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Pyne Abandons Gonski School Funding Agreements; New Arrangements After 2014

The Minister for Education, Christopher Pyne, has confirmed that the government will honour school funding commitments of the previous government for 2014 but will implement a new funding model after that.


Pyne was quizzed about the government’s abandonment of its commitment to the previous Labor government’s school funding agreements at a press conference today.

Pyne described the situation it inherited as “Shorten’s shambles”. He said the government will abandon an “incomprehensible mess” and implement a new funding model that will be “flatter” and “simpler”.

No government could bind a future government to

  • Listen to Pyne’s press conference (22m)

Official transcript of Education Minister Christopher Pyne’s press conference.

CHRISTOPHER PYNE: …the unfortunate revelation that the previous government when Mr Shorten was the education minister cut $1.2 billion from the school funding envelope for the next four years. In the economic statement of 2 August 2013 the Government – which was the political document released by the Treasurer Mr Bowen – the Government revealed on page 57 that treatment of payments for non-participating states and territories was NFP which stands for not for publication. We’ve got other names for it as well, but not for publication – NFP.

Then unfortunately in the PFO document on page 36 the Government made it very clear – well the department made it very clear through Treasury and Finance – that the Better Schools treatment of payments for non-participating states and territories would be cut by $1.2 billion. And on page 36 it’s broken down year by year adding up to one-point-two-zero-three and $300 million – $1.2 billion. Now this of course presents a real problem for the Government because that money was taken from the education budget and returned to consolidated revenue.

And the implications for the new school funding model are that the funding envelope is now $1.6 billion as opposed to the $2.8 billion that Labor promised in the budget last year.

Now the new government will obviously have to deal with that issue. As has been revealed over the last few days the new school funding model is a complete shambles. The minister Mr Shorten has left us with a shambles. Not only have Victoria and Tasmania been revealed not to have signed bi-lateral agreements – in effect making them non-signatory states to the new school funding model. But of course the National Catholic Education Commission have revealed that they never signed a written agreement with the Government.

We now know that 900 schools in the independent sector will have what you might like to describe as the pure funding model. But the other – 90 per cent of schools around Australia – will have a hybrid model which differs from every state and territory and the Catholic sector. So it’s an incomprehensible mess. Added to that is this very substantial blow of a $1.2 billion cut across the forward estimates for the non-participating states.

The Government’s responsibility is to fix that problem. So we will honour funding in 2014 and I am working now – as I have been for several weeks and I will over coming days- working with the state governments in Queensland, Western Australia and the Northern Territory to resolve what to do about their school funding in 2014.

Beyond 2014 we have to implement a new school funding model. It’ll be flatter, it’ll be simpler. It’ll be fair between states and territories and it’ll be equitable for students so that the school funding reaches those who need it the most.

And I’d say in conclusion that we are keeping our promises by doing just that. We said that we would remove the control and command features from the Government’s model – that’s exactly what we will do. We will make the model less prescriptive, less restrictive with less control from Canberra in what is effectively a state government and territory government schools. They own and operate schools – we don’t. And we don’t want to try and tell the states how to operate their own responsibilities. We’re not going to infantilise the states – we’re going treat the states and territories like adults. And we always said before the election that we would have a school funding model that reflected that. I had assumed it would be in some years but because of the one-point-two billion dollar Shorten cut we have to bring forward our plans – and I’m happy to bring forward those plans.

Secondly we said we’d have exactly the same funding envelope as the Labor Government and that’s exactly what we will achieve. Our funding envelope over the forward estimates will be precisely the same as Labor’s so we are keeping our promise. And we will focus beyond funding on things that I think will make a different to school education. Parental engagement, teacher quality, a strong and robust curriculum and more and more decisions being made locally. Which of course is what I said for several years – and a lot before the last federal election. So nobody should be under any illusions about what the government’s plan was – nor should any of the states and territories who signed agreements. Because we always said that we would have a four-year agreement and never beyond that.


QUESTION: Hello. Mr Pyne the PFO document doesn’t actually say the funding is cut. All it says is that the treatment of payments are the – was published- or the funding not for publication – and it’s itemised the amounts involved.

PYNE: Yes.

