Forecasting the Cost of Education
  • The education cost calculator is designed to provide an estimate of the future total cost of education per student. It shows the variability of costs in education and illustrates the range and differences, across school types and locations.

  • Changes in school fees cannot be accurately predicted. Estimates of future long-term education costs are provided as a guide only. Futurity cannot guarantee they will represent the actual cost of education for a particular child.

  • The figures have been rounded to the nearest dollar amount.



School Education Costs



  • The education cost calculator assumes that a child will attend formal schooling for thirteen (13) years. It assumes this starts with a preparatory program (“Prep” in most States) as the first of seven (7) years of primary schooling and is followed by six (6) years of secondary schooling.
  • The education cost calculator estimates are based upon data collected for the ASG/Futurity Parents Report Card 2020. The Report Card is based upon Monash University research and analysis of public data related to schooling tuition fees from the MySchool website and supplemented by Futurity Investment Group member survey data on ancillary costs.
  • Estimated costs for tuition have been calculated based on the annual median costs. The median costs used a group of schools in the calculations rather than the mean fee (an ordinary average) as used in previous years. The median is seen to be more typical of the fees for any group of schools.
  • The ancillary costs derived from the 2020 Futurity Parent Survey are expressed as simple averages of the median costs identified by survey respondents.
  • Inflator dimensions related to trends in the Australian Consumer Price Index (CPI) have been applied for the projection of schooling costs over time. The default inflation rate applied is consistent with the long-term forecast of the Commonwealth Treasury.

  • Futurity has endeavoured to provide a reasonable basis for planning. Futurity has not taken into account the possibility of GST being applied to education fees in the future.



How Futurity’s education cost estimates are calculated and defined



SCHOOL SECTORS



The school sectors are defined as per the education convention for school funding and reporting (NRS/ABS /Productivity Commission). Schools can be differentiated by their affiliation, ownership and management, and are presented as two broad categories: Government schools that are owned and managed by State and Territory governments and Non-government schools (including Catholic or Independent schools) that are owned and managed by non-government establishments. These schools have associations with religious denominations e.g. Church of England, Presbyterian, Methodist, Catholic, Lutheran, Jewish, Islamic) or secular bodies (philosophical beliefs), or are entirely independent and have values maintained by the school.



SOURCE



Data has been obtained from Cost of Education: A Report for Futurity Investment Group, Monash University which draws on the MySchools site, and the ASG/Futurity Parents Report Card survey 2020.



Estimates of school tuition costs (‘fees') were based on Monash University’s research and analysis of public data related to schooling fees – particularly the My School website which reports school fees and voluntary parent contributions.



The ASG/Futurity online Parent Report Card survey delivered in February and March 2020 captured the views of approximately 1800 members. The survey covered costs beyond school fees (“ancillary costs”) for children attending primary and secondary schools across Australia and the opinions on the quality of education.



METHODOLOGY & INDEXATION



Ancillary cost data was collected immediately prior to the COVID-19 health crisis and resultant school closures. Data on tuition fees was generated by Monash University using a purposive sample of 764 schools – implemented to ensure a mix of schools were included from across school sectors, including metropolitan and regional settings across States and Territories in the sample. The consolidated research revealed the variability of costs in education and illustrated the range and differences, across school types and locations. Consistent with long term Commonwealth Treasury future projections of the All Groups CPI, to illustrate possibilities in the face of price uncertainty we have used a 2.5% inflator for both the Primary tuition fee and the Secondary tuition fee and future school related costs.



TUITION FEES



The estimates of fees for Government, Catholic and Independent schools are based on a sample of schools constructed by Monash University using data from the Commonwealth Government's My School website (www.myschool.edu.au).



Government schools do not charge tuition fees but rather publicly report parents’ contributions for a range of costs. The My School website reports the average parent contribution per student by school including for government schools.



ANCILLARY COSTS



These costs include items or activity costs appropriate to the stage of schooling for each child such as digital devices, external tuition, uniform, transport, excursions, camps, sports equipment etc. Some survey categories were statistically insignificant (boarding costs etc.) and so were not included in cost calculations. The estimates of ancillary costs are based on the member responses survey. Overall, the estimates of the annual ancillary costs from the survey should be considered as illustrative and not necessarily an accurate indication of the average expenditures of all members of Futurity.



METRO vs. REGIONAL



To determine whether fee and ancillary cost data is categorised as Metropolitan or Regional, responses have been sorted by respondent postcode. We have used the “Major cities” and “Regional and Remote” categories as per: https://www.abs.gov.au/websitedbs/d3310114.nsf/home/remoteness+structure (last retrieved in July 2020).



CORE CATEGORIES

  • Extra curricula – includes Electives, School camps, School Excursions, extra Vocational education & Sports equipment

  • Outside tuition

  • Necessities – includes Uniforms, Library charges, Stationery & Textbooks

  • Transport

  • Electronic devices

  • Other spending

    

NECESSITIES



These items include uniforms (all school-related special clothing requirements), library charges, stationery and textbooks and are considered to necessary costs for educating any child.



EXTRA CURRICULA



These items include electives, school camps, school excursions, additional vocational education and sports equipment which all contribute to a complete education yet are considered to be optional or discretionary expenditures.



OUTSIDE TUITION



Annual cost for outside tuition or coaching, which is generally optional.



ELECTRONIC DEVICES



Computer hardware and software (e.g. desktop computer and/or laptop, tablets, software etc.) and internet service costs at home and/or at school.



OTHER SPENDING



The survey was not prescriptive. Examples of possible inclusions under the Other Spending category include annual spend on musical instruments and associated performing arts related equipment.



TRANSPORT



Items such as car travelling expenses (calculated based on travel for one child), public transport tickets and school buses to travel to and from school.



INDEXATION



Consistent with long term Commonwealth Treasury future projections of the All Groups CPI, to illustrate possibilities in the face of price uncertainty we have used a 2.5% inflator for Primary tuition fee, Secondary tuition fee as well as for other future school related costs.