NZEI Te Riu Roa is demanding the National/Act Government say how much it’s spending on four new charter schools, adding its money that should have gone on education of children with additional learning needs.
“It’s immoral to spend huge amounts of public money on schools that aren’t even needed, when children with additional needs are being denied the support they need to learn,” NZEI Te Riu Roa President Lynda Stuart said.
This week it was revealed that three and four year olds were waiting up to a year for an initial appointment with Ministry of Education specialists when they were identified with special needs.
“These children are being robbed of their right to an education, at the very time when it can have the greatest impact.
“The money being spent on charter schools would change the lives of thousands of children missing out on an education because this Government won’t properly fund learning support.
“The charter school experiment has not worked to raise achievement, according to recent analysis of school leaver results.
“It’s time to put an end to political interference in education, and focus on what works for all our children. That’s a strong public education system designed to ensure every child, not just some, achieve their full potential.”
Figures just released by the Ministry of Education show that only 59.7% of charter school leavers left with NCEA L2 or above in 2016. (School Leavers Stats.xlsx – Sheet1)
This compares to a system-wide figure of 80.3% across all schools within the system in 2016.
Looking more closely at specific groups, the system-level result for decile 3 schools was 74.3% and for Maori students, across all deciles, it was 66.5%.
The School Leavers metric is used as the performance standard in the charter school contracts. Former Minister of Education, Hekia Parata, made her intentions clear when she said:
“There is to be no compromise on the system level benchmarks”.
(Source: Hand-written comment from the Minister on a Ministry of Education paper, dated 24 May 2013)
The decile 3 system-level result for 2012 had been used as the baseline for the charter schools in their first year, i.e. 66.9% for the 2014 year. The contracts then set out a series of performance standards for subsequent years, culminating in the target of 85% of School Leavers attaining NCEA Level 2 or above by 2017. *
Worryingly, even this poor performance masks a weak set of results overall.
There were 124 School Leavers from charter schools in 2016 and this is the breakdown of the highest qualification they left school with:
Qualification # students % of total
Below Level 1 25 20.2%
Level 1 25 20.2%
Level 2 45 36.3%
Level 3 14 11.3%
UE 15 12.1%
Given the hype around charter schools, it is disappointing to see that 20.2% of students left school in 2016 without even attaining NCEA Level 1.
And at the top end, numbers above Level 2 fall away quite markedly:
As we await this year’s Ministry of Education evaluation of the charter schools, we are minded to note Hekia’s comment from 2013. Clearly, the New Zealand model of charter school is currently not achieving at anywhere near the system-level benchmarks that have been set for it.
~ Bill Courtney
* Note: There were no contract performance standards set above NCEA Level 2. The contracts for primary and middle schools are based on performance standards using National Standards for years 1 to 8.
For more information on charter schools, you may wish to read Charter School Report Card by Shawgi Tell
1. The introduction of charter schools is both a sop to the ACT Party, with their ideological desire to introduce a privatised, market based model of education, and a follow up to the Step Change Report produced in the term of the previous National Government. [Feb 2010]
2. However, there are significant differences between vouchers, the pure market model usually promoted by ACT, and charter schools, which is privatisation by way of contracting with private sector providers. Treasury calls this “Contracting for Outcomes”.
3. Treasury, in its advice to the Minister of Finance, noted that: “The evidence suggests that schooling systems that use strongly competitive elements such as vouchers, avoiding school zoning and ‘charter’ schools do not produce systematically better outcomes.” [July 2012]
4. “School Choice” is the phrase used in America to describe the market model. But New Zealand already has “arguably the most aggressive school choice system in the world” in the view of one overseas commentator. [Marc Tucker, Washington Post, October 2012]
5. NZCER surveys over the years consistently show that the vast majority of NZ parents already believe they send their children to the “school of their choice”. [NZCER]
6. Overseas evidence on charter school performance is inconclusive, at best. A wide range of individual school performance is evident but with little system-wide effect across the model as a whole. [CREDO and Hattie]
7. This purely quantitative analysis is then subject to further criticisms of many aspects of US charter school practices, including: student selection, including the effect of “self-selection” amongst parents; the proportions of English language Learners and special needs students; student attrition; school discipline and behaviour management practices; the apparent lack of backfilling, i.e. the tendency to not replace students as they leave; and the drive for what is commonly called “test prep”, in contrast to a genuine focus on the quality of education.