QUESTION: Now the normal procedure here is that if an item is mentioned as not for publication it’s just not itemised but it is included in the budget bottom line. Why are you so sure that there’s a shortfall here?

PYNE: That’s the advice that I have received from Treasury and Finance that the effect of this describing it as a measure in the PFO is that it doesn’t appear anymore as part of the budget line item for education. Those non-participating – or non-signatory states – that $1.2 billion which was still in negotiation when the economic statement was released on August 2 – disappeared in PFO.

QUESTION: Exactly where did you get that advice?

PYNE: From Treasury and Finance.

QUESTION: When did you get it though?

PYNE: I’ve had it since the election.

QUESTION: Mr Pyne you said during the election schools need the certainty and states need the certainty to know that whether they vote Liberal or Labor they will get exactly the same amount of money. Is that still true? And why is taking away the money in PFO a problem given that was money that was earmarked for the states that had not signed anything – not signed up at all?

PYNE: Well the money was taken in PFO as a saving and disappeared back into consolidated revenue. It’s not available for us to use anymore and as has become very apparent since we were elected the cupboard is very bare. The Labor government – the previous Labor government – has left the treasurer and the finance minister very short of funds as I am sure you understand. And it’s not possible to simply find that money.

QUESTION: But the money for the states that had signed up in some way shape or form was allocated will they still get – as you said during the election – exactly the same amount of money?

PYNE: Well that wasn’t taken as a cut in PFO. So the money that was allocated to participating states is still there.

QUESTION: They’ll still get exactly the same amount of money?

PYNE: Well in 2014 we will ensure that the new school funding model as proposed by Labor is implemented because it is too late to change that. Between now and sometime next year I will propose a new school funding model from the Commonwealth which will be flatter and simpler; fair to all the states and territories and equitable between students.

QUESTION: Minister on your choice of language you keep on saying flatter. The reason that it wasn’t flat in the first place is that some states and territories were forfeiting more money than others. Are you suggesting that under your model the states that are putting less money into their schools will receive less from you guys because you’ll be expecting them to fork in more?

PYNE: Andrew as we said before the election we would have a no strings attached school funding model in time. The Commonwealth would put the money that it wanted to put in. And whether the states and territories put the money they wanted to put in would be a matter for them. I never supported – and said so many times – I never supported the Labor Party’s attempt to essentially insert the Commonwealth in state and territory schools in their responsibilities by saying, well give you X amount of money as long as you put in Y amount of money. I don’t think that is any way to have negotiations between states and territories and the Commonwealth. And we don’t own and operate any schools. So we will say to the states and territories, this is the contribution that we’re making. If the Northern Territory or Victoria wants to put in more money that’ll be a matter for them. And at election time…

QUESTION: Is this the whole key to this funding issue that the Commonwealth is trying to get students treated equally regardless of the jurisdiction? And if you have states who have other priorities – priorities that are higher than education; I can’t think of any that should be – but if they do then shouldn’t you be putting pressure on them to put in more money if you’re not going to increase your funding?

PYNE: Well Andrew the states and territories are responsible for school of education. They own and operate schools – they employ teachers. I don’t think it’s right for the Commonwealth to try and cover the field of a state responsibility. I don’t think it’s right for us to tell the states and territories how to run their budgets.

Now they have electors, they have elections every three or four years, three in Queensland and four everywhere else. If their electors decide that their priorities are wrong then they will vote them out of office. Alternatively if they like the opposition’s policies they will vote them into office. Similarly federally I don’t expect the state and territory defence – the state and territory premiers to tell the Minister for Defence what all our priorities should be in terms of defence spending and I don’t intend to tell the states and territories how to run their governments. That’s a matter for their electors to determine.

QUESTION: What will – given what you’ve just said then can you guarantee, over the course of the next four years, that no public school or private school will be worse off?

PYNE: Well, the former Prime Minister, Julia Gillard, made that claim. And, then we saw recently when New South Wales released its model – because every state and territory – which is one of the incomprehensible aspects of this what Labor’s left us, this Shorten shambles that we face. One of the aspects that is every state and territory has their own method of applying the model. In New South Wales the minister there revealed that many schools, dozens of schools, would get less money. So…

QUESTION: So you’re backing away from that guarantee?

