Omari Gates
Education is a fundamental pillar of any society, and the Australian government has shown a commitment to investing in its educational institutions. The Commonwealth has been providing funding for schools since the 1960s and has repeatedly reviewed and refined its funding model to ensure that money is directed where it is needed most. The government has also pledged to increase funding for public schools, with the Commonwealth promising to raise its contribution to the Schooling Resource Standard (SRS) from 20% to 25% by 2034, representing a significant boost in investment. However, it is worth questioning whether these efforts are sufficient to meet the needs of Australia's students and teachers. This article will explore the current state of education funding in Australia and discuss whether the government's investments adequately support the country's educational goals and aspirations.
| Characteristics | Values |
|---|---|
| Schools funded by | Australian Government (Commonwealth), state and territory government funding, and funding from fees, charges and other parental or private contributions |
| Australian Government's role | Provide funding and set national education policies |
| State and territory government's role | Own and manage government schools, register non-government schools in their jurisdictions, and provide most of the public recurrent funding for government schools |
| Recurrent funding for schools | Estimated to total $31.1 billion in 2025 |
| Recurrent funding breakdown for 2025 | $11.9 billion to government schools, $10.4 billion to Catholic schools, and $8.7 billion to independent schools |
| National School Reform Agreement | Joint agreement between the Commonwealth, States, and Territories to improve student outcomes across Australian schools |
| Commonwealth's contribution to Schooling Resource Standard (SRS) | Increased from 20% to 25% by 2034, except for the Northern Territory where it will increase to 40% by 2029 |
| Additional Commonwealth funding for public schools | Estimated $16.5 billion over the next 10 years |
| Australian Education Act | Sets out the Commonwealth's recurrent funding model and provides other funding for schools from time to time |
| Reports on school funding | Annual report tabled by the Minister for Education in Parliament, National Report on Schooling in Australia, and Report on Government Services |
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What You'll Learn
The Australian government's funding of public schools
Schools in Australia are funded through a combination of Australian Government (Commonwealth) funding, state and territory government funding, and funding from fees, charges, and other parental or private contributions. Under Australia's constitutional arrangements, state and territory governments are responsible for providing school education. The Commonwealth does not own or operate schools, but it does provide significant funding and is involved in setting national education policies.
The Commonwealth has been providing recurrent funding for non-government schools since 1970 and for government schools since 1974. This funding has been reviewed and refined several times since then to ensure it is directed to where it is needed most. The Commonwealth's recurrent funding model is set out in the Australian Education Act 2013, which also covers capital funding for schools.
The National School Reform Agreement is a joint agreement between the Commonwealth, States, and Territories to improve student outcomes across Australian schools. As part of this agreement, the Commonwealth has promised to provide an additional 5% of the Schooling Resource Standard (SRS) to all states and territories, except for the Northern Territory, where its contribution will increase from 20% to 40% by 2029. This will result in an estimated $16.5 billion in additional Commonwealth funding to public schools over the next 10 years, representing the largest new investment in public schools by the Australian Government.
The Australian Government provides recurrent funding for every student enrolled at a school. In 2025, recurrent funding for schools is estimated to total $31.1 billion, including $11.9 billion for government schools, $10.4 billion for Catholic schools, and $8.7 billion for independent schools. The Minister for Education tables an annual report in Parliament on financial assistance paid under the Australian Education Act 2013, and the My School website provides nationally consistent school-level data about every school in Australia.
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The National School Reform Agreement
The NSRA is a part of the Full and Fair Funding Agreement, which commenced on January 1, 2025, and replaced the NSRA, which expired on December 31, 2024. The Full and Fair Funding Agreement is a joint agreement between the Commonwealth, states, and territories to create a more equitable and inclusive education system for all students. The Commonwealth has increased its contribution to 25% of the SRS to put government schools on a pathway to 100% funding over the life of the agreement. States and territories are required to maintain a share of at least 75% of the SRS for public schools.
The Full and Fair Funding Agreement includes 10 National Reform Directions and 5 National Enabling Initiatives to support the achievement of three national priority areas. These priority areas include a review of the Schooling Resource Standard base and loadings calculation methodology, the implementation of a Unique Student Identifier for school students, and a focus on socioeconomic diversity and its impact on schools and student learning. The National Enabling Initiatives require collaboration between all governments and include activities that support particular student cohorts, such as Aboriginal and Torres Strait Islander students, students in regional and remote areas, and students with disabilities.
