Annual expenditure per student
What We Have Found
New Zealand's annual public and private education expenditure per primary school student is well below the OECD average, whereas expenditure per secondary school student is slightly above the OECD average.
Date Updated: February 2017
Annual expenditure by 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
In New Zealand schooling is compulsory from 6 to 16 years of age, thought the majority of children start at 5 years of age. In 2014 around 14.7% of the New Zealand population were aged 5 to 15 years and were enrolled in schooling. This ratio puts relatively high demands for funding on the schooling sector, compared with other countries with a smaller youth population. For comparison, in the same year approximately 14.2% of the United States population, and 12.5% of the United Kingdom population, were 5 to 15-year-olds enrolled in schooling.
In 2013 New Zealand's annual public and private per student expenditure by primary education institutions was well below the OECD mean across 33 countries. Per student expenditure on secondary education institutions was slightly above the OECD mean, across 31 countries.
New Zealand's annual education expenditures for primary school students and secondary students (US$7,354 and US$10,198 respectively, converted using purchasing power parities for GDP) ranked 21st and 17th respectively in the OECD, below Australia, Ireland, the United Kingdom and the United States.
Education for New Zealand's primary school aged population costs less per student than the OECD mean and other countries in this indicator. When examined in relation to findings from recent international studies it appears that 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.
Figure 1: Annual expenditure by primary and secondary educational institutions per student (2013)
- Figures provided are 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
- Chamberlain, M. & Caygil, R. (2013). TIMSS 2010/11 and PIRLS 2010/11 Key Findings: New Zealand's participation in PIRLS and TIMSS. Wellington: Ministry of Education.
- Cochrane, D. (2001). Why Education Matters: Race, Ethnicity, and American School-Equity Research.
- Cochrane, N. Bottani. (Eds.). In Pursuit of Equity in Education: Using International Indicators to Compare Equity Policies. Dordrecht: Kluwer Academic Publishers.
- DfES (2001). The relationship between capital investment and pupil performance: An analysis by the United Kingdom. The Journal of the OECD Programme on Educational Building, OECD, 44, 8-9.
- Jones, J.T., & Zimmer, R.W. (2001). Examining the impact of capital on academic achievement. Economics of Education Review, 20, 577-588.
- OECD (2016). Education at a Glance 2016: OECD Indicators. Paris, OECD Publishing.
- Telford, M. & May, S. (2010). PISA 2009: Our 21st century learners at age 15. Wellington: Ministry of Education.