Competitive forces in school education

Funding changes are not the only threats non-government schools will need to have on their radars in the next decade. School enrolment data from the Australian Bureau of Statistics shows that after four decades of relentless growth, the proportion of students in independent schools has slowed substantially.

The number of students in the independent sector has continued to increase, but the other sectors have begun to regain some territory. The patterns are different for primary and secondary schools. At primary level, government schools have had an uptick in enrolment share for the first time since the 1970s, whereas secondary school growth has been greatest in Catholic schools.

This is arguably a good thing. For competition to be beneficial — either by raising quality or lowering costs, or both — it has to work in both directions. Growth in one sector alone over a long period of time creates stagnation; the waning sector is not responding effectively, and the prevailing sector becomes complacent.

Independent schools have been able to maintain their respected and valued position as educational leaders through a combination of strong and visible achievement and, for some schools, a large element of prestige.

But parents are becoming savvy consumers of education. Thanks to the My School website and various other sources of information about comparing schools, parents are able to weigh up school performance in NAPLAN versus the cost commitment of school fees. Of course, NAPLAN is not the only measure of school value, but it provides a hitherto missing piece of the puzzle.

There are also other potential disruptors. The success of free schools and academies in England is arousing the interest of policy makers, and the example of New Zealand’s Partnership Schools has been instructive. Free schools and Partnership Schools were inspired by charter schools in the US. They are privately-operated schools that are fully publicly funded. They cannot charge fees and are usually not selective. This combination of independent management (with a high level of accountability) and the absence of fees will be an appealing prospect for many parents.

A healthy and high quality non-government school sector is an important part of the education landscape. But it should not be assumed that the circumstances of the past will be continued into the future.