The school funding partnership
Public and private funding sources
The proportion of government funding for individual Independent schools varies greatly. Once the new SRS funding model has been fully implemented, the level of Australian Government funding for each Independent school will be calculated on a base plus loadings model with the base amount adjusted according to an assessment of the capacity of the school community to contribute. While some states and territories will be using the Australian Government model to determine the level of funding they provide to non-government schools, others use their own methodology. Some Independent schools receive as little as 15 per cent of their funds from governments, while others, where the community has limited capacity to contribute, are almost fully government funded.
Independent schools on average receive 42 per cent of their funding from governments and 58 per cent from private sources, mainly from parental contributions through fees.
Sources of Independent sector income, 2014
Source: Australian Government Department of Education and Training
Independent school parents choose to spend their after tax dollars on prioritising an Independent school education for their children, often necessitating considerable sacrifice. The fees levied by schools vary widely and are influenced by the community the school serves, the level of schooling, the types of education program offered and the level of government funding provided to the school.
This parental contribution means that in 2014 on average, the total recurrent expenditure per student in Independent schools, at $18,880, is higher than the $11,110 for Catholic systemic students and $16,180 for government school students. The amount of government funding per Independent school student, from both state and territory governments and the Australian Government, is however on average considerably lower than the level of funding for Catholic systemic and government school students.
Total government recurrent funding per student by sector, 2013-14
Source: Productivity Commission Report on Government Services, Australian Government Department of Education and Training and state funding rates
In 2013-14 governments contributed on average $16,180 per annum in recurrent funding on each student enrolled in a government school, compared with $7,940 on a student in an Independent school. That is, students in Independent schools on average receive less than half the public funding of students in government schools, and many students in Independent schools get considerably less. Families make up the difference in total per student funding in the Independent sector through school fees, donations and fundraising.
See Recurrent funding for more information.
Most of the income from private sources comes to Independent schools through fees charged to parents. In 2014 this accounted for 94 per cent of their private source income. Income from donations, fundraising, sponsorship and investments made up the remaining 6 per cent of their income.
The total income of individual Independent schools varies greatly according to three main factors: the level of education provided; the level of contribution from the Australian and state or territory government; and the types of education program offered.
The costs of schooling vary according to whether the school offers preschool, primary or secondary education, or a mix of levels. Higher costs are associated with secondary schooling.
There is significant variation in the amount of Australian Government funding provided to individual Independent schools. Under the new Schooling Resource Standard (SRS) funding model, once fully implemented the base funding each school receives is discounted by an assessment of the school’s ‘capacity to contribute’, which is determined by a measure of the school community’s socio-economic status. As well, while some states and territories are using the SRS funding model as the basis for distributing funding, others are using their own system of assessing the level of funds they are prepared to contribute to Independent schools in their jurisdiction resulting in significant variation on state by state basis.
In addition, each school makes its own decisions about the quality and breadth of the educational programs it will offer, within the boundaries of nationally and state mandated curriculum and staffing requirements, depending on the nature of the community it serves and the particular needs of its student population.
It is estimated that the willingness and commitment of parents to pay fees for Independent schooling saves governments approximately $4.3 billion a year, based on a calculation of the increased funding that would be required if all Independent school students attended government schools where they would be fully publicly funded. Through fees and private contributions, the families of students in Independent schools contribute over $5 billion to the annual total investment in education.
Most of the capital development in Independent schools – 86 per cent of the average annual investment – is funded from private sources. Parents contribute through fees, fundraising and voluntary contribution. The Australian Government supports the sector through tax concessions on parents’ voluntary contributions to school building funds, and also contributes, via grants, an estimated 8 per cent of total capital funding. The remaining 6 per cent comes from state and territory governments. Access to these grants varies considerably across Australia.
See Capital funding for more information.