Inside Story

The educational consequences of the peace

We’re still living with the legacy of Labor’s decision to support public funding of non-government schools

Dean Ashenden 28 July 2016 4611 words

Past and future: Gough Whitlam (left) and Arthur Calwell, shown here in 1960, the year they took over as deputy leader and leader, respectively, of the Labor Party. National Archives of Australia

In July 1966 a special federal conference of the Australian Labor Party voted, in dramatic circumstances, to abandon its opposition to “direct state aid” for non-government schools. The decision was seen at the time, and often since, as a radical reversal of Labor’s historical attachment to “free, compulsory and secular” education; as the beginning of the end for Australia’s “oldest, deepest, most poisonous debate”; and as the harbinger of a great leap forward in Australian schooling. Each of these estimates is half-right at best.

By 1966 Labor governments had been dispensing state aid for a decade or more. One state (Queensland) had been doing so ever since 1899, and another (New South Wales) since 1912. Labor had gone to two federal elections (1961 and 1963) with significant offers of aid. And while it is true that the 1966 decision led directly to the famous Karmel report of 1973, with its new deal for schooling, it also led to serious deformities in the structure of the schooling system – deformities that generated significant educational and social difficulties, and frustrated their solution.

Much in this ambiguous legacy was defined by the Byzantine politics within and between the Catholic Church and the Labor Party, institutions so similar in many respects, and so deeply entwined, that politics often took on the character of a civil war, much of it fought on the battlefields of state aid.

The Catholic–Protestant sectarianism that had riven schooling for a century or more was about to disappear, but not the acrimonious division and controversy that accompanied it. That was simply transposed to a new, secular ground.

The second half of the nineteenth century saw the end of the decades-old system of public support for religious schools, and the creation of a government school system. But the Catholic Church was no hapless victim of the campaigns that brought this change. It did every bit as much as the most ardent exponents of “free, compulsory and secular” education to split Australian schooling into what became three “sectors”: government, Catholic, and “independent” or “private.” It was angrily determined to go it alone, un-aided. And, by combining modest fees with the low-cost labour of nuns and brothers shipped in from Ireland and elsewhere, it did.

Some Catholics hankered after a restoration of state aid, but others did not. With aid would come conditions and controls, and the risk of secular pollution. In any event, right up until the eve of the second world war, the question – leaving aside the small bursary schemes in New South Wales and Queensland – was hypothetical. Governments weren’t going to stir up sectarianism all over again, even if they wanted to help, which most didn’t, and the bishops weren’t going to ask for aid, for the same reason.

The war had scarcely ended before aid became both possible and necessary. Numbers of students rose as rapidly as the supply of nuns and brothers fell. Classes swelled to sixty or even seventy or more, often taught by poorly educated teachers in schools that, as demonstrated by a famous and farcical incident to which we’ll return, could not even provide enough toilets.

What could be done? State governments had trouble enough finding money for their own bulging institutions. Federation had left them with the responsibility for schools, but wartime legislation had taken away the taxation powers they needed to pay for them. The Church needed the money, though, and politicians needed the votes.

The solution was an under-the-counter trade conducted within boundaries well understood by both sides. Aid to meet educational expenses, yes; for staffing or building costs, no. To families and students, yes; to schools or school authorities, no. “Indirect” and covert aid, yes; “direct” and explicit aid, no. From state governments, yes; from the federal government, no.

A patchwork of arrangements made within these distinctions gave Australia in the mid 1950s something reminiscent of pre-abolition reality combined with post-abolition appearance. Aid ranged from the relatively straightforward (scholarships, bursaries and allowances, tax deductions, free milk, stationery and bus passes) to the truly ingenious and obscure, such as grants for Catholic parent associations to match those given to their state school equivalents, and subsidies for school pianos.

At first the management of aid-that-wasn’t proceeded smoothly enough, particularly with Labor governments. Labor was almost as Catholic as the Church itself. Most Catholics were Irish and therefore working class and therefore Labor, and Labor governments – particularly in the two big states of Victoria and New South Wales – were often dominated by Catholics. On the Church side, all was in the hands of the hierarchy. Neither the laity nor the teaching orders had any say or role in the matter (nor, it followed, did women). As Michael Hogan put it in his definitive history, the bishops set out not to change public opinion but to go around it, and they succeeded. This cosy arrangement was blown to smithereens by three explosions, one after another.

