THE cost of educating a child in a public school is surging ahead of inflation, guaranteeing an increase of nearly $400 million in federal funds to non-government schools this year.
Government primary school costs for 2011 have risen 6.9 per cent to $9697 a child, and secondary school costs are up 4.8 per cent at $11,945 - continuing the upward trend of recent years.
But the current non-government school funding scheme - which distributes funds based on the Average Government School Recurrent Costs (AGSRC) - is likely to be heavily scrutinised by the Gonski review into education funding.
Non-government schools, depending on the socio-economic status of the parent community, receive between 13.7 and 70 per cent of the average expenditure per child in public schools. State governments receive a flat rate of 10 per cent.
An independent report released last week by the review, headed by a Sydney businessman, David Gonski, commented unfavourably on the scheme.
The report said the AGSRC ''has a number of limitations as the basis for the sustainable and transparent school resourcing measure''. Its particular concern was that the scheme is based on average expenditure and that there is no relationship between costs and outcomes.
Instead, it suggested a different calculation be made, one that estimates a notional cost of how much is needed to educate the average child to reach minimum benchmarks, known as an educational resource standard.
A previous paper released by the Gonski panel said the current system is viewed by many as ''complex and inequitable''.
The payment to non-government schools also highlights concern in the education sector over indexation, as school systems await the final report of the Gonski review - due by the end of the year - and the federal government's response.
The federal Education Minister, Peter Garrett, has repeatedly promised ''an absolute guarantee'' that no school will lose a dollar in federal funding as a result of the review. But Mr Garrett again refused to guarantee any indexation of current funding arrangements, leaving independent schools uncertain about their future income streams - especially given the rate at which educational costs continue to grow.
''This highlights the need to maintain indexation linked to increases in government school running costs,'' said Geoff Newcombe, the executive director of the Association of Independent Schools of NSW.
''It just shows how crucial it is so that by Garrett not saying 'in real terms' he is leaving open the potential to cut $400 million a year off the funding. This is really significant for us.'' Even if a new scheme was introduced similar arrangements would be needed, Dr Newcombe said.
A Deloitte report to the Gonski review said it was ''less clear'' that indexation had mirrored efficient growth in costs. In the nine years to 2008, the AGSRC had risen by 59 per cent, compared with inflation of 35 per cent.
Dr Newcombe said the rise in costs should be viewed positively as it reflected higher investment in education, teacher salaries and technology. Independent school costs are rising even faster, he said, because of the cost of servicing loans for capital investments.
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