PYNE: That was a guarantee that Julia Gillard made and it fell at the first hurdle which was New South Wales applying its model. Now, what we will do is the Commonwealth will do its bit in education. We’ll focus on the things that we can control so we’ll work hard on the national curriculum, on national teacher standards and leadership, on principle autonomy which we believe has a transformative effect on the outcomes for students. We will try and come up with programs that engage parents more and, of course, we will provide a base level of funding through a national school funding agreement with each of the states and territories, the Catholics and the independents. But, I won’t be pretending that I’m a State Minister for Education that employs teachers, that owns and operates schools and makes day to day decisions in schools. I’ll allow the state and territory Ministers to make decisions because that’s their area of responsibility.

QUESTION: Why should states such as New South Wales and my own state of South Australia which had the wherewithal to cut a deal with the Labor government and don’t want those deals – they want those deals honoured, why should that have to, you know, have everything they’ve negotiated unwound as a result of your change of mind?

PYNE: Well, the change of government means that the new government will implement its policies in the future. Now, I know that Labor wanted to try and tie the Coalition into the future for at least past two elections. But, the way our system works is that no government can bind any future government, what one government does, another government can undo. And, I made it very clear before the election that I didn’t buy up to the Labor Party model. We said that we would have the same funding envelope and we will. But, I also made it very clear that I didn’t support the central command and control features that were coming from Canberra and I won’t have that in the model.

Now, we assumed that this could last several years. But, it’s quite clear that it would be irresponsible of me, as the Minister for Education, to try and implement a model that is effectively un-implementable and common sense tells me – and I think that’s what the Australian public expect – common sense tells me that we have to have a new funding model beginning in 2015 but it’s too late for 2014. So, states that relied on year five and six with massive accelerating expenditure from the Commonwealth Government in years five and six they should never have relied on that because we won the election and we always said we would never have anything more than a four year agreement.

[Over speaking]

QUESTION: If I may, you talk about the funding envelope but about a week short of the election you said you can vote Liberal or Labor and you’ll get exactly the same amount of funding for your school. That’s not an envelope, that’s a promise to every school you’ll get the same regardless of the outcome. Are you going to be keeping your promise?

PYNE: We are going to keep our promise which is that we have exactly the same funding envelope available to us as the Labor Party promised before the election.

QUESTION: But not for each school. That’s not what you’re saying today.

PYNE: What I’m saying is that we will have exactly the same funding envelope available [Hugh] and we will work through with the states and territories to ensure that that is equitably distributed…

QUESTION: But that promise…

QUESTION: But what that…

QUESTION: …plainly no longer stands then because you’re not making a promise for each school being identical between Liberal and Labor, it’s what you said on the 29th of August.

PYNE: But, Hugh, I couldn’t possibly implement a new school funding model that I know is un-implementable. It’s incomprehensible…

QUESTION: So you’d be happy to break your promise…

QUESTION: You’re fibbing…

PYNE: That is incomprehensible…

QUESTION: You’re happy to break a promise because you feel you need to now, is that what…

PYNE: It was based on poor data and in some respects it was – the data was massaged in order to try and get the result that Mr Shorten and the Labor Party wanted. Now, I have to do what’s right for the Australian taxpayer and for Australian students. And, Australian students should be our first priority…

QUESTION: Will you…

PYNE: Our policy was to put students first and we will. We will ensure that the funding gets to where it’s needed the most. At 2014 the states and territories can be certain of the funding that was promised before the election in this agreement. After 2014 we will have to have a new school funding model that works. Now…

QUESTION: Will you…

PYNE: …it would be very foolish of the government to implement a model that it knows is unfair based on not correct data and attempts to create a model that doesn’t fit the responsibilities in our federation between the states and territories and the Commonwealth…

[Over speaking]

QUESTION: …with two-point-three billion worth of cuts to higher education will you commit that to schools as Labor did?

PYNE: Well, I’m not in the business of telling the Treasurer and the Minister for Finance how to draft their books. The higher education cuts were never designed for the school funding model. I mean some people made that interpretation but as you would know that is not the way budgets work. Since the election we’ve obviously scrapped the cap which was bad policy that Labor introduced, the five hundred million dollar savings. So we’re making sensible decisions as events are presented to us and the higher education cuts, the other cuts that we have legislated for last week that I introduced into the Parliament last week, they will go ahead because they are necessary to try and stabilise the budget emergency that we’ve inherited from the Labor Party.

