We only need to remember as far back as when Brendan Nelson was the federal education minister. Intelligent Design anyone?

    Further, despite Andrew believing that state education was one of the greatest mistakes of the 20th century or some such twaddle, his own research determines it’s more cost effective than fully privatised systems. Gee, that sounds like a tragic, earth shattering mistake we should all be ashamed of.

  • 3
    James Simpson
    March 6th, 2007 01:02

    Andrew, doesn’t the $5 billion figure you quote ignore the potentially huge savings that the reduction in the size of education departments around the country would incur under a full voucher scheme? All you would need is a handful of people who could operate a spreadsheet, as opposed to ten of thousands of enlightened bureaucrats micro-managing the school system.

  • 4
    Andrew Norton
    March 6th, 2007 06:21

    James – The figures I have say that $1.1 billion of the approximately $25 billion spent on government schools is ‘out of school’. I don’t think that we can count all this as a potential saving though. For example I think moving staff selection to the school level is an important reform, but it would add costs for the school.

    David – In your rush to score ideological points you are confusing my position, again. I don’t support the traditional voucher scheme because it provides needless government subsidy without adding to market choice. So I prefer lower taxes overall but more parental responsibility for their children’s education, ie direct market choice without necessarily the intermediary of the voucher, or with the voucher making up a small percentage of total expenditure.

    But I think what subsidies are paid should be paid in a non-discriminatory way, without the government favouring its own product – which I think has proven not to be cost effective, as the outcomes are so poor at the lower end of the SES scale.

  • 5
    conrad
    March 6th, 2007 07:40

    One way to make it less discriminatory would be to stick a means test on public schools like we have on the health care system (i.e., get taxed more or cough up). I don’t see why people with the money shouldn’t cough up at least something for their children’s education when they have to — especially for the selective state schools. If people are worried about a further exodus from the public school system, then simply getting people to cough up some part of the fee would still mean they are competitive based on price. This would either add more money to the system or cost taxpayers less.

  • 6
    derrida derider
    March 6th, 2007 08:37

    Let me say where I’m coming from, Andrew. I buy most of the CIS rhetoric about how equality of outcomes is not necessarily a Good Thing. But I hold equality of opportunity dear to my heart for a range of reasons beyond the obvious equity ones. One of those reasons is that such inequality is inherently self-perpetuating – it’s natural for parents to want to give their kids a big head start (I certainly do), but its a disaster if some are allowed to.

    My opposition to voucher systems stems from this – I think they’d undermine political support for free education, as well as contributing to some forms of diversity in education that are not at all desirable (I’m sorry, but I’m not in favour of brainwashing children into ancient superstitions. And I shudder to think of the “schools” some kids with ignorant and/or uncaring parents would be sent to – there’s an agency problem here).

    You claim delivering universal education through government schools was a historic mistake, but I think that if it hadn’t been through government schools it would not have stayed universal for long.

    Yes, Conrad, I live in Canberra and yes, the public schools are mostly pretty good. But the interesting thing is that the ACT government doesn’t spend any more on these schools than other parts of Australia (except maybe on preschools and on the disabled). They’re good schools because the kids are good, because even the best parents send their kids to them – it’s a self-sustaining equilibrium. What would happen to these schools if these best parents sent their kids to private schools is pretty much what would happen in a voucher system – the public schools would become ‘sink’ schools, just like UK comprehensives. They’d move to a much inferior equilibrium.

    As for a means test, as someone who has made a career out of designing means tests and trying to measure their effects on behaviour, let me tell you that they are inherently a blunt (current income is an amazingly poor measure of economic status), complicated (usually in an attempt to make it less blunt) and intrusive (because otherwise evasion will be rife)instrument. They are a form of tax, and usually structured as a very heavy and incentive-destroying one. What they save other taxpayers is at family’s expense – but if you think that is a good thing wouldn’t it be a lot simpler to simply reduce family cash benefits?

  • 7
    Rajat Sood
    March 6th, 2007 08:50

    I disagree in principle with using the education system as a tool for redistribution. There is a progressive tax system plus means-tested family benefits (Part A). Why should parents with school-age children who want to give their kids a better education be further penalised?

