Inequality Matters – What is to done?

Issue 16 | May 2012

The Hon Tony Smith is the federal Member for Casey and was first elected to parliament in 2001. Tony is the Shadow Parliamentary Secretary for Tax Reform and a member of the House of Representatives Economics Committee. In January 2007, Tony Smith was appointed Parliamentary Secretary to the Prime Minister in the Howard Government. At the Sydney Institute, on Tuesday 1 May 2012, Tony Smith joined Andrew Leigh, the Member Fraser, to discuss alternative approaches to policy aimed to reduce inequality.

INEQUALITY – WHAT IS TO BE DONE?

TONY SMITH

Thank you Gerard and Anne, for the opportunity to speak this evening. And let me acknowledge my colleague from the other side of the Parliament, Andrew Leigh.

Gerard’s choice of topic is both profound and provocative. I expect – at least I hope – that Vladimir Lenin is spinning in his Kremlin mausoleum on the news that a bastion of free enterprise like the Sydney Institute has co-opted the title of his infamous Bolshevik manifesto. And adding insult injury, we’re speaking on May Day itself.

The very breadth of our theme – “what is to be done” – could lead in any number of different subject matter directions. But as well as having a joke at Lenin’s expense, I think we all know Gerard is also inviting us to take the long view of the challenges facing our nation. I’m also well aware that I follow in the footsteps of many parliamentary colleagues who’ve come before The Sydney Institute to lay out a long-term vision that extends beyond the immediate election cycle to the challenges of the decades ahead.

Now I’m sure you’ll be relieved to hear that I won’t attempt to list, discuss or prioritise my view of everything I think needs to be done. This means there are many salient topics that I won’t be able to mention tonight. But the fact that I won’t be giving a dissertation on tax reform or economic management doesn’t detract from their critical importance. It’s merely because I want to avoid a recreation of the 2020 summit, something that surely would send you all scrambling for the exits.

Instead, I intend to take the liberty of focusing narrowly on a single area of long-term reform whose difficulty is directly proportional to its significance. A reform agenda so singularly significant that many other public policy issues flow from it. An agenda that, if ignored, will impair our economy and our society.

My focus will be not the months ahead; not even the years ahead; but the decades ahead. And I hope to plant a few seeds for the discussion we must have about the shape of our nation at mid-century. To that end I’ll seek to transcend the normal hurly burly of partisan give-and-take because this isn’t about the next election, it’s about the next generation. What I’ll endeavour to do is look way ahead through a pair of policy binoculars to where we want to be, where we need to be and how we get there.

We all understand that our productivity growth is a key speed limit on our future prosperity. All other things being equal, the more productive we are, the more affluent we are. Whilst discussions of productivity naturally revolve around infrastructure and, of course, industrial relations, as important and obvious as these factors are, there are other critical drivers of future productivity. And as I broach one of these tonight, I do so in the full knowledge that I’m leaping forth into a paddock that has more sacred cows in it than a Devondale dairy farm.

There’s little doubt that education is vital to national productivity. One study found that enhanced educational attainment can trigger growth of up to 20% in output per worker.[1] International achievement tests show that an increase in student academic performance by a single standard point of deviation can add one additional percentage point to GDP growth.[2]

There’s nothing revolutionary about these findings. They’re pretty commonsense. The best certain investment for future national opportunity and prosperity is in the platform, or should I say, springboard that is a well-educated nation.

A first class education system will grow over time a first class productive capacity and place us in the best position possible to deal with challenges, seize opportunities, and deliver economic wellbeing to the greatest number of Australians. A first-rate education system provides the attributes and the attitudes required to thrive in the ever-shifting tableau that is our modern globalised economy. An economy in which both employers and employees must be nimble enough to keep pace with changing technology, and savvy enough to embrace new ways of doing business that flow on from all that new gadgetry.

So how are we faring in this global education race? Better than many countries, but not as well as in the past. In fact, the most recent findings of the Programme for International Student Achievement – known as “PISA” – make for pretty sobering reading.

