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Student Resource Package — Equity Funding (Student Based Funding)

Equity (Social Disadvantage) (Reference 11)

Funding for Equity (Social Disadvantage) provides an individual loading for students from disadvantaged backgrounds that will increase with the density of disadvantage at the school. Social disadvantage can often place students well behind their peers when entering the education system. Increased funding for schools has proven to raise educational outcomes, particularly for these students. Schools will use Social Disadvantage funding to deliver tailored educational programs that meet the needs of this cohort of students.

The Equity (Social Disadvantage) loading allocates funding based on parental occupation, parental education and the level of concentration of disadvantage in a school. Students with the highest level of need will be targeted with the most funding to ensure schools have the resources to support them. The loading is need based, however to increase year on year stability for schools, a floor on negative funding changes and a weighted rolling average is applied to this loading.

While having similarities to the former Student Family Occupation (SFO) index, the Equity (Social Disadvantage) funding contains some important differences:

  • Social Disadvantage utilises both the Student Family Education (SFE) and SFO index, further strengthening the targeting of existing and new equity funding.
  • The median threshold previously used under the SFO for equity no longer exists.
  • All students identified with high needs will be provided with funding.

Eligibility

  • All School types are eligible, students identified with high needs will be provided with funding at school level.*

Funding will be calculated at the Indicative budget cycle only, schools are provided with cash and credit funding.

How social disadvantage is identified

The level of Social Disadvantage is measured through the student’s Student Family Occupation and Education (SFOE), which is a combination of their SFO and SFE categories. The matrix below in Table 1 depicts the possible SFOE categories a student may have. These categories are used to determine which students come from disadvantaged backgrounds and the Social Disadvantage loading they would attract. There are two levels of Social Disadvantage loadings available, depending on the student’s level of need: 

Level 1: For students with parents who are unemployed with below diploma level education or have lower skilled jobs with very low or low education

Level 2: For students with parents who have various combinations of medium and low skilled jobs and education levels, or are unemployed with a diploma level education

Table 1

The letters (A to U) in the far right columns reference SFO categories

CASES21 Code Education Category
A B C D N U
0 SFE Not Stated/Unknown 0 0 0 0 0 0
1 SFE Yr 9 or below 0 0 2 1 1 0
2 SFE Yr 10 or equivalent 0 0 2 1 1 0
3 SFE Yr 11 or equivalent 0 0 2 2 1 0
4 SFE Yr 12 or equivalent 0 0 0 2 1 0
5 SFE Certificate I to IV 0 0 0 2 1 0
6 SFE Advanced Dip/Diploma 0 0 0 0 2 0
7 SFE Bachelor degree or above 0 0 0 0 0 0

The density of need according to each school’s new SFOE index will further weight the Social Disadvantage loadings.

To calculate the SFO index, the parent’s occupation is categorised and weighted according to the categories found in Table 2 below. Data regarding occupational categories is collected each year as part of the August census

Table 2

Category Occupation Grouping Weighting
A Senior management in large business organisation, government administration and defence, and qualified professionals 0.00
B Other business managers, arts/media/sports persons and associate professionals 0.25
C Tradesmen/women, skilled office, sales and service staff 0.50
D Machine operators, hospitality staff, assistants, labourers and related workers 0.75
N Unemployed & pensioners (for 12 months or longer) 1.00

Data recorded in the August census as 'unknown' is allocated to the SFO density category as ‘Occupation Group A’ and attracts a zero weighting.

For detailed categorisation of SFO occupational categories please refer to the link below:

SFO.aspx

SFO, SFO and SFOE index calculation

The SFO index is then calculated using the method below: 

SFO calculation = (number of students x weighting for each occupational category) / total number of students based on the occupational groupings and weightings in Table 2

To calculate the SFE index, the parent’s educational qualification is categorised and weighted according to the categories found in Table 3 below. Data regarding educational qualification is collected annually as part of the August census.

Table 3

CASES21 Code Qualification Grouping Weighting
0 Not stated/Unknown 0.00
7 Bachelor degree or above 0.00
6 Advanced diploma/Diploma 0.40
5 Certificate I to IV (inc. trade certificate) 0.50
4 Year 12 or equivalent 0.40
3 Year 11 or equivalent 0.70
2 Year 10 or equivalent 0.90
1 Year 9 or equivalent or below 1.00

NOTE: CASES21 Code 8 is No non-school qualification and defaults to the highest year of school completion.

