Introduction to
Economics
Lesson of 22 August 2006
EDUCATION VOUCHERS
State-supplied
free, universal and compulsory education for all children is a feature
of many, if not most, developed nations.
This has led in many instances to the creation of school systems
run, or supported, by the state. In
Australia’s case, each state has created a state-run school system,
both at primary and secondary level, which systems function and co-exist
together with non-state, fee-paying schools.
In recent years
state school systems have been subjected to considerable criticism from
a variety of sources. There
has been a perception that the quality of education offered in state
schools has declined and there has been a drift in numbers from the
state schools to the various private alternatives.
This is despite the fact that the state system offers a free, or
near free, service, funded by taxpayers, whilst that provided by the
private system has to be paid for personally with no taxation allowance.
Apart from the
alleged decline in quality in state- school education, critics have
pointed to the alleged inherent lack of responsiveness of state schools
to the wishes of the relevant consumers, which in this case are the
students and, [even more so] their parents.
The producers of the service, namely the teachers, principals and
administrators of the state school system are not directly responsible
to the consumers. They are employed, paid, promoted and their position
protected by the state. Since
typically, as in Victoria, students are assigned to a school by virtue
of their residential zone, each school is assured of a supply of
students. The teachers, principals and administrators of the state
system, unlike the private school alternative, are thus largely spared
the burden of attracting and retaining students.
One consequence of
any direct responsive connection between the wishes of producers and of
consumers is to lead to an imbalance; an over or under supply. State schools might offer more of what is not desired by the
consumers, such as for instance sex education, and not enough of what
is, such as religion. Such
imbalances are wasteful and inefficient.
In an endeavour to
overcome some of the perceived problems in the state school system, a
number of reforms have been proposed.
One such proposal is education vouchers.
Credit for their formulation is generally attributed to the
leading Chicago School American economist, Milton Friedman, who
certainly coined the phrase “education voucher” in the context of
two separate school systems, state and private, although suggestions
that the state should provide some form of universal educational subsidy
go back much earlier in time, including to John Stuart Mill, the C19
British economist and political philosopher and Thomas Paine, the C18
British/American pamphleteer.
WHAT ARE
EDUCATION VOUCHERS ?
An education
voucher is an authorisation issued by the state for a pre-determined
amount of money payable by the state to an approved education supplier
on behalf of a named student [or their parent] for educational services
supplied to such student. Although
details vary depending on the actual proposal, it is generally envisaged
that each student should receive an identical amount to be used for the
purpose of their education at any approved school or education supplier
that the student [or their parent] chooses, regardless of locality and
whether state or privately operated.
SOME SUGGESTED
ADVANTAGES OF VOUCHERS
The introduction of
vouchers would increase the freedom of choice available to students to
choose their own education. This
would be particularly helpful to the financially poor who presently,
unlike middle and upper class students, are unable to pick and choose
where they reside so as to enable themselves to gain access to the more
desirable state schools, which generally speaking tend to be located in
the more affluent [and expensive] areas.
The movement of
students away from the less desired schools and towards the more desired
would tend to introduce an element of competition.
A school faced with a major drain of pupils would be forced, no
matter how reluctantly, to examine its practices in an endeavour to
ascertain why it was being shunned and thereafter possibly take some
steps to improve itself or risk its own demise.
Ultimately this would lead to greater efficiency and less waste.
The availability of
funds should enable a number of new and innovative educational
establishments to be set up, which presently does not occur.
Although a few for-profit schools do exist, such as Taylors, it
is extremely difficult to set up or maintain a commercial operation when
the product is being given away by your competitor. The vast bulk of the presently existing so-called private
schools are supported, and in many cases subsidised, by churches and
religious groups.
The provision of
vouchers would be a more equitable method of financing universal
education. Presently all
are taxed to provide a service, which many do not avail themselves of
but rather choose to pay to be provided elsewhere.
Whilst it would not address the complaints of the childless or
the home-schoolers, vouchers would address the argument of those who
complain that they should be compensated for sparing the state the
expense of educating their children, for which service they have paid
for in their taxes.
SOME SUGGESTED
DISADVANTAGES OF VOUCHERS
State schools exist
only partly to teach the 3 Rs. Arguably
state schools exist, at least as much, to provide a common educational
experience for all and to inculcate a desired universal set of civic
views and attitudes, to discourage separation and divisiveness,
assimilate immigrants and promote harmony.
Vouchers, to the contrary, are likely to preclude this common
experience and to encourage division and the setting up of ethnocentric
and diverse religious schools.
Vouchers would
enable the more able students to desert or be poached from the
struggling schools, where they are needed to provide hope and
encouragement to the less able. Ultimately
the struggling schools would be reduced to the least able students or
those who, for whatever reason, were unable or unwilling to go elsewhere
and the schools themselves would become centres of despair and a
breeding ground for misfits.
Many parents,
particularly the disadvantaged, lack the capacity or the interest to
make sound or beneficial decisions regarding their children’s
education. Their increased
freedom to choose would be likely merely to frustrate or confuse them
and lead ultimately to less beneficial outcomes for their children.
Vouchers are likely
to lead to an increase in fraud such as kickbacks to parents.
Vouchers are likely
to erode the independence of the existing private school system.
Financially it would be extremely difficult for a private school
to decline to accept a government voucher.
Yet with state funding is likely to come increased state control
since only approved schools will be eligible to receive vouchers.
The ultimate result is likely to be a takeover of the private
schools by the state bureaucracy and the public service unions and less
freedom of choice rather than more.
David
Sharp
22 August 2006