Private school fee pain threatens enrolments

Private schools could start ramping up collections on struggling families by early 2021. It comes as many families remain on fee “life support”.

Some schools could be looking at losing up to 10 per cent of their students.

Some private schools in Victoria have up to 30 per cent of families on fee “life support”, with financial relief extending into 2021.

But the screws are tightening on embattled parents, with some institutions demanding “restitution” repayments of deferred fees by the end of the year.

Prushka Fast Debt Recovery chief executive Roger Mendelson said schools would start to ramp up collections by early next year as COVID-19 bankruptcy protection measures end.

Despite this, student numbers in the independent sector are holding steady, with more than 151,000 children enrolled for next year.

However, frozen fees for 2021, a lack of international students and fee rebates of up to $5 million are threatening the financial viability of some institutions.

Some school are forecasting a drop in student numbers of up to 11 per cent from next year.

State schools such as Auburn High, which has gone from 200 to 700 students in recent years, are also reporting a drift from private institutions.

Loretta Wholley, president of Catholic Secondary Principals Australia, said “schools’ incomes have been noticeably impacted by parents needing fee relief”.

“In some schools it has been a huge impact especially if they were in a regional area affected by sudden high unemployment,” she said.

Trinity Grammar in Kew has waived $5 million in fees this year.

The state’s 31 boarding schools, and those heavily reliant on Victoria’s 10,000 overseas student enrolments, have been hit the hardest.

Richard Stokes, CEO of the Australian Boarding Schools Association, said 2022 was looming “as a bigger concern than 2021”.

Principal of Ivanhoe Grammar Gerard Foley said his school’s high domestic numbers were “unprecedented” but the effect of COVID had been “significant” on international student revenue.

Michelle Green, chief executive of Independent Schools Victoria, said that “while all Independent schools have been affected by COVID-19 and its economic impact, the nature and extent of the impact varies widely”.

Jim Miles, executive director of Catholic Education Melbourne, said he didn’t expect enrolments to be impacted by the pandemic.

One new school opening next year is St Joseph’s Catholic Primary School in Werribee, which will have around 110 students.

Principal Shelley Ryan said she had been delighted by the community support for the new school.

FEE RECOVERY COMING

Mr Mendelson said referrals to his debt recovery service had dropped off from March but he expected them to start picking up again.

“The stated reason is not wanting to upset parents over the COVID period,” he said.

“Our approach is always ‘soft touch’. We encourage schools to accept reasonable instalment arrangements.”

Geelong Grammar has frozen fees. Picture: Mark Wilson

He said during COVID, legal action had been curtailed due to restrictions on bankruptcy.

“A creditor could commence bankruptcy after obtaining a judgment of more than $5000.

However, temporary rules have resulted in a lift to $20,000. In addition there was a 21-day period to respond to a bankruptcy notice but this is currently $20,000.

Both changes are expected to revert back on January 2 and, after this, we expect a lift in legal actions and some bankruptcy action for the most recalcitrant parents.”

Regent Consulting director Paul O’Shannassy, who runs a consultancy advising parents on choosing schools, said schools were under no obligation to freeze fees but many had.

He said the impact on schools from the COVID lockdown would be clearer in March when JobKeeper finished and many people had gone through their savings.

He said he would not be surprised to see some schools dropping enrolments by up to 10 per cent.

Other schools have tens of thousands of dollars of bad debt on their books.

Mr O’Shannassy said schools were businesses and needed to pay their own bills, with teacher salaries making up the bulk of their expenses.

“It is an incredible juggling act for schools,” he said.

“I think the majority of schools are doing a pretty good job under the circumstances.”

He said he was aware of schools where spots had opened up.

He said the shift from local primary schools at year 5 to take up positions in junior schools in secondary schools might also slow as parents looked at saving money.

PRIVATE SCHOOLS FACING EXODUS?

While fees at prestigious schools are inching closer to $40,000 a year for senior students, many schools have frozen fees at 2020 levels, with an eye to longer-term effects of Victoria’s pandemic lockdown.

Most schools require quarterly instalments, offering small discounts for upfront payment.

Victorian Association of State Secondary Principals president Sue Bell, said they were not seeing evidence of leakage from the private sector to the government sector.

However, she said there appeared to be more scholarships on offer in the non-government sector.

There was a suggestion that some parents priced out of expensive private schools due to changed COVID circumstances might scale back to the cheaper non-government school.

Scotch College in Hawthorn was the first to announce a fee freeze. Picture: Kelly Barnes

While this is being talked about, Terry Blizzard, principal of St Mary’s College, which was created as a result of a merger between CBC St Kilda and Presentation College Windsor, wasn’t seeing it at this stage.

PRIVATE SCHOOL FEES

Top-notch Scotch College was the first to announce a fee freeze mid-year.

Prep at the famous Hawthorn school will cost $28,728, rising to $39,928 for years 9-12. Boarding will cost an extra $28,548.

Geelong Grammar, which offered an across the board 20 per cent discount for all families in Term 3, has also frozen fees.

Years 10-12 at Corio for day scholars will be $42,500 while boarding will be $72,040, which is slightly down on last year.

Year 9 at Timbertop, famously attended by Prince Charles for a term, is $72,040 or $18,000 instalments.

Wesley College Prep to year 3 fees are $23,110, rising to $29,220 in year 7 and $34,610 in Years 10-12. The Year 9 term in Clunes costs an additional $4800.

Melbourne Girls Grammar fees for years 11-12 are $36,784. $33,288 for year 7 and $23,960 for Prep. Boarding is an additional $26,684.

Haileybury, which has campuses in the city, suburbs, Darwin and in China, has frozen its fees this year.

While the school did offer some discounts, principal Derek Scott said there were major fixed costs in staff wages. Savings were made for travel.

The school charges $19,425 for prep, $28,800 for years 5-6 and $33,560 for years 9-12.

St Catherine’s Toorak notes in its business notice, which accompany fee invoices, that it is not a credit provider.

It charges $23,620 for Prep, rising to $30,520 for Years 5-6, up to $33,180 in Year 7 and $38,040 in Years 11-12. Boarding is $30,480 and casual weekly boarding is $910 per week.

It levies a composite fee of $2520 in year 12 for extras but that does not include rowing, music and snow sports.’

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