Rudd’s Market Paradoxes

As far as education policy is concerned, the Rudd Government has given John Howard and David Kemp another term in office. It is completing Kemp’s vision to subject education to the rule of market forces.

This is paradoxical. Labour strongly opposed Kemp’s major initiatives such as the massive expansion of private school funding under the SES model, fewer restrictions on new private schools and reporting the results of individual schools. Now, not only has Labor maintained privatisation and competition policies, but it is extending them by publishing tables of school results.

Julia Gillard’s “new progressive approach to schools” is to implement Kemp’s goal to efface the difference between the public and private sectors. According to Gillard, “the old progressive assumptions about the roles of different schools and the nature of disadvantage don’t hold”.

Advocacy of the special role of the public sector to ensure universal access, social equity and democracy in education is now disparaged as a “sterile” and “fractious” debate, as it was by Howard and Kemp.

As under Howard, private schools share in all new initiatives despite much lower proportions of disadvantaged, Indigenous and special education students. Private schools even get a windfall gain on these students because their government funding is already linked to government school costs which are higher because of its larger proportions of these students.

It is also paradoxical that the Prime Minister vigorously criticises markets for creating the worst financial and economic crisis in 80 years and advocates greater regulation. Yet, he and his Education Minister are intent on extending the market in education.

The Government’s key market innovation in education is to publish tables of individual school results, which inevitably means ranking schools on performance. The PM says that this is designed to get parents “to walk with their feet”; that is, he wants to make the market work better.

His ultimate market discipline is to subject schools to a form of bankruptcy proceeding. He says that schools that fail to improve will be subject to “tough action”, including firing principals and senior staff and closing schools.

Another paradox is that the Government is drawing from the failing English and American market models, especially New York City, rather than the most successful education system in the world – Finland – which has rejected the market approach. This is despite the fact that Australian students are 6-12 months ahead of English, US and New York City students but about a year behind Finnish students in reading, mathematics and science.

The justification for ignoring Finland is that it has a relatively homogenous population and faces an easier education task than Australia. So, Australia must look to England and the US because they have more diverse populations. However, the evidence on the achievement of English and US immigrant/ethnic and disadvantaged students shows this is a furphy.

Australia has a higher proportion of immigrant students than these countries, yet it has the best results for immigrant students of all OECD countries and is well ahead of those in the UK and the US. Their performance is similar to native born Australians whereas there are large gaps between the achievement of immigrant and native born students in the UK and the US.

The most disadvantaged students in Australia have much higher average outcomes in reading, mathematics and science than those in the UK and the US. Australian disadvantaged students are 6 months or more ahead of those in the UK and 18 months ahead of those in the US.

But, Australia can do much better. Our results are much lower than those of the most disadvantaged students in Finland. Finnish disadvantaged students are some 12-18 months ahead of the Australian students. Overall, Finland’s most disadvantaged students are over 18 months ahead of those in the UK and about 2½ years or more ahead of those in the US.

Finland also has the lowest achievement gap between rich and poor students in the OECD. In contrast, the US has the largest gap and the UK has the third largest.

All this suggests that we have something to learn from Finland in its rejection of the market in education.

The lesson is confirmed by major research studies which demonstrate that reporting school results and greater competition and choice do not lead to significant improvements in student achievement, but greater social segregation and education inequality.

For example, an extensive review of research studies published last year by the Federal Reserve Bank of Chicago concluded that students who exercise choice do not experience achievement gains and that school choice does not induce public schools to improve their performance.

As Professor of Economics at the University of Chicago and the co-author of Freakonomics, Steven Levitt, says of school choice and competition: “the theory sounds great, but evidence confirming it has been hard to find”. A major study by the London School of Economics concludes that “choice and competition does not seem to be generally effective in raising standards”.

Already, nearly 25% of students from low income families in Australia do not achieve expected international proficiency standards and are 2-2½ years behind high income students. There has been no improvement in recent years under the new market rules.

If Australia persists with promoting a market in education it is likely to exacerbate existing achievement gaps. The dismal results in the UK and the US after 20 years of experimentation with the market show that Australia is gambling with its current high levels of achievement.

Trevor Cobbold
National Convenor
Save Our Schools

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