Parental choice in school education : options for publicly financing and regulating a state/private mix of education provision

Abstract

The education system in New Zealand has traditionally involved only very Limited choice and competition between private and state provision. The notion that parents should be able to choose education provision beyond the state sector has been implicit in the fact that limited financial assistance (varying over time) has been given to private schools. However, the state has maintained, and at the time of writing continues to maintain, the competitive advantage. In addition, prior to 1989, there was virtually no choice within the state sector either. The ability to choose between schools was, therefore, limited to those who could afford to opt out of the state system or change residential location in order to access the state school of their choice. Discussion about the desirability of enhancing parental choice, although it began much earlier, was particularly apparent in the 1989 reform of education administration and has been a theme common to both the then Labour Government and the 1990-1993 National Government. The 1989 reform, and subsequent policy changes, have focused on facilitating parental choice and provider competition within the state sector. Although the National Government increased funding to private schools and indicated an intention to increase it further, a significant funding differential still remains. Initially, the main thrust of the reform was to strengthen the voice of parents through school based management with the direct participation of parent representatives. Limited exit ability was provided through changes to zoning arrangements and provision for greater freedom for schools to change their status (for example, to Kura Kaupapa Maori) thereby giving some measure of choice and competition within the state sector. The emphasis was on effecting improvements within the state system. Exit ability within the state sector has subsequently been strengthened through further changes in enrolment policy. While the potential for enhanced parental choice has been increased, many parents still do not have the ability to realise those choices given the asymmetrical nature of information difficulties associated with education and the opportunity cost of changing school. In addition, because the reform focused on the state sector there is still scope for the range of choice to be further enhanced (that is, intersectorally) and, because the reform focused on voice and exit within the state sector, there is still scope for the extent of choice to be enhanced through the addition of purchasing power. For example, through: Non-differential funding between state and private providers; ability of state schools to charge fees like their private school counterparts; income-related and compensatory vouchers to deliver special needs funding; and unrestricted student selection. Each of these options is considered in detail with regard to how they enhance parental choice and their likely impact on efficiency, equity, and social/cultural relationships.