How the Federal Government funds Catholic schools

Over the past two weeks numerous parents who send their children to our local Catholic schools have contacted me, concerned about the changes our education reforms will have on our schools and our children. 

I understand that this is a complex issue with a lot of misinformation out there, and that parents are understandably worried, so here are the facts when it comes to funding Catholic schools in Australia.

The Federal Government has never funded Catholic schools directly, we have always funded the Catholic Education Commission. The CEC has sought, demanded, always had, and continues to have full autonomy on how to distribute those funds. 

During a meeting last Tuesday with Bishop Comensoli, Ross Fox, Peter Hamill, the Minister Simon Birmingham, and I, the Minister suggested that if the CEC felt the wording in the legislation did not provide them with enough security, they could provide him with wording they felt more comfortable with, and he would move an amendment in the Senate to have the legislation changed. We are yet to receive the proposed new wording the CEC would like us to introduce. 

Since 2004, the funding the CEC receives has been calculated on the basis of their schools’ SES scores. If a school, or parents at a particular school, believe they are being disadvantaged, the CEC can ask for an individual school to be audited by the Federal Department of Education. A number of schools in NSW have done so in the past, however I am advised that this has never been requested by the NSW CEC. 

The Quality Schools Package will increase money to the Catholic school system, including Broken Bay, by 3.8% in 2017 and by 43% over ten years. 

Last year, off their own bat, the CEC decided to increase fees for schools on the North Shore, and redistribute the funds to other parts of NSW, as is their prerogative. I opposed this at the time, but respect the Catholic Education Commission’s right to allocate funds.

Both my wife and I went to schools in the Catholic system; in fact, OLGC is my old school, and I fondly remember playing tackle football on the asphalt playground.  All my nieces and nephew attend Catholic schools, as does my daughter. So it will come as no surprise to you when I say I strongly believe in school choice, and the role that the Catholic system plays in that. 



My letter to our Catholic School principals

Dear Principal

Over the past two weeks, a number of concerned parents and community stakeholders in the Catholic systemic schools of Mackellar have contacted me to request clarity on how the Turnbull Government’s new needs-based funding will affect Catholic systemic schools on the Northern Beaches.

Let me make it clear that I am a strong supporter of Catholic education and of the rights of parents to choose the school to which they send their children – as is the Turnbull Government.  I am a graduate of Our Lady of Good Council in Forestville, as are all my brothers and sister.  My nieces and nephew attend Catholic schools as does my daughter.   That is why total Commonwealth funding for the Catholic system - in the Diocese of Broken Bay, in New South Wales and around Australia - is increasing under our Quality Schools package.   

Over the next four years, the annual average Commonwealth funding per student to the NSW Catholic school sector will grow by 3.8 per cent. 

Total Commonwealth funding being provided to the Catholic systemic schools of the Diocese of Broken Bay will also rise strongly.  In 2017 that funding will stand at an estimated $119 million; by 2027 it will rise to $170.1 million, an increase of 43 per cent.

Compared to last year’s Budget, the 2017 Budget will see an additional $2.8 billion of Commonwealth funding over ten years go to the Catholic sector around Australia. 

Catholic schools will also benefit from the expanded capital investment program for the non-government sector, which will grow by $300 million over 10 years to a total of $1.9 billion. 

I have discussed these matters with Bishop Peter Comensoli and with Peter Hamill, Director of Schools for the Diocese, and ensured that they have had the opportunity to raise their concerns directly with Commonwealth Education Minister Simon Birmingham.

I have also attached a letter from Minister Birmingham to parents which explains the way that funding for Catholic systemic schools, and schools in the Diocese of Broken Bay, will be determined under the Quality Schools package. I would be much obliged if you could distribute this letter to your parent network.

It continues to be the case that it is based on the Gonski Review’s recommended Schooling Resource Standard, and the funding will continue to be paid as a block amount to the Catholic Education Commission of New South Wales.

Individual Catholic education systems – such as the NSW system administered by the Catholic Education Commission of NSW - will continue to be able to allocate Commonwealth funding to their individual schools as they see fit.

Fees within a particular system would therefore only increase if an internal decision was made by Catholic education authorities to do so.

As I understand from my discussions with the Diocese of Broken Bay, there is concern that, for the first time, the Turnbull Government has made available to parents an online calculator which shows funding for each school calculated under the needs-based model. This transparency is designed to meet the Government’s responsibility to taxpayers to explain how their money is being spent. 

But there has been no change to the principle that Catholic education authorities are free to allocate their block grant across all schools in their system in accordance with their own assessment of the needs of each school.

I also want to make it clear that the Diocese of Broken Bay is free to determine the schedule of fees for each school in the Diocese. The Commonwealth does not have any involvement in the setting of fees at individual Catholic systemic schools.

