Australia’s public school system is in crisis, underfunded, residualised, and struggling to retain teachers.

While Coalition Governments have happily maintained the trajectory, the uncomfortable truth is that much of the market-based policy architecture undermining public schooling was designed, implemented, and proudly defended by Labor. From Hawke and Keating’s embrace of economic rationalism to Gillard’s league tables and compromised Gonski reforms, the ALP has been the willing midwife of neoliberalism in education. Their current delay in guaranteeing full Schooling Resource Standard funding for public schools proves they remain blind to the damage they have done. If Labor is serious about equity, it must dismantle the system it built.

The Albanese Government’s refusal to guarantee the full SRS for public schools until 2029 is more than a policy failure. It is a moral abdication. Every year of delay means another generation of children, disproportionately from low-income, regional, and First Nations communities, are denied the resources the government itself says they need. This is not an unfortunate oversight. It is the latest act in a long-running pattern of Labor Governments privileging market logic over public provision, even when it undermines their own working-class constituency.

Labor still trades on its image as the party of equality and opportunity. But when it comes to education, its record is one of consistent surrender, and often leadership, in the marketisation of schooling. The most damaging reforms of the past 40 years have Labor fingerprints all over them.

Public schools now educate the majority of students with high and complex needs: children from low-income families, those with disabilities, newly arrived migrants, and students living with trauma. Private schools, by contrast, draw disproportionately from higher socio-economic groups and have enjoyed a sustained boom in facilities, staffing and academic results.

This concentration of disadvantage, residualisation, is no accident. It is the predictable outcome of policies that tie school funding to enrolments, publish league tables, expand selective schools, and protect the financial privileges of the private sector. It is also the direct legacy of ALP-led reforms that embraced competition, choice, and accountability metrics lifted from the corporate world.

The shift began under Bob Hawke and Paul Keating whose governments in the 1980s and 1990s embraced “economic rationalism”, the Australian label for neoliberalism. Their education legacy is profound:

• The Dawkins Reforms (1987–1992): Introduced the Higher Education Contribution Scheme, shifting part of university costs to students and embedding the principle of individual cost-sharing. Forced university amalgamations, creating mega-institutions competing for students and research dollars. Imported managerialist structures, with vice-chancellors and TAFE directors operating as chief executives.
• TAFE Marketisation: Funding tied to student numbers, opening the door to “contestable funding” where private Registered Training Organisations could compete for public dollars. Quality oversight was weak; the seeds were sown for the later VET FEE-HELP scandals.
• National Competition Policy (1995): Although framed as microeconomic reform, it entrenched the idea that public services, including education, should be exposed to competitive pressures wherever possible.Labor’s rhetoric was that these measures expanded access. In reality, they normalised the idea that education is a private investment in “human capital” rather than a public right.

Kevin Rudd’s prime ministership continued the embrace of market principles, but it was Julia Gillard, as deputy prime minister and education minister, then as prime minister, who supercharged their application to schooling:

• NAPLAN (2008): A national standardised testing regime in literacy and numeracy, intended to identify gaps but quickly weaponised in school comparisons.
• My School Website (2010): Published NAPLAN results, school finances, and demographic profiles. Gillard defended it as “transparency,” but it created de facto league tables.
• School Autonomy Agenda: Promoted “empowered” principals and local decision-making, but without redistributing resources to match the vastly different capacities of school communities.
• Performance Pay Trials: Linked teacher bonuses to student results, despite international evidence showing negligible impact.
• Gonski 1.0 (2011): Sold as a needs-based funding revolution. In practice, deals preserved private school overfunding during the transition, locking in inequities

Gillard was heavily influenced by US education reformers like Joel Klein, whose charter school and high-stakes testing models have since been widely discredited.

By the late 2000s, the ALP’s public narrative on education was indistinguishable from neoliberal orthodoxy:

• Language of “choice”: Casting parents as consumers.
• Obsession with “accountability”: Reducing complex learning to measurable outputs.
• Efficiency over equity: Treating resources for high-need schools as an investment only if it yielded short-term gains.

The party that once argued for public education as a bulwark of democracy now framed it as an instrument for producing economically productive individuals.

It is tempting to lay all blame for marketisation at the Coalition’s feet. Liberal-National governments have been enthusiastic custodians:

• Howard Government (1996–2007): Poured record funding into private schools via the SES funding model.
• Abbott, Turnbull, Morrison: Preserved My School, doubled down on NAPLAN, and reshaped Gonski 2.0 to protect non-government sectors.

But the essential architecture funding tied to competition, high-stakes metrics, and school autonomy without equity safeguards was already in place when they arrived. Labor built it; the Coalition maintained it.

The results are visible in every state:

• Public schools carry the overwhelming share of students with disabilities, language barriers and complex social needs.
• Teacher shortages are chronic, with high attrition linked to workload, compliance burdens and lack of support.
• Curriculum has narrowed, as schools “teach to the test".
• Social cohesion suffers as education becomes increasingly segregated.

Residualisation is both symptom and cause, a feedback loop where disadvantage concentrates, resources decline, and political support for public provision erodes.

If Labor is serious about repairing the damage, it must repudiate the policies it once championed.

Immediate actions:

1. Fully fund public schools to 100% of the SRS by 2025 – no delays.
2. Abolish the overfunding of private schools.
3. End high-stakes use of NAPLAN.
4. Remove school league tables from My School.
5. Invest in comprehensive schools, stop selective school expansion.

Structural changes:

• Legislate a needs-first funding guarantee.
• Rebuild TAFE as the dominant public provider.
• Embed collaboration over competition in governance and teacher development.

The ALP likes to invoke its history as the builder of public institutions. But in education, its modern record is one of demolition by stealth. From Hawke’s economic rationalism to Gillard’s league tables, Labor has been an eager agent of market reform.

The Albanese Government’s refusal to fully fund public schools now is not just a budget choice, it is a continuation of this market logic. Until Labor admits its role, repudiates its own neoliberal legacy and rebuilds public education as a universal good, its claim to be the party of equality will ring hollow.

The views expressed in this article may or may not reflect those of Pearls and Irritations.