17 May 2024

Charter schools might increase government costs, deliver marginal benefits - Cabinet papers

10:31 am on 17 May 2024
David Seymour makes an announcement regarding charter schools at Vanguard Military School.

Associate Education Minister David Seymour says there is "no reason to disallow" for-profit charter schools as long as they are meeting students' educational needs. Photo: RNZ/Nick Monro

Charter schools will increase government costs and might deliver only marginal benefits, Cabinet papers indicate.

The papers show the $153 million allocated over four years for reviving the schools - which are publicly funded but privately owned - is mostly for the extra cost of opening and administering the schools.

Not included in that figure was the money the schools would receive for their students that would otherwise go to the state schools they attended.

Associate Education Minister David Seymour told RNZ: "When state schools convert to charter schools, or when students transfer from state schools to charter schools, there will be baseline funding that effectively 'follows the school' or 'follows the child'."

However, the papers indicated the transfer would not be cost-neutral to the government for newly created charter schools.

They said the students were likely to be funded at a higher per-student rate because charter schools were generally small, and small schools received higher per-student funding than larger schools.

The papers showed the Ministry of Education estimated the schools might deliver a benefit equivalent to up to $1250 per student per year - but only if they were 10 percent more efficient at delivering education than state schools.

"We consider it unlikely that changing to a charter school model could improve efficiency by more than about 10 percent," they said.

However, long-term benefits could be greater, the papers said.

The ministry had advised that improvements to student achievement were possible, but overseas and New Zealand evidence was mixed.

"Evidence from other jurisdictions show mixed results on whether model [sic] will benefit achievement and engagement," it said.

"There is evidence that partnership schools attracted a high proportion of "priority learners" (Māori, Pacific, students with learning support needs, and students from low socio-economic backgrounds), as was intended by the policy, including roughly double the proportion of students from a long-term benefit-dependent household, or those with an Oranga Tamariki notification, relative to state schools.

"However, it was unclear if the model had an impact on the academic achievement for these specific learner groups."

David Seymour makes an announcement regarding charter schools at Vanguard Military School.

Vanguard Military School in Auckland was one of New Zealand's first charter schools and was opened in 2014. It later converted to a 'designated character' state school when the Labour government halted the charter schools programme. Photo: RNZ/Nick Monro

The biggest improvements might occur if existing kura kaupapa Māori that were struggling to grow converted to charter schools and enrolled more children, the papers said.

"Overall, the evidence suggests that under the right settings (such as good leadership, implementation, and a widespread uptake of the model) school choice policies can drive innovation, improve efficiencies in the system and improve outcomes for students."

Though for-profit schools would be permitted, the ministry said based on the previous round of schools "we expect very little profit to be taken".

Seymour said there was "no reason to disallow" for-profit schools as an option if they ensured the educational needs of students were being met and they were accountable for positive outcomes.

"Operating for profit can also encourage investment in charter schools. Profit is also not a deduction."

The papers also showed that distance education charter schools would be allowed, breaking the monopoly on state-funded distance schooling held by Te Kura The Correspondence School.

Seymour said a separate funding model would be considered for distance charter schools.

"While it is not envisaged that any distance charter schools will open in the first year, the charter school model is designed to give greater flexibility to innovate, and it allowed for distance schools in the future - in the event that a suitable sponsor wants to apply," he said.

"Any potential distance schools will still need to meet the mandatory requirements for becoming a charter school. As well as that, when the Authorisation Board is deciding whether to approve any distance schools, it will consider the size of the school, whether students are full time or part time, whether the students are onshore or offshore, as well as plans to provide adequate pastoral care to distance students.

Large sections of the papers relating to the conversion of state schools to charter schools were redacted.

Seymour said that was because some of the information was under active consideration and some was legal advice.

However, they showed that the Crown would retain ownership of any school buildings and land it already owned.

They also showed that local students would retain the right to continue attending a school that converted to charter status.

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