Speech to ACT Northern Regional Conference

Speech to ACT Northern Regional Conference

Education Policy

Jamie Whyte

28 June 2014

Ladies and Gentlemen,

Thank you for coming today.

Some of you are probably here because we picked this lovely spot to hold the meeting.

It’s a good thing for us and for the members of the Takapuna Boating Club that it was built before 1991, when the Resource Management ACT was passed. Today it might not get planning consent.

Who knows if it would count as respecting the “intrinsic value of the environment”? It might not even be sustainable.

Some people I talk to are surprised to learn that the RMA was passed by a National government. They shouldn’t be.

For although the National Party in opposition claims to believe in personal responsibility, individual choice and fiscal discipline, in government they turn into the Labour Party.

If you did not know the election results, but could see only the policies pursued over the last 15 years, you would think that Helen Clark’s Labour Party was still in power.

Labour increased government spending dramatically. This National government has sustained it, increasing government debt to 35% of GDP in the process.

Labour employed tens of thousands of new bureaucrats. National has kept them in their jobs, beavering away, paid from our taxes to impose even more burdens on us.

Labour made tens of thousands of middle-class families welfare beneficiaries with their Working for Families money-go-round. These families are still being taxed to fund their conversion into state supplicants.

Labour bribed university students with interest free loans. National has kept slipping the envelopes under the table, despite the cost of the programme exploding to more than $500 million a year.

Bill English has actually boasted that under National high-earners pay a greater share of total taxation than they did under Labour.

Only two policies would surprise someone who didn’t know Labour had been kicked out: three strikes for violent crime and partnership schools. And they are both ACT policies.

Voters now face a choice between a Clinton-Blair-Clark-style “Third Way” Centre Left party. That’s National.

An old-fashioned, trades union-dominated, central-planning Labour Party.

A Watermelon Party – Green on the outside and red on the inside.

The Internet-Mana Party, which combines the racial politics of Hone Harawera with the socialism of Laila Harre.

A Muldoonist, anti-trade, anti-foreigner New Zealand First.

A Muldoonist, anti-trade, anti-foreigner Conservative Party.

And ACT.

ACT is the only party in New Zealand that truly believes in free markets. The only party that believes in property rights. The only party that believes in individual liberty and personal responsibility. The only party that believes in a small state and a big individual.

Nowhere is this more evident than in education policy, which is what I want to discuss today.

The importance of Education

Education has become more important than ever. All around the world, the incomes of the well-educated are rising rapidly while the incomes of uneducated people are stagnating.

This is a predictable result of technological progress. Physical labour and physical strength have become relatively unimportant.

What matters now are your intellectual and social abilities, both of which can be greatly improved by a good education.

Many New Zealand children are well educated. We have some excellent schools here. But we also have a large rump of failure.

The OECD’s 2013 international rankings placed New Zealand 15 year olds at 18th in Science, down from 7th in 2009. It placed us 23rd in Maths, down from 13th. 13th in reading, down from 7th.

It’s disappointing that the ranking of our average student is declining. But our mediocre averages disguise an even more unpleasant fact.

The difference between our best students and our worst is the biggest in the OECD. Our average is average only because our best are very good. Our underperforming students are doing really badly. About 15% leave school almost illiterate.

If we cannot improve the educations supplied to those now being failed, they will fall farther and farther behind well-educated New Zealanders. They won’t have a real chance to get ahead in life. And New Zealand’s overall economic growth will be slowed.

This economic view of education will be familiar. But it doesn’t go far enough.

Education is not important merely for your standard of living. It runs deeper than that. Education forms you. It is part of what makes you the person you are.

I’ll name some of the teachers who have contributed not only to my progress in life but to who I am.

There was Mr Heath, my Standard 2 teacher at Melon’s Bay Primary. He was a long haired sax-playing jazz musician who inspired an enduring love of music in me.

Mr Taimana at Buckland’s Beach Intermediate taught a few of us University Entrance maths even though we were only 12, and made me realize that we are often capable of more than we realize.

Miss Stevens, my history teacher at Pakuranga College, made me understand that the way we live today is not just a natural fact but the result of big ideas that have been battled over for centuries.

Then my philosophy lecturers at Auckland and Cambridge taught me how to be truly boring at parties.

Most of you here could probably name teachers who have been similarly important influences. But many New Zealanders couldn’t. And their baron educational experiences have impoverished them, not just materially but spiritually.

Once people are fed, clothed, housed and loved, nothing is more important to them than their educations.

What’s wrong with our education system

Food, clothing and housing are provided by competing private suppliers, and sometimes even love. But, for the most part, education is not. 85% of children attend a state school.

State schools face no serious competition.

If a supermarket fails to provide its customers with the food they want, it will go broke. Other supermarkets that offer these dissatisfied customers a better deal will win their business.

The same goes for the farms that produce the food. Fail to provide what your customers want as efficiently as your competitors do and you will eventually go bust.

This ongoing competitive market process explains why the quality of food has improved so much over the last 100 years while the cost has declined.

By contrast, if a state school fails to provide educations that satisfy the parents of their pupils, it will not shut down. Its income does not come from the parents it is failing to satisfy. It comes from taxpayers with no choice in the matter.

Indeed, if a school performs poorly, it is likely to attract extra government funding. In the private sector, resources flow into success; in the public sector they flow into failure.

In a free market, what counts as a good product or service is decided by consumers. It’s up to them what they spend their money on.

Because consumers have different needs and preferences, free markets tend to result in a great variety of products being offered. Think of the extraordinary range of tastes that are catered to by restaurants and food retailers in New Zealand.

