Bills Digest no. 37 2008–09
Schools Assistance Bill 2008
WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced
and does not canvass subsequent amendments. This Digest does not have
any official legal status. Other sources should be consulted to determine
the subsequent official status of the Bill.
CONTENTS
Passage history
Purpose
Background
Financial implications
Main provisions
Concluding comments
Contact officer & copyright details
Passage history
Date introduced:
24 September 2008
House:
House of Representatives
Portfolio:
Education, Employment and Workplace Relations
Commencement:
1 January 2009
Links: The relevant links to the Bill,
Explanatory Memorandum and second reading speech can be accessed via BillsNet,
which is at http://www.aph.gov.au/bills/.
When Bills have been passed they can be found at ComLaw, which is at http://www.comlaw.gov.au/.
The Schools Assistance Bill 2008 (the
Bill) provides Australian Government funding for non-government schools
for the years 2009 to 2012. It succeeds in part the Schools Assistance
(Learning Together—Achievement Through Choice and Opportunity) Act 2004
(the current Act), which provided funding for both government and
non-government schools for the years 2004 to 2008.
The Bill also provides funding for Indigenous students
attending non-government schools. This funding was previously appropriated
under the Indigenous Education (Targeted Assistance) Act 2000 (the
IETA Act). A separate bill, the Education Legislation Amendment Bill
2008, amends the IETA Act for this purpose.[1]
The Bill marks a major departure in Commonwealth funding
arrangements for schools. The current Act and its predecessors provided
funding for both government and non-government schools. This Bill provides
the funding arrangements for non-government schools only. Future Commonwealth
funding for government schools will be provided through the National Education
Agreement which is currently being negotiated with the states and territories
through the Council of Australian Governments.
The Bill fulfils the Government’s commitment to retain
the current system of general recurrent funding for non-government schools
(the Socioeconomic Status (SES) funding system) for the next four years.
There is a minor modification to the system, necessitated by the routine
revision of SES funding scores for the next four years and the requirement
that no school receives less funding because of the re-assessment of its
SES score. Under the SES system, the higher a school’s SES score the lower
the per student funding rate. Therefore, those schools with a 2009 to
2012 SES score that is higher than their current score will continue to
be funded at their 2008 per capita amounts until the funding value of
the new score is equal to, or greater than, their 2008 entitlement unless
the school is already funding maintained (with indexation) at a previous
level or already receiving the maximum per capita amount.[2]
The Bill also provides additional funding for non-government
schools that have significant numbers of Indigenous students. The maximum
rate of general recurrent funding will automatically apply to non-government
schools in remote and very remote areas that have 50 per cent or more
Indigenous enrolments and to non-government schools in other areas that
have 80 per cent or more Indigenous enrolments. The Minister for Education
estimates that this measure will provide an additional $5.4 million to
these schools.[3]
There is also another change to the funding arrangements
for non-government schools. Previously new non-government schools were
entitled to establishment assistance grants, which were paid at the full-time
equivalent per student rate of $500 for the first year of the school's
operation and $250 per student for the second year of operation. This
assistance is being phased out, with only the remaining 2009 second-year
payments to be made. This funding was not provided to new government schools.
The Bill provides funding for capital grants and continues
funding for existing targeted programs, including short term emergency
assistance; education in country areas; teaching English to new arrivals;
and literacy, numeracy and special learning needs.
Two elements of funding to the non-government sector—funding
for non-government hostels and non-government centres (which provide services
to children with disabilities)—are not in the Bill but will be paid to
the states and territories to manage through the National Education Agreement.
In addition to the extra general recurrent funding for
non-government schools with significant Indigenous enrolments, the Bill
provides supplementary recurrent funding for Indigenous students attending
non-government schools. This funding was previously provided through the
Indigenous Education (Targeted Assistance) Act 2000.