I hope this letter helps explain what is happening with Commonwealth funding for Catholic systemic schools in Mackellar. To discuss this further, and dispel any misinformation within our school community, I invite you to join me for a meeting upon my return from Canberra Monday 26 June at 1pm.

Kind Regards

Jason Falinski


The Minister's letter to our Catholic school parents

Read the letter here.  

Quality schools package: understanding the funding model 

The Quality Schools package needs-based funding is modelled according to the Schooling Resource Standard (SRS) recommended in the original Gonski Review. The SRS is a needs-based funding measurement tool that provides a quantitative calculation of the cost of educating a child to the national educational standards we have set. Schools that have consistently performed well in NAPLAN tests are used as a baseline for calculating the average cost required to educate a student to the national academic standard.

The SRS is comprised of two funding parts. The first is a per-student base amount which is discounted by the capacity of the school community to financially contribute towards the school’s operating costs. The capacity is calculated by using from the census Statistical Area Level 1 (SA1) in which the residential addresses of enrolled students are found.

Socio Economic Status (SES) scores will continue to be used to determine ‘capacity to contribute’ under the Government’s new school funding arrangements. The Review of Funding for Schooling in 2011 (the Review) recommended that ‘a better measure of the capacity of parents to contribute’ be developed, trialled and implemented.

Since the Review, the Australian Bureau of Statistics (ABS) has replaced the smallest spatial unit of data available from Collection District (CD) with Statistical Area Level 1 (SA1). According to the ABS, SA1s were designed to be much more homogenous than CDs and are less likely to mask socioeconomic diversity. This has significantly reduced the concerns raised in recommendation 3 of the Review. SA1s have a population of between 200 and 800 people with an average population size of approximately 400 people.

The Review concluded that the major strength of the existing SES funding model was that public funding is directly related to the capacity of non-government schools to fund their own resourcing requirements. The Review found that the use of an SES-type measure for this purpose provided a fair, consistent and transparent basis for funding the different types of non-government schools that parents can choose to send their children. It acknowledged that to collect SES data from each individual household could raise several issues of privacy and feasibility.

It also concluded that using a funding model based on the actual resources available to each school, such as the pre-2001 Education Resources Index (ERI), would be a disincentive for private investment into education and may include assets which are not readily available as a cash-flow provider, such as land.

Under the current system, the SES scores for every school within the Catholic Schools system of NSW are averaged to provide a single SES for the system. This is known as the System Weighted Average. Per-student funding is then calculated based on this score. This means that a student in a systemic school with an SES of 80 would not necessarily receive the same funding as a student in an independent or government school with the same SES score.

The Quality Schools package removes the system weighted average and provides per-student funding to each Catholic systemic school based on the SES score of that school alone. This delivers a fair and accurate measure of the individual school’s resources and the Government funding that is required to supplement this. It also ensures that parents who choose to enrol their students in the Catholic schools system are guaranteed that the funding treatment will be the same as children at a government school with the same SES.

Of course, it is still a matter for the Catholic Education Commission to distribute this funding among their schools according to their own needs-based assessment. That is because non-government school systems, including the Catholic sector, will still retain the ability to redistribute the funding they receive from the Australian Government to their member schools according to their own needs-based model. This approach recognises that schools and school systems are best placed to understand the individual needs of students and budget accordingly. This will also assist systems to respond to policy changes occurring as part of the reform process.

The second part of the SRS is a group of six loadings which take into account the individual characteristics of each school and each student enrolled at that school:

- Student level loadings – for students from socio-educationally disadvantaged backgrounds, students with disability, Aboriginal and Torres Strait Islander students, students with low English proficiency; and

- School-level loadings – for school size and location

These loadings are not discounted by the school community’s capacity to contribute.

The student level loadings specifically recognise the individual circumstances of students at each school. The Socio-educational disadvantage loading uses the Index of Community Socio-Educational Advantage (ICSEA) which was introduced in 2010. The ICSEA is calculated using data collected by the school at the time of enrolment, and measures parental occupation, income and employment. This is an important factor as this loading can help to correct for house-to-house differences that are not identified in the data attained from the ABS Collection Districts.

Students in the bottom two quartiles of the ICSEA attract additional funding at different rates.

The disability loading is designed to ensure that schools that cater for students with disabilities receive the funding required to provide the necessary care to those students.

It is important to emphasise that under the Quality Schools package every student’s individual circumstances and needs will affect the SRS of their school.

The school level loadings recognise the fact that smaller non-government schools be may disadvantaged by their size in their ability to raise capital and attract private investment.

The Turnbull Government is a strong supporter of Catholic education and of the rights of parents to choose the school to which they send their children. That is why total Commonwealth funding for the Catholic system - in New South Wales and around Australia - is rising strongly under our Quality Schools package.