  • 8
    David Rubie
    March 6th, 2007 10:11

    Andrew Norton wrote:
    I prefer lower taxes overall but more parental responsibility for their children’s education…

    but then

    But I think what subsidies are paid should be paid in a non-discriminatory way, without the government favouring its own product – which I think has proven not to be cost effective, as the outcomes are so poor at the lower end of the SES scale.

    You can’t legislate against poor parenting – whether the costs are up-front or across society, bad parents are going to fail their children. Compulsory, state based education gives the kids a chance to escape this trap. Bringing in up-front costs to education will also require the introduction of non-compulsory schooling (exactly how will we force parents to pay for education?). If the obvious answer is that we abandon compulsory education, we might as well throw away the child labour laws and retreat back to the 18th century.

    Rajat – the public education system is not being used as a tool for redistribution, it is a safety net.

  • 9
    Andrew Norton
    March 6th, 2007 10:19

    “You can’t legislate against poor parenting – whether the costs are up-front or across society, bad parents are going to fail their children. Compulsory, state based education gives the kids a chance to escape this trap.”

    True, it is very hard for governments to deal with bad parents. But they can do something about bad schools, and that primarily means dealing with the poorly performing government schools attended by most low-income Australian kids.

  • 10
    Russell
    March 6th, 2007 11:02

    “that primarily means dealing with the poorly performing government schools attended by most low-income Australian kids”

    but I don’t see where you’ve shown that it’s something inherent in the state schools that’s to blame. In a previous thread I suggested that poor attendance by some students in lower socio-economic areas might be one factor. (You asked ofr figures but your site wasn’t working – so I posted on AN’s site: Nedlands Primary School (in the heart of Julie Bishop’s electorate) has an attendance rate of 95.8%, and almost 100% of year three students meet the numeracy benchmark.

    Alphabetically close but socio-economically in another gallaxy is Orelia Primary in Perth’s hellish southern suburbs which has an attendance rate of 90.2% and where only 70% of year three students meet the numeracy benchmark.

    So it’s possible that a small minority of kids in Orelia are dragging that attendance figure down by frequently missing classes – and when they are at school dragging the rest of the class’s performance down too.

    Here’s another suggestion I heard over the weekend – that what parents are mostly concerned with is that their child will get the “bad” teacher, apparently everyone (teachers & parents) knows who they are – a very small minority in most schools. So perhaps the most cost effective and do-able thing is to improve education in the state system would be to weed out those incompetent teachers.

  • 11
    Fred Argy
    March 6th, 2007 14:33

    Andrew, it is good to see your blog is now easily accessible again. I always learn from your comments on education. But, like derrrida derrider, I am fully sold on the need for governments to do more to equalise education (and hence employment) opportunities.

    While our education system is still mildly progressive, it is less so than many of the developed countries we like to compare ourselves with. And the trend is disturbing. If I am right (and you will soon correct me if I am wrong), the achievement gap between rich and poor kids has widened in the last decade. One reason is the changing distribution of education resources: government funds have become less need-targeted (I think) and parents are stepping up their per capita investment on their private school children. As a result, we are seeing a large and widening gap between the total education resources (public and private) deployed on rich children relative to poor children. It has been estimated by Teese that children attending private schools now spend on their education (on average) a quarter to a third more than the average child in a public secondary school (at least in NSW and Victoria).

    If my assessment of the facts is correct, I find it very distrubing. Andrew, you seem to be able to put your hands on data very quickly so you could set me right where I have gone wrong. Thanks.

  • 12
    Andrew Elder
    March 6th, 2007 14:34

    Government schools are paid a premium to take children that non-government schools have the luxury of rejecting.

    The public policy reason for commitment to state education is one of educational quality. Latin America, the Middle East and Ireland contain examples of poor educational outcomes when education is handed over entirely to religious authorities. Look at the conflict in the US over basic science education and know that it could happen here: state education keeps private education honest. It is the only bulwark against collusion in favour of educational quietism and against intellectual curiosity.

    It is a mistake to refer to parents’ religion as a motivator for choosing a religious school. Go to 90% of schools run by a religion/denomination and you will find students there from outside that religion/denomination. It also falls into the trap of assuming that those who fail to send their children to a school run by their professed religion/denomination are irreligious, that secularism is a figleaf (or a synonym) for atheism.

    One way to make it less discriminatory would be to stick a means test on public schools

    There are numerous funding programs which do exactly that. The school I went to surveyed all parents’ incomes in the hope of securing some extra funding, but because so few parents returned the completed survey the school missed out on the funding.