This supplementary funding for Indigenous education is
also being restructured. The non-government components of various Indigenous
school education program elements contained in the IETA Act are being
streamlined into the one per capita payment—Indigenous Supplementary Assistance
(ISA).[4] As the Minister explains in her second reading
speech, the aim of this restructure is ‘to reduce reporting and red tape
for schools and provide them with increased flexibility to focus on the
educational achievement of their students.’[5]
For the first time, ISA will be indexed at the same rate as other general
recurrent school funding. The increased indexation is estimated to provide
an additional $24.5 million.
The Bill also provides an Indigenous Funding Guarantee
to ensure that non-government schools and systems, as a result of these
new arrangements, do not receive less funding than they received in 2008.
Funding of $18.1 million over four years has been provided for the guarantee.[6]
Together, the ISA and the Indigenous Funding Guarantee
will provide $239 million over four years for the education of Indigenous
students in non-government schools.[7]
The Bill continues the general provision in schools funding
legislation for the Minister to make conditions in the agreements for
Commonwealth funding for schools.[8]
However, the current Act introduced an unprecedented number of specified
conditions for Commonwealth funding for schools. While a number of these
conditions have either been met, superseded or abandoned by the Bill,[9] it retains the broad thrust of the educational
outcomes accountability framework of the current Act. There are now six
conditions covering school performance:
- participation in national student assessments
- participation in national reports on the outcomes of schooling
- provision of individual school performance reports to the Minister
- provision of ‘plain language’ student reports to parents, to include
an assessment of the student’s achievement against any available national
standards and relative to the student’s peer group at the school
- provision of publicly available information about the school’s performance
and
- implementation of the national curriculum.
Further information about the specific requirements under
each of these conditions will be provided in the regulations to the Act
when it is passed. However, this accountability framework will be consistent
with that for government schools under the National Education Agreement.
The financial accountability conditions for Commonwealth
funding have been significantly strengthened. The Bill includes a new
provision which empowers the Minister to refuse or delay payments if a
school audit raises questions about a school’s viability.[10]
Although non-government schools have always been required
to complete a financial questionnaire, the Bill contains a new requirement
for schools to report funding sources. This is intended to provide the
Government with more flexibility as to what financial information it can
collect from school authorities. The final decision about what schools
will be required to report will be made after consultations with the non-government
sector.[11]
Previously, the financial information that was collected
was treated as commercial-in-confidence and, therefore, individual school
financial information was not released. However, the Bill contains another
new provision which empowers the Minister to ask for reports about individual
school information in a way determined by the Minister.[12] Potentially, under this provision, the Minister
could make these reports publicly available.[13]
From 2009 Commonwealth funding for government schools
will be provided through the National Education Agreement (NEA) which
is currently being negotiated with the states and territories through
COAG. The NEA will provide the same accountability framework for government
schools as the Bill provides for non-government schools.
The NEA is part of the Australian Government’s reform
of specific purpose payments (SPPs) to the states and territories. The
new structure will comprise an Intergovernmental Agreement (IGA) between
the Commonwealth and the states and territories, with separate National
Agreements, which will be schedules to the IGA, covering school education,
health, disability services, housing, early childhood and vocational education
and training. The Minister has indicated that the NEA will not be a matter
for legislation. Rather, the proposed State Finances Act will appropriate
funding for the NEAs.[14]
As well as setting out the broad goals for school education
and incorporating the existing SPPs, the NEA will include National Partnerships
to support specific projects and reforms, as agreed to by COAG. The Minister
has identified three priorities for National Partnerships:
- improving the quality of teaching
- raising outcomes in disadvantaged school communities and
- delivering a ‘new era of transparency, to guide parents, teachers
and policymakers in making the best possible decisions.’[15]
These arrangements will have to be finalised by the end
of the year, for implementation from January 2009.
The Bill provides an estimated $28 billion (final 2008
prices) for non-government schools for the years 2009 to 2012. The amounts
under the different programs will be adjusted annually according to their
particular indexation arrangements for price increases.
Commonwealth funding for non-government schools remains
essentially unchanged. The general pattern, with the majority of Commonwealth
funding for schools provided to non-government schools, will continue.
