NRT: 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.

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