The annual running costs of Australia’s schools is over $44bn dollars, around $36bn of this provided by governments. The Gonski review suggested we spend more, especially on needy students. Opponents often asserted that spending more doesn’t get results.

But a closer look at where the money goes and what it delivers reveals many surprises. Schools are expensive places, some far more than others, depending on where they are located and who they enrol.

Some schools are also better than others. But whether they’re public or private, schools that enrol similar students (in terms of their socio-educational background) turn out much the same results. This similarity between schools prompts us to take a close look at exactly how much money schools are spending to get these same results.



By examining data available on the My School website, we found that if all schools spent the same as the lowest cost providers, up to $3.3bn each year could potentially be released and diverted to our most needy students. Gonski would be back in play and Australia’s worrying student achievement gaps would diminish.



How is the figure of $3.3bn reached? We considered the dollars spent per student on similar students to reach a common standard of achievement. The data behind the My School website makes it possible to identify the amount spent by the lowest cost sector and to compare this amount against the dollars spent by other sectors. The full version of this analysis shows calculations for groups of schools.

In general we found that most private schools were spending more per student, and often much more, to achieve close to the same results as public schools serving similar students. In public schools, the more advantaged students are cheaper to teach – the real cost of bringing them up to the common level of achievement becomes lower. The same is true, with significant exceptions, for students in Catholic schools.



But the per student cost in Independent schools progressively rises, with few exceptions, as student advantage increases – to the point where over twice as much is spent in comparison with public school students. It is important to note that these are averages: due to the lingering complexities of the Howard government’s arrangements, some schools receive far more funding than others with similar students.



When the numbers of enrolled students in each sector are taken into account the total “excess” amounts allocated to students who achieve the same results as the “cheaper” public school students are:



$520m for students in Catholic schools

$2,771m for students in Independent schools.

This adds up to almost $3.3bn per annum for students in all private schools. The total public contribution to private school recurrent costs is around $9.6bn, hence around one-third of this amount is arguably in excess of what is needed to bring student achievement to the average level for similar students across the sectors.



If the purpose of investing money in schools is to improve student results then this represents a poor investment: it has little or no additional impact on measurable student achievement.



We need to know more – and My School can only partially tell us – about how the money is spent in these schools. This might help explain why it has such little impact. What we do know is that this amount, if redistributed, could more than double our investment in disadvantaged schools - in all sectors.

The most common rationale for higher spending in some schools is that the additional money comes from parents – especially for advantaged students in higher fee schools. Parents make a choice, so the argument goes, to spend their money in these ways and hence the value which may or may not be gained is a matter for them alone.

But the reality is that, regardless of the source, the funds spent on students in these schools come from both parents and governments. The current funding regime, quite unique to Australia, makes governments active and willing partners in arrangements which create, sustain and actually worsen a well-researched and documented inequity. In view of the demonstrated needs of students in disadvantaged schools, how and where should governments direct public funding?

The $3.3bn apparently not used for, or not succeeding in, improving student outcomes in advantaged schools would be far better invested in schools with lower ICSEA (Index of Community Socio-Educational Advantage) scores, in all sectors, where the upside potential for improving outcomes is considerable.

If the required investment identified by Gonski for these students can’t come from additional funding then existing public funding needs to be redirected to where it can make the greatest difference. It is a policy choice: we either make the investment needed to lift the strugglers or continue to top up the advantaged. We can’t do both.