The Labor Split, 1955: Victorian anti-communist Catholics, abetted by archbishop Daniel Mannix and his protégé Bob Santamaria, marched out of the Labor Party to form what would become the Democratic Labor Party, or DLP. Hogan likens the post-Split relationship to a soured romance, but that was in New South Wales. In Victoria it was a vicious divorce.

One of many consequences was the revival in the Labor Party of the old battle cry of free, compulsory and secular. In Victoria particularly, and in the national machinery of the party, anti–state aid feeling and forces mobilised. Long-serving federal powerbroker Joe Chamberlain, hitherto content to leave backroom deals to the state branches, became a ferocious opponent of state aid in any form, determined to choke off supply to the treacherous Catholics. That was, of course, directly contrary to what was needed to get the Catholic vote back from the DLP.

The politics of the Church, the Labor Party and their relationship in the decade that followed was dominated by the state aid question. They were rancorous, perverse, doctrinaire and extraordinarily complex. Labor was a tangle of cross-cutting divisions – between left and right, pro- and anti-aid, and Catholic and Protestant; between the states (again, New South Wales and Victoria especially), the state party machines and governments, and the federal office; and between an old guard led by Arthur Calwell and a new guard dominated by Gough Whitlam, twenty years younger than Calwell and a rising star.

As for the Church, differences among the bishops, particularly those from Victoria and New South Wales, were greatly complicated by rising agitation among the laity, and especially among those who had the thankless task of running schools and a school system careening towards collapse, who were fed up with the ineffectual bishops and their backroom manoeuvres. But the laity, too, was divided, between militants and gradualists, and between those loyal to Labor and those whose loyalties lay elsewhere.

Goulburn, 1962: In July 1957 the NSW education department issued a “certificate of efficiency” to Our Lady of Mercy Preparatory School in Goulburn, in south-central New South Wales, conditional upon the installation of another seat in the boys’ toilet. (Accounts differ on this and other details. It was just one seat according to Hogan, three according to political historian Jenny Hocking, and an entire toilet block according to the Bulletin’s man on the spot, Peter Kelly.)

The parish was beyond broke; its expenditure on schools had sent it into heavy debt. It temporised and fudged. The government authorities turned a blind eye for as long as they could, but then registration inspections came around again. The department told the parish that there would be no registration this time without the toilet upgrade. The local bishop, recently installed in office at the unusually early age of forty-two, got his back up. After consultation with a small group of (male) laity, he decided to go public. In the course of a speech on St Pat’s Day, and in the presence of the local (Labor) member of the state (Labor) government, he said that the school might have to be closed. The certificate was promptly issued, pending advice that toilet facilities met requirements.

The Goulburn Catholics now asked to see the minister. The minister said no, he wouldn’t see them. The bishop said that if the government wanted the school to stay open it could always pay for its requirements to be met. More fudges and deals were attempted, without success. The bishop then wrote to the minister, inviting him to attend a public meeting arranged for four days hence. Seven hundred people – not including the minister – turned up, and voted 500 to 120 to close not just Our Lady but Goulburn’s five other Catholic schools as well. Two thousand children would be instructed to seek enrolment at their local state school. The next day, the “Goulburn Strike” (or “Lockout”) was on front pages around the country.

Turning up the heat: the bishop’s lockout hits the front pages in 1962.

The strike moved state aid from the backrooms to the middle of the political agenda. Initial media hostility soon turned to consensus that “something had to be done.” The Catholic schools could not be allowed to collapse. Goulburn’s state schools were stretched to accommodate even the one-third (or a half – reports vary) of the 2000 applicants they were able to enrol, leaving the rest with nowhere to go. Imagine that scenario across the country! Governments were getting exactly the intended message. Perhaps most significant but least noticed was that the Catholic parents and students of Goulburn had made their requests for enrolment courteously, and the state schools responded in that same spirit. Some of those enrolled in state schools stayed there after the strike was over. Sectarianism was dying.

The strike put almost as much heat on the bishops as on the government. They had lost control to the laity, and their sotto voce requests for bits and pieces of aid were increasingly seen as craven as well as ineffectual. On the government side, the NSW premier, R.J. Heffron, made a great show of refusing to be bullied and then let it be known that he would be open to representations from the Church. The Church rolled out its heavy artillery, a delegation headed by the cardinal himself, and made a list of its requirements available to the media. The list comprised more scholarships, help with teacher training and salaries for lay teachers, and support for capital works including science labs in particular.

