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Private school profits spark debate about government funding
http://www.theaustralian.com.au/ ... 9niix-1225938922877
Justine Ferrari and Brett Clegg
From: The Australian October 15, 2010
ELITE private schools that receive millions of dollars in government funding recorded surpluses last year as high as $14 million.
Three of the nation's richest schools holding net assets worth more than $100m.
Financial statements for some of the most prestigious private schools reveal a staggering accumulation of wealth, with Melbourne Grammar holding retained earnings of $128.3m, Scotch College in Melbourne boasting net assets of $116.6m and Geelong Grammar $108.9m.
In Sydney, available statements for schools show that Cranbrook holds net assets worth $87.7m and Ascham has $67.3m.
The schools also posted large surpluses last year, with Scotch College reporting a "profit" of $13.9m and Geelong Grammar $10.6m, followed by Cranbrook and Melbourne Grammar with surpluses of more than $8m and Ascham $3m. All schools are not-for-profit and surplus funds are reinvested in the school.
The five schools received substantial grants from federal and state governments, worth between $2.6m for Ascham to $6.3m for Geelong Grammar, which last year included more than $3m for each school under the Building the Education Revolution.
The financial health of the schools raises the question of whether they should be receiving government funding, given their grants last year were a substantial proportion of their surplus, from 84 per cent of Ascham's surplus to 42 per cent of Cranbrook's.
As a condition of government funding, all school financial resources will be reported on the My School website from the end of the year, but the public school lobby is concerned the accumulated wealth in private schools will not be put on the website.
Federal, state and territory education ministers will meet in Canberra today and are expected to approve a framework for the reporting of school resources.
But The Australian understands the focus is on the operational costs of a school rather than the assets held and the model proposed by the Australian Curriculum, Assessment and Reporting Authority responsible for My School will report only recurrent income, recurrent expenditure per student and what is spent on capital works.
Schools will also be able to deduct future capital expenditure from the declared expenditure per student.
For public schools where budgets are managed centrally by education departments, operational costs such as teacher salaries and maintenance as well as the cost of the bureaucracy has been allocated on a per student basis to each school.
Melbourne Grammar headmaster Roy Kelley yesterday said the school's financial details were already publicly available through its reporting to ASIC, so he had no issues about reporting again on My School but it was important school details were interpreted consistently.
Mr Kelley said one in three students attended independent schools, but received only 23 per cent of state and federal education spending: "The important issue is that both independent and government schools should be provided with adequate government funding, rather than this discussion being polarised into an 'us versus them' debate."
Australian Education Union president Angelo Gavrielatos said the ACARA proposal ran counter to the level of transparency on financial reporting promised by Julia Gillard in 2008, when she told parliament: "Only by understanding the total amount of funds at the disposal of individual schools is it possible to understand the relationship between resourcing and educational outcomes."
Mr Gavrielatos said millions of dollars kept in trusts, bequests, share portfolios and property portfolios will not be included in the financial reports on My School, presenting a "distorting and misleading" account of the financial resources of many private schools.
A spokesman for School Education Minister Peter Garrett said while ministers were yet to decide, the government wanted financial information reported in an aggregated form, to show the mix of income between private and public sources of funding. |
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