Gillard facing tough project

JULIA Gillard was big on inspiration and aspiration when she stepped out on schools policy, but short on detail.

By InvestSMART · 4 Sep 2012

By InvestSMART ·
4 Sep 2012

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JULIA Gillard was big on inspiration and aspiration when she stepped out on schools policy, but short on detail.

Rallying the community to a "crusade" on education, she left the difficult stuff for another day. Better to arm wrestle those pesky (and mostly Liberal) premiers in private, rather than spoil a grandiose public pitch.

She warned that she won't be giving the states a blank cheque. But she would not reveal the size of the cheque she will offer them towards the total of $6.5 billion extra a year, recommended by the Gonski review, that she endorsed in her announcement. Nor would she outline any proposed details of the phase-in to be executed between 2014 and 2020 of the new system.

Education is Labor's natural ground and Gillard's performance was upbeat. She should start with an advantage over Tony Abbott. But the way ahead holds plenty of obstacles for her.

She has set herself an ambitious timetable a deal on the new framework by early next year. The haggling with the states will begin in earnest soon they were firing their early shots yesterday and it won't be pretty. Apart from pursuing their own interests, those conservative premiers will also be playing politics, driven in part by the closeness to the federal election. Gillard has put herself totally on the line she will lead the negotiations with the states.

Critics will be emboldened by the prospect that, as the new system would not start until 2014 and Abbott will likely be in power by then, it could be stillborn.

Gillard is using every opportunity to try to keep the debate on the high ground for example, by pledging to enshrine in legislation the goal of having Australia in the world's top five schools systems on various key measures by 2025. By then, would anyone remember such a symbolic gesture? Probably not.

They would be judging the reality. The school funding debate will be among the most meaty policy clashes of coming months. Gillard has to get traction from it if she is to lift Labor's stocks.

She always says education is her passion she needs to turn that into political capital.

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Frequently Asked Questions about this Article…

What did Julia Gillard announce about her schools policy and education funding?

Julia Gillard rolled out a high-level schools policy endorsing the Gonski review and its push for better school funding. She pledged to lead negotiations with the states on a new funding framework but did not specify how much the federal government would contribute toward the Gonski recommendation of $6.5 billion extra a year.

What does the Gonski review recommend for school funding and did Gillard endorse it?

The Gonski review recommends an extra $6.5 billion a year for schools and a new funding system to be phased in between 2014 and 2020. Julia Gillard publicly endorsed the Gonski recommendations as part of her schools policy announcement.

Will the federal government give the states a blank cheque for school funding?

No — Gillard said she would not give the states a blank cheque. However, she did not reveal the exact size of the federal contribution toward the Gonski-recommended $6.5 billion extra a year.

What is the proposed timeline for the new school funding framework and implementation?

Gillard set an ambitious timetable: she aims to have a deal on the new funding framework by early next year, with the new system to be phased in between 2014 and 2020. Negotiations with the states are expected to begin in earnest soon.

What political challenges could derail Gillard’s school funding plan?

The biggest challenges are tough negotiations with state premiers—many of them conservative and likely to play politics—and the proximity of the federal election. Critics warn the plan could be stillborn if political leadership changes before the system starts in 2014, with Tony Abbott likely to be in power by then.

How does Gillard plan to keep the education debate ‘on the high ground’?

Gillard said she would try to keep the debate constructive by, for example, pledging to enshrine in legislation the goal of having Australia among the world’s top five school systems on key measures by 2025. The move is framed as a symbolic commitment to long-term improvement, although its lasting impact will be judged by results.

How should everyday investors think about the timing and negotiation risks of the schools funding reforms?

Everyday investors should note the reforms involve long lead times and political negotiation risk: a framework is being pursued aggressively but details and funding shares remain undecided, and a change of federal government could halt or reshape the plan before implementation begins in 2014.

What should people expect next in the schools funding debate?

Expect hard bargaining between the federal government and state premiers, political posturing from conservative premiers, and a campaign-style fight over details as the government seeks a deal by early next year. More specifics on funding amounts and phase-in arrangements are likely to emerge only through those negotiations.