Educational inequality in Australia and policies for reducing it

Laura B. Perry

According to the Organisation for Economic Cooperation and Development (OECD, 2015), 17 per cent of Australian young people leave secondary school without achieving basic educational skill levels. This underachievement has negative impacts for young people themselves, which in turn has negative impacts for the larger society. Low educational outcomes are related to diminished health (Australian Bureau of Statistics (ABS), 2011), unemployment (Rumberger & Lamb, 2003), low wages (ABS, 2010), social exclusion (Azpitarte, 2012), crime and incarceration (Australian Red Cross, 2016), and teenage pregnancy (Jeon, Kalb, & Vu, 2011). Eliminating school underperformance would reap enough fiscal benefits to pay for the country’s entire school system (OECD 2015).

School underperformance is not randomly distributed throughout society. Rather, some groups are more vulnerable to educational disadvantage and underperformance than others. These groups include Indigenous students, students who reside in rural/regional areas, and students from low income or lower socioeconomic status backgrounds (Thomson & De Bortoli, 2008). Inequalities between students from different social backgrounds already exist when they start primary school. Worryingly, these inequalities increase as students progress through the education system.

Educational inequality is a serious topic, and not just one that concerns the teaching profession or socially minded citizens. The negative consequences of educational inequality are so substantial that they attract the concern and attention of public policymakers.

Educational inequality

Educational inequality can be categorised into inequalities of educational opportunities, experiences, and outcomes.

Educational opportunities comprise inputs and resources, structures and access. They include, for example, qualified and experienced teachers, particular forms of curriculum, facilities and resources. Educational experiences are the processes and interactions that occur in schools, such as classroom disciplinary climate, student-teacher relations, teacher expectations, pedagogical practices, and relations with peers. Ensuring equity of educational opportunities and experiences is important because they are related to equity of educational outcomes. Just as importantly, however, all students should have equal access to quality learning environments, regardless of whether they impact on their educational outcomes or not. All students, regardless of where they live or go to school, have a right to enjoy supportive relationships with their teachers, or to have a safe and orderly classroom. Thus, ensuring equity of educational opportunities and experiences is important for ensuring equity of educational outcomes, as well as a matter of equity in its own right.

Educational outcomes are the values, skills, qualifications, attributes and characteristics that schooling develops in young people. They include secondary school completion qualifications, tertiary participation and completion, scores on standardised tests and evaluations, and grades from school-based assessments. Educational outcomes also include cognitive skills such as writing, analysis, critical and creative thinking, and “soft” skills related to interpersonal communication, emotional and social intelligence, teamwork and intercultural understanding, among others. Finally, educational outcomes include disciplinary knowledge, literacy and numeracy skills, and cultural knowledge. These various forms of knowledge and literacies are measured in Australia by the National Assessment Program -  Literacy and Numeracy (NAPLAN). Australia also participates in the Programme for International Student Assessment (PISA), which is administered by the OECD to a nationally representative sample of 15 year-olds in member countries every three years.

Inequality of educational outcomes

Stark inequalities of educational outcomes exist in Australia, as measured by NAPLAN and PISA.

Analysis of NAPLAN has uncovered the following inequalities:

  • 62 per cent of Year 7 Indigenous students did not meet the international benchmark, compared to 27 per cent of non-Indigenous students (Lamb et al., 2015).
  • 50 per cent of Year 7 students whose parents did not complete Year 12 (a proxy for socioeconomic status) did not meet the international benchmark, compared to 13 per cent of students whose parents have completed Year 12 (Lamb et al., 2015).
  • Among Year 5 students, achievement gaps between students from high and low educated parents was the equivalent of more than 2½ years of learning in reading and approximately two years in writing and numeracy; in Year 9, the gaps were approximately four years in reading and numeracy and 4½ years in writing (Cobbold, 2017a)

Data from PISA show similar inequalities. Australian students from the highest socio-economic status (SES) quartile substantially outperform those from the lowest SES quartile in reading, maths and science. The equity gap represents almost three years of schooling in all three domains (Thomson, De Bortoli, & Underwood, 2016).

These inequalities of educational outcomes are partly driven by poverty and disadvantage outside the school. But these inequalities are then amplified by schooling. This is because socially advantaged students in Australia often receive more educational advantages than their less privileged peers, not less.

Inequality of educational opportunities and experiences

Large inequalities between socially advantaged and disadvantaged schools exist in Australia. In fact, Australia has one of the largest resource gaps between advantaged and disadvantaged schools in the OECD (Cobbold, 2017b). Australia has the largest gap in the shortage of teachers between disadvantaged and advantaged schools among all OECD countries (Cobbold, 2017b). Disadvantaged schools in Australia also have far fewer educational materials (books, facilities, laboratories) than high SES schools (Cobbold, 2017b). This gap is the third largest in the OECD, with only Chile and Turkey showing larger inequalities between schools. Data from PISA also shows large inequalities in students’ educational experiences between advantaged and disadvantaged schools, particularly in regards to classroom disciplinary climate, teachers’ use of stimulating instructional strategies, and supportive relationships with teachers (Perry, Lubienski, & Ladwig, 2016).

Policies for tackling underachievement

To tackle underachievement, two approaches are especially effective.

First, we should give early, targeted and intensive support to students as soon as they start to fall behind. This is what Finland does, with almost 30 per cent of its students receiving such an intervention at one time or another (Graham & Jahnukainen, 2011). It is one of the best ways to ensure students do not fall between the cracks. But it requires resources, so we need to give more money to the schools and students who need it. This is where needs-based funding plays a role.