In the three subject areas tested – literacy, maths and science – Australian students were significantly outperformed by countries ranging from mainland-China through South Korea to Canada and Finland.[3] Some might find solace in the fact that our children scored a bit higher than average on these tests. But in this world of hyper-competition, where our heels are constantly being nipped by those seeking to supplant and supersede us, anyone who seeks consolation in mediocrity is on a pilgrimage to the false comfort of fools.

So how do we do better? How do we create more schools that will enable more of our young people to be the very best they can be?

Some argue the solution is simply a matter of dollars and cents. They contend that more money is needed to improve our schools and boost academic achievement. But there’s a growing body of empirical evidence that disputes the – “more-money-equals-better-results” –  hypothesis.

A recently published article in the Australian Economic Review noted that, from 2000 to 2009, the average level of government spending per state school pupil throughout Australia grew in constant dollar value from $11,155 to $13,069. [4] An increase of 17.16 per cent.

And what did we get for that money? Not much, because average Australian student PISA scores over that nine-year period fell by 2.46 per cent.[5] Another study, co-written by some bloke named Andrew Leigh, found that the real dollar value per-child government school expenditure throughout Australia increased by a whopping 258 per cent from 1964 to 2003.[6]

Yet despite this increased funding, this study found there was “a small but statistically significant fall in numeracy”. [7] As noted sociologist Frank Furedi wrote just last week in The Australian: “Those addicted to throwing money at the problem need to face up to the fact increased spending on education in Australia has coincided with a fall in student performance.”[8]

And where did all those new dollars go? Much of it went into reducing class sizes, which some educational theorists have turned into something of a fetish.[9] Over the 1964-2003 timeframe, the average number of students per Australian classroom shrank from 36 to 26, a drop of 43 per cent.[10] But as we’ve seen, lowering the number of pupils per teacher has not proved a panacea to our educational ills. As the ranks of our teachers have swelled, the academic achievement of our children has stagnated.

So what then, is the recipe for reversing these doldrum decades in Australian student achievement?  This topic has been much discussed in the media of late, with editorials and columns on solutions ranging from curriculum reform to teacher bonus payments. But to my mind one of the most important antidotes to our educational malaise is found in the single issue of teacher quality.

Put simply, we know that great teachers make a great difference in the lives of children. I believe this because I was lucky enough to be taught by some of them, and as a Member of Parliament I’ve met many, many more.

There’s no doubt we have many gifted, impassioned and dedicated teachers working hard in schools throughout Australia. But there’s also no doubt we don’t have enough gold-medal worthy teachers. Not enough of them begin a teaching career and of those who do, not enough of them stay. And if we’re honest we’ll also admit that the teaching profession does not attract enough of the intellectual elite of our university-bound youth.

We see this in uni admissions statistics. A place in the Monash University Bachelor of Laws program requires an enter score of 98.05. But admission to the Monash Bachelor of Education course demands a score of only 70.7. Similar disparities in academic achievement are replicated at universities throughout the country. It is undeniable that teacher quantity has come at the expense of teacher quality.

As a Liberal, I believe that people respond rationally to incentives. And one of the most important incentives at our disposal is money. At this point, some you might be thinking that I’m caught on the horns of my own self-contradiction. After all, wasn’t I saying just a few minutes ago that money isn’t the answer? So let me dispel any confusion – I’m not opposed to spending more money on education, per se. I merely object to pouring “new-money-after-old” into a stale and stagnant enterprise. To do so strikes me akin to Albert Einstein’s famous definition of insanity: trying the same thing over and over while expecting a different result

It’s not that I’m against higher pay for teachers. In fact, if we want to get our smartest uni graduates into the classroom, we’ll have to pay them very well indeed. But there must be strings attached. And I think it’s only appropriate that higher levels of salary should be matched by higher levels of performance.

I’m particularly impressed by the reformist ideas of Michelle Rhee, who formerly presided over the problem-plagued Washington DC Public Schools in the US. One of Ms Rhee’s most dynamic reform proposals provided for increasing teacher salaries up to US$130,000 – if and only if – they agreed to forego tenure.

The idea was that the absence of rigid tenure-based seniority rules would allow superior performance in the classroom to be recognised and rewarded. And Ms Rhee’s plan allowed teachers to opt-out of her reformed pay scheme and remain in the old system, where they’d earn roughly half as much.