Heffron had the advantage of a (Protestant-dominated) conservative opposition, unfriendly to Catholics and to aid, plus more than two years to the next election, plenty of time to get the party onside. His optimism was misplaced. The state conference endorsed aid of the science laboratory kind, only to be slapped down by its federal counterpart, urged on by the man Whitlam’s speechwriter Graham Freudenberg called the “self-appointed keeper of the conscience on this matter,” Joe Chamberlain. The NSW government was instructed to “recast” its plans. New South Wales resisted, and met with an even more stinging rebuke. It was required to submit all decisions on state aid to the federal secretary (aka Joe Chamberlain) “for consideration and advice.” The lesson for the Church was that Labor could not be trusted to deliver.

Menzies – Protestant, no enthusiast for state aid, firm opponent of any federal involvement in schools – saw his chance. Two weeks after Chamberlain’s diktat, Menzies called an early federal election with a centrepiece policy of providing science laboratories to all schools, government and non-government alike.

The Liberal leader had scraped home by just one seat in 1961, and Calwell believed that this time he would be prime minister. Instead, he lost ten more seats, seven of them in New South Wales. Then it was the state party’s turn to be hammered. In May 1965, the NSW Labor government fell. It had been in office since 1941. The shift in the Catholic vote, and the Church’s allegiance, away from Labor and towards the conservatives, which had commenced with the 1955 Split, was accelerating. First the Church found that it couldn’t trust Labor, then it discovered that it no longer had to.

The writing was on the wall, or two lots of writing actually, one about state aid, the other about the control and leadership of the Labor Party. Calwell couldn’t or wouldn’t read either. Whitlam could read both.

Showdown at Surfers, 1966: The sharp end of the Menzies wedge fell first on Labor’s federal MPs. Come the next election, would they promise to cancel the science labs? In May 1965 caucus decided, albeit by a narrow margin, that no, it wouldn’t. It would not undo “existing arrangements.”

The wedge now pointed at the federal conference of the party, held a few months later. Calwell supported a move to dodge the question by having it referred to a national advisory committee on education.

The committee was dominated by Chamberlain, with Calwell in support. Its majority report to the federal executive six months later proposed that there would be no aid for school buildings or staff and that Labor’s federal members could support existing federal aid, including, of course, Menzies’s science labs. But on the very day of the report’s presentation, Calwell announced that he had had an epiphany. He would withdraw his opposition to direct state aid. He had been much moved by a letter from his old friend (and friend of Labor) James Carroll, auxiliary bishop of Sydney, which documented the parlous conditions for students and teachers in Catholic schools, and protested against the iniquity of denying them financial support on the ground of their religion.

Chamberlain wasn’t going to have it. Calwell was prevailed on to change his mind, again, and the Labor executive did a U-turn of its own. Not only would parliamentary members be bound to oppose state aid but, even more startling, the possibility of a High Court challenge to its constitutionality would also be investigated.

Whitlam had been a member of the advisory committee on education, and was scathing about the majority report’s internal contradictions. Now he was apoplectic. He famously determined to “crash or crash through,” labelling the federal executive “extremists,” then (on national TV) declaring them to be “twelve witless men.” Calwell was jubilant. The upstart Whitlam had signed his own death warrant.

Calwell’s move to have Whitlam expelled by a meeting of the national executive; a desperate phone call from Queensland MP Rex Patterson (beneficiary of Whitlam’s phenomenally successful campaigning in a recent by-election) to state secretary Tom Burns; an equally desperate call by Burns to the two Queensland delegates at the meeting of the executive; the last-minute switch by those delegates as the noose was being placed around Whitlam’s neck; and Whitlam’s consequent escape by the narrowest of margins (seven votes to five) – all these are the stuff of Labor legend.

As important to history as the decision to let Whitlam off with a reprimand was the accompanying decision to send the whole business back whence it had come, to federal conference. Even that took two goes, one in March, and another in July, at Surfers Paradise. There came a denouement less dramatic than the events that had led up to it. Joe Chamberlain was out of the game for once, laid up in hospital, and anyway, delegates’ minds were concentrated by a looming federal election. It was agreed that Labor would not oppose existing aid, a crucial vote coming from Calwell, who had changed his mind yet again.

One view of that decision is that it was a volte-face, a reversal of a long-held policy. Another view, not quite the opposite but close, is that Labor had merely abandoned an old policy without deciding on a new one. A third view is that 1966 was not a reversal; it was another step down a long and tortuous path. And while 1966 didn’t decide on a new policy, it very nearly arrived at one by default. To mix the metaphors, since the early 1950s Labor had been the frog in the pan, and by 1966 it was too late to jump. It would have to live with what a tangled history had provided, which included Menzies’s “direct” federal aid as well as the many and varied devices of the states.

