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Profit no longer a dirty word in education

By Mikayla Novak - posted Tuesday, 29 March 2005


Private sector intervention in schools is also becoming more commonplace in other countries. For example, in the United Kingdom, Edison Schools Inc provides school improvement services, including reforms in school learning environments, systems and teaching strategies, to around 20 existing schools that currently serve around 15,000 students. Under this partnership framework, schools retain their autonomy and benefit from Edison’s expertise in developing accelerated learning strategies and programs.

There are also a number of for-profit private school chains already operating in the UK, including Global Education Management Systems, Cognita Schools, and the New Model School Company. Finally, chains of for-profit private schools are also developing in countries as diverse as Sweden (Kunskapsskolan), Brazil (Objetivo, Pitágoras) and even in the communist People’s Republic of China (South Ocean Schools).

These international developments reflect a growing vote of confidence in the capacity of the private sector to provide high-quality school education that boosts the long-term economic, social and cultural capacities of young people. Profit is no longer a dirty word in education as the market has progressed from selling textbooks and providing the ingredients for school lunches to delivering education in the classroom.

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Indeed, it is important to note that in many cases, education policymakers are permitting firms to turn around failing public schools. Therefore, in this sense, the reactions against corporate involvement in school education at home are dramatically at odds with developments occurring across the globe.

State and Territory roadblocks against private sector participation in schools

The future capacity of Australian schools to deliver educational excellence will critically depend on the level of support for the principle of school autonomy.  Providing individual schools with the authority to make decisions, take risks and learn from their own initiatives would drive sustained improvements in education outcomes in the longer term, to the ultimate benefit of students. This is confirmed empirically in a number of recent studies of OECD education performance data by the German educational researcher Ludwig Woessmann and others.

However, a key constraint on individual school freedom is the growing tendency for State and Territory Labor Governments to interfere with the autonomy of non-government schools in areas such as curriculum and educational standards, teacher quality and professional development, school disciplinary policies, education facilities, and the like. The proposed amendments to the Queensland accreditation legislation, which impact on the freedom of non-government schools to determine their own governance arrangements and operating standards as they see fit, including the extent to which they choose in engage in partnerships with business, serves as further evidence of the eagerness of the States to “micro-manage” non-government schools and reduce them to lowest common denominator standards.

Further, the prospect of preventing non-government schools with relations with commercial entities, from receiving public funding for their enrolled students will only serve to further skew the competitive “playing field” of funding particularly to the advantage of the public school system, moving the funding system further away from a genuine student-centred voucher funding model.

For states hooked on various incarnations of “state socialism”, these regulatory impositions seem nothing more than contrivances acting to shield poorly performing government schools, and the public sector teacher unions that patronise these institutions, from further competition for students by innovative non-government school education providers. Indeed, to the extent that education regulators choose to go down the path of deciding for individual non-government schools who they should, or should not, enter into arrangements with, then private companies and their profits will continue to be prevented from being directed towards the service of educating our school-age children on a significant scale.

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Article edited by Maggie Dunphy.
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About the Author

Mikayla Novak is a Research Fellow with the Institute of Public Affairs. She has previously worked for Commonwealth and State public sector agencies, including the Commonwealth Treasury and Productivity Commission. Mikayla was also previously advisor to the Queensland Chamber of Commerce and Industry. Her opinion pieces have been published in The Australian, Australian Financial Review, The Age, and The Courier-Mail, on issues ranging from state public finances to social services reform.

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