As reported in today’s Australian, the Association of Independent Schools Victoria today released research showing that private schools saved taxpayers $4.9 billion in 2004-05, reflecting the lower subsidies paid on behalf of students at private schools compared to students at government schools. That’s very similar to a claim I made in a post last year.
Having done a lot of work on ‘big government’ since, I am no longer sure that this is quite the way to look at it. This is because while technically all students at private schools are entitled to more heavily subsidised places at government schools, we cannot assume that all students would switch even if private schools received no government money at all. Before state aid for private schools was introduced in the first half of the 1960s, nearly a quarter of students were in private – mostly Catholic – schools. It was trending down, and the Catholic schools were facing serious problems as the supply of brothers and nuns prepared to teach for a pittance shrank. But we cannot assume private school enrolments would have inexorably dropped without state aid. Not all private schools at the time even took the money straight away.
Nearly half a century on, in a much more affluent society, in which education is of greater significance for a child’s future, there would surely be considerable demand for private schools even without any subsidy. Some private schools recieve subsidies that are a fairly small percentage of government school subsidies in any case, and a smaller still percentage of total revenue per student.
A more accurate way of expressing the point would be that to fund private schools on the same basis as government schools would in 2004-05 have cost taxpayers another $4.9 billion, which is why I do not support a standard Friedmanesque flat voucher scheme. Sometimes there are tensions between introducing markets and keeping taxes down.
Andrew Norton 
I sort of agree with that logic. However, I presume that you are assuming that free public places are available. I’m not sure why people with enough money shouldn’t have to pay to use the public system — this already happens with the medical system, where, after, a certain amount (basically the average wage), you are forced to get medical insurance. This would reduce the demand on public schools. If you look at prices of real-estate around good public schhols, it also seems pretty clear that some people are willing to do this at least to some extent.
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Conrad – The AISV argument assumes what the public school lobby assumes – that public schools are the norm. The research was presumably commissioned to challenge AEU propoganda (though undaunted the AEU used it repeat their factoid that the federal government pays more to private than government schools, completely overlooking that government schools get far more public money overall).
Now my personal view is that government schools should not be the norm – indeed, government-delivered schooling should be abolished in my view. My point in the post was that even if we accept the AEU/AISV starting point, the AISV conclusion does not necessarily follow.
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I always found the argument that it was somehow inequitable for government schools to receive more funding than private schools an odd one. Public hospitals receive more than private hospitals. Government funded public transport receives more than private buses and taxis. Law courts more than private arbitration. The list goes on
If governments choose to provide a certain service in a certain way, why does it follow that private alternatives to that service (often with a competing vision of how to provide it) have to be equally supported?
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Of course, Andrew, that’s still from the viewpoint that government-delivered education remains the norm.
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Matt – I think your second point goes to the heart of it. Except for courts, the services you mention could all be entirely provided by the private sector.
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Whether those universal services could be entirely provided by the private sector is an interesting question. To take the key example of education, the private sector has no mandate to provide universal service, and has done quite well in cherrypicking the students that are easy to teach – either the bright ones which boost the school’s end of year performance, or more or less well behaved kids from stable background. I know that’s how my school worked, systematically poaching the brighter kids from the region for yr 11 and 12, while troublemakers were sent packing.
Private health works in a similar way – there may be mandated community rating to prevent discrimination against the sick, but the simple cost of insurance means health funds will never provide universal coverage.
Which works up to a point. But whether the private sector would find it worth its while to cater to that final 5-10% or so of the market, who might find it difficult to pay, or who are difficult to service or even unhelpful clients, is a point worth considering. And if it can’t, is a gradual ghettoization of government services, as the undesirable provider of last resort, socially useful?
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Afterthought – are there statistics around on private schools taking in low SES students, compared to their government counterparts?
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Matt – There are some SES stats in the AISV report, obtainable by clicking on the AISV link.
