Tuesday, September 13, 2005

Some facts about education

Yesterday's Herald reported on a study from the Council for Educational Research showing that parents were refusing to prop up schools and that our "free" education system's ability to raise extra funds to cover government underfunding. One of the TV news channels (sorry, I lose track) followed up with a report that, on average, schools only received 66% of their revenue from the government and had to raise the rest themselves. It then quoted National's Bill English, who presented the National party's solution (as seen in their education policy): slash the number of "education bureaucrats" and redirect the funding to schools. But there's one problem: "education bureaucrats" make up only a tiny fraction of the overall education budget.

A quick perusal of the Budget 2005 estimates of appropriation for Vote: Education [PDF] reveals the following facts:

  • Total education spending for 2005/06 is $8,519.381 million;
  • of that, the vast bulk ($6,305.367 million) goes on "provision of educational services", meaning schools, universities, and ECE centres;
  • Primary education costs a total of $1,988.163 million, secondary $1,536.401 million, for a total of $3,524.564 million of the above;
  • $1,371.667 million is spent on services purchased from the Ministry of Education - the "education bureaucracy".

(These numbers aren't meant to add up; I'm trying to give a relative picture of the costs involved. if you want a full breakdown, read the estimates)

National points to the growth in overall education spending, and in particular the growth of spending on the Ministry to paint a picture of a bureaucracy gone mad. But this isn't entirely supported by the facts. While Ministry spending has indeed grown, the largest jump - between 2002 and 2003 - is due to the absorption of the previously independent Specialist Education Service (SES) into the Ministry. This added about $150 million into the departmental budget. More importantly, there has also been significant growth in the capital charge and depreciation spending - which shorn of the accountantspeak means the government has built new buildings and spent on maintenance that had been deferred for years under the previous National government. So we're not seeing a metastasising bureaucracy so much as a reorganisation and a significant growth in investment. Likewise, the growth in overall spending is due to them doing more (particularly in the area of early childhood education), and paying teachers more - not "waste".

But more importantly, when we look inside the Ministry's funding, we find that precious little of it is actually spent on bureaucrats. Of the Ministry's $1,371.667 million budget, $971.729 million goes on "provision of school sector property". $624.589 million of this is the capital charge (essentially depreciation on school buildings, repaid to the government in the name of transparent accounting), and the rest goes on maintenance, upgrades, and new construction. $163.295 million goes on the Special Education Service, which provides educational support to children with special needs. The remainder - $236.643 million - covers everything else: administering education regulations, administering the resources, making sure that school boards of trustees didn't spend all their money on a holiday on the Gold Coast, making sure that schools meet curriculum requirements and academic standards, answering Bill English's questions ($3.7 million worth!), planning, and policy advice. That's your education bureaucracy right there. Even if it was completely disestablished, it would save only 2.8% of the total education spend, or 6.7% of the amount we spend on schools - far short of the 33% shortfall estimated above.

Basically, Bill English's claim that culling "education bureaucrats" would result in significant funding increases at the frontline are simply a fantasy. The only way he can produce the required funding increases would be either to spend vastly more money (impossible given National's tax-cut plans), or dramatically slash capital and maintenance spending, and run the schools into the ground again - exactly as National did in the 90's.

Addendum: David Slack has pointed out in email something I should make clearer: most of that $3.5 billion we spend on primary and secondary education is in the form of teacher salaries. These are paid directly by the Ministry, and one of that body's key administrative functions is making sure everyone gets paid. Likewise, building and maintenance costs are paid by the Ministry. The 33% shortfall is measured against a baseline which does not include these costs - which means on the one hand that disestablishment would make a bigger difference, and OTOH makes it very clear the importance of those bureaucrats's jobs (and how little would be saved if they were disestablished; the administrative cost of paying everyone has to be paid somewhere, and if it is not done by the Ministry, it will have to be done by the schools...)

It also points out another way National can make the "necessary" savings to fund their tax cuts: by employing fewer teachers or paying them less - again, just as they did in the 90's.

And to throw in a point I left out of the original post: if you're concerned about children's education being affected by school underfunding, then you should be asking yourself whether you really think schools will get more money under a party which wants to empty the government's coffers on tax-cuts for the rich.


I'm not sure what the cost would be, but I've suggested before that it would be a good move to abolish school fees in public education.

This could be done by having an Education Amenity Fund (or similar nice name) that gave grants to schools on a needs basis. This could be publically funded but also accept donations from parents and others. As a corrollary to this, schools would be prevented from seeking or accepting direct donations from parents.

Posted by Rich : 9/13/2005 03:23:00 PM

In some contexts larger clases would be a good thing. Also lets say the education system is even vaguely efficient and it hires good teachers - then each new (marginal) teacher is significantly inferior to the average.

Thus for example if you had in an extreme case 1 teacher per pupil you would have one of the worst education systems imaginable.

Therefore in many context less teachers may be a good idea. And throwing money at the problem may make it worse.

Posted by Genius : 9/13/2005 09:22:00 PM

Not necessarily, Genius. The benefits of one-on-one teaching may well outweight the limitations of the marginal teacher, especially if the high quality teaching resources are provided. And the marginal teacher might not be significantly inferior to the median teacher, if really excellent teachers are a small minority that couldn't possibly teach everyone on their own.

It's Alliance policy to abolish public school fees, and the cost is covered by the Alliance tax scheme.

Posted by Commie Mutant Traitor : 9/14/2005 09:35:00 AM