SYDNEY, Australia — Australia's education system, long praised for its quality, is facing growing criticism for its stark inequalities, particularly in how public and private schools are funded. In a new essay titled Rich Kid, Poor Kid: The Battle for Public Education, author and advocate Jane Caro argues that the nation's funding model has systematically favored private schools, leaving public institutions under-resourced and serving the majority of disadvantaged students. Published by the Australia Institute Press, Caro's work comes at a pivotal moment as the federal government's Better and Fairer Schools Agreement takes effect, aiming to address some of these disparities.
According to recent research from the Australian Education Union, over half of Australia's private schools now receive more combined government funding per student from federal and state sources than comparable public schools. This imbalance has contributed to what Caro describes as one of the most segregated schooling systems in the Organisation for Economic Co-operation and Development (OECD). Public schools educate the bulk of students from low-income backgrounds, while private institutions, including Catholic and independent schools, often cater to more affluent families and boast concentrated advantages in resources and outcomes.
Caro's essay traces the roots of this divide back more than 65 years, beginning in the late 1960s when the federal government first dipped into school funding. Prior to that, education was largely a state responsibility, with the federal role minimal. The shift started with one-off grants for building science laboratories and libraries in both government and non-government schools, but it quickly expanded amid political pressures.
A key catalyst was the Catholic sector's push for 'state aid' to cope with surging enrollments and a shrinking pool of religious teachers, such as nuns and brothers. This demand was politically charged, pitting religious groups against secular education advocates. By 1975, under Prime Minister Gough Whitlam's Labor government, recurrent federal funding for private schools was established. Whitlam framed it as 'educationally necessary,' basing allocations on student needs for both public and private sectors. The move also served political ends, easing tensions over state aid and appealing to Catholic voters.
However, Caro contends that this marked the beginning of a troubling evolution. Subsequent governments, starting with Malcolm Fraser's Liberal administration in the late 1970s, shifted the emphasis from need-based support to a 'basic grant model' rooted in parental choice and entitlement. 'This was reinforced by the next federal government under Malcolm Fraser, who embedded a “basic grant model” for private schools based on entitlement and choice, rather than need,' Caro writes in her essay. This approach laid the groundwork for Australia's unique system, where both public and private schools receive government funds—a model not replicated internationally.
The essay delves into decades of policy twists, including the landmark 2011 Review of Funding for Schooling, chaired by business leader David Gonski. The Gonski Review exposed the concentration of disadvantage in public schools and recommended a needs-based funding framework called the Schooling Resource Standard (SRS). It proposed allocating resources according to individual student needs, such as those from low socioeconomic backgrounds or with disabilities.
Yet implementation faltered. Then-Prime Minister Julia Gillard promised that 'no school will lose a dollar' under the new model, a assurance that Caro says compromised its equity goals from the start. Private schools, which can charge uncapped fees and select students—including exclusions based on gender or sexuality—continued to receive full SRS funding plus extras. Many also benefit from charitable status, granting tax exemptions and encouraging donations. In contrast, most public schools in states outside the Australian Capital Territory (ACT) fall short of their legislated SRS minimum.
Caro challenges common defenses of the status quo. Governments often claim funding private schools expands parental options, but she points to a recent study showing Australia's secondary schools among the priciest in the OECD, even after decades of public subsidies. 'Even “after decades of publicly funding private schools”, Australia’s secondary schools are some of the most costly among developed economies of the OECD,' she notes.
Another frequent argument—that private school parents pay taxes and deserve subsidies—is dismissed by Caro as flawed. 'Taxation is not a deposit account that we can draw on to “buy” whatever service we choose,' she argues. She highlights that such choices often mean only wealthy families can afford the fees, perpetuating inequality. The notion that subsidizing private education saves public money is also critiqued, as it ignores how underfunded public schools bear the brunt of higher-needs students.
Not all private schools fit the elite mold; the sector includes lower-fee Catholic institutions serving diverse communities. Still, Caro wonders if the system was designed to 'divide and conquer,' fostering competition that disadvantages public education. Schools vie for high-achieving students to boost rankings, while sidelining those requiring more support—a market-driven dynamic that exacerbates segregation.
Reflecting on her own 1960s and 1970s experience in New South Wales public schools, Caro recalls a more inclusive era where students from varied backgrounds mingled, fostering social mobility. 'Public schools are an expression of a public good: the common good,' she writes, echoing the democratic ideals tied to representative government. Yet, as education professor Jessica Gerrard cautions in a related commentary, idealizing the past overlooks historical exclusions in public schools, such as racial and gender biases. True equity demands ongoing fights for inclusive policies and funding.
The Better and Fairer Schools Agreement, legislated recently, promises progress by tying federal funds to needs-based principles and requiring states to meet SRS targets. However, Caro warns that without tackling private school privileges—like tax breaks and selective admissions—the reforms may fall short. Her essay proposes solutions: revoking tax exemptions for private schools, imposing uniform standards on all publicly funded institutions, and reframing the debate away from 'cost' narratives that stigmatize needy students.
Political hurdles loom large. Australia's commitment to school choice, enshrined across parties, resists change. Caro calls for a cultural shift, questioning the 'unwavering political and cultural fidelity to school choice and entitlement.' Until then, she argues, the battle for public education persists, with profound stakes for social cohesion.
The implications extend beyond classrooms. Unequal funding correlates with widening achievement gaps, as seen in OECD data where Australia's performance has stagnated despite high spending. Public schools, serving about 65 percent of students but the majority of disadvantaged ones, struggle with outdated facilities and teacher shortages. Private schools, meanwhile, report better results, though critics like Caro attribute this to selective enrollment rather than superior teaching.
As the new agreement rolls out over the coming years, advocates hope it signals a turning point. Caro’s work, reviewed in The Conversation, underscores the urgency: without bold action, Australia's education system risks entrenching class divides for generations. For now, the conversation—fueled by voices like Caro's—continues to push for a fairer future.