1. 1 The transformation of Australias school funding arrangements: The changing federal framework. Bronwyn Hinz Columbia University – Teachers College & The University of Melbourne www.bronwynhinz.com Paper presented at the Comparative and International Education Society 54 th Annual Conference, Chicago, 3 March 2010

2. Introduction: Australias school funding system has changed dramatically over last 40 years. most complex, inconsistent and opaque in the developed world with detrimental consequences on outcomes, equity and accountability. (Senate Committee Report 2004) Federalism a major contributor, key challenge and potential vehicle for reform. It also has changed dramatically over time, especially last 10 years. Parallel debates, but common lacuna: How, and to what extent, does federalism affect Australias school funding arrangements? 2

3. Government roles in Australian schooling 3.4million school students, 66% in public schools. Constitution: Education a STATE government responsibility… But, in 1973 FEDERAL government began systematic, recurrent funding for all schools – based on federal conditions. Since then ever-increasing federal government funding, regulation and policy for schools. Now: a SHARED responsibility between federal and state governments. Both levels of government fund both school systems. There are dozens of different funding and reporting mechanisms used by each government for different school sectors. Some decisions made collaboratively, but most made independently (i.e. without intergovernmental consultation ). 3

4. Government recurrent funding for school sectors (billions, 2007-2008) 4 40 years ago - private schools enrolled 25% of student population and had virtually no government funding. Ie 2 nd column wouldnt exist. Big differences amongst private schools – fees and funding Authors own chart. Data from Productivity Commission 2010 Report on Government Services.

5. Australias $36.4 billion school funding pie. All schools – public and private – receive government funding. 5 40 years ago – almost all pie would be yellow. Authors own chart. Data from Productivity Commission 2010 Report on Government Services.

6. Consequences No significant improvement in student outcomes Muddying of roles and responsibilities: parents, voters, schools, bureaucrats and even ministers dont know who does what and how. Expansion of private system, residualisation of public system (which enrolls disproportionate share of disadvantaged students). Benefits of federal system lost? (Autonomy? Innovation? Subsidiarity? Accountability?) Negative impact on service delivery, schooling outcomes and equity. (eg PISA results, university entry; onerous federal conditions) Consensus: arrangement is inefficient, unfair, inconsistent, obstructive and even detrimental. 6

7. Research to date has severe limitations Poor methodology (limited data, conceptual frameworks etc) Trenchant ideological, political, sectoral and geographical divisions A focus on the relative funding shares of government and non-government schools, and/or outcomes. An emphasis on the federal government at expense of the broader, intergovernmental settlement. We do NOT know… how, and extent to which federal government policies and intergovernmental agreements, affect state government funding policies (78% of school funding pie). how much funding individual schools receive from all sources (state, fed, private). How fund schools based on need? 7

8. Most seriously, federalism – the broader system in which schooling operates- is ignored or falsely understood as static institutions and rules. Federalism is a complex and dynamic system of processes and institutions, embedded in, and interacting with society. 8

9. These structures, processes and institutions… Constitution Federal and State governments Intergovernmental bodies (COAG, MCEETYA etc) Intergovernmental fiscal & financial arrangements Regulations …are moderated by political actors, decisions, ideologies & circumstances. So, the operation, and impact of each of these institutions, processes and relations is different under different constellations of political power and in different policy spheres (esp parties in power). 9

10. The big picture: Evolution of Australian federalism The growing involvement of the federal government in schooling reflects growing power and involvement of Australias federal government in ALL policy areas. Enabled by three core and growing factors: Federal government fiscal and constitutional dominance over the state goverments Preference for national solutions and consistency to improve economy and equity Ideological shifts: Choice as a right and a virtue; market principles in schooling to drive results. 10

11. 11 (and VFI only gotten more severe since) 1999 Federal GST replaces State sales and service taxes GST revenue returned to states, but half of all federal grants to states has federal conditions attached. States are financial hostages – with what consequence?

12. Moving forward Imperative to explore complex, dynamic nature of federalism (institutions and processes) and their effect on all pieces of the funding pie – especially the biggest piece (state gov $ for public schools) which as received least analysis. New, interdisciplinary approach required to transcend academic, ideological and political divisions. Starting points: (Rational & new) institutionalism (March and Olsen) Frame-reflection (Schon and Rein) Issue networks (Heclo) Comparisons with other federations: lessons and insights. 12

13. Concluding remarks Federal processes, dynamics and institutions play major role in shaping creation, evolution and operation of Australias school funding settlement. The need to understand the mechanics and dynamics of current and past intergovernmental funding settlements within federal framework has never been greater. Major state and federal reforms in school funding and intergovernmental relations underway Uncertain economic climate This new research and understanding could improve quality, equity and accountability of schooling and provide insight into other complex policy problems, in Australia and other federations. 13

14. 14 The transformation of Australias school funding arrangements: The changing federal framework. Bronwyn Hinz Columbia University – Teachers College & The University of Melbourne www.bronwynhinz.com Paper presented at the Comparative and International Education Society 54 th Annual Conference, Chicago, 3 March 2010