    Per-capita subsidies are effectively a voucher system. Those whose mission it is to work the v-word into every blog thread everywhere must confront the possibility that it is not likely to work any better or worse than any other policy.

    what parents are mostly concerned with is that their child will get the “bad” teacher, apparently everyone (teachers & parents) knows who they are – a very small minority in most schools. So perhaps the most cost effective and do-able thing is to improve education in the state system would be to weed out those incompetent teachers.

    Most states have four-year terms. A sensible and politically feasible education reform program would go something like this:

    Year 1: Government increases back-up resources and training for teachers, defers pay-rises.

    Year 2: Government lays off teachers who have lost confidence of Minister – no marginal cases. Union outcry, selected examples leaked of teachers so incompetent it’s a wonder they’ve lasted this long, wins PR battle comprehensively. Remaining teachers still have to work hard but are not covering up for incompetents.

    Year 3: Government recruits top students into teaching on limited scholarships. Teachers unions struggling to get members to pay dues.

    Year 4: Government seeks re-election with strong education policy.

  • 13
    Andrew Elder
    March 6th, 2007 15:35

    Another public policy justification is that your obligations to society extend beyond merely your offspring. If non-government schools have means of sourcing funding other than government subsidy, then good luck to them: their success at wrenching blood from stones would only be tarnished by installing the spigot of government funding.

  • 14
    Russell
    March 6th, 2007 18:31

    Andrew E – approached the right way, the teacher unions might agree to a fair method of removing incompetent teachers because the overwhelming majority of teachers resent the continuing employment of the incompetent, and because the unions resent spending a disproportionate amount of time defending them.

  • 15
    Andrew Norton
    March 6th, 2007 19:30

    Fred – I don’t know enough about trends in the socio-economic performance gap to know if the achievement gap has widened. It is large in absolute terms. However, an ACER report found that between the 2000 and 2003 PISA studies on maths that socio-economic factors became less important here compared to the OECD average. But whether this is because Australia improved or other countries became worse they do not say.

  • 16
    conrad
    March 7th, 2007 06:42

    Russell & Andrew E,

    how do you intend to replace the lost teachers now already in shortage apart from

    “Year 3: Government recruits top students into teaching on limited scholarships.”

    which I’ll just assume isn’t very like to do the job given that at least Andrew E has alrady reduced wages in Year 1, and the wages are already low for anyone with a degree in a shortage area. Given a low-wage, poor conditions scenario, the idea of removing teachers is also likely to cause a lot of political controversy. More importantly, it is also likely to scare the average 18 year old. Who is going to spend 3 years to learn how to do a low wage job with poor work conditions and perceived poor job security (and essentially untransferrable skills) unless there was likely to be some reward at the end (which there isn’t for teaching) ?

  • 17
    Russell
    March 7th, 2007 10:16

    “how do you intend to replace the lost teachers now already in shortage ” – that is the fly in the ointment, the shortage of teachers. I guess larger class sizes isn’t a goer – are there any incentives that could keep good teachers from retiring early, or leaving the profession ?

    And teachers should be better paid.

  • 18
    Andrew Norton
    March 7th, 2007 18:58

    Fred – I have found Year 12 retention data by SES background over 1997-2005. The gap has widened in that period, mainly because of a 5 point gain by the top third, but also because of a 1 point decline in the bottom third.

  • 19
    Fred Argy
    March 8th, 2007 08:30

    Thanks Andrew.

  • 20
    Yobbo
    March 9th, 2007 01:44

    Russell: Why should the teacher’s union spend any time or money defending incompetent teachers?

    Should paying your union fees guarantee you a job irregardless of your competence?

    The teacher’s union should recognise that defending incompetent teachers is in the worst interests of the majority of their members.

    But they don’t, and that’s why the teacher’s union will always be a net negative on education outcomes.

  • 21
    Russell
    March 9th, 2007 10:32

    Yobbo – I wasn’t saying the union should defend them – just that they do, and might be glad to see the back of them.

    Look at it from the union’s position – someone joins a union, if it turns out that they are fairly useless and their troubles take up a lot of union time, it’s a bit difficult for the union to throw them out. Really it’s up to the department to have a process (designed in consultation with the union) to decide whether they’re competent to be teaching. Big unions are big bureaucracies, just like government departments, and they have their good and bad points.