In 2008–09 an estimated 67 per cent, or $6.4 billion, of Commonwealth
funding for schools will be provided to non-government schools, compared
to $3.1 billion for government schools. A similar pattern continues in
the 2008–09 budget projections for the out-years.[16]
However, the Government has signalled that it is time
to move on from the past debates about the funding of government and non-government
schools:
For too long the debate about schools was diverted
into unproductive avenues … The true target of our efforts must be individual
students no matter which type of school they attend … we are moving
beyond the traditional and discredited focus of schooling debate in
Australia; the debate that revolved around competition between sectors
and failed to focus on the realities of need and outcome across all
sectors.[17]
The Government regards its new accountability and performance
reporting framework as integral to improving educational outcomes:
In schooling, all Australian governments share the
objective of raising overall attainment so that all students acquire
the knowledge and skills they need to participate effectively in society.
In support of this objective, the Australian Government is working with
State and Territory Governments to develop a strong and transparent
data and reporting framework for student and school performance, which
provides:
- Parents with clear information about the performance of their child
and their child’s school.
- Comparative information about schools’ performance, which is required
to support the COAG-agreed outcomes. Particularly important is the
literacy and numeracy performance of like schools, given that achievement
here is arguably the most critical factor in young people staying
on to attain a Year 12 qualification.
- Performance data about schools and school systems, which is necessary
to build a substantive evidence base to show what works and to support
future improvements.
Clear accountability helps create a learning environment
that encourages innovation and excellence from school leaders, teachers
and students. It also means that students, parents and teachers have
the evidence they need to make informed choices.[18]
There has been little reaction to the actual Bill and
its funding of non-government schools. The non-government sector has readily
accepted the legislation and its conditions for funding, no doubt assuaged
by the continuation of the SES funding system. The sector has welcomed
the Bill because it provides ‘funding stability’ and the sector has not
publicly expressed concern about the new reporting framework.[19]
However, the Government’s promised review of the SES funding system raises
questions about the future of Commonwealth funding for non-government
schools. An internal review of the system under the previous Government
recommended changes to the system to lower some schools’ funding levels
which have been maintained at higher levels because of the policy’s ‘no
losers’ approach.[20]
In the main, the debate is focussing not on the actual
content of the Bill, but rather the policy issues relating to the future
arrangements for government schools funding and the national school performance
reporting framework that will underlie the foreshadowed National Partnerships.
The presentation of this Bill before the arrangements
for government school funding have been finalised, has created some uncertainty
about the future of Commonwealth funding for government schools.[21] It is not until the National Education Agreement
is produced that judgements will be able to be made about the financial
and educational accountability framework that the Government is establishing.
The issue which is currently receiving most attention
is the Minister’s regard for New York City’s school reporting system as
a basis for the proposed school reporting framework—the head of
the New York education system will be visiting Australia next month on
the Minister’s invitation:
We can learn from Klein's methodology of comparing
like schools with like-schools and then measuring the differences in
school results in order to spread best practice.[22]
However, she has stopped short of endorsing league tables
and ‘A to F reporting’ which is a feature of the New York system.[23]
The New York City system uses annual school progress
reports which compare students' performance from year to year and compare
schools within a group of 40 peer schools with similar populations. Schools
are then graded from A to D and F based on student test results, the progress
of students in a year and the school environment as determined by attendance
and a survey of parents, students and teachers. Schools rated as A or
B receive financial rewards and are used to demonstrate good teaching
practices. Schools graded D or F are given assistance to improve and if
no progress is made the school is restructured, the principal changed
or it is closed.[24]
According to the latest results for 2007–08, nearly 60
per cent of schools either improved their grade or maintained an A-level
from the previous year, 50 schools received a D grade compared to 86 for
the previous year, and the number of F-rated schools dropped from 35 to
18 schools. Accompanying these results were the results of a pilot school-based
merit pay scheme, whereby teachers at 89 of the 160 participating schools
will receive bonuses as the result of improved student test scores.[25]
However, the New York City system has been assessed by
some as unreliable and producing misleading comparisons of school performance
and student progress. In his analysis of the system, Trevor Cobbold, Convener
of Save our Schools, concludes: ‘It is incoherent, can be used to produce
league table[s], fails to compare like with like and is statistically
flawed.’[26]
Main
provisions
Clauses 12 to 15 establish the basis upon which
the Minister may authorise payments to non-government schools; namely,
that a funding agreement must be in place, that schools must be approved
to operate as a school and that schools must be financially viable. Proposed
paragraph 15(c) is a new provision which empowers the Minister
to refuse or delay payments if a school audit raises questions about a
school’s financial viability.