8. The promotional pack from the Authorisation Board boasts that the New Zealand charter school model represents “Freedom from constraints imposed on regular state schools in exchange for rigorous accountability for performance against agreed objectives.”
9. It then identifies the following factors, but without any evidence that these are likely to lead to higher student achievement: Cashed-up per student funding; school day & year; school organisation; curriculum; teacher pay / teaching practice; privately provided / secular or faith based. [PSKH Authorisation Board, 2016]
10. The argument that “freedom” will encourage/facilitate “innovation” is weak. It is not supported by overseas evidence [Lubienski 2003] and one US charter school industry’s overview even conceded that “… most charters do not employ particularly innovative instructional approaches”. [Bellwether 2015]
11. The combined roll of the 10 schools now in operation was 1,257 as at 1 March 2017, an average of about 125 students per school. The combined Maximum Roll across the 10 schools is 2,112 students. [MoE Schools Directory, April 2017]
12. The original funding model has already been changed, as it soon became clear how much operational funding these schools were receiving compared to their local state schools. Small schools are expensive and the government was fully funding the First and Second Round schools with no Sponsor capital input required.
13. Even in their 4th year of operation, the two largest First Round charter secondary schools are receiving cash funding of over $14,000 per student, compared to a system-wide weighted average for all schools, including property, of $7,046.11. [2015 system data]
14. The Third Round funding model now uses an approach more oriented to funding the student than funding the school, as the roll grows. But the government still provides the property and insurance funding for what is essentially a private sector organisation.
15. Cabinet was told: “A strong evaluation programme will be put in place that thoroughly examines the impact and effectiveness of the first such schools. This will enable us to make informed decisions about whether or not to open further such schools in the future.”
16. This promise has not been carried out. The roll-out of the model has proceeded well ahead of the release of any evaluation. At the time of writing, the Third Round schools have opened this year and applications are being processed for the Fourth and Fifth Rounds!
17. The first two reports from the Martin Jenkins Evaluation Programme are weak and do not rigorously examine school performance or the impact these schools have had. The Evaluation has also completely ignored the failure of the First Round school at Whangaruru.
18. Student achievement outcomes to date have been mixed but difficult to analyse thoroughly given the delays in the Ministry releasing accurate information.
19. By May 2017, the Minister has still not announced her decision on the release of the performance based funding for the 2015 school year! No operational reports for the entire 2016 year have yet been released, along with supporting documentation such as contract variations and Ministry advice to the Minister.
20. There was a major problem with the interpretation of the original secondary schools’ contract performance standard, which is “School Leavers” and not NCEA pass rates. This resulted in incorrect reporting of the true state of the 2014 and 2015 secondary performance. [MoE advice to the Minister, July 2016, obtained under the OIA]
21. Superficially high NCEA pass rates are published by Vanguard Military School but NZQA data obtained under the Official Information Act (OIA) reveals issues around the quality of the credits gained, the high proportion of unit versus achievement standards entered and large differences between internal and external pass rates. [NZQA]
22. Primary and middle schools assessed against National Standards have not performed well. In the 2015 year, only one school out of five – the Rise Up Academy – met its NS student achievement standard targets. [MoE initial analysis, 30 May 2016]
23. Some schools, including Vanguard and the two Villa middle schools, have failed to meet their Student Engagement contract standards relating to stand-downs, suspensions, exclusions and expulsions. This is of concern, given the US charter school practices noted above.
24. Charter schools are not more accountable than public schools, simply because they operate under a contract. Whangaruru was not closed for failure to achieve contract standards; it was dysfunctional from the start.
25. Public school accountability includes parent-elected Boards of Trustees, which must hold open meetings, maintain open records and be subject to the Official Information Act. Board finances are subject to audit under the supervision of the Auditor-General.
26. No such requirements apply to charter schools, which are organised under a commercial contract between the government and the private sector Sponsor.
27. Public funding must go hand in hand with public accountability. State and State-Integrated schools both abide by this principle but charter schools do not.
