Peter Lyons

What's the difference between an education hub and an education board?

The answer is 30 years of misguided market-driven education policy.

The government's education review taskforce has released its recommendations — it has decided to go back to the future, albeit with new age terminology.


The recommendations have predictably been labelled "Stalinist" by some in the winner schools under the current system.

There is an irony that the furore over winner schools using their affluence to subvert the Auckland First XV rugby competition also hit the headlines the other week. The allegations are that St Kentigern College has used its superior resources to poach players from other regions therefore creating an unfair competition.

This could be an analogy for the entire New Zealand school system over the past 30 years.

If the taskforce recommendations are adopted, it could go a long way to achieving greater fairness in our system — especially for the most disadvantaged communities.

In the 1990s, New Zealand's school system was dominated by a market-driven philosophy. Competition between schools would ensure greater efficiency and improved performance, and winner schools could even "take over" loser schools just like in the real world of business.

The legacy of this ideology still dominates. But there are some tragic flaws in this ideology.

There was never a level playing field to start with. Winner schools have far greater access to additional funding — maybe through international fee-paying students, wealthy alumni, affluent fee-paying parents or even black-tie dinners that can raise an additional $100,000 in a single evening.

Winner schools could then poach higher quality staff or top-performing students and sports stars; they could offer state-of-the-art facilities and infrastructure; they could fund professional sports academies staffed by professional coaches.


The market for schooling resembled a running race with some participants on steroids and others with their legs tied. The losers were then castigated by Education Review Office reports for their failure to perform.

Peter Lyons
Peter Lyons

This taskforce has recognised the flaws and limitations of schools being regarded as independent stand-alone business entities in competition with each other.

Schooling has huge spillover benefits for the wider society, and the market model of schooling fails to recognise or capture these spillover benefits — it treats education as a pure private good.

These spillover benefits are the reason for state-funded education in the first place.
Winner schools and loser schools inevitably mean winner students and loser students, and the students who lose in such a system eventually cost us all. We can ill afford to have a sizeable rump of our population being failed by our schooling system as is currently happening.

The taskforce's recommendations are aimed at ensuring greater fairness for all New Zealand children — even though those from affluent backgrounds will always get a better deal because their parents can afford to pay more.

Let's hope these recommendations are adopted. They make sense to me.

There will be an inevitable backlash from those who benefit under the current regime, but the recommendations are not "Stalinist" — they are common sense.

Peter Lyons teaches economics at Saint Peter's College in Epsom and has written several economics texts.