Hers was an innovative, yet pragmatic proposal. But the local teachers’ union fought it tooth and nail, claiming Michelle Rhee’s political scalp in the process.

Another way of attracting top-notch talent into the system is through Teach for Australia and fast-track mid-career entry programs. Modelled on a similar scheme in America, Teach for Australia outflanks the bureaucratic morass by fast tracking some of our highest-achieving uni graduates into some of our lowest-achieving schools. With outstanding results. And as Caroline Milburn noted in yesterday’s Age, Australia abounds with accomplished professionals who’d be interested in a second career as educators if there weren’t so many procedural hoops in the way.[11]

Now, it’s true the Gillard Government has just proposed its own bonus scheme for “teachers who go the extra yard ”, to quote Education Minister Peter Garrett.[12] And while this plan might look good at first glance, in reality it’s nothing more than a facade. It’s bad enough that the sums involved – up to $10,000 for a mere handful of teachers nationwide – are paltry. And even worse, the selection criteria for the payment of these bonuses are subjective and vague. Last week in the Sydney Morning Herald, education expert Dr Kevin Donnelly dismissed this Gillard Government initiative as: “an exercise in bureaucratic red tape and educational mumbo jumbo”.[13]

Yet many might say this is nonetheless a step in the right direction. But just a step won’t do. Incremental improvement doesn’t take us where we need to go. I’m talking about something much bigger in scale and approach.

We need to pay truly excellent teachers truly excellent wages. $120,000 per year or $130,000 and even up to $150,000 for those exceptional educators who, not only teach their students, but who teach and mentor their colleagues as well. After all, haven’t we become accustomed to public servants earning that much and more at the federal, state and even local government level?

But only on condition that we adopt honest objective measures to separate the best from the rest. And the most effective way to distinguish the excellent from the average is to measure the competence of teachers by the academic competence of the students they teach. Objective testing of individual student achievement over time MUST be the primary benchmark for measuring teacher effectiveness.

But such common-sense policies of educational reform have faced unyielding opposition from teacher unions that display less openness and flexibility than even a medieval craftsman’s guild. In fact, I think it’s fair to say that teacher unions have come to constitute the biggest obstacle to substantive education reform, not only in Australia, but in the US and UK as well.

And no-one provides a more compelling example of union thuggery than Katherine Birbalsingh, an Oxford-educated teacher who was brought out to Australia on a speaking tour last year by the Sydney Institute. Put simply, Katherine was driven from her job for having the temerity to speak truth to power. She roused the ire of Britain’s educational establishment with a speech to the 2010 Tory party conference in which she denounced the English state school system as “fundamentally broken”.

A system that, in her words, conspired to “keep poor children poor” through political correct policies steeped in what George Bush once described as: “the soft bigotry of low expectations”. In an article for the UK Daily Telegraph, Birbalsingh described the noxious nexus that exists between pugnacious unions and a mendacious educational bureaucracy:

These unions paint themselves as the working man’s saviour, when all they do is degrade the teaching profession by ensuring that bad teachers remain in their posts and give the rest of us a bad name.

In the last 40 years, only 18 teachers have lost their jobs for incompetence.

So how would we pay for this massive boost to the salaries of outstanding teachers? One way would be for state governments to forego the services of some of teachers who were not-so-outstanding. That is, to have fewer teachers over all. The record shows that our children are much better served by larger classes taught by the-excellent than by smaller classes taught by the-mediocre. The fact that fewer children are sitting in a classroom doesn’t really matter if their teacher isn’t up to the job.

And, with that in mind, we must empower our school leaders and school communities to recruit the smartest and most talented people around. But our principals must not only be able to hire the best teachers around, but they must also be empowered to weed out substandard teachers before they commit the fraud of stealing a child’s future. My colleague Christopher Pyne, as Shadow Education Minister, has been advocating just this sort of enhanced school autonomy for some time. Anything else is an exercise in self-deception.

So when the Australian Education Union describes the push for teacher accountability as an “assault on public schools”, I describe it as an assault on teacher protectionism.[14] In the end it all comes down to one simple question: are our children in school to serve the teachers, or are our teachers in school to serve our children?