We need to separate funding and delivery; I accept some role for public funding but think it is unlikely that there is any inherent need for government delivery in education.
Private schools enrol very few of the very poor, because they all charge at least some fees to most parents, but really it is just a matter of the price being right. After all, the private sector is prepared to run jails, which is where too many kids from the worst schools end up. If they were offered enough, the private sector would take up the task.
The selectivity issue is really a red herring; most private schools aren’t academically selective. As I have commented in previous school threads, this debate is distorted by images of perhaps a hundred of the more exclusive private schools, which are not typical of private schools generally, and certainly would not be the typical model for an expanded private school system.
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“We need to separate funding and delivery; I accept some role for public funding but think it is unlikely that there is any inherent need for government delivery in education.”
Howabout the money being given to local governments to run schools? I was just googling something about education in Finland, since they seem to top the OECD education table, and they manage to have the best school system in the world using public provision. Free universities too!
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Russell – Local governments could perhaps be allowed to operate schools, but parent choice should drive the system.
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Depends on your idea of “saving” – what of the Bonnor and Caro thesis that money “saved” on maintaining existing facilities is being spent onbuilding new facilities for private schools, creating a building boom that does not necessarily flow through into the teaching for which the school was built?
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I shudder to think what parochial horror we could end up with – the US education system rather than that of Finland.
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Maybe after a bit of amalgamating ….??
Idly googling about Finland also gave me the impression that their teachers were very well qualified and very well paid. That’s surely worth learning from.
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Andrew – if parent choice isn’t a feature of some of the world’s best school systems, why is it so important?
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AndrewN, I’d like to see parents be better informed before the question of choice receives the undue emphasis that it does.
Russell, what you’re advocating is something like the ACT: big enough for politicians to get vainglorious and bureaucracies to be cumbersome, yet too small to enjoy economies of scale.
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Andrew E – I haven’t seen studies of it, but newspaper reports certainly suggest that parents prefer better facilities to lower fees in the elite private schools. It’s their trade-off to make in my view.
Russell – I think Andrew E at comment 12 has it right. I know nothing about Finnish schools, but even if they have good education outcomes what makes us think we can replicate it, given that our public schools system, along with just about every public school system, does a poor job for large proportions of those kids who need good schools the most.
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Andrew E – While ideally all parents should make informed choices for their kids, this isn’t necessary for markets to work. Suppliers respond at the margins, so long as some people act on the information they receive suppliers will have to react.
And until we have a market, there won’t be strong incentives to become well informed. If you don’t have any effective choices, there is little value in knowing whether the school your kid is at is better or worse than another school.
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Andrew – I don’t ask this as criticism, but as you’re so interested in education, why not look at countries whose students top the international rankings – and if parental choice and markets don’t have much of a role in those systems, why should we go down that path? Why not learn from what they are doing?
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I think this is the reason you got such a low Right score on the Crikey Bias-o-meter Mr Norton (and why I read your comments with interest) – you don’t hesitate to beard your ideological allies when they use dubious arguments.
Excellent post.
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Russell – I am not an expert on schooling around the world, but a quick check of a webpage on Finnish schools suggests that their basic structures differ from Australia’s mostly in the role of local government, and it sounds like their private schools are mostly free. I think it would be wildly optimistic to think Australian local government could manage education well.
Also, Finland appears to be quite homegenous in culture and religion. One of my objections to public education is that I think parents should be able to educate their children in line with their own culture and religion. A monopoly curriculum is less of an issue in an homogenous society than one like Australia or the US.
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“I think parents should be able to educate their children in line with their own culture and religion.” – a good point, but you could do that within a government funded and controlled system.
Surely you listen to Radio National’s Religion Report ? from last week’s, on Catholic Schools:
“Catholic schools are for the poor and that ideally they should be free – even integrated into the state public school system. That’s the way things are done in Canada, the UK, many European countries, and right next door in New Zealand. The head of New Zealand’s Catholic Education Office, Brother Pat Lynch, explains how” (transcript available – if I paste the link here this post will disappear!)