Clauses 17 to 22 set out the requirements relating
to the performance of, and reporting by, non-government schools. Proposed
subparagraph 19(2)(b)(ii) empowers the Minister to make reports
about non-government schools’ performance and financial arrangements publicly
available.
Clause 24 provides that reports in relation to
the programs of financial assistance and the financial operations of a
school, including its financial viability and funding sources, be provided
to the Minister.
Paragraph 29(c) provides that the agreements for
Commonwealth schools funding may include any other conditions or provisions
that the Minister considers appropriate.
Clause 36 explains the meaning of Average Government
School Recurrent Costs (the AGSRC), which is the basis upon which the
per capita general recurrent funding rates for non-government schools
are calculated. Proposed subparagraph 36(1)(a)(i) provides the
initial 2009 primary AGSRC amount ($8044) and subparagraph 36(1)(b)(i)
provides the initial 2009 secondary AGSRC amount ($10 061).
Clauses 38 to 56 set out the arrangements for
the SES system of general recurrent funding for non-government schools.
Clauses 64 to 69 provide for Indigenous supplementary
assistance. Proposed paragraph 67(1)(a) provides the per capita
assistance amount ($1600) for Indigenous primary students at non-remote
school campuses and paragraph 67(2)(a) provides the amount ($3850)
for Indigenous primary students at remote school campuses. Proposed paragraph
69(1)(a) provides the per capita assistance amount ($2250) for Indigenous
secondary students at non-remote school campuses and paragraph 69(2)(a)
provides the amount ($4400) for Indigenous secondary students at remote
school campuses.
Clauses 70 to 71 provide for the Indigenous funding
guarantee. Proposed subsection 71(b) provides $18.1 million over
four years, 2009 to 2012, for the guarantee.
Clauses 83 to 85 provide for capital expenditure.
Proposed paragraph 84(2)(b) provides base 2009 program year funding
of $128.712 million.
Clauses 86 to 99 provide for grants for targeted
assistance:
- proposed paragraph 87(2)(b) provides base 2009 program year
funding of $1.057 million for short-term emergency assistance
- proposed paragraph 88(2)(b) provides base 2009 program year
funding of $5.246 million for education in country areas
- proposed paragraph 91(1)(b) provides base 2009 program year
funding of $12.334 million for languages education
- proposed paragraph 94(2)(a) provides the base 2009 program
assistance amount of $5,786 per student for teaching English to new
arrivals—eligible new arrivals
- proposed paragraph 95(2)(a) provides the base 2009 assistance
amount of $11,572 per student for teaching English to new arrivals—eligible
humanitarian new arrivals
- proposed paragraph 96(3)(a) provides the base 2009 assistance
amount of $853 per student for literacy, numeracy and special learning
needs (LNSLN)—students with disabilities
- proposed subparagraph 98(1)(b)(i) provides the base 2009 program
year funding of $142.375 million for LNSLN—school grants and
- proposed subsection 99(a) provides $1.942 million for LNSLN—guarantee
amounts.
Schedule 1 lists the SES scores and their equivalent
funding level as a percentage of AGSRC.
Concluding
comments
The Bill heralds a significant change in the structure
and arrangements for Commonwealth funding for schools. However, until
the National Education Agreement is finalised, the exact form of these
arrangements and the implications for the accountability of Commonwealth
funding for schools will not be known. The future direction of schools
funding remains opens with the promised review of the SES system, the
new arrangements for government schools funding and the foreshadowed National
Partnership Agreements to improve the quality of teaching and the outcomes
for educationally disadvantaged schools and to establish a new accountability
framework for school performance.
Marilyn Harrington
10 October 2008
Bills Digest Service
Parliamentary Library
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