Was federal private school funding a mistake?

In last weekend’s Sunday Age Chris Berg joined the dots between some of the IPA Review‘s suggestions for our 13 biggest mistakes. One of the 13 he didn’t mention in his article was federal aid for school science blocks, including at private schools, introduced by the Menzies government in 1963. Perhaps he did not mention it because it is hard to argue that it was a mistake.

While it is true, as the IPA Review points out, that school funding is now a mish-mash of bureaucratic programs from two levels of government, this ‘mistake’ faces the same problem as the claim that publishing On Liberty was a mistake: it relies on a complex, and not very convincing, counter-factual.

Essentially, we are being asked to believe that if this policy initiative had never occurred we might have at least trialled a system in which parents had ‘real financial choice’ about which school their child attended. But the more likely scenario is that we would have ended up like the US, where about 10% of students attend private schools, or Britain, with about 5% in private schools – much less practical choice for parents than exists in Australia today.

Without the series of policy changes that began with the Menzies state aid decision in 1963, private school enrolments would probably have gone backwards from the 24% they were at then, as the Catholic Church no longer had enough nuns and brothers to teach in Catholic schools (the largest part of the non-government sector) or the money to employ enough laypeople to take their places. And because parents would have had to pay both full fees and taxation to maintain government schools, most of the remaining private schools would have been for the very rich only or struggled to provide adequate facilities.

Instead, at least partial transferability of funding from public to private schools has generated considerable growth in private enrolments, with nearly a third of students now at private schools, a proportion that increases every year. Expanding the private system has meant that the Australian school system has had better results than it would otherwise have had. And if we do the sums on the Productivity Commission’s Report on Government Services, private schools save taxpayers about $4.7 billion a year (the difference between the average per student funding in the two systems, times the number of students in the private sector).

If, as the IPA Review does with On Liberty, we are also to consider the tangential consequences, federal funding of private schools looks better still. For a start, it helped Menzies win the 1963 election, sparing us Arthur Calwell as Prime Minister (though Calwell may have saved us from a mistake not on the IPA list, the Vietnam War). It also helped ease tensions between Catholics and Protestants, as Catholics resented the lack of aid, which they rightly put down at least partly to anti-Catholic prejudice. Admittedly, those tensions have been displaced into the on-going ideological disputes about public versus private education, but this left-right faultline would exist in any case and only seriously preoccupies a small number of people.

As I said, none of this is to deny that there are problems in the existing arrangements, or that a better system can be imagined. But given the realistic actual alternatives, partial private school funding has been a big success.