I still think if the world’s top performing school systems – don’t have parental choice, we should probably look at other factors to improve our system: teacher salaries and qualifications, teacher-pupil ratios, whether every high school has to offer so many subjects etc
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Russell,
you are also missing out on what I think is the biggest factor for rich countries — the relevant cultural beliefs. You can look up the Hong Kong system, they have higher teacher-pupil ratios than Australia (35 per class in primary schools), and have a similar sort of public-private mix. Yet they achieve better results, especially on the real scales (like TIMMS and not PISA) and despite the fact that a reasonable percentage of students are getting taught in a second language (written Cantonese is also a disaster). The main reason for this is that even the poorest parents want their children to do well at school and go to university — No-one is going to tell you that you have wasted time getting a degree. This has nothing to do with money.
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If the problem is that parents here don’t care enough about education, having a market for it isn’t going to improve anything, is it?
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BTW I only mentioned teacher/pupil ratio because over the last 20 years I think we’ve reduced the ratio while recruiting teachers with the lowest, lowest uni entrance scores. Maybe we should go the other way. Have there been any experiments putting really good teachers in large classes? If they have and they show it’s the teacher that matters more than the class size, it would suggest where we might start to improve things.
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There are problems with both the Australian and Norton’s particular definitions of private and private sector in relation to education.
Private as a term derives from the Latin word deprivi meaning deprived of public exposure.
The large “private” schools in Australia are often prominently located, widely advertised and open to members of the public with more money than sense. Many people in public positions such as premiers come from these schools. Catholic schools are part of the largest and most inclusive religion in Australia. They are not deprived of public exposure. Hence the British term public schools meaning Eton etc..
The free market thinkers need to go back to the drawing board and sort their ideas out before they set out and write books or blogs or whatever, just as the communists have had to.
You are a pack of bullshitters who do not even realise the extent of your emissions.
Get the terms correct if you are writing in European languages. Maybe next life time… Mine’s a long black with gluten free cookie..
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Russell – Check out Andrew Leigh’s very interesting research on these issues.
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Russell, our host is generous in citing my jottings, but the fact is that I don’t think we have good answers to those questions. Over the past couple of decades, Australian educational policymakers cut class sizes by about 10%, and allowed teacher salaries to fall by 10% (relative to other occupations). My hunch is that this was a bad decision, but a couple of randomised policy trials across schools would provide much more precise answers.
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Yes, it is interesting – pity it has all those statistics in it. I prefer to absorb information by listening to Radio National, preferably while lying in bed. How come, given the amount of research done in ‘education’, there’s so little known about why some teachers are so much better than others? On what evidential basis did we spend so much money reducing class sizes?
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Russell,
you’ll have to pick up a basic stats book. Most libraries have hundreds :).
Back to the point, there is in fact evidence from other countries about class size. In HK, I seem to remember you don’t get much overall benefit from about 30 to 15? (which I presume is one reason why they don’t care about large class sizes like Aus — the government is much more practical than in Aus). Alternatively, some education colleagues I work with in HK seem to think that the big problem with big classes is picking up outliers (i.e., kids who are really bad at something, like reading), which might be made easier via smaller classes (I tend agree with this — I did some testing when I worked there and found almost no relationship between teacher’s grading of students English and some of the tests I run, so its clear, lots of them don’t know whats going on, although I wonder if Aus teachers would be better with smaller classes). However, that isn’t an argument for smaller classes — it might be a lot cheaper to pick them via external testing, should be easy (ten minutes per kid), and most HK teacher’s are not going to complain about these things (potentially unlike Australian ones).
I also wouldn’t know how well the results generalize across cultures — the extent that HK parents push their kids is much more than Aus ones. This is sure to compensate for larger class sizes in some circumstances.
