BUDGET BRIEFING May 12, 2015 Background on the Australian Government 2015-‐16 Budget Overview 1. The 2015-‐16 budget projects a deficit in the fiscal balance of $33 billion in 2015-‐16 with the deficit diminishing to $3.2 billion in 2018-‐19. 2. The budget position has been affected by a $52 billion write-‐down in tax receipts and the iron ore price halving in the last twelve months. 3. The budget contains a range of measures to generate budget savings and changes the basis of major entitlement areas. 4. Policy areas affected include small business, family payments, company taxation, defence, childcare, paid parental leave and pensions. 5. The 2015 budget overview available at www.budget.gov.au covers the major initiatives. School funding under the Australian Education Act through to 2017 6. The 2015-‐16 budget confirms $15.7 billion in Commonwealth funding for Australian schools for the next financial year, predominantly provided for under the Australian Education Act. [see Budget Paper 3, p29] 7. This represents an annual increase of 7.4% in commonwealth funding for schools on 2014-‐15. In per student funding this is approximately 7.2%. 8. Overall, these funding increases are at the top of the range of indexation received in recent times using Average Government School Recurrent Costs (AGSRC). Indexation beyond 2017 9. The budget has restated the budget assumption that from 2017 school funding is projected to increase by the consumer price index (CPI) and enrolments. 10. The Minister for Education and Training, on behalf of the Australian Government, has previously stated that: “The indexation rate foreshadowed in the 2014-‐15 Federal Budget provides a starting point for negotiations with states and territories and the non government sector on schools funding arrangements from 2018.” 11. In another important policy area, the budget papers state that the Government has decided not to proceed with the 2014 Budget measure to index pension and pension equivalents by CPI. 12. Despite this decision, the budget assumption remains that school funding be indexed by CPI. 13. The budget forward estimates assume that CPI will vary as follows: 2014-‐15 (1.75%); 2015-‐16 (2.5%); 2016-‐17 (2.5%). 14. In comparison the budget forecasts the wage price index as follows: 2014-‐15 (2.5%); 2015-‐16 (2.5%); 2016-‐17 (2.75%). 15. In two years out of three, wages are forecast to grow in excess of CPI. 16. Staff costs typically make up 70 to 80 per cent of school expenditure. Page 1 of 5 Funding for Students with Disability 17. The Minister for Education’s budget media release states that students with disability will receive a record $1.3 billion in 2015-‐16 and more than $5 billion over 2014-‐17 through the funding loading for students with a disability. 18. Despite the Minister’s statement, the issue of consistent funding treatment of students with disability under current funding arrangements (as raised in the NCEC budget submission) has not been addressed in this budget. 19. In 2015, all schools are participating in the Nationally Consistent Collection of Data (NCCD) on Students with Disability. 20. The Minister has stated that this will be used to inform future funding for Students with Disability. Funding increases – Government schools compared with Non government schools 21. The budget provides for increases in Commonwealth funding for government schools of 9.55% per student in 2015-‐16. [see Department of Education Portfolio Budget Statement, p22] 22. In comparison, Commonwealth funding per student for non government schools is forecast to increase by 5.6%. 23. Over the forward estimates (2014-‐15 to 2018-‐19) Commonwealth funding for government schools under the Australian Education Act is projected to increase by 36.1%. 24. This represents a total increase in Commonwealth funding of approximately 30.5% for each student in a government school over the forward estimates. 25. In comparison, over the forward estimates (2014-‐15 to 2018-‐19) Commonwealth funding for non government schools will increase by 23.4% (predominantly under the Australian Education Act). 26. This represents a total increase in Commonwealth funding of 17.7% for each student in a non-‐
