5 June 2024

Funding Australia’s Private Schools

Unlike many other countries, Australia has a strong private school sector with many different types of schools. These include:

• Those affiliated with Christian denominations, e.g. Catholic, Uniting Church.
• Non-denominational Christian institutions.
• Montessori schools.
• Jewish schools.
• Islamic schools.
• Steiner schools.
• Schools constituted under specific Acts of Parliament, e.g. grammar schools.
• Aboriginal and Torres Strait Islander community schools.
• Schools that cater for pupils with disabilities.
• Those serving pupils who face high educational risk due to social, emotional, behavioural, or other factors.

Historically, the responsibility of funding is shared between federal, state and territory governments, with the federal government acting as the major funder for independent schools, whilst state and territory governments contribute small amounts.

According to Independent Schools Australia (ISA) 2023 statistics, every 1 in 8 schools is  independent with 1 in every 6 pupils attending. Figures show that enrolments at independent high schools are growing. In 2023, private high schoolers made up 41% of all students. Consequently, more money is being invested into private schools – however, as in most systems, there are checks and balances.

Base or Recurrent Funding

With independent schools, the amount of base funding allocated per student varies. According to the Schooling Resource Standard (SRS) estimates for 2024, it costs $13,557 per annum to educate a primary schooler, and $17,036 per annum for a high schooler. At private schools, annual Direct Measure of Income or DMI scores are used to calculate the school’s Capacity To Contribute or CTC. The Australian Bureau of Statistics (ABS) calculates the family income for each student based on available information, identifies the average family income at the school, then ranks all median incomes for all independent schools. These ranks are then converted into DMI scores for each school.

From 2022 onwards, a private school’s CTC score determines how much that school contributes to base funding. This can be anywhere from between 10% to 80% of total base funding. Loadings ensure that more funding is given to pupils who need it most. These aren't affected by a school’s CTC. The six loadings include:

• Students with disabilities.
• ESL students.
• Parent’s or guardian’s occupation and educational level.
• Regional or remote schools.
• Small schools.
• Aboriginal or Torres Strait Islander pupils.

This funding is earmarked for the everyday running costs of schools. It’s used to pay for both teaching and non-teaching staff salaries, utility bills, insurance, admin costs related to NAPLAN and PISA testing, and general maintenance.

According to 2023 figures, private institutions receive less base or recurrent funding than government ones – around $12,260 per student per annum.

Whilst some schools have historically been funded above the SRS and others below it, it is expected that all schools will be fully funded to SRS levels by 2029 at the latest.

.

Approved System Authorities

In the case of government schools, SRS funding is administered and allocated by the relevant state or territory. With private schools, it is passed on to Approved Authorities. The Australian Education Act 2013 states that Approved Authorities can best understand the individual needs of the students and schools they serve. For private schools, the Approved Authority is the body corporate approved by the Minister for the school.

Approved Authorities for more than one school can distribute SRS funding in two ways:

• according to the Schooling Resource Standard (SRS).
• Redistributing the funding among individual member schools according to their own needs-based funding arrangements.

Capital Funding

Capital funding pays for facilities such as libraries, gymnasiums, and swimming pools. Whilst struggling independent schools (supported by their approved authorities) can apply for grants, parents and independent school communities raise much of the funding for these projects – 86% of the required costs in 2023. Independent schools also rely on income from fees, charges, parental contributions, and private sources.

School systems

Schools with common aims, philosophies, or religious affiliations may be governed or administered as part of a distinct system. Currently, the largest systems within the private school sector are Seventh-Day Adventist, Lutheran, and Anglican. Systems can include between 3 to 38 separate institutions. There are also informal groupings of Independent schools throughout Australia which provide member institutions with crucial support.

Both government and private schools strive to ensure that funding is allocated on an as-needs basis which benefits schools, families, and communities that need it most.

Bibliography

“Dispelling Myths.“ Independent Schools Australia. Accessed 14 April 2024.

“How are schools funded in Australia?” Australian Government – Department of Education, Skills and Employment. Accessed 14 April 2024.

“How is Australian Government funding distributed according to need?” Australian Government – Department of Education. Last modified 15 March 2024.  

“Independent Schools At A Glance.” Independent Schools Australia. 2023. Accessed 14 April 2024. https://isa.edu.au/documents/at-a-glance/

“National Report On Schooling in Australia 2022.” Australian Curriculum, Assessment, and Reporting Authority (ACARA). 2022. Accessed 14 April 2024.

“School Funding.” Catholic Education Commission. Accessed 14 April 2024.

“School funding on a page.” The Association of Independent Schools of New South Wales (AISNSW). 2024.

“Types of Schools and Systems.” Independent Schools Australia. Accessed 14 April 2024.

Facts, Courtney. “Are private schools better than public schools?” ABC News. 20 January 2023.

Author
Estelle Borrey
PhD in European Languages and Cultures.