QUESTION: What is your consultation process now leading up to the new funding formula that you want to see in 2015? And do you agree with the Gonski principle here of extra loadings for disadvantaged, for students who come from poorer areas, students from non-English speaking backgrounds? Do you believe that schools deserve a base funding per student with extras for disadvantage?

PYNE: I believe that the school funding model that was implemented by the Howard Government, which was based on the socioeconomic status and qualifications of parents and went to the schools that were most in need is a good starting point for a school funding model.

I think the Gonski report had some very useful suggestions about base levels of funding and how they should be applied. And of course, common sense tells us that students with greater needs need greater funds whether they’re children with disabilities, non-English speaking background, rural and remote students, micro schools and low SES students and I’ll be working through with my state and territory counterparts.

But I’m not going to initiate another report, another conference, another meeting with all the key stakeholders. The public has elected us to get on with the job and I have to, in the months ahead, develop a new model with the information that I already have which is voluminous to come up with a model that’s fair and equitable to everybody and ensures that we get the best outcomes for our students. And, I think the time for more and more studies is over and the time for action has arrived. There are so many different institutes, university studies on school funding models. They’ll inform all my thinking. And, obviously, I’m fortunate to be meeting on Friday with all my state and territory counterparts at the first Education Ministers’ Council meeting and I imagine this subject will come up there.

QUESTION: Minister, it seems that you were endorsing the Howard Government model some months ago. You then change your mind for political convenience to go on a unity ticket with Labor just two days before the election was called. And now you’re ripping that up and going back to where you were several months ago. Isn’t this just political cynicism writ large?

PYNE: No, Mark, because what I said before the election – and what Tony Abbott said – was that we had exactly the same funding envelope as the Labor party, but that we believe the model that they had implemented was too restrictive and too prescriptive from Canberra about what states and territories should do. And we said before the election that we would revisit the model itself, but we’d keep the same funding envelope. That remains exactly the same policy.

QUESTION: The unity ticket. I remember the phrase…

QUESTION: As far as school funding’s concerned Kevin Rudd and I are on the unity ticket.

PYNE: As far as school funding’s concerned…

QUESTION: [Interrupts]…funding envelope.

PYNE: …Kevin Rudd and I are on a unity ticket – exactly, school funding. But I also said…

QUESTION: …funding envelope.

PYNE: But I use the phrase envelope many times, in fact. But whether you use the phrase envelope or something else school funding is about money. But I also said before the election, in many different interviews, that we didn’t believe that the Government had got it right with the central command and control features of the new school funding model. Our Government wants to have a deregulatory agenda, not a heavy regulatory agenda. We want to reduce the footprint of Government in schools, and particularly in trying to second guess states and territories. Nobody could be under any illusions before the election that that was our view. One more question and then I’ve got to go. Who hasn’t had a question? You haven’t had a question. Where are you from?

QUESTION: [inaudible].

PYNE: Lovely.

QUESTION: Minister, given you’re in receipt of the Treasury advice saying there was a $1.2 billion dollar cut to the education budget at the election, why are you only now announcing that? And, secondly, if that advice is there have you made any representations in the time that has lapsed to the Treasurer to seek that money back into the education budget, and why not?

PYNE: Well, they’re both good questions. In terms of the latter question I wouldn’t reveal any conversations that I’ve had with the Treasurer or anybody else in the Government, particularly in the Cabinet, about how we make our decisions, but it’s worth a try asking, I suppose. But no, I’m not going to answer that question.

Secondly, in terms of the first question, well, since we got elected – which is about two and a bit months ago – I have been working through how to make this school funding model work, and I’ve had many meetings with my department, with key people in the portfolio, with Finance and Treasury, and it’s become quite apparent to me that the only way to deal with this issue is to guarantee 2014 and start the ball rolling again – go back to the drawing board – because the Shorten shambles that I’ve inherited is not an egg that I can put back together again. Two different metaphors there. All right. Thank you very much.

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Malcolm Farnsworth
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