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I suspect the main explanation for the emphasis on student:staff ratios can be found in the staff statistics, with about 70% of teachers being women. I suspect they prefer the shorter hours that come from fewer students (less marking etc) to higher pay.
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I’m sure AN’s argument is part of it, but there’s also a political economy argument – voters are more willing to support class size cuts than teacher salary increases.
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BTW, and I can concur with Russell. Listening to Phillip Adams’ dulcet tones is infinitely preferable to working out how to bootstrap a two-sample IV estimator.
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I used to be of the opinion that smaller class sizes might benefit struggling students, but having kids at school changes that perception somewhat. It’s all about the teacher and to a lesser extent the makeup of the class.
I thought that a smaller class might help poorer students as it would free up time for a bit of extra attention from the teacher, but this is absolutely counter-productive if the teacher is useless.
The biggest problem is the lottery involved when your child gets placed in a class. Whether expensive private, middling private or public school, the teacher is a factor that just isn’t under your control no matter how much in fees you are paying (except perhaps if you home schooled). The other factor out of your control is the makeup of the class: dull, uninterested, stupid and cruel children appear to be equally distributed across the socio-economic spectrum, and thinking (foolishly) as I did that paying school fees might weed some of them out is wrong.
There is one factor under your control and that is having the time to regularly front up to the teacher and make sure they know who you are and who your child is. That guarantees attention (even if your kid doesn’t need it). It also costs nothing.
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AN — I’m not sure about the argument for smaller class sizes and time taken teaching. In my books, the amount of time it takes to teach follows a log function, so the more students you have, the less time it takes per student. You could therefore have larger class sizes and potentially teach less. Your assumption is that the contact hours remain stable but classes sizes increase — probably true of primary schools, but not neccesarily of high schools.
DR: You comment probably isn’t true of many good private schools — they are able to pick and choose teachers to a much greater extent than public schools. Than can also pay more to get the best ones. Also, your comment about fronting up to teachers unfortunately works a bit like a game of prisoner’s dilemma. Once everyone starts doing it, the benefit is negative. In addition, given that parental abuse of teachers is anecdotally becoming more of a problem, then, in some places, probably very negative.
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conrad, in my experience (3 different schools, 2 private, 1 public, 1 city based the other two regional) the public school teachers were dressed worse and taught better. I’d believe the private schools pay more (and they ought to), but it doesn’t automatically guarantee more teaching skill. The idea that more money “attracts better teachers” would be very hard to quantify. It might attract a particular kind of teacher though.
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I agree with conrad (at 22) and I think Russell (at 23) makes a point that requires a response. Clearly consumers must value something for a provider to have an incentive to improve quality. I think a benefit of markets is that they only require some (marginal) agents to take an interest in something for outcomes to improve. Without choice, all the parents at a school could be interested in the quality of education and there is no clear mechanism for that to be reflected in school decisions or performance.
The other point I would make is that the very process of making decisions forces people to pay more attention to what they are doing and leads to greater engagement in the activity. Surely this is a desirable thing?
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Rajat – if your marginal agents have moved their children to another school (further away, harder to get to?) it could still allow the children of careless parents to be left in a dud school. Or even, as DR points out, with just a dud teacher in an OK school. Something needs to be done about the quality of bad/mediocre teaching or some unfortunate kids will suffer from it.
Offering people choice doesn’t necessarily mean they will pay more attention to their decisions – look at how most people buy food when they go shopping.
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Russell, you’re right – I was opining in shorthand. Choice would need to be accompanied by the ability for schools to fail/close down or be taken over so that bad schools could not operate indefinitely. This is not to say that to the extent public schools remained in existence (and I agree with Andrew N that they shouldn’t), the ultimate manager (ie the State Govt) should not do everything reasonable to improve them.
