The full list of ‘overfunded’ Victorian private schools facing big cash cuts

Some of Victoria’s most expensive private schools will have their federal funding reduced over the next five years, leading to fears many will raise fees to compensate.

Schools such as Geelong Grammar, Penleigh and Essendon Grammar, and Mentone Grammar are among hundreds of private institutions nationwide that have banked millions of dollars in overfunding from the Commonwealth over several years.

The list of 299 schools and institutions federal Education Minister Jason Clare has vowed to transition down to their assessed School Resourcing Standard (SRS) by 2029 was published for the first time during Senate estimates and obtained by this masthead. Sixty of the schools and institutions on the list are Victorian.

The dining hall at Geelong Grammar, Victoria’s most expensive private school.Credit: Cathryn Tremain

The schools were found to have received up to 40 per cent above their funding entitlement and are now undergoing annual reductions.

The government will gradually transition the schools down to 80 per cent of the SRS by 2029, which the Greens have criticised as too slow. But Independent Schools Australia chief executive officer Graham Catt says the reduction has to be gradual to avoid slugging parents with massive fee hikes.

“Without transition arrangements, schools would have no option but to implement huge fee increases for families,” Catt said.

“Given that 60 per cent of families are from low to middle-income households, this would hurt the hundreds of thousands of everyday Australians making sacrifices to give their children the best education possible.”

The Victorian branch of the lobby group for independent schools has separately written to Clare pushing for more federal funding, arguing the introduction of state payroll tax is hurting their bottom line. Private schools increasingly listed the tax alongside their 2025 fees, promising to refund the amount to parents should the 4.86 per cent tax be cut or scrapped.

An analysis of Victoria’s high-fee schools, published earlier this week, found tuition fees were increased by an average of 6.5 per cent last year, well above the inflation rate of 2.8 per cent.

Catt said claims the majority of private schools were overfunded were overblown and ignored the important role they played in Australia.

“Independent schools educate 716,000 students across the country, offering families a choice that reflects their values and aspirations,” he said.

“Misrepresenting the sector as overfunded ignores the reality that independent schools save the public system billions and relieve enormous pressure on public schools.”

Many of the 299 schools and authorities on the government’s list were revealed to be educating the highest-income families, meaning a median annual income exceeding $209,000, during Senate estimates last year.

Credit: Matt Golding

Most of those schools were identified as overfunded due to a measure introduced in 2020 calculating how much parents could afford to contribute to private schools.

Victorian Catholic Education Authority chief executive officer Elizabeth Labone said while a small number of its schools would receive less funding, the change more accurately reflected the incomes of the parents that choose a Catholic education.

However, Labone disputed the idea that Catholic schools were overfunded and denounced the timing of the funding cuts.

“This transition comes at a difficult time for Catholic schools who are facing budgetary pressures because of increases to insurance, WorkCover … and the Victorian government’s unfair payroll tax,” she said.

“Any claims that Catholic schools are overfunded are inaccurate. Claims that Catholic schools will receive 80 per cent of their SRS from the Commonwealth government disregard the substantial private contribution that is expected from parents.”

Economist and public education advocate Trevor Cobbold said changes to reduce private school funding were long overdue.

“High-fee elite private schools serving the richest families in the country have long had their snouts in the taxpayer trough. Bleating about their funding being reduced is nonsense,” he said.

Cobbold, a former Productivity Commission economist who now runs public education advocacy group Save Our Schools, said he believed indexation would offset the SRS reduction for the vast majority of transitioning schools.

“Only a small minority will actually have their funding reduced and this is overdue because they have long been over-funded by millions by the taxpayer at the expense of better funding for disadvantaged public schools,” he said.

The Commonwealth estimates it will provide $13,456 of recurring funding per student at Catholic schools and $10,714 per student at independent schools in Victoria in 2025. The state’s public schools, which serve the majority of disadvantaged students and remain below the SRS, were estimated to receive $4377 per student, according to Senate estimates.

States and territories, which provide the bulk of funding to public schools, were locked in negotiations over a 10-year funding arrangement with the Commonwealth until late last year.

While Western Australia, Tasmania, the Australian Capital Territory and the Northern Territory agreed to an arrangement that removes the funding ceiling stopping the Commonwealth providing more than 20 per cent funding to public schools, Victoria is among the states that held out over its pitch for an increase to 25 per cent.

The stalemate leaves Victoria’s public schools vulnerable to an ongoing funding gap of at least 5 per cent.

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