A capacity to contribute (CTC) score is a measure of the capacity of a non-government school’s community to contribute to the recurrent costs of the school. A school’s CTC percentage affects the amount of base recurrent funding the school attracts from the Commonwealth Government under the Australian Education Act 2013 (the Act).
From 2020, the Australian Government is introducing a new Direct Measure of Income (DMI) of CTC to replace the current area-based socio-economic status (SES) score measure used to determine the CTC for most non-government schools. The DMI is based on the median income of parents or guardians of students at a non-government school.
Under the current legislative arrangements, approved authorities may submit an application requesting the SES score for a school be re-determined. An amendment to the Act seeks to enable approved authorities to request a review of its CTC score which could lead to a re-determination of the score.
The department is working with the Australian Bureau of Statistics (ABS) on the new measure of CTC, including the development of a Data Quality Framework and a Review Framework.
How can an approved authority seek a review of its school’s CTC score?
An approved authority cannot seek a review of its CTC score until legislative changes for the DMI are in-force. This is expected to occur by mid-2020.
Guidelines will be developed in consultation with stakeholders to assist approved authorities determine whether or not to request a review of a school’s CTC score. These Guidelines will outline possible exceptional circumstances where a review request would be considered, such as, but not limited to:
- a change in circumstance not reflected in data or methodology, which may not have been reflected in the DMI scores. This could include recent significant changes in enrolments or local economic impacts affecting a school community
- unique circumstances of the school community or school itself which impact the financial capacity of the school community to contribute. This could include high proportions of students from large families (e.g. those with greater numbers of dependants).
It is important to note that not all approved authorities will be funded on their schools’ DMI scores until 2022. This phased transition provides the opportunity for both approved authorities and the department to consider and refine the review process.
What will the review process look like?
The review process is being developed with the aim of minimising the administrative burden for schools and approved authorities. Work is underway in consultation with the ABS on a technical framework for the review process. This framework will inform the development of Guidelines for approved authorities to assist them in determining whether to proceed with a review request.
Consistent with current review processes in respect of SES scores, approved authorities will be required to provide the department with a business case outlining reasons and evidence for a review of a CTC score made under subsection 53(2) of the Act.
The department will assess each business case together with additional evidence sourced by the department from external datasets, such as the ABS Census of Population and Housing. If further information is considered necessary, the department will work with the approved authority to undertake a survey of parents and guardians of students at the school.
An independent advisory panel will provide oversight of review decisions.
The department will also consult with key stakeholders on the proposed CTC review process and potential considerations for approved authorities in reviewing a school’s CTC score.
Please check the Quality Schools website regularly for information about the review process.