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Labour's figures on laptops don't compute

By Sinclair Davidson and Alex Robson - posted Thursday, 22 November 2007

Labor leaders used to promise that no child would live in poverty. The Coalition’s economic management has been so good that they are now forced to guarantee that no child will be without access to a laptop computer.

There has been little said about how Labor's education policies will improve the quality of our education system or learning outcomes.  But this is the new Labor spin: anti-poverty platitudes are out and computer clichés are in.

Actually, Labor seems to believe that working families have done so well under the Coalition that one computer may not be enough to buy their vote.


Let’s go back to the first week of the election campaign when Labor told us that school children need a laptop.

Never mind that laptops cost hundreds of dollars; that childrens' school supplies frequently go missing; and that laptops would overburden already over-weighted school bags.

Kevin Rudd's much anticipated tax plan simply consisted of some families being able to claim a rebate on some school expenses, including computers.

Now fast forward to week five of the campaign. Mr Rudd promised one billion dollars over four years to "turn every secondary school in Australia into a digital school".

Under the policy, schools can apply for grants of up to $1 million for computers or computer related expenditure. So even if (courtesy of the Rudd tax rebate) a child already owns a laptop at home, they could conceivably have access to a taxpayer-funded computer at school as well.

Why is this wasteful duplication needed? There is already a high level of computer penetration in Australia - 68.9 per every 100 people, which puts us at sixth among 122 countries ranked by the World Economic Forum.


And what will it cost the taxpayer? Technical support for the computers, running costs, insurance costs and housing costs for school computers are likely to be very high.  Under the laptop plan those costs are absorbed by the family, but under the school plan they would be borne by the school itself.

The ALP says its secondary school grant scheme will cost $1 billion over the forward estimates out to 2011. This figure is very interesting because Rudd used it last week when he claimed that he was the more fiscally responsible candidate.

According to the Australian Bureau of Statistics there were 2,659 schools with secondary students in 2006.

Straight away you see the problem. If each eligible school applies for a $1 million grant, that actually implies a budgetary cost of $2.659 billion and not $1 billion.

So much for fiscal responsibility and "economic conservatism" - Labor’s policy has a gaping black hole of $1.659 billion.

Labor sneakily tries to get around this by saying that under their policy, "every Australian student in years 9-12 to have access to their own school computer".

There are just under 1 million students in years 9-12 in Australia.  But as anyone who has attended an Australian high school knows, Year 8 is not a primary school year in any Australian State or Territory.  And in NSW, Victoria, Tasmania and the ACT, Year 7 is also counted as "secondary school".

If we count those students, we arrive at a much larger number: 1,431,918 secondary students in 2006.  Labor - the party touting an “education revolution” - has ignored more than 400,000 students.

It gets worse. The number of secondary schools and students is growing steadily. Each year there are about 15 additional schools and 15,000 additional students added to existing stocks.  By 2011 there will be over 2730 schools with well over 1.5 million students.

Moreover, computers have a three year life - they are usually depreciated on a straight-line basis over three years. This means (as Labor’s policy explicitly acknowledges) that the stock of computers will need to replaced every three years.

But Labor's spending figures don't appear to have taken any of these facts into account. Even if the grants are spread evenly over existing schools during the next four years, spending which occurs in the first year will need to be repeated in the fourth year.

In other words, allowing schools to reapply for grants mean that a four year policy could cost five years worth of funding, because some schools will be double dipping.

All of this means that Labor’s policy will cost much more than they admit or that some schools will miss out on the full amount of funding - or both.

The ALP has put out two school computer plans - one through the tax system and one through a grants system. Why each student needs to have two computers remains a mystery.  Perhaps not having two computers is the poverty of the future.

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About the Authors

Sinclair Davidson is a senior fellow at the Institute of Public Affairs and Professor in the School of Economics, Finance and Marketing at RMIT University.

Dr Alex Robson is a lecturer in economics at the Australian National University.

Other articles by these Authors

All articles by Sinclair Davidson
All articles by Alex Robson

Creative Commons LicenseThis work is licensed under a Creative Commons License.

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