The NSRA and the subsequent Full and Fair Funding Agreement demonstrate the Australian government's commitment to investing in education and improving outcomes for students across the country. These agreements ensure that all public schools in Australia are on a path to receiving the funding they need to provide a high-quality education to their students.
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The Australian Education Act 2013
The Act ensures that all schools receive adequate funding to meet their students' educational needs. It calculates a Schooling Resource Standard (SRS), which estimates the total public funding required by each school. The funding is allocated based on a Capacity to Contribute (CTC) score, which considers the parents' ability to pay for their children's education. This ensures that schools with similar needs receive the same level of funding support from the Commonwealth.
The Act promotes fairness and transparency in funding allocation, ensuring that all students have equal opportunities regardless of their background. It also empowers the Approved Authority to redistribute funding using a needs-based funding model, provided it is fair and equitable. The Australian government has reached agreements with states and territories to ensure full and fair funding for public schools, demonstrating its commitment to investing in education and improving student outcomes across the country.
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The role of state and territory governments
In Australia, schools are funded through a combination of Australian Government (Commonwealth) funding, state and territory government funding, and funding from fees, charges, and other parental or private contributions. While the Australian Government provides recurrent funding for every student enrolled at a school, the state and territory governments are responsible for providing school education under the country's constitutional arrangements.
The state and territory governments own and manage government schools and are responsible for registering non-government schools within their jurisdictions. They provide most of the public recurrent funding for government schools and have agreed on recurrent funding contribution levels for their government and non-government schools from 2018 to 2023. These agreements are set out in bilateral agreements with the Australian Government under the National School Reform Agreement.
The Commonwealth, however, has been providing recurrent funding for non-government schools since 1970 and for government schools since 1974. It also provides capital funding for schools under the Australian Education Act 2013 through programs like the Capital Grants Program for non-government schools. The Commonwealth's funding model aims to allocate resources in a targeted manner to direct them to where they are most needed.
The Albanese Labor Government has reached agreements with every state and territory to ensure full and fair funding for all public schools in the country. As a result, the Commonwealth will increase its contribution to the Schooling Resource Standard (SRS) for all states and territories, except the Northern Territory, from 20% to 25% by 2034. This represents a significant investment in public schools by the Australian Government, with an estimated additional funding of $16.5 billion over the next decade.
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The impact of COVID-19 on government finances
The COVID-19 pandemic has had a significant impact on government finances globally, and Australia is no exception. The Australian government has had to navigate a delicate balance between investing in public health measures, supporting the economy, and managing its budget. The pandemic has presented unique challenges, and the government's response has had a notable impact on its finances.
One of the primary ways COVID-19 has affected government finances is through the increased spending required to address the health crisis. The Australian government had to allocate significant funds towards the healthcare system to cope with the influx of patients, source personal protective equipment, and fund vaccine research, procurement, and distribution. This unexpected expenditure put pressure on the government's budget, requiring them to either reallocate funds from other areas or increase borrowing.
Additionally, the economic fallout from the pandemic has resulted in a substantial decrease in government revenue. As businesses closed and unemployment rates rose, there was a sharp decline in tax revenue, which is a significant source of funding for government operations. The government implemented stimulus measures, such as the JobKeeper wage subsidy program and tax breaks for businesses, to mitigate the economic impact. While these measures provided much-needed support to individuals and businesses, they also contributed to the government's fiscal deficit.
The pandemic has also disrupted the government's ability to plan and allocate resources effectively. With the unpredictable nature of the virus and its variants, the government has had to make swift decisions and adjustments to its policies and spending. This has made long-term financial planning challenging, and the government has had to adopt a more agile approach to budgeting. The pandemic has also shifted priorities, with a greater focus on healthcare, social safety nets, and economic recovery, which may have impacted the funding available for other areas, including education.
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Frequently asked questions
Schools in Australia are funded through a combination of Australian Government (Commonwealth) funding, state and territory government funding, and funding from fees, charges and other parental or private contributions.
The Australian government provides recurrent funding for every student enrolled at a school. In 2025, recurrent funding for schools is estimated to total $31.1 billion. This includes $11.9 billion for government schools, $10.4 billion for Catholic schools, and $8.7 billion for independent schools.
The Australian government has made significant progress towards providing full and fair funding for all public schools in the country. The Albanese Labor Government has reached agreements with every state and territory to increase funding for public schools, with an estimated additional $16.5 billion in Commonwealth funding over the next 10 years. This represents the largest new investment in public schools by the Australian government.
