State government efforts to set up foundations to encourage businesses to pledge financial support to state schools won’t fix a system in need of root and branch reform, according to the CEO of a not-for-profit organisation that helps people and businesses donate cash.
The Business Working with Education Foundation announced this week by the Victorian government, and the Public Education Foundation established by the NSW government in March last year, can receive tax deductible donations from businesses that want to support public schools.
But businesses and individuals making donations direct to public schools don’t get the discount.
“The motivation [for the foundations] is spot on but it doesn’t deal with the big elephant in the room. It doesn’t deal with the fundamental issue of deductibility, which is a federal tax law issue,” said Sarah Davies, CEO of the Melbourne Community Foundation.
Davies described the restriction on tax deductible donations to public schools as “ridiculous” and “archaic”.
Unlike independent schools, which are able to generate millions of dollars from tax-deductible donations, public schools are not considered ‘charitable organisations’ under federal tax laws.
“The reason state primary and secondary schools are not considered ‘charitable organisations’ is that they are predominantly government-funded. But at the tertiary level, with universities … you can give tax deductible donations, even though they’re largely publicly funded and are public institutions,” she said. “I don’t think there’s a coherent logic there.”
Furthermore, while foundations for public schools provide a way for businesses to make tax-deductible donations to public schools, these foundations do not address the restriction on donations from individuals.
“Corporations [that donate to these foundations] can claim a deduction for charitable giving against their business expenses but that’s very different to a person claiming a tax deduction for a gift. These are different areas of tax,” Davies said. “So while I think … it’s fabulous to build better partnerships between business and public schools … what is really needed is a reassessment of federal tax laws.”
According to Davies, corporate and business support of the public education system in the UK has been “incredibly successful” but “not without controversy”.
“Questions arise around policy, control and influence, but … that doesn’t mean we shouldn’t pursue it. We just need to be thoughtful about it,” she said. “We need to ask how do we protect the broad public interest and public access to quality education and opportunity but at the same time encourage greater participation and support from a broad set of community players. The point is to incentivise giving to help build the community asset that is our public education system.”
President of the South Australian Association of School Parents Clubs, Jenice Zerna, said the association would want to know how increased funding from business would impact government funding for public education: “Is that going to stop funding coming to the schools from government? What sort of influence are businesses going to want and is that going to affect the curriculum and learning? That would be our concern.”
Jenni Neary, chair of the Public Education Foundation of NSW, which granted its first scholarships to public school students this year, said the Foundation was reluctant to get into a debate over whether the Foundation was substituting government funds.
“It’s not substituting funds, it’s adding money … Because it’s specifically not for the things government fund, it doesn’t impact government spending. The system itself funds buildings, teachers, facilities and so on, but not individual students, which is what our job is,” Neary said.
Like Victoria’s Business Working with Education Foundation, the NSW foundation is prohibited under national tax laws from spending funds on capital works — a restriction that, according to The Age, highlights “more than anything” the inequity between public and private school funding.
Both foundations have been established to help redress the inequity in corporate donations to public schools, but just how much impact these organisations will make is unclear. Neary admits that the sums of money the Foundation deals with — currently in the tens of thousands — are relatively small and must stretch much further than the millions raised by private schools.
“We’re covering the whole state system so obviously it’s not comparable to the kind of money raised by private schools, but over time these foundations grow,” she said. No such foundations exist for public schools in other Australian jurisdictions.
John Hassed, Deputy Chief Executive of Tertiary, Corporate and Portfolio Services in the Northern Territory Department of Education and Training, told Crikey that “positive relationships between businesses and school councils are encouraged”, but there are no formal structures to assist businesses to make donations to public schools. “It is a matter between the particular business and the school,” he said.
The story is much the same in Tasmania, Queensland, South Australia and Western Australia.
Robert Fry, president of the Western Australian Council of State School Organisations said businesses in the mining sector give “generously” to public schools in the Pilbara region, but private schools “would do exceptionally better than public schools in terms of support from business”.
He said he didn’t think states should actively pursue corporate support of public education: “Working with business is positive and benefits the schools and the kids but … at the end of the day it’s up to government to provide an education system.”
I don’t understand why each public school can’t establish its own foundation whose donations are tax deductible.
Most but not all universities are public institution but most aren’t largely publicly funded. In 2008 the most recent year for which figures are available public universities got 43% of their revenue from government grants and 34% from fees and charges, including 16% from international students.
I think you will find that most tax deductible gifts to universities are in fact made to one of their foundations.
Allowing tax deductions for gifts to public schools is another in the long list of smokescreens thrown up to make it appear something is being done, when we’re actually exacerbating the problem of ever-increasing inequalities, not only between government and non-government sectors, but also among government schools themselves.
Within the State Government system, already advantaged State Schools will be the ones which tend to receive the more generous donations. What follows is based on general tendencies, so there will, of course, be exceptions; but it does reflect sad realities found in State School systems.
Three of the existing inequalities within State School systems include:
1] Schools in advantaged areas benefit from greater fund-raising capacities, pupils whose homes insist on taking education seriously, more experienced teachers gravitating to them, less effective teachers being more likely to be moved on, etc.
2] Permitting parents to move their children out of zone to escape less-advantaged schools exacerbates the problem, and widens the gaps even further.
3] Creating increasing numbers of allegedly ‘special purpose’ schools provides still further opportunities for parents to flee evermore schools, again widening the existing gaps even further. An example of how parents can legally manipulate the system is provided by James Ruse Agricultural School. Claim that your child wishes to study agriculture, and he/she is permitted to apply. Genuine interest in taking Agriculture through to Matriculation level, or actually working in agriculture is irrelevant. You’re into James Ruse which (thanks to its highly inflated entry mark, and keen interest in education of the parents) means your child’s chances of enjoying superb educational opportunities are better than they’d be at most private schools. At what cost is this approach, however, to all the other Government Schools which lose so many good students, such dedicated families?
I forgot, didn’t I? For all too many of us, an education revolution isn’t so much about education, as it is about using revolutionary slogans to distract attention from the actual problems.
I don’t understand. We can afford undeclared wars but we cannot afford decent education for our children? How does it work? Chasing America?
Norman Hanscombe you are right! But why are those things important?
Because education is the single most effective investment a government can make to improve the health, financial outcome and potential of its citizens. Every dollar spent on education is paid back many times over by higher employment, less welfare, greater civic engagement, better health and a more productive economy.
To allow the differentials to increase so that poor areas have poorer schools is a social evil that blights the lives of those students and costs every one of us in tax dollars that could be put to something productive.
A related point ,the primary determinant of how well children do at school is the relationship with their teacher. Good school/bad teacher = poor outcomes and so on. Even if you choose your child’school you probably won’t get to choose their teachers. So why all the fuss about choice. We’d do far better as a society improving teaching practice than entrenching and exacerbating inequities between schools by encouraging an essentially dishonest idea of ‘choice’.
1. SBH, no matter how worthy a cause may be, bad policies can waste money, and a throwing money mentality can create bad policies. Not every dollar spent on education generates a return, not every return warrants the investment made in it, and some “returns” can in fact be negative.
Sometimes money spent on social engineering pays off, sometimes it doesn’t.
As for your claim that the “the primary determinant of how well children do at school is the relationship with their teacher,” it’s a tad more complex than that; but to respond adequately would require not a brief post, but a long article — and most readers simply aren’t all that interested in analysing complex disputes.
One brief suggestion, however, even assuming it’s the teacher which counts most, choice ends up meaning those already advantaged to start with, end up being the major beneficiaries, including being in classes taught by good teachers.
2. Rena Zurawel, you’re 100% correct when you say you, “don’t understand.”