Just when we are getting used to the idea of having a mix of public and private schools in Australia, along comes a development with the potential to upset everything once again. Over the years our federal and state governments, apparently without comparing notes, have raised private school funding to the point where those schools can no longer be considered to be private.

How did this happen? Years ago we began to widen school choice by increasing public funding of private schools. We were told this would not only increase choice but the competition would also lift overall school achievement. Even better, it would be a good deal for taxpayers when families paid much of the schooling bill. Armed with the power of such promises both levels of government, especially the federal, rolled out the cash.

Alas, these promises have amounted to very little. Choice widened, but has remained an illusion for most: only one in every two average families can afford a fee-charging school – and even then just for one child. As for the second promise, an overall lift in school achievement … you’d have to be brave to back that claim.

And now the third promise – that publicly subsidised private schools would actually save public funds – is under challenge. The public funding of private schools has risen to the level where the running costs of most private schools are now substantially met by combined state and federal funding. If a private school is defined by who pays then they are rapidly becoming public.

They still collect fees, a hangover from when they needed the money to match the investment in public schools. But for all but the wealthiest schools the fee income seems to be icing on the cake. When we realise that schools enrolling similar students churn out similar results, it becomes harder to justify the icing – especially when governments are such big partners.

Of course, from the federal minister down, the standard claim is that private schools get less than 60% of the public money going to public schools. True on average, but grossly misleading. Public schools are expensive. They alone have to be available to all students, from all families in all places and in all circumstances. Anyone who has visited a remote school, a disadvantaged school or a special school will know this is a very expensive obligation. My School data shows which students go to which schools. Comparing the sectors as if they were equally sharing the load is a nonsense.

We can now compare schools which enrol similar students and hence face similar needs and challenges – and how much they are paid each year to operate. The My School website shows that two-thirds of our schools lie in the 950-1150 index of community socio-educational advantage range. Ninety-three per cent of Catholic schools fall in this range and they receive not 60% but between 90.8% and 99.5% of the public dollars going to similar public schools. Seventy-nine per cent of independent schools fall in this range and they receive between 79.5% and 94.6% of what goes to similar public schools.

So should it matter that governments are now effectively paying for the running of public schools and the “private” competition? Leaving aside all the other oddities of doing this the problem is that each system has very different obligations, accountabilities and operational rules. Aside from fees, private schools can impose other criteria for admission or exclusion of students, on grounds that aren’t (and shouldn’t be) permitted in the government school system.

They can apply additional discriminators in the form of entry tests, previous school reports, test results and other restrictive (including religious) criteria. As a general rule, they also have a statutory exemption from a range of anti-discrimination provisions. They can hire and fire staff, and refuse admission to students on various grounds including sexual orientation, sex, age, marital or domestic status. They are not “government agencies” under freedom of information legislation.

In short, by getting the public funding and holding on to the privacy of their operation they have got the money and the box. As a consequence our playing field of schools has become very tilted: in the fair go country there is very little in our framework of schools that is fair.

Solutions to this seemingly intractable problem might range from abolishing all private schools through to integrating most of them into the state’s provision of education and having them operate under consistent rules – something that is standard practice overseas. Maybe an alternative might be to seek a stronger alignment between each school’s level of public funding and the “publicness” of their obligations and operation.

Whatever happens, the do nothing solution isn’t an option.

To read the full report by Chris Bonnor and Bernie Shepherd go here.