Wealthy Victorian Private Schools Rake in Millions in Donations & Investment Income

Trevor Cobbold / February 13, 2023 / Funding

Victoria’s wealthiest most exclusive private schools are raking in millions of dollars in donations and investment income. It exposes a major flaw in how private schools are funded. These millions are ignored in assessing the need for government funding. It means the schools are massively over-funded by the taxpayer. It shows that the funding of private schools must be overhauled.

New figures obtained from the Australian Charities and Not-for-profits Commission (ACNC) show that 44 Victorian private schools received nearly $300 million in donations and investment income over five years from 2017 to 2021 (download table below). Donations totalled $215 million and investment income was $84 million. Just nine schools received $175 million over the period. The average income from these sources was $6.8 million per school over the five years. Each of the 44 schools received more than $1 million over the five years.

Melbourne Grammar raked in the most donations and investment income at $43.2 million comprised of $26.7 million in donations and $16.5 million in investment income. Other schools with highly lucrative income in these forms were Geelong Grammar with $32 million ($16.3 million in donations and $15.7 million as investment income), Scotch College with $31.4 million over four years ($30.2 million in donations and $1.2 million from investments) and Caulfield Grammar with $17 million ($10.4 million in donations and $6.6 million from investments).

Five other schools received over $10 million – Wesley College $10.8 million, Ivanhoe Grammar $10.6 million, Bialik College $10.2 million, Korowa $10.1 million and Xavier College $10.1 million.

Donations and investment income of these wealthy exclusive schools dwarf other private income of public schools. The average such income of Victorian public schools in 2020 was $179 per student. By contrast the donations and investment income of Melbourne Grammar was $5,055 per student and $5,784 per student at Geelong Grammar.

These 44 private schools received $484 million in funding by the Commonwealth and Victorian governments in 2020. This funding was determined without regard to their donations and investment income.

Under the current Commonwealth funding method, private school funding is determined by the capacity of families to pay fees. This is measured by the adjusted taxable income of families as reported by the Australian Taxation Office. It ignores other very lucrative sourced of income for private schools such as donations and investment income.

These schools raise additional funds through multiple tax exempt organizations such as foundations, building funds, scholarship funds and others. For example, Melbourne Grammar raises funds from its Foundation Endowment Fund with assets of $56 million and a building fund. Geelong Grammar raises funds from its Endowment Trust, with assts of $31 million, a Scholarship Foundation with assets of $40 million, a building fund and a foundation.

Scotch College has numerous trusts and beneficial funds that provide funding for the school. Indeed, it has so many that it had a special Act of the Victorian Parliament passed in 2001 to enable it to pool the investment of those trust funds in one or more common funds to minimise administrative costs of operating each fund and increase its investment income. Scotch College has its own building, library and museum funds. The Scotch College Foundation raises money for the school through numerous funds including scholarships, bursaries, arts, library and endowment funds. The Foundation had current assets of $100 million in 2021 according to its annual information statement to the ACNC.

At the time the Scotch College Common Fund Bill was debated in the Victorian Parliament, the Labor member for the district of Footscray in Melbourne’s west, Bruce Mildenhall, contrasted the huge fund raising success of Scotch College with the inadequate funding of Braybrook College, a public school in his electorate. He said: “It is testament to the inequality in our education systems that those inequalities are being exacerbated and widened.” It is even more evident 20 years later.

It should also be noted that donations to private schools and their foundations and trusts also reduce the tax burden of the donors, so even more money goes to private, not public benefit.

The failure to include donations and investment income in determining Commonwealth funding of private schools is a major flaw in the current funding model. It results in over-estimation of the financial need of private schools and massive over-funding by the taxpayer. However, it is not sufficient to just include other school income in determining the financial need of private schools because there are other major flaws in the model.