As for shopping, how do you conclude that people don’t pay attention their decisions? I frankly care a lot about whether I buy Cadbury or Lindt chocolate or quilted toilet paper vs unbleached. The quality and safety of the food available in Australia is excellent – do you think it would improve if the Govt ran supermarkets? It’s true that the average Australian’s diet could be improved. But I would hope that the appropriate response to this would not be to nationalise supermarkets and have the Government restrict the range of products available!?
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Rajat – did I say that I want supermarkets nationalised? (I want them banned).
I won’t comment on your immoral choice of non free-trade chocolate, but I’m not convinced most people have as much enthusiasm for making decisions as you have. Despite what’s on offer they will mostly buy the same things, or something that has “Special” stuck on it, or what their mother used to buy … if you look at what’s in most people’s shopping trolleys it’s hard to believe there was much (informed) decision making going on.
And why should they bother to decide between 10 different bathroom cleansers (probably made by the same manufacturer) or whatever – a lot of this ‘choice’ is just a fabrication of the advertising industry. Do you want schools to be marketed like toilet paper?
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Russell, I think you’ve illustrated my point perfectly: You care about how chocolate is made; I don’t (although if it’s any consolation, I have been buying more Green & Black lately – for the taste, of course). You may not care about what toilet paper you use; I do. I also think Morning Fresh liquid dishwashing detergent is better than Palmolive, but am happy to use no-name powder for the dishwasher. Do you really have such little time for individual freedom that you want someone to prescribe the food we eat? If not, then why the schools children go to?
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The idea that more money “attracts better teachers” would be very hard to quantify.
Actually, I think it would be exceptionally easy to quantify. Just imagine to yourself what the effect would be on international benchmarks if teachers earned the minimum wage, or if teachers earned twice what they do now.
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Rajat – you bring discernment down to such a tedious level: Morning Fresh or Palmolive!
Wy do I want control over schools? Fairness. I don’t want to reinforce unfairness by having some system where kids with parents who are too poor or too careless, end up with low standard schooling.
You wrote earlier about marginal agents – wouldn’t it be the case then that if everybody’s children were in the state system, there would be marginal agents agitating for better schooling and constantly pressuring politicians to provide it?
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In the shameless self-promotion department, here’s my best attempt at answering the ‘do higher salaries buy better teachers?’ question. (Shorter AL: yes).
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Russell, this is why I said (at 36) that lack of choice means there is no *clear* mechanism for parents’ preferences to be translated into action. If markets do not exist, the allocation of resources becomes about political power and influence. This is something the (anglo) middle-classes have in abundance; it is not something that non-English-speakers or otherwise disadvantaged groups have much of at all.
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“This is something the (anglo) middle-classes have in abundance; it is not something that non-English-speakers or otherwise disadvantaged groups have much of at all.”
Rajat – It’s not often I disagree with you. Kids with non-English speaking backgrounds are over-represented at both private schools and universities (the last two features possibly not being coincidental). It’s probably because migrants are, almost by definition, people trying to improve their own lives and the lives of their kids, and see education as one way of doing it.
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Andrew, I agree that many migrants care a lot about education and their children tend to do well (in fact I endorsed conrad’s comment to this effect). What I was referring to was the ability or willingness of migrant parents to front up to their MP or the local state school principal and/or galvanise the community to fix up a local school, as Russell suggested (in 42). Other things being equal, I think the ability to choose a school provides relatively greater advantages to less confident and articulate parents.
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Rajat – Yes, good point. Requiring things to be decided politically favours people who have knowledge of local political systems and can express themselves persuasively.
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So where have Rajat’s marginal agents gone? Can’t be too many schools where every parent is inarticulate and lacking confidence. Better the articulate parents haven’t just taken their children elsewhere.
Plus we now have these standardised tests to find out where standards aren’t being met – whether parents are interested or not.
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Russell, that’s why I said articulate and connected parents will have *relatively* more success with political processes than inarticulate and unconnected parents. That’s not the same as saying that a political process for fixing schools will work as well as the market.
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At least our political processes aim to have fairness as an outcome, and can be held to that – the market doesn’t.
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