What is needs-based funding?
Needs-based funding is a methodology by which funds are equitably distributed to schools in accordance with legislation to support the individual needs of a school and its students.
Why needs-based funding?
All schools start with a standard amount for any student in Australia (with one amount for primary schools and another for secondary schools). The Commonwealth Government specifies an amount known as the Schooling Resources Standard (SRS).
(All DMI Scores)
School (DMI 90)
School (DMI 125)
How are the schools in the NSW Catholic Schools System funded?
In 2024, CSNSW will receive a forecast $3.65 billion in funding from the Australian and NSW governments. The schools that make up the NSWCSS will also raise approximately $550 million from school fees and $100 million from other private income, including donations and investments.
The government funding is based on a standard per student, per annum, amount – known as the Schooling Resource Standard (SRS) or “base funding”. In 2024, base funding is approximately $13,557 for a primary school student and $17,036 for a secondary school student.
$13,557
Primary Student
$17,036
Secondary Student
The base is then supplemented by “loadings” – additional amounts that help cover the needs of student priority cohorts and disadvantaged schools, including:
- Students with disabilities
- Students with low English proficiencies
- Students of Aboriginal or Torres Strait Islander backgrounds
- Students with socio-educational disadvantages
- Small schools
- Remote schools
For non-government schools, including those in the NSW Catholic Schools System (NSWCSS), the base amount of funding is then reduced based on a school community’s Capacity to Contribute (CTC) to the operating costs of the school. The CTC is a measure of the capacity of the parents or guardians of students to contribute to the cost of educating their child.
The base amount (discounted by the school’s CTC) plus loadings is then multiplied by the school’s “legislatively determined transition share” to make up the Schooling Resource Standard (SRS) for that school:
How does CSNSW distribute its funding under the needs-based funding arrangement?
After CSNSW receives the recurrent funding from government funds are distributed to its almost 550 systemic schools via a 2-stage process:
Step 1: As an Approved System Authority (ASA), CSNSW centrally pools all Government funds before distributing them to the 11 Diocesan School Systems (DSS) within NSW.
Step 2: The 11 individual Diocesan Schools Offices (DSO) then deploy or allocate funds to each school within their diocese.
Each diocese is given the prerogative to determine how they deploy or allocate the funds to their schools. That’s because they’re best placed to understand each school’s individual needs, based on local knowledge of the school and its community.
How is the funding used?
Funding is used for a school’s operations, including:
- Salaries (including principals, teachers and support staff)
- Operating costs (including administration, marketing, IT and accounting)
- Property expenses (including maintenance and utilities)
- Debt servicing costs; and
- Capital equipment
Funding distributed by CSNSW is to be spent (or committed to be spent) on eligible school-related items in the year it’s received.
Download your copy of the New South Wales Catholic Schools System Needs-Based Funding Arrangement.
Find the answer in our FAQs
Need more information? See below for answers to frequently asked questions.
How many students make up the NSW Catholic Schools System?
Catholic Schools NSW educates approximately 127,000 primary school students and 100,000 secondary school students across close to 550 schools in the NSW Catholic Schools System.
How does a school within the NSW Catholic Schools System differ from a non-systemic Catholic school?
NSW Catholic schools are operated by the relevant Diocesan Schools Office whereas non-systemic Catholic schools are operated by a religious order or a Public Juridic Person (a Catholic legal entity established for school governance purposes). The non-systemic Catholic schools are funded directly by Government, not the System Authority.
How is school funding calculated?
School funding is based on the Schooling Resource Standard (SRS), which is the government’s estimate of the cost to educate a student. The SRS is used as the base amount in the calculation of recurrent funding. It may also be supplemented by loadings, which address the needs of disadvantaged schools and students. Critically, in the case of non-government schools, the base funding is discounted by a Capacity to Contribute (CTC).
What are loadings?
Loadings are additional amounts that address the needs of priority cohorts of students and disadvantaged schools, including:
- Students with disabilities
- Students with low English proficiencies
- Students of Aboriginal or Torres Strait Islander backgrounds
- Students with socio-educational disadvantages
- Small Schools
- Remote Schools
On average, loadings make up approximately 24% of total funding for the NSW Catholic Schools System. However, the composition varies from school to school.
