Does Private Schooling Pay? Evidence and Equity Implications for Australia

Written by Associate Professor Mike Dockery, NCSEHE

Introduction
A ‘better education’ is strongly associated with better outcomes across a range of life’s domains and educational attainment is commonly used as a marker of socio-economic status. Universal access to quality early childhood, primary and secondary schooling, followed by equitable access to further and higher education, is critical to ensuring children from different backgrounds have equal economic and social opportunity. The benefits of education may derive not only from the level of education attained and the student’s academic performance, but also from the prestige of the schools and institutions attended and the associated social capital passed on to the individual.

Within Australia, education in schools is primarily a responsibility of State and Territory governments and pre-school, primary and secondary schooling is available universally free of tuition fees through the government-run public school system. However, parents may opt to pay to send their children to one of a number of non-government or ‘private’ schools, which are broadly categorised as Catholic schools or non-Catholic Independent schools. According the Australian Bureau of Statistics, around two-thirds of all students in 2015 attended government schools (ABS 2016), with 20% attending Catholic schools and 14% in Independent schools. Fees to attend such Catholic and private schools can be substantial. Data compiled the by Australian Curriculum, Assessment and Reporting Authority show annual fees paid to Catholic schools in 2012 averaged $3,107 per student, and $9,345 per student for Independent private schools (ACARA 2012: 58).

The question as to whether the private school sector provides a better education is of great importance to parents, students and providers, and for government policy. It is known that Independent school students come from higher socio-economic status (SES) backgrounds, on average, than Catholic school students, who in turn come from higher SES backgrounds than students of government schools (Watson & Ryan, 2010). This raises concerns of the existence of a ‘two-tier’ school system that limits inter-generational mobility in SES. Consequently there is a considerable empirical literature comparing public and private schools in terms of academic outcomes at both the school and student level, including school test scores, university entrance and performance at university. In contrast, this paper focuses on whether there is a wage premium associated with private schooling in Australia, using data from the Household, Income and Labour Dynamics in Australia survey. Outcomes in other selected life domains are also explored: namely household income, neighbourhood socio-economic status and life satisfaction. To the best of the author’s knowledge the existence and extent of a public-private divide for these post-education outcomes life has not previously been analysed in Australia.

Full report.

Dockery, A.M. (2016). Does Private Schooling Pay? Evidence and Equity Implications for Australia. National Centre for Student Equity in Higher Education (NCSEHE), Perth: Curtin University.