Inequality in Australian schools costs the country $20 billion: report

By Michael Koziol

2 April 2018

A new report has warned the declining performance of Australian school students will cost the country $120 billion in coming decades, of which $20 billion is due to rising educational inequality.

The finding, released Tuesday by the Public Education Foundation, is based on six years of testing data that reveals “a stark, unpalatable fact” – reading, maths and science results are falling faster and further for students who are already at the bottom of the performance curve.

Australia’s declining performance in maths, reading and science will cost the nation $120 billion over the next 45 years, according to new analysis.

“This trend should be deeply concerning for all Australians,” said the report’s author David Hetherington.

“If this continues, there will be lower incomes, fewer job opportunities, a less dynamic society – and that affects all of us, not only the kids at the bottom who bear the most direct brunt of it.”

A new report reveals reading, maths and science results are falling faster and further for students who are already at the bottom of the performance curve.


The report, What Price the Gap? Education and Inequality in Australia, attempts to quantify the future economic loss caused by our students’ sliding educational outcomes as measured by the OECD’s Programme for International Student Assessment.

Between 2009 and 2015, the average performance of students at the 10th percentile (the bottom 10 per cent) fell 21.3 points. At the 90th percentile – the top end – performance fell 14.4 points. The gap was most pronounced in reading, where scores at the lower end fell nearly twice as much as scores at the higher end. By contrast, results in mathematics declined evenly across the board.

The OECD estimates a 50 point change in a country’s PISA scores is associated with a change in long-term GDP growth of 0.87 per cent a year. The Public Education Foundation used this figure to estimate the damage to Australia’s economy at $118.6 billion over the working lives of the current crop of school leavers.

Australia’s PISA results have been in decline since 2003.

Last year, PISA co-ordinator Andreas Schleicher linked that to what he called a “tolerance of failure”, relative to teachers in other countries who would “redouble their efforts for students who are struggling”. Education Minister Simon Birmingham has conceded the PISA results demonstrate a “worrying trend”.

The Grattan Institute’s school program director Pete Goss, who has done his own work in this area, said it was difficult to quantify the economic benefit of improving school-age skills but there was sufficient evidence behind the logic.

He said “the gap between the educational haves and have nots” was one of the biggest challenges facing Australia’s education system.

“If there’s evidence that that gap is getting wider, that’s a real problem for a number of reasons,” Dr Goss told Fairfax Media.

“At one end, you would include the personal individual cost of disadvantaged students falling further behind. At the other end, it’s a waste of human potential that economically hurts everybody.”

Mr Hetherington said early intervention and “alternative learning programs” were required to pick up the sagging bottom end of the curve. He cited a program called Hands On Learning in Victoria, which takes students outside the classroom to work on real-world projects.

“We’ve got to find ways of engaging kids who are otherwise going to be detached from the school system,” he said.

On the sensitive subject of school funding, Mr Hetherington – a member of the Labor Party – said neither party had got it right. He called for the full quantum of Gonski 1.0 funding to be restored but without former prime minister Julia Gillard’s promise that no school would lose a dollar.

Read the article in the Sydney Morning Herald here.