The cover up of the true picture of student achievement in charter schools continued today with the belated release of the second Martin Jenkins Evaluation Report.
The report, with a final publication date of 28 November 2016, was released on Friday 5 May 2017, a delay of over 5 months.
However, even now, the report contains a massive caveat in the section discussing student achievement, which indicates there are still major problems behind the scenes.
Here is the footnote set out under the Evaluation Report’s analysis of Student Achievement:
The ratings in the May 2016 advice were based on the best information available to the Ministry at that time (and are indicative of the reports that the Ministry had received from schools/kura by then). They reflect the most up-to-date information provided to the evaluation team at the time of writing this report, but are not the Ministry’s final assessments of schools’/kura performance for 2015.
Source: Ministry of Education (2016) Education Report: Partnership Schools/Kura Hourua: 2015 Quarter Four and Annual Reports, 30 May 2016
So, a formal policy evaluation signed off in November 2016, cannot go to print in May 2017 with a clear statement of exactly what represents the “Ministry’s final assessments of schools’/kura performance for 2015”?
The same problem is holding back the Minister of Education’s decision on whether or not to release the retained operational funding that is performance related, in respect of the 2015 school year. And this is now May 2017!
The major problem relates to the issue which surfaced last year, when the Ministry acknowledged that the interpretation of the secondary schools’ contract performance standards had been incorrect. As a consequence, the schools had also reported incorrectly against their contracts.
These incorrect figures had been used to determine the Ministry’s ratings in its May 2016 advice, referred to in the footnote. While the Ministry has now acknowledged that these figures are incorrect, nothing further has since been released.
The poor performance of the primary and middle schools is also evident in the Evaluation Report. Of the five primary and middle schools, which have contract targets set against National Standards, only one school, the Rise Up Academy, was assessed as having met its contract targets.
And problems are also clearly evident in the assessment of performance against the Student Engagement standards. Vanguard Military School and Middle School West Auckland performed very poorly against the standards for Stand-downs, Suspensions, Exclusions and Expulsions.
Overall, the main takeaway from the Evaluation Report is a fairly damning indictment of performance to date.
But the continued cover up of the true picture should not be tolerated any longer.
~ Bill Courtney
For a Minister so obsessed with data and, in particular, the sharing of data, it is interesting how little we know about charter schools.
Bill Courtney writes:
The game of delaying the release of a vast range of information on the charter schools continues.
The Ministry has promised to release a lot of material, including the formal evaluation of 2015 student achievement, in “April” but has refused to state exactly when. They also need to release all of the 2016 quarterly reports, the 2016 contract variations and the second “annual” installment of the Martin Jenkins evaluation of the charter school initative.
In short, lots of information is being withheld for no apparent reason.
When it is finally released, we will go through it and post our thoughts on what it reveals.
In the meantime, propaganda and marketing material fills the void.
This is the second in a series of postings following up an op-ed written by Don Brash published in the NZ Herald.
Our first response discussed what motives might lay behind what we feel is a concerted PR push by Villa Education Trust, the Sponsor of South Auckland Middle School.
In this piece we will look at the statement made in the op-ed about funding, as this remains one of the real sticking points about the early charter schools.
Ah yes, critics argue, but partnership schools get a lot more money from the taxpayer than other schools do. Absolute nonsense.
Sorry, Dr Brash, but charter schools do get more OPERATIONAL FUNDING than the local schools get. Especially when their funding is compared to the larger schools in South Auckland, where SAMS is located.
In a nutshell, SAMS received total operational funding of approx. $12,800 per student in 2015 compared to Manurewa Intermediate (the intermediate school used in the article) which received approx. $5,600 per student.
To understand how this large discrepancy arises, we need to look at the original charter school funding model. The single biggest policy mistake it made was to try and work out the equivalent funding that a stand alone State school of the same size and type might receive.
But, in practice, the charter schools are being created in places like South Auckland where there are larger, more established schools that receive much lower average per student funding. This means that the larger schools could not possibly recreate the conditions such as class sizes of 15 that the smaller charter schools can.
One recent story on Radio NZ described the pressure on some South Auckland schools that saw many of them using their libraries and halls as teaching spaces. One school had plans to start teaching next year in the staffroom!
