Malcolm Turnbull has been warned against striking a “special deal” with the Catholic schools sector by a group of peak independent schools bodies enraged by the prospect of losing up to $1bn in funding over a decade.

As Turnbull and the education minister, Simon Birmingham, continue consultations to soften the blow of reduced funding growth in its Gonski 2.0 funding package, the independent schools bodies in New South Wales, Victoria and South Australia have expressed alarm the government is preparing to “appease” the Catholic sector at their expense.

Turnbull and Birmingham are consulting both sectors about the outcome of a review of the socioeconomic status formula, which recommended using data on parents’ income and family size to recalculate government payments.

The Association of Independent Schools in NSW and SA, and Independent Schools Victoria warned the recommendations “would entail a substantial shift in government support” from independent schools to the Catholic sector.

“Despite initial reassurances that the recommendations would have a relatively limited impact on independent schools as a whole, further analysis we have undertaken, and additional information provided by the Department of Education and Training, reveal the changes would have a damaging impact on many of our schools,” the letter to Turnbull said.

The three peak independent schools bodies argued that “a funding method based on parents’ tax returns is not only unreliable but represents an education consumer tax imposed on parents with children in independent schools who already pay school fees with their after-tax dollars”.



The impact would be “felt by students from all socioeconomic backgrounds and restrict the choices available to their parents”.

The independent schools claimed to have been gagged by “unnecessarily restrictive confidentiality conditions imposed by the department on the data it has provided us”, preventing them from informing member schools of the effect of changes.

The government maintains that confidentiality clauses are needed while it generates more refined modelling of the impact of SES changes, and says it is too early to say if estimates that independent schools could lose $100m a year are correct.

The Gonski 2.0 funding package increases schools funding by $24.5bn over 10 years, including an extra $3.7bn for the Catholic sector.

The Catholic sector is concerned the policy cuts funding growth relative to the previous Labor government’s arrangements and removes the system weighted average which allows them to keep fees low in schools in high-income areas.

The Catholic sector has waged a fierce campaign against the Coalition policy, writing to parents before the Batman and Longman byelections to warn of possible fee rises and school closures. Labor has promised to restore $250m to the Catholic sector in the first two years if elected.

The three independent school bodies said they “had hoped that the school funding reforms you announced last year would put an end to the so-called funding wars”.

They said they had “endured with growing dismay” the “intemperate campaign” of the Catholic sector, which could see a return of “funding wars” between the sectors.

The independent schools asked for an “urgent meeting” with Turnbull to discuss its concerns.

Turnbull has taken a larger role in the funding fight, meeting Catholic bishops on 19 July and writing to them on 27 July, promising that his office would now “engage directly” on the issue.

On Tuesday the Liberal MP Tony Pasin said he was “very pleased the prime minister has sought to intervene”.

“Clearly the relationship between Minister Birmingham and the Catholic education sector has become toxic,” he told Sky News.

“We’ve allowed this sore to fester for far too long – over 12 months – and clearly that had an impact across the nation and will have an impact at the forthcoming federal election, if it’s not resolved before then.”

Birmingham said the government’s focus is “delivering for the first time ever a distribution of school funding according to fair and consistent principles and I continue to work constructively with all stakeholders”.

“We promised a thorough review of the SES model followed by thorough consultations with stakeholders in the non-government school sector and have delivered on both fronts,” he said.

“Once these consultations are concluded we will act on implementing the review to ensure our record and growing funding for all school sectors is distributed according to fair and consistently applied principles.”

On Wednesday the shadow education minister, Tanya Plibersek, said the Coalition had united “all three sectors in opposition to their funding cuts”.