Federal Budget 2025: sector generally positive about Labor’s education efforts

However, moving forward, and with the federal election only weeks away, independent school representatives have urged the Government to include more sector-blind programs and policies.

AEU Federal President Correna Haythorpe said by prioritising public schools, TAFE, and early childhood education, the Government has demonstrated a commitment to building an education system that works for every Australian, regardless of their location or background.

In the Budget, the Government is providing $407.5 million over four years from 2025–26 (and $7.2 billion from 2029–30 to 2035–36) to jurisdictions that have signed Better and Fairer Schools Agreement (Full and Fair Funding 2025–2034) bilateral agreements. 

“With funding agreements now signed across the nation, the Albanese Government has shown its commitment to finally make the underfunding of public schools a thing of the past,” Haythorpe said.

The Government will cut student debts by 20 per cent with effect before indexation is applied on June 1, 2025, wiping $16 billion from outstanding student loans. It is also making the student loan repayment system fairer.

“Cost of living measures such as the Commonwealth Prac Payment and Student Debt Relief will help attract people to the teaching profession by alleviating some of the ongoing costs associated with Initial Teacher Education,” Haythorpe said.

Independent Education Union of Australia NSW/ACT Branch Secretary Carol Matthews said the delivery of historic reforms to the education system, together with much-needed cost-of-living relief will help build and maintain a sustainable, high-quality education workforce.

“Tax cuts combined with changes to workplace laws that have delivered higher wage outcomes will make a big difference to household budgets,” Matthews said.

The union leader explained that following the first round of tax cuts last year, this will see combined tax cuts of about $50 a week for a school staff member on average wages, or $2548 a year.

She said the 20 per cent cut to HECS-HELP debts also means more than $5500 will be cut from the average early career teacher’s university debt of $27,600.

“Combined with the capping of indexed increases to HECS debts last year, new teachers will have access to much needed financial relief as they begin their new career in the classroom,” Matthews said.

The early childhood and care sector will see an investment of $5 billion, with $3.6 billion to lift the wages of ECE educators through the Worker Retention Payment, $1 billion to establish the Building Early Education Fund to increase the supply of high‑quality early childhood education and care places, and $426.6 million for the new 3 Day Guarantee, which replaces the Child Care Subsidy Activity Test to ensure families are eligible for at least three days a week of subsidised early childhood education and care. 

Matthews acknowledged the sector has seen overdue and unprecedented reform over the past year.

“The Budget continues efforts to rebuild the sector, from new funding for the three-day guarantee to federal support for better wages,” she said.

Not everyone was quite as glowing in their response to the Budget, however.

Dr Saul Karnovsky, from Curtin University’s School of Education, believes the Government should be be doing far more to address attrition rates and teacher shortages.

“The budget is focused on the construction of new schools, upgrading existing schools and meeting student enrolment growth from our increasing population,” he said.

“Yet schools are just buildings until teachers turn them into places of learning.

“I see no additional investment in teacher training, support or workload reduction within a crisis of very high staff turnover rates.”

While Independent Schools Australia (ISA) CEO Graham Catt welcomed aspects of the Budget, he said more must be done to ensure a fair and inclusive education system that supports all students, in all schools.

“This Budget confirms that all public schools are now on the path to full and fair funding. That’s a great outcome, and it should also mean an end to the political attacks and misleading rhetoric about non-government schools that have characterised the past few years,” Catt said.

He wants a line to be drawn in the sand and Government assurance that all education programs and policies are sector blind.

“For example, all schools, in all sectors, are grappling with challenges of finding and retaining teachers,” Catt said.

“Yet we have a Commonwealth teacher scholarship program that allocates resources based only to one sector.”

“If you’re a graduate teacher employed by the best resourced Government school in Australia, the government will pick up your student debt.

“But if your first job is in the smallest, most remote non-government school, working with vulnerable students, you’re not eligible for the same support. That’s simply not fair.”

Catt said the Budget didn’t include anything to reassure the hundreds of thousands of families who choose an independent school for their children, make financial sacrifices to support that choice and are looking for leadership and certainty in education.

According to the ISA, independent schools have seen their strongest growth in more than a decade with enrolments increasing by 3.8 per cent from 2022 to 2023.

Projections indicate that this trend will continue, with independent schools expected to become the largest non-government school sector by 2027, enrolling an additional 121,000 students by 2033.

“Families who choose independent schools are everyday Australians. They pay taxes, make sacrifices, and want what’s best for their children. They deserve policies that support, not ignore or punish them,” Catt said.