By 1966 Whitlam was (as he himself had pointed out) Labor’s leader in waiting, and it was his conceit that he knew how to rise above this history. What had long been seen as a question of religious versus secular schooling he had reconfigured as a question of meeting need in the interests of equal opportunity for all Australians. In place of a dog’s breakfast of measures, he would put aid on a systematic basis across the nation. Against the push by a conservative–Catholic alliance for per capita grants, his aid would be according to need in government as well as non-government schools (which meant that expensive private schools would have to fend for themselves). All this would be worked out in detail and carried into practice by a grand new edifice, the Australian Schools Commission.

It is not hard to see why Whitlam believed that his plan changed everything. Amid an increasingly heated, confused and intractable debate, his proposal had cut through. It seemed lucid, sensible and practical, as well as bold. But it also changed much less than Whitlam imagined.

The “needs” approach apart, Whitlam was effectively tagging along behind Menzies and the policy of direct aid, to be provided to all schools, by the Commonwealth. With that came a number of fundamental, structural realities: non-government schools would be “aided,” not funded. They would therefore continue to charge fees. Parents would have the right to choose between free and secular state schools or fee-charging religious schools. There would still be three school sectors, each run and funded in its own way, plus the additional complication of the involvement of a second layer of government. Implicit in the decision and the non-decisions of 1966 was the extension of an unfortunate history.

Among the very first actions of the Whitlam government was the appointment of an interim committee of the Australian Schools Commission, to be chaired by economist Peter Karmel. It handed down its report less than six months later (in May 1973). The report earned a rapturous reception for its trenchant support for equal opportunity, its encouragement of new approaches to teaching and curriculum, its preference for “community participation” over authoritarian and centralised decision-making, and its special programs for disadvantaged schools, innovation, special education and the like. A generation of teachers, academics and administrators came to see the report, the Schools Commission and the Commonwealth as sources of inspiration, salvation even.

The interim committee was serious in its advocacy of a more equal, humane and enlightening schooling for all, but that was not its core business. It was charged by Whitlam with working out the detail of his plan to bring the state aid question to a close, once and for all.

No part of Karmel’s recommendations on implementation would have surprised Whitlam or, for that matter, many of the delegates to the 1966 conference in Surfers Paradise. The three school sectors would continue to operate in their familiar form; all would get support from both state and federal governments, one sector fully funded, the other two aided and therefore fee-charging; levels of funding and aid would be determined by need, which would in turn be tied to capacity to pay; distribution of those funds within the government and Catholic systems would be the responsibility of system authorities; parents would have the right to choose and, thanks to government subvention, choice would be more widely available.

The committee was clearly uneasy with the task it had been set and, by implication, with its own proposals. It was unhappy at being required to make recommendations “in terms of structures which exist and which it has little direct power to modify [and which] may not be equally relevant for all time.” It fretted about how to ensure “maintenance of effort” by both the states and the non-government schools in receipt of substantial new funding, about the “role of fees in the financing of schools,” and about the likelihood of a “changed relationship” between government and non-government schooling. But there was no time to turn these and other concerns into proposals, and anyway they were scarcely heard in the clamour of approval. The state aid problem had been resolved, at last!

That illusion didn’t last long. Less than two years on, an economic downturn restricted the massive outflow of federal funds needed to keep the many parties happy, leaving the realpolitik of the Karmel/Whitlam settlement exposed like coastal rocks after a storm.

One problem was inordinate complexity combined with confusion of roles and responsibilities: three sectors, each funded and controlled in its own way, two of them getting funds from three different sources including fees, a total of seven governments at different stages of three-year electoral cycles and of differing political persuasions. This was the genesis of a funding system described forty years later by David Gonski and his colleagues as uncoordinated, divisive and unnecessarily complex; containing overlapping responsibilities leading to duplication and inefficiency; and lacking any coherence, transparency, or connection to educational objectives.

A related problem lay in the interaction of “need,” “capacity to pay” and arguments about reducing fees in the interests of “broadening access.” The new system was an invitation to gaming and, on occasion, rorting. State education departments and Catholic school authorities both resisted Commonwealth efforts to attach conditions and purposes to its funds.

Moreover, almost everyone had a legitimate basis for complaint. One side could insist: we are open to all, and cater to most disadvantaged students and their families, so fairness requires that our schools have priority over schools that exclude. The other side could counter: it is not fair that those who choose a religion-based education should have to pay for that choice; parents who pay taxes and then make an additional contribution to the funding of schooling, year in, year out, are entitled to public support; and the lower the public support to non-government schools, the less able we are to enrol all comers.