When market competition is replaced with state supplied goods and services, consumers’ preferences do not determine what gets offered. The preferences of government ministers and bureaucrats do.

We do not get a variety of educational offerings tailored to the different needs and preferences of children and their parents. We get a standardized, one-size-fits-all educational model.

And, as always with one-size-fits all models, state education in New Zealand now fits only a few children.

Who are those children?

They are children with well-off, well-educated parents.

Parents who can afford to buy a house near to a school that will do a good job for their child.

Parents who have the confidence to lobby for changes to curriculums and teaching methods that would suit their children better.

Parents who can afford to pay the fees of private schools, which do face competitive pressure to supply educations which suit their customers.

The children of poor parents have none of these advantages. That’s why their children get educations that don’t suit them. That’s why there is a strong correlation between educational performance and the “income decile” of the neighbourhood around a school.

Many people blame this correlation on the poor families themselves. Their children just cannot be taught.

That is offensive bullshit. Poor children can be taught. Talented teachers, free to adapt their methods to the needs of their students have shown this time and time again.

My PhD supervisor at Cambridge was the son of a British Rail steward and a mother who didn’t work outside the home. His family would now be described as living in poverty. Yet his education at Manchester Grammar School was so successful that he went on to obtain first class honours degrees in chemistry and engineering at Cambridge University before becoming a philosophy lecturer there only three years after taking up the subject.

The grammar schools of pre-politically correct England are not the only examples of educational excellence for the poor. As a recent Economist Magazine survey showed, charter schools in America clearly outperform state schools.

In New Zealand, the Nick Hyde’s Vanguard Academy and Alwyn Poole’s South Auckland Middle School, for examples, are showing what committed and creative principals can do to lift standards.

Imagine the progress we might see if educators were set fee. If the likes of Nick Hyde and Alwyn Poole were not the exception but the norm.

Imagine how much better education could be if it were provided in the way food is provided in New Zealand rather than the way it was provided in the Soviet Union.

ACT’s long term education policy

ACT thinks education should be provided in a market of competing suppliers. That has always been our position.

It does not mean that we are opposed to the state funding of education. Not at all. We share the almost universally accepted idea that all children should get a decent chance in life, whatever the circumstances of their birth.

But that doesn’t mean that the state must provide educations, that it must run schools.

The unemployed are now guaranteed food by the state.

This is not done by way of state farms and state supermarkets. It is done by way of cash payments which the unemployed can use to buy food from privately owned and commercially run supermarkets which get their produce from privately owned and commercially run farms.

No sane and informed person believes that the unemployed or the working poor would be better off if the food industry were nationalized. Pre-communist Russia was known as the bread basket of Europe. The Soviet Union relied on food-aid from its arch-rival, the capitalist United States of America.

The same goes for clothes, housing, computers, shoes and just about everything else. No one would expect quality or value-for-money to be improved if these industries were nationalized and we all got what government bureaucrats believed we deserved. And no one would think that nationalizing them was a way to help the poor.

ACT believes the same is true of education. The state should make sure that every child gets an education. But that education should be supplied by educators competing for parents’ voluntarily patronage. Educators should have to win the business of willing customers, just as supermarkets do, just as clothes stores do and just as builders do.

Government should make sure that every child gets an education by providing all parents with a voucher, redeemable at any school of their choosing. Otherwise the government should have no more involvement in the education business than it has in the food business.

ACT’s Policy for 2014

That’s what we want. But what can we now do about it?

What can we seriously hope to get past the National Party in a confidence and supply deal?

With Partnership Schools, we have already made a step in the right direction.

Partnership schools are largely free from Ministry of Education direction. They are free to adopt educational models that suit their pupils. They can employ who they want and pay them what they want.

Most importantly, their funding depends on how many students they attract. Their fortunes depend on the decisions of their pupils’ parents.

Unfortunately, we have taken only a small step in the right direction. Five partnership schools were opened this year. And another five are expected to open next year. And these few schools come under constant attack for being additional to the current stock of state schools and therefore reducing the funds available to them.

The answer is to give all state schools the option of become partnership schools. School boards should be allowed to opt out of control by the Ministry of Education, and be bulk-funded according to the number of students they can attract.

This policy entails no additional government spending.

Just more freedom for teachers to adapt their methods to their students.

More freedom for schools to innovate.

More choice for parents and students.

And no school board that doesn’t want these freedoms would be forced to have them. School Boards that wish to stay under Ministry of Education direction could choose to do so.

However, I expect that a large portion would choose to be free. And that we would see dramatic improvements in the performance of schools, especially those teaching children from poor families.

ACT has other education policies. For example, we want to slash the number of bureaucrats working in the Ministry of Education – which has swollen to 2,700 – and give the money saved to schools. And we want to increase the subsidy for independent schools. That won’t cost taxpayers anything extra because it will draw pupils out of the state sector.

These and other proposals will be explained in our Education Policy Document which will published on Friday. They are all good moves. But they are small beer compared to giving all schools the choice to become partnership schools.

* * * * *

When I took over the leadership of ACT, some commentators portrayed me as a new captain on the Titanic after it had been holed by an iceberg. If they were referring to Banksy’s troubles with Kim Dotcom, they got their nautical metaphor wrong. Though Dotcom resembles something from the sea, it isn’t an iceberg.

More importantly, ACT is not a ship. It is a torch for an idea. I am proud to have picked up that torch. For the idea is the most powerful idea, the most beautiful idea in the history of human affairs. It is the idea of freedom.

ENDS