Second, we should make our schools more socially integrated. It is the most effective way to raise achievement (Gorard, 2010; Kahlenberg, 2001). A socially mixed or average student composition creates conditions that facilitate teaching and learning. Middle-class and/or socially mixed schools are also much less expensive to operate because they have fewer students with high needs. Less expensive running costs frees up funds which can be used for targeted and intensive support for students who need it.

And how can we reduce school social segregation? If we look to Commonwealth countries that have less segregated schooling than Australia, such as New Zealand, Canada and the UK, we can see two inter-related things. They have a much smaller proportion of schools that charge fees, and smaller qualitative differences between schools in terms of their facilities and resources.

These countries show both of these things can be done while maintaining diverse schooling options. We can still have schools with different faiths, philosophies and orientations, in addition to a strong and robust public school system.

The role of funding

As highlighted in the previous section, funding plays a large role in reducing educational disadvantage and inequality. Australia’s school funding approach is based on an inherent contradiction that reduces its effectiveness, however. On the one hand, we have a funding policy that promotes unequal resourcing between schools via a large fee-paying school sector. This inevitably leads to a socially stratified school system, which increases educational inequalities and underachievement.

We then try to mitigate those negative consequences of our funding policy with a different funding policy (redistribution via needs-based funding). The two prongs are working against each other, which is not only educationally ineffective but also fiscally inefficient.

Needs-based funding is necessary, but it can only do so much. It is much more effective if we do not have schools with high concentrations of poverty and disadvantage. Needs-based funding will not be much more than a band-aid if it is not accompanied by greater structural reform in the way we fund and organise schools. Needs-based funding redistributes some funding from schools with lower needs to those with greater needs, but it will do little to reduce school segregation, a major cause of educational inequality.


While schooling in Australia is generally considered high-quality, educational disadvantage and inequality are a cause for concern. Inequalities of educational outcomes in Australia are of a similar magnitude as the US, and are greater than in the UK or Canada (Lamb et al., 2015). This is a striking finding, and one that is perhaps surprising given our national identity as an egalitarian society that gives everyone a fair go.

School funding is an important lever for reducing educational inequality. Needs-based school funding is crucial for addressing the additional challenges that socially disadvantaged students and schools face. Needs-based funding is not sufficient, however. Even more importantly, school funding formulas should be designed to reduce, not increase, qualitative differences between schools in terms of their resources and facilities.

Parts of this article have been previously published in the following two publications:


Australian Bureau of Statistics. (2010). Are young people earning or learning? Australian social trends, March 4102.0. Canberra: Author.

Australian Bureau of Statistics. (2011). Australian social trends March, 4102.0. Canberra: Author.

Australian Red Cross. (2016). Vulnerability report 2016. Victoria: Australian Red Cross.

Azpitarte, F. (2012). On the persistence of poverty in Australia: A duration analysis based on HILDA data. Melbourne: Melbourne Institute of Applied Economic and Social Research.

Cobbold, T. (2017a). NAPLAN data shows continuing large achievement gaps between advantaged and disadvantaged students. Education Policy Comment: Save Our Schools.

Cobbold, T. (2017b). Resource gaps between advantaged & disadvantaged schools among the largest in the world. Education Policy Comment: Save Our Schools.

Gorard, S. (2010). Serious doubts about school effectiveness. British Educational Research Journal, 36(5), 745 - 766.

Graham, L. J. and Jahnukainen, M. (2011). Wherefore art thou, inclusion? Analysing the development of inclusive education in New South Wales, Alberta and Finland. Journal of Education Policy, 26(2): 263-288.

Jeon, S.-H., Kalb, G., & Vu, H. A. (2011). The dynamics of welfare participation among women who experienced teenage motherhood in Australia. Economic Record, 87(277), 235-251. doi: 10.1111/j.1475-4932.2010.00685.x

Kahlenberg, R. (2001). All together now: Creating middle-class schools through public school choices. Washington DC: Brookings Institution.

Lamb, S., Jackson, J., Walstab, A., & Huo, S. (2015). Educational opportunity in Australia 2015: Who succeeds and who misses out. Melbourne: Mitchell Institute, Centre for International Research on Education Systems, Victoria University.

OECD. (2015). Universal basic skills: What countries stand to gainhttp://www.Oecd.Org/edu/universal-basic-skills-9789264234833-en.htm. Paris: Organisation for Economic Cooperation and Development.

Perry, L. B., Lubienski, C., & Ladwig, J. G. (2016). How do learning environments vary by school sector and socioeconomic composition? Evidence from Australian students. Australian Journal of Education, 60(3), 175-190. doi: 10.1177/0004944116666519

Rumberger, R., & Lamb, S. (2003). The early employment and further education experiences of high school dropouts: A comparative study of the United States and Australia. Economics of Education Review, 22, 553-556.

Thomson, S., & De Bortoli, L. (2008). Exploring scientific literacy: How Australia measures up. Camberwell, Victoria: Australian Council for Educational Research.

Thomson, S., De Bortoli, L., & Underwood, C. (2016). PISA 2015: A first look at Australia's results. Camberwell, VIC: ACER.


Laura B. Perry is Associate Professor of comparative education and education policy in the School of Education at Murdoch University. She conducts research about inequalities of educational opportunities, experiences and outcomes as they occur between schools and education systems, and the policies and structures that shape them. Particular research interests include school socioeconomic segregation, school funding, and educational marketisation. She is currently developing a conceptual typology of cross-national school funding regimes. She has also been conducting research about the International Baccalaureate, and is interested in its potential to promote socially diverse schools.

This article appears in Professional Voice 12.3 Personalised learning, inclusion and equity.