For all these reasons, conflict over funding returned in full spate. The Schools Commission, attempting to arbitrate between lobby groups constituted or empowered by the Karmel–Whitlam settlement, was the first major victim of policies it was charged with administering. It was downgraded, and eventually (1988) scrapped. Other victims, in whole or in part, included a federal minister (Susan Ryan, author of the putative “Ryan hit list”), a federal leader of the opposition (Mark Latham, of “Latham hit list” fame), and the Gonski proposals, Julia Gillard’s pre-emptive buckle (“no school will be worse off”) notwithstanding.

More important than any of these disturbances in the corridors of power and in public forums were the consequences down on the ground. With three sectors funded and administered in different ways came very different levels of funding and very different regulation of rights and obligations. The Karmel/Whitlam settlement gave Australia both free and publicly subsidised fee-charging schools; schools lavishly funded and schools relatively impoverished; schools permitted to select on grounds of capacity to pay and/or religious affiliation and/or academic performance and schools prohibited from doing any of those things; parents who are required to pay when often they can’t afford it and parents who aren’t and can; and parents who are offered the full menu and others who must take whatever is put on their plate.

Unfairness is one part of the problem. The other is exacerbation of social and educational division. Parents in a position to choose have typically chosen schools where their children will find others just like themselves. In the doing, they make a choice for those who can’t choose, for reasons of income and/or location, and/or because their child doesn’t have what the choosy schools are looking for. Thus the non-choosers, like the choosers, increasingly find themselves among their own kind.

Australia now has an unusually high concentration of students at both ends of the spectrum, and a relatively small proportion of schools with socially mixed enrolments. One consequence of the massive sifting and sorting of the forty years since the Karmel/Whitlam settlement is a transformation of the Catholic sector. A school system established to help the poor and the excluded has off-loaded much of that task to the government schools in favour of catering to those already in the mainstream. One quarter of students in Catholic schools are not Catholic, and half of all Catholic students – and almost certainly a relatively poorer half – are enrolled in government schools.

There is clear evidence to suggest that this segmentation, amounting in some respects and areas to segregation, has a depressing effect on the academic attainment of many, perhaps even most students. Its social and cultural effects go unmeasured and unreported.

What went wrong? In his celebrated denunciation of the 1919 Versailles peace conference, The Economic Consequences of the Peace, J.M. Keynes said of its protagonists that “the future life of Europe was not their concern; its means of livelihood was not their anxiety.” Their anxiety was territorial settlement and reparations, with, Keynes correctly predicted, dire consequences to follow.

The analogy with the Karmel/Whitlam settlement is not exact in kind or, of course, in scale, but it is illuminating. Whitlam did have a concern for “the future life of Europe” but it played very little part in shaping his thinking about the nature and terms of a state aid treaty, most of which had taken its final shape by 1966.

In 1991 Jean Blackburn, like Keynes a key player in the proceedings concerned (she was deputy chair of the interim committee and subsequently an important voice in the Schools Commission), looked back in anger. “We created a situation unique in the democratic world,” she said. “It is very important to realise this. There were no rules about student selection and exclusion, no fee limitations, no shared governance, no common curriculum requirements below the upper secondary level… We have now become a kind of wonder at which people [in other countries] gape. The reaction is always, ‘What an extraordinary situation.’”

Some of the omissions listed by Blackburn, to do with curriculum and accountability, have since been addressed, if not resolved, but others have not been addressed at all.

Both sides of politics are aware of structural problems in the school system. The Coalition has focused on dysfunctional governance arising from the involvement of two levels of government. Labor’s concerns, larger in scope and spirit, concentrate on the (closely related) problem of complex and counterproductive distribution and use of funding. Neither seems aware of the importance of student selection and exclusion, of the consequences of the fee/free distinction, or of the relationship of all of the elements identified by Blackburn to each other. Neither has grasped how these dynamics are in turn related to Australian schooling’s persistent inability to “lift performance,” and to the social and cultural effects of schooling. Neither has been able to escape the power of interest groups formed in the 1960s to block structural change, and neither has been willing to confront some of those groups on the reduction of decisions about “the future life of Europe” to grabs for cash. Each seems to understand only parts of a big, complicated problem; each, like Labor in 1966, canvasses remedies which, if seen as solutions rather than steps towards a solution, will perpetuate more than they change. •