government school over the forward estimates. Other education items in the budget 27. A table listing the detail of education budget initiatives is attached. 28. The new budget measures affecting schools are generally as anticipated. If you have any questions in relation to this information please contact Ross Fox, NCEC Executive Director, via the NCEC secretariat: [email protected] or 02 8229 0800. Page 2 of 5 Budget 2015-‐16 School Education Measures -‐ Summary School Education Students First and National Partnership Payments See pages 29-‐35 Budget Paper 3 Parental Awareness Campaign $5m over two years from 2014/15 for a communication campaign to raise awareness of the positive effect of parental engagement on children’s achievement Sm aller Governm ent – Education and Training Portfolio (Savings Measure) Save $131m over 5 years from 2014/15 by terminating or redesigning DoET programmes including the Endeavour Language Teacher Fellowships, National Workforce Development Fund, Promotion of Excellence in Learning and Teaching in Higher Education, competitive tender for the further development and support of the MySkills website VET Sm aller Governm ent – Education and Training Portfolio (Savings Measure) Save $1.6m over 5 years from 2014/15 by replacing seven VET governance bodies with the Australian Industry and Skills Council. National Partnership on Trade Training Centres in Schools $52.2m in 2015/16 Early School Leaver Programme $14m to improve educational outcomes and employment prospects for those who have not completed high school, by ensuring they are either looking for work or studying p78 Budget Paper 2 p79, Budget Paper 2 Does not appear to significantly affect school education programs or funding. p 79 Budget Paper 2 No further comment P35 Budget Paper 3 p 82 Budget Paper 2 As previously flagged Page 3 of 5 Summarises funding by state and territory for all schools under the Australian Education Act and specific national partnerships New measure Employment Media release 12 May Indigenous Rem ote Indigenous Students Attending Non governm ent Boarding Schools $5.4 over two years from 2015/16 Indigenous Advancement Strategy $4.8m in 2018/19 to ensure consistent rate of indexation across all elements of the IAS $6.7m over three years from 1 July 2015 for remote Indigenous internet training and infrastructure ABSTUDY (under 16 Boarding Supplem ent)-‐ extension $10m over 5 years from 1 July 2015 to extend ABSTUDY Under 16 Boarding Supplement to approved hostels for secondary students from remote communities National Partnership on the Northern Territory Rem ote Aboriginal Investm ent – children and schooling component $183m over 4 years from 2015/16 to improve school readiness and the literacy and numeracy of remote and very remote Indigenous students in the Northern Territory Building a Quality W orkforce initiative No further funding beyond 2014/15 Teacher Education Improving the Quality of Teachers and teacher Education Courses $16.9m to AITSL over 4 years from 2015/16 to implement the Government’s response to TEMAG. Early Childhood Education and Care Australian Early Development Census (Savings m easure) Save $4.6m over three years from 2014/15 National Partnership on Universal Access to Early Childhood Education – Extension (Expense M easure) $843m over three years from 2015/16 to extend the NPA for the 2016 and 2017 calendar years. National Partnership on the National Quality Agenda for Early Childhood Education and Care (Expense M easure) $61.1m over 3 years from 2015/16 (inc p 78 Budget Paper 2 Previously Announced see Media release 29 April p 142 Budget Paper 2 Building on existing program funding p 146 Budget Paper 2 No further comment p143 Budget Paper 2 p33 Budget Paper 3 Replaces existing NPA on Stronger Futures p 35 Budget Paper 3 Under previous NPA on Stronger Futures p 77 Budget Paper 2 Previously Announced see Media Release 7 May p75 Budget Paper 2 As stated does not affect availability of information. p76 Budget Paper 2 Families Package -‐ Preschool Previously Announced see Media Release 3 May p153 Budget Paper 2 Families Package – Childcare Page 4 of 5 $3.8m in additional money) to extend the agreement to support the delivery of an integrated national regulatory system for child care services See Fam ilies Package – childcare – W orkforce Participation Stream and Child Care Safety Net for further childcare reform s Students with a Disability National Partnership on m ore support for students with disabilities (M SSD) No further funding beyond 2014/15 NDIS – early access for children in the Nepean Blue M ountains area of W estern Sydney Early access of 2000 children (under 18) in Nepean and Western Sydney areas from 1 Sept 2015. Jointly funded with NSW Government Chaplaincy National Partnership on the National School Chaplaincy Programme $181m over 3 years from 2015/16 p154 and 155 Budget Paper 2 Families Package – Childcare p 31 Budget Paper 3 As previously announced p165 Budget Paper 2 (see pages 164-‐165 for further NDIS measures) Previously announced see Media Release 22 March 2015 p32 Budget Paper 2 Previously announced Page 5 of 5