In 2024, Equality Australia, one of the country’s leading LGBTIQ+ advocacy organizations, released a national report detailing stories from teachers, parents and students who had faced discrimination inside Australia’s faith-based schools. One teacher was dismissed after coming out. A female student was told she could not bring her girlfriend to the school formal. Another child was denied enrollment because her parents were in a same-sex relationship. These incidents occurred despite every one of these schools receiving public funding from the Australian government.
Australia’s approach to funding schools is unusual. The Australian government directs billions of taxpayer dollars annually not only to public schools but also to private schools, including independent and religious schools. The origins of this system date back to the 1960s, when Australia’s non-government schools, primarily Catholic schools, faced severe financial shortfalls and were struggling to keep up with modern educational standards and facilities. In response, Australia’s federal government, led by Prime Minister Robert Menzies, introduced targeted funding to improve school facilities, for example by funding science laboratories, that could be given to both public and private schools.
What started as a modest, pragmatic intervention quickly grew into a sprawling and entrenched funding system. Proponents of this funding model argue that funding both public and private schools promotes parental choice, ensuring families are not financially penalized for opting out of the public system. In turn, funding private schools eases enrollment pressure on Australia’s public schools by spreading students more evenly across the education sector. According to Australia’s Bureau of Statistics, 36 percent of all Australian students attend private schools, significantly higher than most places in the OECD.
Unlike public schools, which are obligated to accept all students, private schools have their own admission rules. Private religious schools, such as Christian, Islamic, and Jewish schools, have legal exemptions that permit them to deny enrollment to certain students. For example, Australia’s Sex Discrimination Act 1984 includes provisions that allow religious educational institutions to discriminate on the basis of sexual orientation, gender identity, marital or relationship status, and sex, if the conduct is done in good faith in order to avoid injury to the religious susceptibilities of adherents of that religion or creed.
Anna Brown, CEO of Equality Australia, one of the country’s most prominent organizations advocating for LGBTQI+ rights, says these exemptions highlight deep tensions within the current funding model. “There is overwhelming public support, including among parents and people of faith, for removing the special exemptions that allow religious schools to discriminate against LGBTQ+ people and others,” Brown said. “These schools rely on millions of dollars of taxpayer funding every year, and they should uphold the same non-discriminatory practices that other government schools and institutions have abided by for decades.”
Jasmine Yuen, a state director of the Australian Christian Lobby, which describes itself as a leading voice in grassroots efforts to protect Christian rights and values in Australia, takes a different view. “Government funding helps ensure these schools remain accessible to ordinary Australian families, not just the wealthy,” she said. For Yuen, the issue is not about exemptions or privilege but about recognizing the role faith-based schools play in the national education landscape. “Funding religious schools is not a favor; it’s a recognition that these schools are partners in the national education task.”
Yuen also defended the legal provisions that allow schools to make decisions aligned with their religious beliefs. “[T]he existing legal protections for religious schools are not about ‘discrimination’ in a pejorative sense. They are about safeguarding the integrity of the religious mission,” she said. “If a religious school is compelled to hire staff or affirm student behaviours that contradict its beliefs, it effectively loses its right to operate according to its faith.”
Australia’s funding system stands in sharp contrast to that of the United States, where the separation of church and state in schools is far more clearly defined. In the U.S., private religious schools typically do not receive direct government funding. When they benefit indirectly, for example through voucher programs or tax credits, they generally must comply with federal anti-discrimination laws. While there are legal debates around religious freedom and LGBTQI+ rights in the U.S., the principle that public money requires adherence to public standards is more firmly established than in Australia.
Critics of the Australian educational funding model argue that if schools receive taxpayer money, they should be held to the same anti-discrimination standards as any other publicly funded institution.
Lucas Lixinski, a professor at the University of New South Wales School of Global and Public Law, sees the current funding structure as inherently problematic. “Australia has a very fragmented legal arrangement when it comes to rights,” he said. “And, because Australia relies on religious schools to deliver basic education and subsidizes them, we end up with this weird situation in which the government funds religious institutions to deliver state functions, but without the means to enforce the separation between church and state.”
Lixinski believes reforms are needed to address this contradiction. In his view, removing certain faith-based exemptions “would go a long way in affirming the rights of LGBTIQ+ students and staff, as well as the rights of unwed parents, who could be subject to exactly the same discriminations if based on religious precept.”
In March 2024, a high-profile report was released by the Australian Law Reform Commission, examining religious schools and their ability to discriminate against staff and students despite receiving public funding. The commission recommended legislative changes to end longstanding legal exemptions that allow these schools to receive government money while discriminating against LGBTQ+ students and staff.
Although the report was embraced by the government, the attempt to change funding legislation, alongside several other equality measures, failed, after which Prime Minister Anthony Albanese ruled out resuscitating the legislation. Religious lobby groups were fiercely against these amendments, arguing that they would inhibit “religious freedoms” and would not allow Australians to live according to their beliefs.
Australia’s Catholic education system, as one of the biggest non-government education providers, has a lot of political clout, especially in marginal districts where Catholic voters can swing an election. With compulsory voting, politicians usually don’t want to risk upsetting these influential players. So, while over the years there have been repeated promises of change, the issue remains politically charged and unresolved.
For many in Australia, the issues around school funding highlight a broader reckoning about Australian life: should any institution that receives public money be allowed to violate the inclusive values that public funds are meant to uphold?