Academic journal article Australian Journal of Social Issues

Calculating the True Cost of Private School Education: Based on a Survey of South Australian School Fees

Academic journal article Australian Journal of Social Issues

Calculating the True Cost of Private School Education: Based on a Survey of South Australian School Fees

Article excerpt

Introduction

This paper is based on a survey of fees charged by South Australian schools. It identifies and calculates the financial burden associated with funding a child's private school education. The survey is a systematic review of up-front fees and ancillary charges. A summary of fee structures is provided and the cumulative cost of secondary education is calculated together with the projected family incremental income necessary to fund these costs. Accordingly, the survey is a valuable resource in support of a consumer's decision to purchase private school education.

Prior to this survey, the public has had to assemble their own data for comparison, or rely on incomplete information and assertions put by journalists. For example, Scott (2001:16) claims that a family paying for secondary schooling for their four children will be out of pocket by "at least $60,000". However, there is no indication of how this sum was calculated. Whilst there have been some cost projections from financial advisers, disclosure of the full cost bases used in the calculations has rarely been made available (Silins, 1998, AMP, 1996, Rush, 1994).

A further benefit of this survey is that it occurred prior to the introduction of the July 2000 Goods and Services Tax (GST) and therefore it will serve as a bench mark, allowing researchers in the future to make a comparison between educational costs prior to and after the GST.

A limitation of the paper is that it is based on a survey of private school fees payable in the 1997 school year only. However, analysis of the data does demonstrate that Australian families require a substantial financial investment to educate a child privately. This paper also emphasises the care and time required by parents to adequately assess the budgetary implications, as a number of `hidden costs' were revealed by the survey. No attempt has been made to enter the debate concerning the supposed benefits of private over public school education. However, it is recognised that the decision to purchase is a function, not only of financial cost, but also of perceived overall social and other benefits associated with the type of schooling selected.

Background

The importance of conducting this survey is reflected in the increasing demand for private school education. Several themes emerge to explain this phenomenon. Participation in private school education in Australia is substantially higher than in the United States or the United Kingdom (Hogan, 1994). This is testament to its importance as a viable educational alternative to public sector schooling in this country. At a national level, the demand for private school education is largely explained in terms of class preferences:

 
   In South Australia, going to a private school is ingrained in the 
   middle class psyche. But nowhere is the impact of our educational 
   novelty more evident than in Melbourne ... In Sydney, by contrast, 
   private schools until recently have been socially select but of 
   lower academic repute than the city's selective (government) high 
   schools. Only in Sydney ... did more of the elite go to public 
   schools than private schools. (Hope, 1996 p. 4) 

An indication of the size of the shift in demand toward private school education is identified by Lloyd (1998a), who states that in South Australia alone, there has been an 18% swing from public to private schools since 1993. During this period, private school enrolments increased by 11,236 to 72,600 (1998 projected) while government school enrolments dropped from 183,772 to 175,600 (1998 projected).

There has also been a shift in supply to meet the shift in demand. Despite Federal Labor government rules to restrict Commonwealth funding of new private schools there has been a substantial increase in the number of private schools (Hope, 1996).

 
   The rise and rise of non-government schooling has occurred despite 
   federal Labor government rules in place for more than a decade to 
   restrict Commonwealth funding of new private schools to those able 
   to meet tough planning curriculum, enrolment and fiduciary guidelines 
   under its new schools policy. … 
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