A major flaw is the assumption that the parents of students pay the school fees and other charges. This is demonstrably untrue. Many private school students have their fees at least partly paid by their grandparents. The funding model also ignores other income provided by grandparents such as money for house renovations, household assets such as whitegoods, furniture and IT equipment, cars, holidays and medical expenses that free up income to be spent on school fees. Over 50% of parents help their adult children with a variety of expenses including school fees. The Bank of Mum and Dad is reputed to be the 9th largest home lender in Australia. As a result of this direct and indirect financial support for families which is not recorded in adjusted taxable income, the capacity of private school parents to pay school fees is vastly under-estimated and private schools are massively over-funded by taxpayers.

Even apart from these flaws, the current funding model is over-funding many wealthy schools according to its own criteria. Private schools are supposed to be funded at 80% of its Schooling Resource Standard (SRS) by the Commonwealth Government and the remaining 20% by the Victorian Government. However, many of these exclusive schools are already hugely over-funded by the Commonwealth. For example, Melbourne Grammar was funded at 107% of its SRS in 2022 by the Commonwealth, Geelong Grammar was funded at 93% of its SRS, Scotch College at 92%, Caulfield Grammar at 86%, Wesley College at 89% and Ivanhoe Grammar at 99%.

The over-funding amounts for Melbourne Grammar was $1.7 million, Geelong Grammar $1.1 million, Scotch College $0.7 million, Caulfield Grammar $1.2 million, Wesley College $1.6 million, and Ivanhoe Grammar $2.5 million. The total over-funding for 30 of these private schools was $35 million. Six schools were funded at slightly less than 80% in 2022 but will be funded at 80% in 2023. Figures for the other 8 schools could not be obtained.

The current funding model for private schools needs a complete overhaul. A new system should be governed by the principle that government funding for private schools should only fill the gap between private income and a revised SRS. The base SRS should be set as the cost of highly successful public schools with minimum disadvantage. Funding for private schools should be conditional on meeting social obligations and education standards. Private schools whose private income is above the SRS should not receive government funding because it extends their resource advantage over public schools.

A significant first step towards this model would be to end all government funding for wealthy, exclusive high fee private schools. They don’t need taxpayer funding. It is a complete waste and simply adds to their huge resource advantaged over public schools. It is funding that would be better used to support disadvantaged students and schools.

Page 1 / 2 Donations & Investment Income of Wealthy Private Schools, Victoria

 

 

 

 

 

School

 

 

 

Donations 2017-2021 ($)

 

 

Investment Income 2017-

2021 ($)

 

 

 

 

Total ($)

 

 

 

Govt Funding 2020 ($)

 

 

Fees per Student

2020 ($)

 

C/W SRS

Share 2022

(%)

Students in Top 2 SEA

Quartiles

(%)

 

Melbourne Grammar

 

26,679,820

 

16,501,702

 

43,181,522

 

8,186,472

 

29,216

 

107

 

95

Geelong Grammar

16,346,000

15,705,000

32,051,000

13,157,323

20,198

93

91

Scotch College*

30,153,645

1,231,815

31,385,460

7,385,441

31,407

92

97

Caulfield Grammar

10,398,468

6,590,370

16,988,838

19,195,304

26,943

86

83

Wesley College

10,324,060

485,552

10,809,612

32,325,016

28,412

89

93

Ivanhoe Grammar

1,706,069

8,875,659

10,581,728

14,151,917

24,453

99

90

Bialik College

8,074,774

2,109,778

10,184,552

10,597,346

15,147

83

94

Korowa

9,679,040

452,588

10,131,628

6,553,982

24,699

78

97

Xavvier College

10,042,020

60,504

10,102,524

8,751,003

29,532

 

94

MLC

6,419,760

2,452,214

8,871,974

17,174,697

29,797

98

97

Siena College

6,823,926

212,704

7,036,630

6,823,145

14,208

 

91

St Catherine's School

4,893,401

1,529,992

6,423,393

6,003,592

30,270

78

92

Lauriston

3,671,033

726,320

6,397,353

9,396,921

29,932

86

97

King David School

6,083,308

34,395

6,117,703

4,589,308

18,394

77

96

Haileybury

4,248,448

1,143,000

5,391,448

3,270,766

24,661

97

95

Brighton Grammar

4,520,698

714,390

5,235,088

10,677,426

24,403

100

87

Melbourne Girls Grammar

 