How is the Capacity to Contribute calculated?
A school’s Capacity to Contribute (CTC) is calculated by reference to a Direct Measure of Income (DMI). The DMI is based on the taxable income of the parents and guardians of the school’s students. The DMI data is collected by the Australian Government Department of Education from Australian Taxation Office and other government agencies’ records. The data is used to:
- Identify the median (middle) family income from all family incomes within a school;
- Rank the median incomes calculated for all non-government schools; and,
- Convert the ranked median incomes into a set of DMI scores.
The DMI scores are averaged over three years to determine a CTC score for each school.
Schools with the lowest CTC scores are entitled to 90% of the SRS, reducing progressively to 20% of the SRS for schools with the highest CTC scores.
Why is funding calculated using a needs-based arrangement?
The simple answer is that it is required by legislation. However, the CSNSW Funding Distribution Model also strives to equitably meet the individual needs of schools and students. The government funding received by CSNSW is distributed in line with the “needs based principle”, as determined by the funding legislation.
How is government recurrent funding used?
Funding for schools primarily covers a school’s operational costs:
- Salaries (including principals, teachers and support staff)
- Operating costs (including administration, marketing, IT and accounting)
- Property expenses (including maintenance and utilities)
- Debt servicing costs; and
- Capital equipment
What do you do with unspent funding?
All government recurrent funding received is spent (or committed to be spent) on school operations in the year it’s received.
Who pays for a child’s education at Catholic Schools in NSW?
Responsibility for funding the cost of education is shared by the Australian Government, the NSW Government and by parents and school communities.
In 2024, CSNSW will receive a forecast $3.65 billion in recurrent funding from the Commonwealth and NSW State governments. NSW Catholic Schools System schools will also raise an estimated $550 million from school fees and $100 million from other private income sources, including donations and investments.
How is the amount of base funding determined?
This is known as the Schooling Resource Standard (SRS) and is indexed annually. The government estimates that the minimum cost to educate a child in an Australian school in 2024 is $13,557 for a primary school student and $17,036 for a secondary school student.
What is Capacity to Contribute?
The Capacity to Contribute (CTC) is a measure of the capacity of the parents or guardians of students to contribute to the cost of educating their child. CTC only applies to non-government schools, such as those within the NSW Catholic Schools System, and calculates the amount of Government funding to be deducted from a Catholic school’s SRS.
What happens after CSNSW receives government funding?
As an Approved System Authority (ASA), CSNSW receives all funds before distributing them to the 11 dioceses within the NSW Catholic Schools System. A funding distribution model is used for this disbursement. Each diocese has the discretion and flexibility to determine how they deploy or allocate the funds to their schools. That’s because the Diocesan Schools Offices (DSO) are best placed to understand each school’s individual needs, based on their local knowledge of the school and its community. As a result, each DSO may fund individual schools differently.
How many dioceses make up the NSW Catholic Schools System?
There are 11 Diocesan Schools Offices (DSO) in the NSW Catholic Schools System. These are:
- Diocese of Armidale
- Diocese of Bathurst
- Diocese of Broken Bay
- Archdiocese of Canberra and Goulburn
- Diocese of Lismore
- Diocese of Maitland-Newcastle
- Diocese of Parramatta
- Archdiocese of Sydney
- Diocese of Wagga Wagga
- Diocese of Wilcannia-Forbes
- Diocese of Wollongong
Does needs-based funding cover the cost of running a school?
In addition to recurrent funding for their day-to-day operations, schools typically require further resources. These are used for additional needs such as buildings, (classrooms, libraries, and sports facilities). This additional funding can be raised from other sources, including school fees.
Is CSNSW accountable to governments for how it uses its funding?
CSNSW is committed to offering both transparency and accountability in the way it receives and distributes funding. As part of its regulatory responsibilities, CSNSW submits annual funding reports to both the Australian and NSW Governments and is subject to comprehensive oversight regimes by the NSW and Commonwealth Departments of Education.