Small schools are not more expensive

Small schools are not more expensive. This may come as a surprise to anyone who has seen the Government’s misleading cost per student figures. All schools have some fixed costs regardless of how many students attend the school, and then the costs increase linearly with the number of students.

This can be seen in the following graph, which plots total cost of ACT Primary Schools versus size (student enrolment):

There are some clear outliers on this plot. Turner Primary and Gold Creek School are much more expensive than one might expect for their size and conversely the Cooperative School and Tharwa are much cheaper. The red line through the points in the above plot is a line of best fit which does not include the four labelled schools.

Turner school provides facilities for physically impaired students, so it is not surprising it costs more to run than other schools of similar size. Similarly the Cooperative school is partially community run, so it might be expected to come out cheaper than one would expect. The really surprising results are the low cost of Tharwa school and the high cost of Gold Creek.

This is still not that useful if we want to understand how the Government plans to save money by closing schools. The total cost of a school includes items that the Government has not included in it’s savings document. These are depreciation, other in school expenses and educational and corporate support costs. In fact, the savings outlined in the budget are based only on reductions in Schools Based Management (SBM) and salary expenses. The plot below shows SBM + salary expenses plotted against enrolment (as above):

A line of best fit, excluding the labelled schools, is shown in red. Even on this measure Gold Creek School is very expensive. The Education Department have not given any explanation for this.
These graphs show that all schools have a fixed cost and after that the cost is proportional to the enrolment.