4,983,324

 

39,168

 

5,022,492

 

8,808,419

 

29,786

 

99

 

96

Huntingtower

3,201,791

1,427,418

4,629,209

5,155,817

18,402

 

96

Firbank

2,795,078

1,715,847

4,510,925

8,197,213

21,709

99

92

Carey Grammar

1,029,126

3,258,096

4,287,222

10,101,784

27,928

96

95

St Margaret's Berwick Grammar

 

3,336,828

 

680,983

 

4,017,811

 

7,242,832

 

19,665

 

 

87

Loreto Mandeville Hall

 

2,754,503

 

805,181

 

3,559,684

 

12,657,580

 

25,534

 

 

93

Toorak College

2,800,845

573,645

3,374,490

10,719,792

22,054

95

89

Fintona

2,577,568

771,890

3,349,458

2,447,481

35,757

83

95

Yesodei Hatorah College

 

2,194,928

 

906,055

 

3,100,983

 

3,288,934

 

4,872

 

80

 

82

PLC

1,828,496

1,188,041

3,016,537

8,533,528

25,886

79

97

Mount Scopus Memorial College

 

2,565,346

 

367,069

 

2,932,415

 

12,749,379

 

24,552

 

98

 

96

Geelong College

2,310,888

564,611

2,875,499

10,956,202

22,652

82

90

Ruyton*

1,840,950

878,025

2,718,975

4,104,880

24,340

91

96

Eltham College *

2,706,360

4,039

2,710,399

7,662,085

21,858

85

88

 

St Michaels Grammar

 

982,243

 

1,519,337

 

2,501,580

 

5,732,746

 

25,110

 

96

 

94

Strathcona

1,005,168

1,426,258

2,431,426

7,175,266

24,390

85

91

Ivanhoe Girls Grammar

 

152,606

 

2,275,841

 

2,428,447

 

7,904,213

 

22,310

 

98

 

92

 

 

 

 

 

School

 

 

 

Donations 2017-2021 ($)

 

 

Investment Income 2017-

2021 ($)

 

 

 

 

Total ($)

 

 

 

Govt Funding

2020 ($)

 

 

Fees per Student 2020 ($)

 

C/W SRS

Share

2022 (%)

Students in Top 2

SEA

Quartiles

(%)

Genazzano FCJ College

 

2,269,326

 

6,582

 

2,275,908

 

9,570,949

 

26,130

 

 

91

Penleigh & Essendon Grammar

 

462,337

 

1,775,869

 

2,238,206

 

29,339,681

 

15,737

 

115

 

92

 

St Leonard's College

 

1,959,000

 

259,000

 

2,218,000

 

13,827,847

 

26,171

 

117

 

95

Ballarat Grammar

1,220,063

929,288

2,149,351

22,409,280

12,536

 

81

Waverley Christian College

 

2,026,845

 

4,899

 

2,031,744

 

19,626,126

 

8,333

 

76

 

89

Mentone Grammar

1,319,853

643,786

1,963,639

10,386,945

22,338

104

90

Camberwell Girls Grammar

 

1,673,942

 

178,222

 

1,852,164

 

4,269,130

 

23,054

 

79

 

96

Sacre Coeur

1,081,123

691,118

1,772,241

4,224,205

21,214

 

94

Mentone Girls Grammar

 

1,584,287

 

155,590

 

1,739,877

 

9,121,122

 

22,520

 

97

 

93

Trinity Grammar

774,860

433,839

1,208,699

8,305,129

29,244

94

96

Camberwell Grammar

 

1,066,166

 

44,370

 

1,110,536

 

6,096,874

 

27,958

 

95

 

95

Total

214,568,320

84,350,050

298,918,370

483,855,098

 

 

 

*Donations and investment income for 2017-2020

Sources:

Donations and Investment income: Australian Charities and Not-for-profit Commission

Government funding, fees, % of students in top 2 socio-educationally advantaged (SEA) quartiles: My School Commonwealth Government share of the SRS: Budget Estimates 2021-22.

 

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