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Thursday, 7 May 1987
Page: 2777

Mr WILSON(11.23) —When my colleague the honourable member for Tangney (Mr Shack), the Shadow Minister for Education, opened the Liberal Party's participation in this debate, he drew the attention of the House to the fact that education is high on the agenda for all in our community-parents, students, young people, teachers and the community generally. He pointed out that people are looking critically at the schools, teachers, subjects, policies and the overall philosophies responsible for preparing young people for their future lives. People are also looking at the role of government in regard to education, because today they are confronted with an education system in Australia which is, as the honourable member for Tangney pointed out, in an unprecedented crisis.

In this debate it is desirable that we look back to the origins of the Australian education system. The general structure of the education system in this country was established in the nineteenth century in response to the political and religious tension of the times and the changing circumstances in the then colonies. From the beginning, education was conceived as being essentially a service to be provided by the governing authority for communities lacking the concern, physical resources and specialised knowledge to organise their own schools. However, in adopting this role the state did not assume a monopoly on education. It allowed independent schools to continue subject only to their meeting certain standards and finding the money to finance their operations through fees, endowments and other fund raising efforts.

We have come a long way since the nineteenth century. At the turn of the century, the colonies were federated into the Australian nation and under the Constitution then adopted the States were left with the responsibility of education. This meant that for many years distinctive education systems were developed in each of the States, but over more recent years there has been an increasing intervention by the Commonwealth Government and pressure for uniformity. But in spite of this, differences in organisation and operation still exist. But it has been through the power of the purse that this Parliament, and the governments formed within the Parliament, have exerted their influence.

In this crisis that confronts education people are wanting a change. They are more literate, more concerned and more responsible about the education of their children, and they want greater freedom of choice. I believe that the majority of Australians want an Australia in which, subject to the national interest, governments cease to be owner-operators of anything that the private sector, or, as I would prefer to call it, the people sector, can effectively run-and the people sector can certainly run schools.

I also believe that the majority of Australians want an Australia in which taxpayers can opt out of paying tax to the extent that they meet the cost of a standard government school place for their children, to the extent to which they provide themselves with the means of meeting the cost of basic medical and hospital care when they require it, or to the extent of providing themselves with a guaranteed stream of income in retirement equal to the current age pension. I believe that the majority of Australians want an Australia in which those with low incomes can, through cashable tax credits, be given the education, health insurance and retirement income opportunities available to taxpayers together with some degree of personal economic independence. In this debate, therefore, I might well ask: Can children be provided with compulsory education without governments running schools or as many schools as they now operate?

If the goals of smaller government, lower taxes and the greater well-being of all Australians are to be achieved, we must develop the means by which this question can be answered in the affirmative. One of the first and most important steps that I see as necessary is the fundamental reform of the Australian taxation system-something that the present Government has failed to do. The way ahead is for the burden of tax to be cut, for tax to be imposed in a way which is fair and for Federal-State financial arrangements to be reformed so that the government which spends the money raises it.

The present tax system is unfair to Australian families, particularly those families who have the responsibility of educating children. It destroys their incentive and distorts their economic and social behaviour. The recent tax legislation, introduced with such trumpeting by the Treasurer (Mr Keating), contained no proposals to remove the underlying unfairness in the present tax system as it impacts of families, as contrasted with those who have no people dependent upon them.

Most Australians believe that the cost of government should be shared according to capacity to pay, but everyone knows that inadequate allowance is made for the effect on this capacity of maintaining dependent spouses, children or other dependants. Tax rebates and cash allowances available to those taxpayers who have dependants amount to substantially less than the pensions and allowances payable to dependants who are the responsibility of the public sector. Similarly, tax rebates and cash allowances, whether received directly or paid to the schools, currently available to taxpayers who send their children to independent schools equal on average about half the cost of a government school place.

If we are to reduce the tax burden, it is government, not `people' expenditure which must be cut. Significant cuts will be achieved only if there is a substantial change not only in the amount spent on services, but in the government sector-`people' sector mix of this expenditure. A worthwhile reduction in the size of government, the extent of government expenditure and the burden of taxation will result only from a radical new approach to government sector involvement in areas such as education. People should be left, or provided, with sufficient resources to enable them to discharge the obligations which society properly compels them to undertake. One of those obligations is the responsibility of ensuring that one's children receive a basic education for a specified number of years.

For a long time it has been public policy that school education should be compulsory and available free of charge. But governments have gone down the path of making education available rather than affordable. Governments have raised taxes when they should have cut them. They have run schools when they should have left it to the people sector to carry out this function. Governments must stop doing things which people can do as well or better. Governments should be more concerned with ensuring that parents have the funds to meet the cost of their children's education rather than with running schools.

