Etudes économiques par pays

Economic survey of Australia 2008: Enhancing educational performance


Contents | Executive summary  | How to obtain this publication | Additional information

The following OECD assessment and recommendations summarise chapter 3 of the Economic survey of Australia 2008 published on 10 October 2008.



Educational performance could be improved further, especially in the critical area of early education and child care

The promotion of a high-quality education system that responds swiftly to changing skill needs is a top priority of the new government. The “Education Revolution” pursues reforms across the whole education system, an important objective being the closing of the gap for the indigenous population. While Australia fares well in international comparison with regards to the Programme for International Student Assessment (PISA) test scores for 15 year-olds, important challenges remain in all education sectors, especially in early childhood education and care. Reducing complexity and fragmentation in this area and tackling issues of under-supply and inequity in access are of major importance, given the beneficial impact of early education on later outcomes. Participation in pre-primary programmes remains low as does government spending on such services. Many disadvantaged children miss out, though they are those with the highest payoff from early childhood education. Budget initiatives support a more integrated and comprehensive early childhood education through the provision, by 2013, of universal high-quality access for all four year-olds. Recent reforms also help parents to meet the cost of care and the number of child-care places is being increased. Efforts to improve access to affordable quality child care should continue. Consideration should be given to extending universal access to three year-olds, focusing initially on disadvantaged groups, and increasing the duration of services to accommodate child care and education needs better.


Enrolment rates in early childhood education is low by international standards1

Children aged 4 and under as a per cent of the population aged 3 to 4, 2006

1. Full and part–time participation in public and private institutions. For Belgium, France, Italy and Spain the rates tend to be overestimated as a significant number of children are younger than three years old; the net rates between three and five are around 100%. The OECD aggregate is an unweighted average.
Source: OECD (2008), Education at a Glance, OECD Publishing.

School outcomes should be enhanced and their variance reduced

Secondary education attainment is a powerful determinant of participation in the labour force. The government’s commitment to increase Year 12 retention rates to 90% by 2020 is therefore welcome. The programme of Trade Training Centres in Schools may raise attainment levels and facilitate the transition to work or further education. A close monitoring and evaluation of the effectiveness of the programme is critical. Though PISA results are generally strong, reading performance has deteriorated between 2003 and 2006 and a considerable gap in performance related to disadvantage remains. Different facets of accountability, autonomy and choice have been shown to be strongly associated with student achievement. Moving towards less centralised management is indispensible to increase school autonomy and choice. Moves by the government towards developing a national school curriculum and a nationally-consistent testing system will strengthen accountability. To improve literacy and numeracy and reduce the “tail” of underperformance, the government will target funds where they are most needed, with the National Partnership payments providing additional funding to schools with pupils from low socioeconomic status. School principals should be given autonomy in recruiting and rewarding teaching staff to attract and keep high quality teachers. Also to that end, consideration could be given to changes to the system of teacher career progression, which caps salaries nine years after graduation in the public sector.

Higher educational attainment leads to higher participation rates
Per cent, 2006

Source: Australian Government, 2008 09 Budget, Budget Overview,

Teachers’ salaries progression: an international comparison1
In thousand USD, 2006

1. Annual statutory teachers’ salaries in public institutions; average for primary, lower and upper secondary education. Salary and wage data are in US dollars converted using purchasing power parities. The G7 (excluding Canada) and OECD aggregates (21 countries) are unweighted averages. No data is available at the top level of the scale for the United States in 2006.
Source: OECD (2002 and 2008), Education at a Glance and OECD (2008), Taxing Wages 2006/2007, OECD Publishing.

There is scope for increasing the flexibility and responsiveness of the vocational and higher education systems

The capacity of the Vocational Education and Training system to address skill shortages needs to be raised. Low completion rates of training courses are of particular concern. The Skilling Australia for the Future reform package aims at reducing the skills gap through the provision of additional training places and by placing industry requirements at the centre of the skills system. As a welcome step, future funding will focus more on the quality of services and completion rates. To raise the effectiveness of the reformed system training packages need to be updated regularly to meet changing skill needs. A more responsive and better performing training system also hinges upon greater competition among providers. Moving towards a more commercial governance model for Technical and Further Education institutes, for example, by allowing course fees to reflect at least partly the costs of courses, would be advisable, while the funding mechanisms for the training system should be reformed to foster competition among providers and become more consumer oriented. Finally, a less rigid policy framework for higher education would promote flexibility and diversity. The government’s commitment to put an end to the current “one-size-fits-all” model of university funding, and move to a more flexible approach through the introduction of mission-based compacts goes in the right direction. Consideration should also be given to making the higher education system more demand oriented, with financing following students. This would raise competition among providers. Improved student support mechanisms are essential for removing barriers to access for students from disadvantaged backgrounds. The reduction of the age of independence from parental means testing could be considered, while raising the extent of student support for living expenses (on a means-tested basis) would be in line with international practice.


How to obtain this publication                                                                                   

The Policy Brief (pdf format) can be downloaded in English. It contains the OECD assessment and recommendations.The complete edition of the Economic survey of Australia 2008 is available from:


Additional information                                                                                                  


For further information please contact the Australia Desk at the OECD Economics Department at  The OECD Secretariat's report was prepared by Claude Giorno and Vassiliki Koutsogeorgopoulou under the supervision of Peter Hoeller. Research assistance was provided by Desne Erb.




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