So, is it any wonder that when given the option of class sizes of 15, free uniforms and free stationery, that parents may be choosing the charter school?
Let’s look briefly at the original charter school funding model, noting that this model has already been changed for the third round schools that have just been announced.
The original model had two essentially fixed components per school: Base Funding and Property & Insurance. The property component is fixed for the first 3 years (unless the school changes size or teaching year levels) and the base funding component varies by type of school (secondary, middle or primary) and is indexed each year.
Variable Funding comes in two parts: a Per Student Grant and Centrally Funded Services. The two variable components are then multiplied by the number of students on the roll or the Guaranteed Minimum Roll (“GMR”) whichever is the greater. So, if the actual school roll is less than the GMR, the Sponsor gets paid for at least the GMR number of students.
In 2015, SAMS operated at its Maximum Roll, which was originally 120 students.
So, putting all the components together the SAMS financial statements show revenue from Government Grants of $1,536,016, or an average government funding figure of approx. $12,800 per student, in 2015.
So let’s walk through the SAMS financial statements for 2015 and see what Villa does with its $1.5 million of funding.
First, it pays the rent, which is $150,000 per annum. If we are generous, and include all Property expenses, including utilities, we find these amounted to $194,776 in the 2015 financial statements.
This would then leave a total of $1,341,240, or $11,177 per student after we have acquired and maintained the school premises.
What do we do next? We would look to hire the teachers necessary to deliver on the 1:15 class size ratio.
For a school of 120 students, we would need 8 teachers, at a round number cost of $75,000 per annum each. That should cost us approx. $600,000 and we find that teacher salaries in the 2015 SAMS accounts came out at pretty much that amount: $584,883. Add in the other curriculum related costs, such as classroom resources – including those free school uniforms and stationery – and total Learning Resources amounted to $869,846.
That leaves us with $471,394 to pay for the administration of a 120 student school.
Plenty of money to pay for a full-time Community Liaison Manager – nice if you can afford it – pay for all the office and other admin costs and allow for depreciation and you spend a total of $263,906.
And what does that leave room for?
That’s right: the Management Fee payable to the Sponsor of $140,000. That’s the cost of hiring a full-time principal at a much larger school!
For comparison, let’s see how Manurewa Intermediate is getting on.
The Find A School application on the Education Counts website has summary financial information for State and State-Integrated schools.
In 2015 Find A School showed Manurewa Intermediate’s Staffing Entitlement figure was $2,510,958 and its Operations Grant figure was shown as $1,431,808. So, let’s cash this all up and make an OPERATIONAL FUNDING total of $3,942,766.
But straight away we have a problem. Manurewa Intermediate has 704 students. So we start our comparison with average per student government funding of only $5,600 per student.
Its property is owned by the Crown, so it doesn’t pay rent in cash. So we can skip straight to the teacher costs.
To engineer class sizes of 15, we would need to buy 47 teachers. At a cost of $75,000 each we would need $3,525,000.
That would leave us with only $417,766 or $593 per student to pay for everything else necessary to run a school of 704 students which is nearly 6 times the size of SAMS!
Out of that amount, we would need to pay for all classroom and curriculum resources, all the non-teaching staff, all the administration costs, the utilities and property maintenance costs and the depreciation to cover the replacement of all the furniture, equipment and ICT resources.
Hopefully you can see from this comparison that it would be virtually impossible for Manurewa Intermediate to have class sizes of 15 with the level of government operational funding it receives.
You could also arrive at the same conclusion with a simple rule of thumb calculation.
Based on a teacher cost of $75,000, in a class size of 15 each student needs to contribute $5,000 to pay for their teacher. SAMS had $11,177 after paying for the premises; Manurewa Intermediate started with $5,600.
In summary, what readers interested in understanding charter schools funding need to appreciate is the significant influence of the fixed cost components of their funding model.
Even at its initial maximum roll of 120, the fixed components of SAMS’ funding comprise 57% of its total funding: base funding was $578,021 and the property component was $303,681. That is why the charter schools are proving to be more expensive than their local counterparts: they are small schools with high fixed cost funding.
But they are being compared to larger, longer established schools where the fixed costs are spread over a much greater number of students.
This is what economists call economies of scale.