The SFE index is then calculated using the method below: 

SFE calculation = (number of students x weighting for each educational category) / total number of students

To determine the SFOE index with the SFO and SFE indices, the following calculation is used:

SFOE calculation = (SFO index + SFE index) / 2

Example: If a school has an SFO of 0.6342 and an SFE of 0.6156, the SFOE index would be 0.6249.

How social disadvantage funding is calculated

Social Disadvantage funding is allocated to schools based on the number of eligible students. Measures are applied to provide more stability in funding while reflecting the need profile of current and more recent student cohorts. A weighted rolling average based on the current year and two years preceding will be used to determine the inputs that Social Disadvantage funding allocations are based on. The weightings are 70 per cent of the current year, 20 per cent of the prior year, and 10 per cent of the year before that will be applied to the campus SFOE index and the number of eligible Level 1 and 2 students.

To determine how much Social Disadvantage funding a school will receive, the following method is used (weighted accordingly for the current year and the two previous years): 

  • The school’s SFOE will be used to calculate the rate of Social Disadvantage loading each student will attract. Where a school’s SFOE is at or below the Minimum SFOE Threshold, the minimum rate of each loading will be applied and, where it is at or above the Maximum SFOE Threshold, each student attracts the Maximum Rate for their loading. (Thresholds and rates can be found in Table 4). 
  • For schools with an SFOE between the Minimum SFOE threshold and the Maximum SFOE threshold, the rate will be tapered based on their SFOE index. To determine the taper, the following calculation is used:

((Campus' SFOE – Minimum SFOE Threshold) / (Maximum SFOE Threshold-Minimum SFOE Threshold))

This is then applied to each loading rate by:

Min Funding Rate + (Taper x (Max Funding Rate – Min Funding Rate))

  • Once the Social Disadvantage loading rates are determined for the school, it is multiplied by the number of enrolled students eligible for either the level 1 loading or level 2 loading, respectively. The enrolment is based on the students recorded in the August census of the preceding year.
  • The school’s overall Social Disadvantage funding is calculated by combining both the total level 1 and level 2 loadings their students are eligible for. 
  • To further reduce negative funding variability, a $90,000 floor on negative funding changes is applied to a school’s Social Disadvantage funding allocation from one year to the next. This means that a school’s Social Disadvantage funding allocation will not reduce by more than $90,000 year on year.

Example - Social Disadvantage funding for a primary school with the following SFOE and enrolment numbers over three years:

2020 Actual 2019 Actual 2018 Actual 2020 Weighted (70%) 2019 Weighted (20%) 2018 Weighted (10%) Weighted Average
SFOE 0.6021 0.5313 0.5189 0.4215 0.1063 0.0519 0.5797
Level 1 166 174 160 116.2 34.8 16 167
Level 2 118 140 144 82.6 28 14.4 125

Example of Loading calculations for a primary school (excluding the floor):

  • Level 1 student: ($968 + ((0.5797 – 0.3612) / (0.6192 – 0.3612)) × ($5241 – $968)) × 167 enrolment = $765,996
  • Level 2 student: ($484 + ((0.5797 – 0.3612) / (0.6192 – 0.3612)) × ($2622 – $484)) × 125 enrolment = $286,834
  • Total Social Disadvantage funding: $765,996 + $286,834 = $1,052,830

Table 4

Minimum SFOE Threshold Maximum SFOE Threshold Level 1 Student Minimum Rate Level 1 Student Maximum Rate Level 2 Student Minimum Rate Level 2 Student Maximum Rate
Primary 0.3612 0.6192 $968 $5,241 $484 $2,622
Secondary 0.3612 0.6192 $862 $4,653 $432 $2,326
Special 0.5040 0.7336 $968 $5,241 $484 $2,622
Language 0.3612 0.6192 $968 $5,241 $484 $2,622

*A minimum funding allocation = $5000

The enrolment is based on the numbers of Level 1 and 2 students recorded in annually in the August census of the preceding year. Data for 2021 is calculated using August 2020 census data submitted by schools and is not adjusted for the 2021 calendar year. The rolling weighted average also relies on August census data from the two periods prior (2019 and 2018).

Equity (social disadvantage) funding displayed in the Student Resource Package (SRP) reports

Funding calculated through the Equity (Social Disadvantage) formula is displayed in the SRP reports under the section entitled Education State (Including Additional Gonski).

*The equity calculation for Parkville College is undertaken outside the standard formulation outlined in this section.

Reference 11 of the SRP Guide, providing information on equity (social disadvantage) funding including SFOE index calculations

Reviewed 05 August 2021

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