Annual expenditure per student

What We Have Found

New Zealand's annual public and private education expenditure per school student is below the OECD average

Date Updated: November 2013.

Indicator Description

Annual expenditure on primary and secondary educational institutions per student.

Why This Is Important

Some past research suggests a link between government spending and student achievement. A quantitative analysis using data from English schools provides evidence of a positive and statistically significant relationship between capital investment and pupil performance (DfES, 2001).

However, it is likely that there are a number of factors, other than unit expenditure alone, which lead to better student outcomes. Changes in teaching techniques and new education strategies are examples of other factors that could influence achievement with little change to cost from teacher salaries and resources.

The OECD compared expenditure over the 2000-2009 period with the results from the Programme for International Student Assessment (PISA) and found that, while the OECD countries examined had generally increased spending on teacher salaries (the main source of per student expenditure), there had been no significant increase in 15-year-old performance for the majority of countries over that time.

Government expenditure per student is of particular importance when the socio-economic status of the student's family or the socio-economic mix of the school community is low.  Greater per-student resource is required to overcome barriers to learning associated with access to reference material and resources, information and communication technologies (ICT), and other opportunities linked to cultural capital and educational achievement.

Effective schools require the right combination of trained and talented personnel, adequate facilities, state-of-the-art equipment and motivated students ready to learn.  The demand for high-quality education, which can translate into higher costs per student, must be balanced against placing undue burden on taxpayers.

Although it is difficult to assess the optimal volume of resources required to prepare each student for life and work in modern societies, international comparisons of spending on education per student can provide a starting point for evaluating the cost effectiveness of different models of educational provision, and of the overall cost to the people of that nation.

How We Are Going

Almost one fifth (17.5%) of the New Zealand population was in schooling in 2010 (over 760,000 students).  This ratio puts relatively high demands for funding of the schooling sector, compared with other countries with a smaller youth population. For comparison, in the same year approximately 15.9% of the United States population and 15.1% of the United Kingdom population were in schooling.

In 2010 New Zealand's annual public and private per student expenditure on primary education institutions was below the OECD mean across 31 countries. Per student expenditure on secondary education institutions was also below the OECD mean, across 32 countries.

Figure 1: Annual expenditure on primary and secondary educational institutions per student (2010)


  1. In equivalent US dollars converted using the Purchasing Power Parity (PPP) for Gross Domestic Product (GDP), by level of education based on full-time equivalents.

New Zealand's annual education expenditures for both student primary school student and secondary students (US $6,841 and US $8,170 converted using purchasing power parities for GDP) were 20th in the OECD, below Australia, Ireland, the United Kingdom and the United States.  Education for New Zealand's school aged population costs less per student than the OECD mean and the other countries in this indicator. When examined in relation to findings from recent international studies it appears that it the system is cost effective at the secondary level where New Zealand's 15-year-olds are achieving at high levels but it may not be as effective for year 5 and year 9 students. Students at these levels are not performing as well in comparison with other nations.


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