It is a major reason why direct comparisons between schools with significantly different funding streams should be treated with real caution.
Research shows that the effects of smaller class sizes are positive and of real help, especially when dealing with students who need more intensive support.
Smaller class sizes are an expensive policy to engineer; but wouldn’t it be great to see class sizes of 15 in all our low decile schools, not just those favoured by the flawed charter school funding model.
~ Bill Courtney, Save Our Schools NZ
The Education Ministry reported that some of last year’s new charter schools are not doing so well, but says there are good reasons for this.
The reasons given include students arriving at school far behind age-appropriate levels, student transience, the high rate of referrals from Child Youth and Family and the Police and referrals of difficult students from other schools.
Indeed, those are valid reasons for any school struggling to help students.
What I would like the Education Minister and the Undersecretary for Education to explain is how these factors are considered sound reasons for charter schools to struggle to help students and yet are considered excuses for public schools.
Sources and further reading:
The two charter schools operated by Villa Education Trust have achieved only 3 of their 12 student achievement targets for the 2015 year, according to analysis by Save Our Schools NZ.
According to the 2015 annual reports to the public released by the two schools, South Auckland Middle School achieved 2 of their 6 targets and Middle School West Auckland achieved only 1 of their 6 targets.
Detailed results are set out below.
South Auckland Middle School
|Target %||Outcome %||Target %||Outcome %||Target %||Outcome %|
Middle School West Auckland
|Target %||Outcome %||Target %||Outcome %||Target %||Outcome %|
Charter schools are supposedly going to be held to account for their performance against clearly specified performance standards set out in their contracts, including student achievement and student engagement.
In its first year of operation, South Auckland Middle School failed to meet its student engagement performance standard when it missed the required standard for stand downs, suspensions and exclusions.
But the Minister of Education still approved the release of the 1% performance retention funding retained under the contract, even though the contract wording required the school to reach all of its performance standards before such a payment could be made.
The clear underperformance in 2015 of both schools in the most important contract area, which is student achievement, should make the Minister’s decision this year clear cut.
But as charter schools are ultimately a political initiative anything can happen!
Cartoon by Emmerson – twitter.com/rodemmerson
Prior to the publication of Save Our Schools NZ’s detailed analysis of charter school funding in 2016, we here present a summary of findings:
Finally, it will never be easy to make straightforward comparisons between charter school and State / State-Integrated school funding, as this inevitably involves an apples v oranges comparison. But even in their third year of operation, the first round schools still have high total funding per student costs compared to the weighted average across the school system.
And while things may or may not change over time, our approach will remain simple: “Follow the Money”.
~ Bill Courtney, Save Our Schools NZ
20 May 2016
Today’s announcement that the government will fund another seven charter schools and an independent body to support them comes as a huge disappointment to Principals across the nation.
‘Only a few months ago, the Minister was closing the Whangaruru failed charter school which spent $1.6million on a farm and the government has no mechanism to retrieve that money, even though the school is now closed,’ said Iain Taylor, President of the New Zealand Principals’ Federation today.
‘We thought that lessons had been learned from that disaster,’ said Taylor, ‘but obviously not.’
‘No one is calling for more of these schools,’ says Taylor. ‘Parents already have more than enough schools to choose from. Charter schools are a political arrangement with the government and the ACT party.’ he said.
‘Charter schools are a business, not a regular school, and businesses market themselves to get more customers by offering enticements. That’s what charter schools do”
‘Kids are not flocking to charter schools. Parents have to be enticed to send their kids there. We see the incentives like free school uniforms, free stationery and no programme charges,’ said Taylor. ‘Charter schools are a business, not a regular school, and businesses market themselves to get more customers by offering enticements. That’s what charter schools do,’ he said.
‘The Minister has often said that the vast majority of public schools of all decile levels in this country are great schools. We want all public schools in New Zealand to be great schools and we don’t need charter schools soaking up precious funds that would make that happen,’ said Taylor.
NZPF President Iain Taylor, media spokesperson
Mob: 021 190 3233
In these two short videos Assoc. Professor Peter O’Connor from the University of Auckland analyses why Charter schools are being introduced into New Zealand.
The first video was released in 2012. the follow-up in 2014, and together they give a good overall picture of the concerns people had and still have regarding NZ charter schools.
