A political brawl has erupted over schools funding and financial reporting, with Opposition Leader Jess Wilson and the state’s Catholic schools accusing the Carroll government of concealing a decision taken last month to claw back more than $200 million previously earmarked for non-government schools.
On the eve of the pre-election budget update, the final adjustment to the state’s books before Victorians head to the polls on November 28, Wilson wrote to the state’s top bean counter calling for the “secret cuts” to be included in today’s accounts to be released by Treasurer Colin Brooks.
The major parties also released warring costings of the Coalition’s signature savings policy – its promise to enforce a hiring freeze on non-frontline workers across the Victorian public service.
In her letter to Department of Treasury and Finance secretary Camille Kingston, Wilson argues that leaving details of the reduced schools funding out of Thursday’s budget update would breach the state’s financial management laws and leave parents of Catholic and other non-government school students in the dark about a change in government policy.
“Victorians are entitled to know the decisions being made in their name, particularly when those decisions affect the funding of their children’s schools and require changes to existing legislation,” she wrote.
“The PEBU exists precisely to provide an accurate and transparent account of the state’s financial position before Victorians cast their votes. Its integrity must not depend on the disclosure preferences of the government of the day.”
The government denies it has cut funding to non-government schools but agrees that under an adjusted funding formula approved by the cabinet, they will receive less over the next four years than they would have under the previous arrangement.
The formula was changed to prevent non-government schools from receiving more than they are entitled to under the Schooling Resource Standard (SRS) – the joint federal/state benchmark for needs-based funding established under the Gonski reforms.
“Catholic schools are fully funded under Gonski and will continue to be,” a Labor spokesperson said.
“Every school is receiving more funding. This change will ensure private schools don’t exceed 100 per cent of their SRS funding.”
This masthead last month revealed that due to additional Commonwealth funding pumped into non-government schools in 2025, some of Victoria’s wealthiest private schools had received more government money than they were entitled to. Under the Gonski model, the Commonwealth provides 80 per cent of non-government school funding needs and the states provide 20 per cent.
This created a political problem in Victoria, where state schools are not due to reach 100 per cent of SRS funding until 2034. On October 6, the budget and finance committee of cabinet altered its funding formula for non-government schools to address what it saw as a funding inequity.
The situation is complicated by a Victorian-only law that requires the state to provide non-government schools 25 per cent of the funding that government schools receive. About 90 per cent of Catholic schools in Victoria charge annual fees below $5000.
The Carroll government’s position has infuriated the Victorian Catholic Education Authority, which administers funding for Catholic schools. The authority is having to find more money for its teachers following the bumper pay deal reached between the government and teachers and staff working in public schools.
Under the pay deal, which the authority has promised to match, teacher salaries will increase over the next four years at twice the rate of the SRS.
“The current government plans to change longstanding funding arrangements for non-government schools if they win the election,” Victorian Catholic Education Authority chief executive Elizabeth Labone said. “Our modelling indicates this would leave Victorian Catholic schools more than $200 million worse off over the next four years.
“We are deeply concerned by reports that these cuts could be buried in the pre-election budget update and not be transparently disclosed to Victorian families to help them make an informed decision about their vote at the state election.”
Opposition education spokesman Brad Rowswell accused the government of trying to hide its funding cuts until after the election. Australian Education Union Victorian branch president Justin Mullaly signalled the argument would continue after polling day.
“Despite the unhelpful cries of ‘poor me’ from private school representatives, the state government’s first responsibility is to ensure public schools are fully funded,” he said.
Catholic school funding is an acutely sensitive issue for Labor, which intervened to help the historically cash-strapped sector during the Whitlam government. Labor stalwart and former education minister James Merlino chairs the Victorian Catholic Education Authority. Premier Ben Carroll was educated at a Catholic high school and his electorate of Niddrie has one of Victoria’s highest concentrations of Catholic households.
Amid the schools funding stoush, Labor and the Coalition were on Wednesday night at loggerheads over Wilson’s promise to save the budget $22 billion over the next decade through natural attrition within the Victorian public service – the key saving measure behind her promise to return the budget to a cash surplus by 2032.
Costings provided to the government by the Parliamentary Budget Office calculate that Wilson’s proposed public service freeze will improve the budget by $19 billion by the end of June 2037 and by only $3.27 billion over the life of the next government. Wilson’s costings, which were also conducted by the PBO, calculate that her policy will net savings of $5.5 billion before the next election and $22 billion by 2037.
The government claims the discrepancy reveals a “budget black hole” in the opposition’s campaign promises and that to achieve the savings it needs, a Wilson government will have no choice but to drastically cut health services. An opposition spokesman said the discrepancy was due to the Parliamentary Budget Office being asked to cost different things.
Where the report circulated by the government assumes a hiring freeze limited to the public service, the opposition savings policy also includes a freeze across three dozen public sector agencies such as the Victorian Infrastructure Delivery Authority, the Suburban Rail Loop Authority, the Victorian Equal Opportunity and Human Rights Commission and the Australian Grand Prix Corporation.
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Chip Le Grand leads our state politics reporting team. He previously served as the paper’s chief reporter and is a journalist of 30 years’ experience.Connect via email.