Thursday, February 19, 2009

State predatory pricing kills business

and that means private schools.

Cactus Kate points out that if private schools fail because parents can't afford to pay for a private education, then the state sector couldn't handle the numbers.

She's right, but the solution is not to fix the state sector. The solution is to end the unfair competition of state schools, which everyone is forced to pay for, against private schools which get funding only from those using them. State schools are the French farms of the education sector, bloated, inefficient, heavily subsidised, and their output has guaranteed markets because of protectionism.

Parents sending their kids to private school pay twice. The PPTA socialists don't give a damn about that. They are ideologically opposed to competition in education, and opposed to their members ever being accountable for their performance. The PPTA would only be happy if there were monopoly state schools everywhere, centrally managed and perpetual pay increases for teachers above inflation. The PPTA thinks what parents want is not as important, after all the workers always know what's best for the consumer don't they? Lockwood Smith's biggest political mistake was not to confront this bullying labour cartel when he had the chance, and remove decisions on teacher salaries from central bargaining.

So the appropriate solution to save private schools is NOT a "bail out", but something more sophisticated than that. End paying twice for education. It can be done different ways. I'd say just give parents back their education taxes and let them spend it. That's Libertarianz policy. In fact, just letting them opt out of taxpayer funded education would do the job. They could always pay directly for a state school if they change their minds.

However, there are other approaches:
- Parents who choose private education could simply have the proportion of their income tax taken for education refunded;
- A standard amount could be refunded to reflecting the average cost of a state secondary education per student; or
- ACT's policy of allowing funding to follow the student. Private schools then get the same funding as state schools.

Whatever it is, it is crying out for radical reform. The Nats wont want to be seen to be propping up private schools, but having either a tax credit or letting funding follow students would make a positive difference to schools.

After all, education is the sector most desperately in need of reform so that those paying for it actually can exercise the power of consumers, and those wanting to provide it can make their own decisions.

Expect the left to fight it tooth and nail though, after all, without the teaching labour cartels, the Labour Party would lose a key source of funding, membership and candidates, and the Greens, who sometimes fight monopolies, embrace them when Nanny State is in charge.

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