Hekia statement about charter school funding misleads

Fact Checker: Hekia makes (another) misleading statement about charter school funding

The taxpayer will pay a total of $839,400 in the second half of 2015 for the troubled Wairua charter school that would not have been payable if the Minister had closed the school at the end of the second term.

Minister of Education Hekia Parata (again) misled the House in response to a question yesterday about the school’s funding.

Here is what the Minister said [Oral Questions no. 8, 29 July 2015]

“Te Pumanawa o te Wairua will continue to operate under its contract and will therefore receive $412,000 per quarter. This is the money that would have been spent had these kids attended other schools.”

Wrong, Hekia, wrong.

Under her charter school funding model, the government pays $355,200 per quarter for the fixed costs that it pays the school’s Sponsor. These costs would cease once the school was closed.

Add in the additional $129,000 in emergency funding that she has thrown in, and the taxpayer will pay a total of $839,400 over the balance of 2015 because the Minister of Education decided not to close the school at the end of the second term.

The charter funding model has four components for each school: two of these are “fixed costs” and two are “variable costs”. But only the variable, or per student costs, would continue and follow the students if they were to transfer to another school in the network.

Here’s the breakdown of the quarterly funding for Wairua for 2015:

Base Funding $252,128

Property & Insurance $103,072

Sub-total Fixed Costs $355,200 [86.2%]

Per Student (based on a Guaranteed Minimum Roll of 40) $54,188

Centrally Funded Services $2,760

Sub-total Variable Costs $56,948 [13.8%]

Total Quarterly Funding: $412,148

So, when Hekia quoted a cost of “412,000 per quarter” she was referring to the total funding that the school receives from the Government.

But $355,200 per quarter would not be payable, if she were to close the school, as her officials clearly recommended.”

ENDS

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