As a follow up, you may wish to watch Bryan Bruce’s up-coming doco about the New Zealand education system, ‘World Class?’, which is being aired on TV3 at 7.30 on Tuesday 24th May 2016. The doco was years in the making and should be very thought provoking.
The promo clip is here:
Assurances that ACT’s charter school experiment was just a pilot have been proven false with this afternoon’s announcement of seven new charter schools.
PPTA president Angela Roberts was surprised a new round of charter schools were being opened when New Zealand tax payers had been promised the concept would be a trial.
With a poorly conducted evaluation of the existing schools lukewarm about their efficacy opening more did not make sense, she said.
“There are still a lot of questions to be answered.”
“We have been constantly reassured there would be just a handful of schools which would be robustly evaluated – both of those claims have been proved false,” she said.
“This is not a pilot, it is just a sop to the ACT party’s ideological commitment to favouring the private over the public sector.”
This was out of step with reality as illustrated by the disastrous Serco prison contracts and the closure of one of the first five charter schools, she said.
Current research shows our poorest schools are facing the deepest challenges in meeting their students’ needs.
“Public money should be going towards what evidence shows helps the most vulnerable, and that is professional support for their health and welfare needs and economic and social wellbeing,” she said.
Enabling schools to be hubs where students can connect with nurses, mental health and welfare support would have a much bigger impact than wasting money on an unproven experiment.
“The funds should be reprioritised to the state sector where they will have the greatest impact on the greatest number of students,” she said.
The ACT party education policy proclaims that:
“all parents should have a chance to send their children to Partnership Schools. The best way to achieve this is to allow all State and Integrated Schools to choose whether they want to convert to Partnership School status.”
Despite the fact that charter schools do not have to have parents on their board of trustees, the ACT policy goes on to say that:
“Partnership Schools are accountable to parents and students.”
How, I wonder, if parents are not on the board and most information about the school can be kept secret due to it being a private business.
It is incredulous that ACT is still arguing that privatisation (of anything) automatically raises standards. It is patently untrue, as shown by the prisons saga and power companies.
What is true is that once a service is privatised, more money goes into CEOs’ back pockets and less to the workers or those they are meant to serve.
“Education is supposed to be for the benefit of New Zealand’s children.”
Ask yourself, who would privatisation benefit?
~ Dianne Khan
Is David Seymour changing the rules for charter schools to make it easier for them to meet their contract performance standards?
Seymour’s bizarre press release (9 December 2015) contained the extraordinary statement that “David has reformed the funding formula for the schools and is tweaking the assessment regime.”
What on earth does “tweaking the assessment regime” mean? And why would a politician be involved in a technical matter such as assessment?
The New Zealand Qualifications Authority is the entity responsible for the qualifications framework in this country not David Seymour.
But is Seymour taking action to change the rules for the charter secondary schools, given they appear to have failed to meet the 2014 standard set out in the charter school contract?
This states quite clearly that the standard is “School leavers with NCEA Level 2” with a 2014 target of 66.9% eventually climbing to 85% in 2017. This is the Government’s main target for the school system.
However, the Education Counts database published by the Ministry shows both Vanguard Military School and Te Kura Hourua o Whangarei Terenga Paraoa fell short of that target in their first year of operation. Vanguard had 60.0% and Paraoa 55.6% of their School Leavers leaving with NCEA Level 2 or above.
So, what is Seymour up to?
Followers of the charter school initiative will also laugh at the comment that “David has reformed the funding formula.” While problems with the original funding model were clear from the outset, Seymour denied this was the case. A quote from his op-ed published in the Sunday Star-Times (8 February 2015) states that: “Why do some claim partnership schools are overfunded?”
So, which level of funding is correct Mr Seymour?
The amount produced by the original model or the amount now on offer after you “reformed the funding formula”? The Ministry document presented to cabinet clearly sets out how much less the “reformed” model produces for a new charter school in its early years compared to the original model. But that cannot stop the overfunding that already applies to the first round of schools, as the Ministry is bound by the original contract.
So, are the schools also being held to account for their side of the same contract? Or is the parliamentary under secretary riding to their rescue and “tweaking” the rules?