A large public sector involvement in the running of schools is not the only way in which free universal schooling can be provided. The operation of schools by governments is an option which is obviously more attractive to a socialist than to those who believe that greater benefits flow from the effective operation of personal responsibility and freedom of choice in the private or people sector. If governments are to run some schools, those schools should compete on the same terms and be treated in the same way as non-government schools. As parents have exercised the right to choose, the proportion of children in Australia being educated in government schools has been declining for a number of years.

The extent of public sector involvement in schooling could be further reduced if the current price of the exercise of this choice were reduced. This could be done by ensuring that all parents have the means to pay for their children's education at a cost which is equal to the standard cost of educating a student in a government school. One means by which this could be achieved would be the use of refundable tax credits which are equal in value to the cost of a government school place. To the extent that such tax credits for school expenses reduce the burden of taxpayers, these credits should be regarded as an integral part of the underlying tax base-the benchmark or normal tax base. These credits should be designed in a manner which takes account of the effect on capacity to pay, not only the size of the taxpayer's income, but also other factors such as the cost of discharging the responsibility for providing for dependants.

I say, by way of further interpolation, that the tax models that were given much publicity in today's paper failed very much in this regard. They seemed to indicate that except for some minor adjustments, the tax capacity was merely a function of income. That is not so. Taxable capacity is affected by other responsibilities that taxpayers so often undertake. If taxpayers did not undertake them, they would have to be met by public sector expenditure. Just as the value of the tax threshold, the spouse rebate and tax relief for the payment of union dues are not included in the measurement of public expenditure, so tax credits for the full cost of a standard state school place should be similarly treated.

Reduced government spending makes tax cuts possible and the people sector payment for these services affordable. It is up to the people sector to determine whether the overall level of spending on education should be increased beyond a government-specified minimum. Let me hasten to add that in putting forward these suggestions as to the directions in which we should move in the reform of our education system I am in no way advocating a return to the law of the jungle and its heartless application of the principle of survival of the fittest. The Government must change its role in a way which shows it has a strong commitment to compassion. Every Australian must be guaranteed a socially acceptable standard of education. Indeed, every Australian must also be guaranteed an acceptable standard of health care, level of income maintenance and general standard of living. The principle of universal access to such a standard of education should be maintained, firstly, by giving taxpayers tax relief to the full extent of the standard cost of education and, secondly, by giving those whose tax liability would otherwise be less than the cost of education, the right to redeem the unutilised portion of the tax credit.

How can society's objectives in education be better achieved? Few would dispute that our objective in relation to education should be to ensure that all children have, free of charge, a good standard of schooling for an agreed period. Currently, school education is free, but only if it is obtained at a government school. The taxes which meet the cost of running government schools are collected from all taxpayers, including those who send their children to independent schools. The many parents who make this choice not only pay a price in the form of school fees, but also, through their taxes, pay part of the cost of educating other people's children. Governments, in running schools, are engaging in activities which private citizens, community groups and religious organisations have shown they can do just as well.

All parents should be provided with education tax credits set at the value of a state school place. Through the reduction of tax liability of taxpayers, and the redemption of tax credits by non-taxpayers in the payment of school fees, the universal availability of free education should be ensured. Tax credits for education expenses should be universal. These credits, by providing tax relief in place of government expenditure funded by increased taxation, would preserve the principle of universal availability of free education. There should be an application to the States of the principle that the Government that spends the money should raise it. The States could discharge their responsibility in education by recovering funds as a result of the enrolments that they receive in their schools, by virtue of the fact that parents could then be provided, through the tax changes I am advocating, with the resources to pay for the education they choose for their children.

It is interesting to note that in many areas people are clamouring for a greater freedom of choice. It is distressing to parents to find that State governments very often zone schools and prevent children from attending good schools, rather than ask why it is that parents want to send their children to a particular school. The answer very often is to be found in an inefficient, badly organised neighbouring school. It is also interesting to find that, as a result of what might be described as democratisation within the schools, and greater parent involvement, there are parent councils which are seeking from State governments the right to have their schools made independent.

Coming as I do from South Australia, where privatisation was criticised but where commercialisation is now accepted by the State Labor Government, it may be it is not appropriate to advocate privatisation of schools. What we should have is greater freedom of choice in schools. We should allow the people to run their own schools. If we do not want to talk about the objective of privatising the education system, let us talk about introducing greater freedom of choice and allow state schools to be established as privately operating independent schools with funding through the tax mechanisms that I just outlined. In this way, parents' aspirations for their children's education would be achieved. The standard of education would be improved as a result of schools being enrolment driven rather than maintained as monopolies established through zoning.

Therefore, I think the proposals in some of this legislation are sadly moving education in a direction opposite to that which I am advocating-the direction in which Australians want the education system to be moved. Australians recognise that there should be compulsory education. Australians recognise that education should be free over a given number of years for their children. But they want the choice to send their children to a school of a standard that they would regard as acceptable. Therefore, what governments should do is get out of running schools. Let the community do what it can do best as has been shown by the way in which enrolments in independent schools has been rising significantly over recent years.