Rethinking school funding



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DR JOHN BOEREBOOM says that using a summative measure of assessment against outcome measures like National Standards and NCEA is unfair and too simplistic to adequately fund schools as these measures provide little information on student progress and whether schools are doing a “good job”.

175781562.jpgThe current system for funding schools in New Zealand is based on deciles. A school’s decile rating measures the extent to which the school’s students live in low socio-economic or poorer communities. The decile ratings of schools reflect the following 5 socio-economic indicators:

  • Percentage of households with income in the lowest 20% nationally.
  • Percentage of employed parents in the lowest skill level occupational groups.
  • Household crowding.
  • Percentage of parents with no educational qualifications.
  • Percentage of parents receiving income support benefits.

Each school is allocated a decile rating between one and 10. A higher number reflects a higher socio-economic school community and a lower number a lower one. The decile allocation is done every 5 years and there is no reference to students in the calculation. The decile system is often used (or abused) to illustrate disparities in our education system. Barback cautioned that “Deciles are often incorrectly interpreted as an indicator of the quality of the education provided at the school. In an education system already fraught with inequality, it is unhelpful to have parents assume that high decile equates to high-quality education or high achievement.” Papatoetoe ex Principal Peter Gall agrees that “the overt labelling of schools by socioeconomic factor is the worst thing we do in our education system. It’s led to all sorts of unintended consequences.” Education Minister Hekia Parata has been on the record for years saying the decile system is too "blunt", and wants a model that targets resources to where they're needed the most.

In a move which is long overdue, the Ministry of Education is currently reviewing the decile system for school funding. Coming up with a fair and equitable replacement model is a complex and high stakes process which may be informed by a simple but effective analogy.

Imagine for a moment you are a homeowner planning an extension to your house. You have approached two builders for a quote. The first builder does not visit the site. He asks you for your postcode and your income level and provides a quote on this basis. The second builder completes a site investigation and consults an engineer and a quantity surveyor to scope the work and draw up detailed plans. The quote is firmly based on the nature and extent of the work required. Needless to say you engage the second builder.

Like the homeowner, schools have a job to do. In simple terms, the job consists of educating students who enter the school and producing an outcome. In the case of primary schools the students need to be prepared for continued successful study at secondary school and in the case of secondary schools students need to be prepared for NCEA and to function successfully in a competitive society. This raises the question: should schools be funded on the basis of the wealth of their communities or on the educational needs of their intakes and the job ahead in educating them?

The Ministry is currently exploring models of per child funding based on how well the students in the school perform when measured against a typical year’s progress. This raises the prospect of national testing against the national standards which in a worst case scenario could lead to league tables, comparisons of school effectiveness and performance pay for teachers.

The problem is that primary school intakes vary considerably and the ‘job’ of educating each individual child is unique. In a recent major study of approximately 4000 students entering primary schools in New Zealand carried out by the Centre for Evaluation and Monitoring (CEMNZ) student ability on entering primary school varied from children who could read and carry out calculations to students who could tell which of three objects is the biggest. Likewise students enter secondary schools with a wide range of ability, a variety of ethnic and socioeconomic backgrounds and arrive from a range of feeder schools in which they have experienced different curriculum programmes and were taught by teachers of varying effectiveness. This is evident in the results of the entrance testing carried out by CEMNZ which shows the huge range of achievement and highlights that the variation within schools can be as pronounced as the variation between schools.

Using a summative measure of assessment against outcome measures like National Standards and NCEA is unfair and too simplistic to adequately fund schools. While these outcome measures are useful indicators of student attainment, they provide little information on the growth and progress made by students and whether schools are doing a “good job”. This view is endorsed by a recent report by the New Zealand Initiative which states “Current benchmarks can unfairly penalise schools with students from disadvantaged backgrounds. They may not meet national targets even if they have progressed their students significantly. Conversely, schools with more school-ready students who meet targets could still perform below their capabilities.” What is needed is a funding model that incorporates the growth of individual students where progress is measured against a baseline of student potential when they enter the school. CEMNZ provides baseline assessments for primary, intermediate and secondary school entry which, like the second builder's quote, recognise the size of the job ahead in educating each child.

History shows us that summative assessment against National Standards and judgements of teacher effectiveness based on standards attainment of their students does not work. It was first introduced in New Zealand in 1878, vigorously debated in the 1920’s and finally abolished in 1936.

Value added assessment provides an alternative way of analysing assessment data. It provides an accurate and transparent measure of the progress students have made in each school subject since they started school. It accounts for the fact that children who may not reach the standard could nevertheless have made substantial progress and that schools that are at the bottom of the league tables may actually be doing a good job in the face of substantial educational challenges. This needs to be recognised and reflected in school funding.

Another approach to school funding is to identify at risk children and fund accordingly. We live in an age where the collection and analysis of data is omnipresent. Statistics NZ's Integrated Data Infrastructure (IDI), which links data from a long list of government agencies including corrections, health, education and the tax department makes it easy to develop funding approaches based on the identification of social risk factors for poor achievement like parental qualifications, having a parent in prison, reliance on a social welfare benefit etc. These approaches while technically feasible are not desirable. We need to remember that statistical correlations do not necessarily identify causative factors. They have the potential to identify, label, and stigmatise children and their families. This may adversely affect student achievement and engagement with schooling. Imagine a parent interview for an at risk child!

Whatever model is developed it need to be firmly student based on the educational needs of children to provide school with sufficient resources to enable the students in their care to reach their educational potential. All other considerations should be seen as irrelevant.

A per child funding model that incorporates baseline testing to measure education need and includes monitoring of student progress against the learning progression framework of the National Standards and NCEA using a value added approach is a fair transparent solution that avoids the pitfalls of the over reliance on summative testing and the negative impact of labelling based on social risk factors.

We have the opportunity to develop a fair and equitable student-centred funding system based on educational needs of students and measures of effectiveness based on the progress made by students. Let’s not enter another failed social experiment which will take years to show its worth. Our children are too precious. Let’s get this right.


Retrieved from

Barback, J (2016) Retrieved from


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