– Bill Courtney, Save Our Schools NZ
This time last year the Ministry of Education published a shamefully misleading publication, ironically called “State and Partnership Schools: The Facts”.
It is time to update the so-called “Facts” on charter school funding and show just how expensive these very small schools are still proving to be.
The Ministry brochure attempted to compare average per student funding between two actual State and two Partnership schools. But there were two tricks used in the illustrated calculation of average funding per student.
First, the funding for the charter schools was adjusted to remove two components produced by the funding model: “Property & Insurance” and “Centrally Funded Services”. The Ministry propaganda argued that these costs were paid for by the Ministry for State schools but that charter schools “must fund these costs themselves, from their Ministry payment.”
Second, the adjusted funding for the charter secondary school was then divided by a projected roll number of 300 rather than using the actual school roll.
For the charter secondary school, the combined effect was to show an illustrated average funding figure per student of $8,452. This was compared to an unnamed State decile 3 secondary school with an actual roll of 307 students and an average funding figure of $9,594.
Why is the illustration misleading?
The secondary charter school used in the brochure was Te Kura Hourua O Whangarei Terenga Paraoa, based in downtown Whangarei.
What we now know from examining their 2014 audited financial statements is that actual property costs in 2014 amounted to only $239,097. By deducting the “Property & Insurance” funding component of $737,936, the Ministry ignored the reality that actual property costs were nearly half a million dollars less than what the school was funded for.
For a State school, where land and buildings are provided by the Government, the cost of creating the school is met by the Crown, which owns the new school property as an asset. But no matter what the cost of creating each new school, the Board of Trustees and staff cannot change the way that teaching and learning are subsequently delivered in the new school. The facilities are provided “in kind” and not in cash. Once the school starts operation the normal State school funding based on the staffing entitlement and operations grant funding will flow.
However, charter schools are funded on a “cashed up” basis with the amount of each component determined by a funding model. Any overpayment from the funding model, relative to actual costs incurred, will create an additional source of income for the charter school Sponsor.
In this case, additional funding of nearly $500,000 per annum from this one source alone has been paid to the Sponsor – in cash. Under the charter school model, it is entirely up to the Sponsor as to what to do with the extra income.
If, for example, the Sponsor uses the cash to employ additional teachers, then the students will benefit from smaller class sizes, other things being equal. In the case of Paraoa, an amount of $500,000 per annum would allow an additional 6 or so teachers to be employed, over and above whatever staffing levels were funded for in the model.
For a school with only 75 students, ignoring an overpayment of this magnitude is grossly misleading when attempting to compare costs with State schools.
The second trick used by the Ministry was to divide the adjusted funding for the secondary school by the Maximum Roll rather than the actual school roll. The Ministry knows there is a real problem with the secondary school funding model, as these schools are paid a much higher Base Funding amount than the primary schools receive. So, to cover its tracks the Ministry used the Maximum Roll rather than the actual roll to bring the average down as much as possible.
But it did this only for the secondary school in the brochure. It did not do it for the primary school, which, incidentally, was the Rise Up Academy, based in Mangere. In the primary school calculation, it used a roll of 50 even though that school’s Maximum Roll is 100.
With the (very late) release of the 1 July 2015 roll returns, we can now see that Paraoa’s roll was still only 75 students, i.e. only one quarter of its Maximum Roll!
So, how should we analyse the school’s actual average funding position?
Here is our adjusted version of the Ministry’s “Facts” brochure:
|Component of payment||State School||Charter School|
|Payment per annum||$2,945,432||$2,145,086 (actual 2015 funding)|
|Property & Insurance costs||Paid by the Ministry||$239,097 (actual property costs)|
|Centrally-funded Support||Paid by the Ministry||$20,700 (based on 75 students)|
|Number of students||307 (March 2013)||75 (1 July 2015)|
|Average funding per student||$9,594||$25,137|
$25,137 for the charter school in 2015 compared to $9,594 for the State school.
Confused? So you should be. And, just for good measure, the Government announced in August that the funding model would be amended for the two new charter schools to be created in the Third Round, due to open in 2017.
So, which version of the “Facts” would you like to use? The actual, the new model, the old model or the Ministry of Education’s fairy tale illustration?
Bill Courtney, SOSNZ