School Funding in a Time of Teacher Shortage

The spectre of teacher shortage will haunt the next meeting of Australia’s education ministers.

Without swift action from Commonwealth and state/territory governments, this growing crisis will exacerbate the difficulties that commonly face disadvantaged schools in finding sufficient teachers for students most at risk of falling behind.

Australia is poorly placed to deal with this crisis. OECD data shows that 34 per cent of students enrolled in a disadvantaged school in Australia lack sufficient teaching staff, compared to 3 per cent in an advantaged school. This not only puts students at risk as individuals.  It also entails risk to the wider society, through planting the seeds of social division.

Education ministers will meet on 23rd February to consider the National School Reform Agreement (NSRA).  Their previous decision to extend the existing NSRA by a year allowed time for the Commonwealth to establish a review by an independent expert panel to inform decisions about priorities for achieving a better and fairer education system.

The panel’s report, Improving Outcomes for All, acknowledges the strengths of the nation’s schools, highlighting the contribution of teachers. It confirms that many schools are managing to provide well for their students. 

But the same cannot be said for the school system itself.

The report reveals that Australia now has 51 per cent of its socio-educationally disadvantaged students attending schools with students from similar backgrounds, one of the highest concentrations in the OECD.  These concentrations have been worsening over time and at a higher rate in Australia than in most other OECD countries.

To quote the Government’s own expert panel, “the quasi market-based nature of the Australian education system entrenches disadvantage.”  

The integrity of the funding arrangements introduced by Labor in 2013 based on the Gonski Review has been seriously compromised by subsequent political decisions and delays.

The way in which the Schooling Resource Standard (SRS), based on Gonski, has been applied has resulted in public schools across Australia now being under-funded by about $6.8 billion while the private sector is over-funded by about $1 billion. The Albanese government is  doing the right thing by retaining the SRS in order to bring public schools up to their rightful funding entitlement.

The Albanese government has responded to Improving Outcomes for All by initiating negotiations with state and territory governments, starting with Western Australia, to jointly increase funding for public schools.  The Commonwealth offer to increase its share of funding from the 20 per cent limit set by the Turnbull government to 22.5 per cent is an overdue step forward.

Agreement will require state/territory governments to boost their share of funding and introduce a range of practical reforms.  Other states are already resisting this deal and demanding that the Commonwealth raise its contribution to public schools to 25 per cent.  Given that the Commonwealth’s significant role in creating the resource gap between the public and private school sectors, this is a reasonable call.  But the WA deal will still leave states using the accounting tricks introduced with the blessing of the Morrison government to reduce their share of SRS funding for public schools from its full 20 per cent.

It will take more than the measures proposed so far to fix the school system. But dealing with teacher shortage cannot wait. 

Without urgent action from both levels of government, market forces will continue to privilege those schools that are ‘strong’ in the market and to further damage the opportunities for students in schools that are ‘weak’.  Private schools are now enabled to combine funds collected from fees with grants from government to operate above their SRS, and to use their superior financial capacity to attract a disproportionate share of the nation’s teaching force.  In 2022, the full-time equivalent student-teacher ratio was 11.7 in independent private schools (the fastest-growing sector) compared with 13.4 for public schools. 

Private school authorities responded to recent salary increases for teachers in NSW public schools by arguing that this justified an increase in their school fees — to shore up their financial capacity to pay higher teacher salaries and protect themselves against teacher shortage, at the expense of schools where these teachers are far more sorely needed.

The full cost of teachers in Australia’s public schools is met by governments. 

For the non-government sector, recurrent grants provided by governments are more than sufficient to cover the total teacher salary bill.  In 2021, total expenditure on teachers in non-government schools was $12.8 billion.  Recurrent funding from the Commonwealth alone to non-government schools was $13.1 billion. State/territory governments provided an additional $4.2 billion, making a total of public recurrent funding of $17.3 billion.  

The teaching force is a national asset. Democratic governments have an obligation to protect the entitlement of all our children to a fair share of the teachers who provide their access to the values, understandings, knowledge and skills built into the school curriculum. 

The SRS includes ‘loadings’ for categories of students who need more intensive teaching.  Ministers need to ask themselves what is the point of providing these ‘loadings’ to schools if they are unable to find the necessary teachers.

Education ministers could use the NSRA meeting as a time to agree on a Commonwealth contribution of 25 per cent and on states and territories meeting the full amount of funding needed for all public schools to reach their SRS entitlement.

The Commonwealth could show leadership by making the public funding of private schools contingent upon school authorities paying no less and no more than the relevant classroom teacher salary award.

There is a good argument, in our view, that this issue goes beyond funding.  The Commonwealth could seek the agreement of states and territories to make this requirement on salaries a condition of registration for all private schools.  All schools, regardless of the source of their funding, have an obligation to contribute to the health of the school system as a whole and to maximising school outcomes for all.  The alternative view is that any fully privately funded schools should be free to operate in their own best interests, regardless of the effects on students in other schools.   

It will take time and effort for governments to move from the current flawed arrangements for resourcing our schools to a system with a clearer focus on strengthening the supply, quality and fair distribution of teaching across the school system as a whole. 

In the meantime, there is an urgent need for damage control.

Lyndsay Connors and Jim McMorrow

Lyndsay Connors AO and Jim McMorrow have held senior positions in education at both the national level and in NSW.

One Reply to “School Funding in a Time of Teacher Shortage”

  1. The destruction of local communities happens a child leave their local area to gain an education in a private school We need to learn how to realate to a a range of folk and let the best students rise to the top not the most privileged!

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