I want schools that attract as many of the sharpest and smartest to service in the classroom as possible. And that means schools where skill trumps seniority. Schools that fill children with knowledge and skills, with inspiration and aspiration.

Throughout human history, it’s been crisis that’s most often served as the engine of serious political or social reform. It is often only when nations are confronted by serious problems posing serious threats they can summon up the critical mass required to inflict short-term pain for long-term gain. Now it’s true our public school system isn’t entirely broken – or “busted” as my 5-year-old would say. It’s slowly coasting downwards into mediocrity. It’s slowly losing altitude, year by year. And it’s the very gradual nature of the decline that makes reform more difficult.

Yet this is our challenge – to summon up the will and revolutionise our education system when our schools are not a catastrophe, but merely not as good as they, could be, should be or need to be. And we must, because in the fast-paced competitive world of the twenty-first century, to be second-rate is to stagnate and to stagnate is to wither. And if we wish to wax and not wane as a nation, we must be prepared to rock a few boats, raise a few hackles, upset a few vested interests and fly in the face of a few dogmas.

When assessing such matters, I find it useful to consider what I have come to call the founding fathers’ test.  At the time of federation, when the nation was being imagined, carved and crafted, would it have been a deliberate future policy ambition to achieve the level of teacher quality we have today?

This is also a task that defies arbitrary political distinctions between federal, state and territory governments. It’s a task that will require all of us to address a problem that affects all of us. From Cairns to Kalgoorlie and from Darwin and to Devonport, all of us – at both state and federal levels – will have to agree and persevere in this common cause.

At the end of the day, we are all charged with responsibility to preserve and promote our national prosperity.

It’s been said that the states are “laboratories of democracy”. And some of our states are leading the way. In Western Australia, the Barnett Government’s “Independent Public Schools Initiative” allows schools to set their own strategic directions, have authority for day-to-day decision making as long as high academic standards are achieved. And it may well be that one state, one day will be emboldened to cast aside its rigid seniority-based pay structure and use higher wages to poach the best classroom teachers from other states.

Yet we can’t expect the states to do all the heavy lifting alone because education has such profound national economic implications. This is why the Commonwealth must also play a leading support role. How, what, when and where should be open for discussion. But first we must have a sustained debate that will spur sufficient public demand for real change.

I have no illusions. What I propose here tonight is a considerable task that will take considerable effort over considerable time.  But I was once told of an inspirational Rabbinic saying that comes from the Talmud: “It is not incumbent upon you to complete the work, but neither are you at liberty to desist from it”

So in that spirit, let us begin.

ENDNOTES

[1] Jonathan Temple, “Growth Effects of Education and Social Capital in OECD Countries”, Historical Social Research, Vol 27-2002- No.4, p 29

[2] OECD, The High Cost Of Low Educational Performance: The Long-Run Economic Impact Of Improving Pisa Outcomes (2010)  P 13

[3] Challenges for Australian Education: Results from PISA 2009, p iii

[4] Ben Jensen, Julian Reichl and Andrew Kemp, Grattan Institute, “The Real Issue in School Funding: An Analysis of Increasing Government School Expenditure and Declining Performance”, Australian Economic Review (vol 44, no. 3) pp 321-329

[5] ibid

[6] Andrew Leigh and Chris Ryan, How Has School Productivity Changed in Australia, (Report for Department of Education, Science and Training 2008)

[7] ibid

[8] Frank Furedi, “Quality curriculum, not more funding, is the key to a better education system”, The Australian (28 April 2012)

[9] Andrew Leigh and Chris Ryan, Long-run Trends in School Productivity, (Report for Department of Education, Employment and Workplace Relations 2011)

[10] Op cit Productivity Changed

[11] Caroline Milburne, “Search widens for a new generation of leaders”, The Age (30 April 2012)

[12] Peter Garrett media release http://ministers.deewr.gov.au/garrett/standing-council-school-education-and-early-childhood

[13] http://www.smh.com.au/opinion/politics/bonus-scheme-degrades-teachers-sense-of-team-spirit-20120424-1xj8n.html

[14] Pat Byrne, “Public Education for Social Justice and Human Rights”, AEU Federal Conference (2006)