The global economic battle is being fought partly in our schools and universities. A skilled and creative workforce is a vital ingredient of economic success, yet we have little systematic information about the success of our educational efforts. This article is necessarily more anecdotal than usual, as hard data is scarce. The lack of hard data is in fact a major issue since, as someone once said: 'If you can't measure it, you can't manage it.'

Universal free primary education was established in the Australian States in the late nineteenth century. Numbers enrolled grew steadily in line with population until there was a major surge in the post world war two decades with the extension of compulsory education into the mid teen years. The proportion enrolled in private schools declined until the early 1970s but has since steadily increased. This is partly due to increasing wealth but growing dissatisfaction with the government sector is a major issue with the middle classes.

Class sizes seem to have varied a good deal during the century, although the available figures do not mean much. Early in the twentieth century, there were a lot of single teacher schools and when times were tough teachers were sometimes told to handle two schools. (In Gippsland in the 1920s, for example, Henry's father saw a teacher only every third week.) In 1906, the ratio of student to staff member (the best proxy we have for class size) was measured at 30 in government schools and 15 in private schools. This ratio declined in government schools and rose in private schools until both achieved a ratio around 25 in the early 1960s. Thereafter, ratios in both systems declined to around 15 in 1998.

These figures, and others quoted here, come mostly courtesy of the Centre for Independent Studies' excellent State of the Nation, 1999. On the issue of class size, the CIS authors comment: 'Within wide limits, it now appears that class size has little effect on the quality of education and teacher quality is more important.

State government legislation excludes much information on school performance under the Freedom of information Act. As a result, there is no feedback of teacher and school performance, and parents are denied informed choice.' Of course, parents scan the HSC results and there can be no doubt that the selective government schools and the leading private schools disproportionately feature in the league tables of results each year.

Ironically, however, tertiary educators notice that kids from less privileged backgrounds disproportionately shine at university, which is usually attributed to the fact that they have had less spoon-feeding at school. (As a student from a prefabricated high school without a library, the young Henry Thornton first noticed this effect almost 30 years ago.)

Retention rates in secondary education have risen strongly in the past 30 years. For year 10, the overall rate has risen from 80 to almost 100%, whilst for year 12 the equivalent rise is from 30% to just over 77% in 1992 with a fall to just over 70% in 1997. Retention rates in government schools have actually fallen in recent years, whilst they have continued to rise in private schools - the 'flight to quality' for the final push being the reason.

The CIS authors examine some interesting data that show that the overall cost per student is actually higher in the government schools. Although they do not make this point, together with the anecdotal evidence on the quality of results, this suggests that the private school system is massively more efficient. However the CIS authors are at pains to note that: 'Pupil attainment, or the outcomes of education, is not treated in Year Books, and is virtually undocumented in official reports of the past decade.'

Two of the Thornton kids have recently transferred from a good middle-class government school to leading private schools, whilst the youngest is still learning how the other 90% get educated. We have no doubt that the private schools are more innovative and much more rigorous. It is sad to report that our youngest last year was in a composite primary/grade one class with six ability levels and a teacher who on her own admission was unable to cope without the voluntary assistance of mothers who between them helped out most days. Our nipper had read all the books by half way through the year, and the teacher explained that there were simply not enough books to keep the class occupied. What is the situation in the poorer geographic locations, I ask myself.

Despite the general dearth of information, there are some international comparisons thanks to successive surveys by the International Association for the Evaluation of Educational Attainment. The CIS authors report: 'The consistent top maths and science performers were Korea, Singapore, Japan and the Czech republic in years 3 to 8, with Sweden, the Netherlands and Iceland taking the top positions in the final year. Nevertheless, Australia is consistently higher than the international average.'

There is also a 1996 survey by the Australian Bureau of Statistics, 'Aspects of Literacy: Assessed Skill Levels'. This survey covered 9,300 fifteen to seventy-four year-olds. A small majority of participants demonstrated literacy and numeracy skills that were described as 'able', 'good' or 'very good'. A staggering 46-48% of participants had literary skills that were considered either 'poor' or 'very poor'. This survey also revealed that only 50% of primary teachers and around 70% of secondary school teachers have literacy skills that are either good or very good.

