Tax Deductions and Other Seductions


As we stagger into the last day of the election campaign the protagonists on either side of the education debate must be wondering why a real policy war has not broken out. Where are the battlers who were wheeled out before the last election to press their dire need for more funding? The skirmishes over private school hit lists? Even The King’s School in Sydney, usually in the front line in such battles, is out of the spotlight. Its headmaster, shedding his role as the Sheik Hilaly of the independent school sector, has even come out in support of some form of needs-based funding of schools.

The furious agreement between the Coalition and the ALP over education policy has survived right up until the last day. An ALP statement on school standards issued on Sunday echoed most of the Howard-Bishop unproven ‘reform’ agenda. For its part, the Coalition is fast running out of wedges with which to taunt Labor. Howard’s school fees tax deduction, announced in his campaign launch, didn’t excite any opposition from Kevin Rudd. The only sound  that resembled protest was the furious gnashing of teeth (behind closed jaws) from Labor’s Left.

Those who ventured into any debate about real issues have been quickly silenced. Mike Kelly, the ALP candidate for Eden-Monaro, had the temerity to assert that the government’s postcode system of funding private schools was ‘totally crazy’. He was promptly demonised by Howard and mugged by his own side. He must have forgotten that he was not supposed to mention the war. Regardless, he was only half-correct: the system of identifying funding needs of private schools is actually unfair, illogical, misleading and badly corrupted it is the people who believe that it works who are crazy.

In an interesting switch, notable opposition to the tax-deductibility proposal came from the principals of a number of high-fee schools. As reported in The Age, Melbourne Grammar principal Paul Sheahan said rather than offering tax cuts and rebates, the nation’s political leaders should promise to spend billions improving classrooms and buildings in poorer non-government schools and across the public education system.

More than ever before, we have to look beyond the ‘me-too’ culture of the main parties to find out about real issues. With the possible exception of the skills shortage the parlous state of public schools has rated rarely a mention the words ‘public’ or ‘government’ (schools) were notably missing from the campaign launches. Howard did make a sneering reference to government school contributions it built nicely on his dismissal of public schools last May as reasonable quality safety nets. Rudd’s digital education revolution did mention ‘public’, but he was talking about libraries, not schools.

Unlike the economy and hospitals, schools don’t rate very highly as sexy, hip pocket, or urgent election policy issues. Interest rates don’t have an impact and no one dies in an underfunded school. But the growing gap between kids, schools and communities is real and harder to hide. The income, class and even cultural divides in the enrolment profiles of public and private schools is easily seen through official statistics or even in casual glances in the direction of schools. Our underperforming kids are the equivalent of a year and a half behind their equivalents in Canada.

So what is the education non-debate in this election all about? Leaving aside the areas of furious agreement such as skills training, the answer is: not much. When Julie Bishop and Labor’s Stephen Smith both appeared on ABC TV’s Lateline the segment had gone beyond the halfway mark before anyone mentioned education. Even then it quickly degenerated into my scholarships are bigger than yours, with digital diversions appearing faster than a broadband connection. While  Bishop maintained that schools have enough computers Smith claimed that private schools welcomed the ALP program, so what more proof does one need?

Much of Labor’s revolution is recycled. The State governments have been rolling out computers to their schools for some time. It was an election winner for Bob Carr, even if the computers came without training, technical support and any broadband. When Julie Bishop complains that there is nothing revolutionary about such promises she has a point if any revolutionaries throughout history were able to witness Rudd’s tilt at the barricades they might well be a tad disappointed.

This is not to say that there aren’t differences and making private school fees tax deductible would certainly be different. When the Prime Minister made this announcement at his campaign launch he was greeted with a round of applause from the faithful and an appreciative ‘amen’ from the most of the private school lobby.

They have been pressuring the Howard Government for some time for more funding. A decade of seeding new schools, often regardless of need, has meant that many private schools are starting to seriously run out of new customers and their growth is slowing, especially in NSW. We now have too many schools and too few kids and Catholic schools especially are starting to feel the same pain felt by public schools over the last decade.

Affordability has always been the key to growing the market for private schools. But affordability is never sustained because the schools keep increasing their fees, in many cases far in excess of cost of living increases. They do this because they can: there is no regulation of private school fees. There are ample parallels in other areas such as child care and housing where private providers ramp up their charges when their potential customers receive some form of public subsidy.

Julie Bishop was quick to respond to various criticisms, even if the critics all seem to come from outside the ALP. In particular she rejected suggestions the Government was secretly trying to privatise education. She is probably partly correct: it isn’t any great secret. In proposing tax deductions for school fees the Howard Government is simply doing more of the same. There is no big picture, no logical framework, not even a coherent ideology. They don’t know where it is going what happens down the track doesn’t seem to matter.

There is now a noticeable income divide between private and public school families and making school fees tax deductible would certainly ensure that divide which other countries try hard to avoid will become more entrenched.

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