What could be called self-education has changed greatly in the past 30 years. When Henry was a kid we roamed the outer suburbs exploring, fishing, stealing apples and indulging in mild gang warfare. Now the modern parent involves their kids in far more structured (but protected) activities - which parent has not spent hours driving kids around on the weekends? When not involved in sporting or cultural activities, kids spend a lot of their spare time surfing the web or playing computer games, which often involve what seem like massive levels of virtual violence as well as fast reaction times and intricate problem solving. The net effect of the change in self-education is impossible to predict, but may not be all negative.

The Tertiary Tangle.

Tertiary education apparently received a major boost in the decade from 1983 to 1993. Partly this is due to the Labor government's upgrade to university status of collages of advanced education, although this was overlaid on a steady long-term trend to more tertiary education. The 1996 university education rate, at almost 600 per thousand, was 36 times the rate in 1913.

There have also been dramatic qualitative changes on campus. University education overall is far more 'practical' and vocational, and university teachers are far more pressured, than they were a mere thirty years ago. Whether this is ultimately a good or a bad thing remains to be seen, but there is a widespread sense of crisis and demoralisation among Australia's higher education professionals.

Leading educators are well aware of the challenges before them. The Vice-Chancellor of Melbourne University, Professor Alan Gilbert, provided a brilliant example in a recent Bert Kelly memorial lecture. Professor Gilbert predicted that the demand for higher education is likely to grow enormously over the next decade, as the economy becomes more knowledge-based. Universities are likely to be faced with the rise of non-traditional competitors clearly focused on the needs of commerce and industry and less concerned with the pursuit of knowledge for its own sake.

Put simply, Professor Gilbert's thesis is that the traditional universities need to work with the corporate challengers or wither into insignificance. Global spending on tertiary education is currently estimated to be of the order of US$1.5 trillion a year. By 2006 this will be US$3.0 trillion, doubling again to US$6.0 trillion by 2012. This explosion of demand parallels that faced by handloom weavers at the start of the industrial revolution. Many handloom weavers were unable to cope and some became luddites, protesting vainly at the new technology instead of adapting to it.

Our universities have a proud 900-year tradition and can play a leading role in meeting the coming explosion of demand for educational services. Or they can sink into despair and become the luddites of the twenty-first century, inhabiting what Professor Gilbert calls a 'twilight golden era'.

From all accounts, Australia's universities are closer to the second response. As one local example, the divided philosophers of Sydney University are having a massive punch-up about co-location of pigeonholes, whilst ignoring many urgent contemporary ethical and philosophical issues. Paul Sheehan recently wrote in the Sydney Morning Herald of the 'powerful and pervasive despair' in Australian universities. The academics have had a monopoly for 900 years, but that is quickly breaking down under irresistible market pressure. They can fight this or work with it. Visionary leadership is needed, and key decisions are being made now.

In the United States there are somewhere between 1600 and 2000 'corporate universities.' The UK Government has just announced a major program to encourage British universities to enter alliances and joint ventures with corporations and Internet providers to create e-universities. In Australia, the leaking last October of Dr Kemp's plan to deregulate our universities so that they could work more effectively in the emerging global market for education produced a massive backlash from the luddites and an equally massive back down by the cabinet.

What can be done? Professor Gilbert will no doubt keep fighting what he calls 'public policy paralysis' in official circles. He has also created Melbourne University Private, and there was the recent share market float of Melbourne IT to show one way forward. Many people in Melbourne university, and no doubt others also, are thinking hard about how to break the shackles of an official policy that simultaneously squeezes resources whilst retaining a policy straitjacket which prevents the universities from creating a viable future.

The major global corporations are scouring the world looking for resources and ideas. They will be quick to form alliances with academics with established reputations for quality, a brand in the commercial argot. Professor Gilbert reminded his audience that the 10 best academic institutions in the world today are largely or wholly private.

In all this there is a clear role for the key educationalists. It is to maintain core academic values, to insist on quality, freedom of expression, self-determination and respect for traditional values, 'like monks protecting standards from the encroaching barbarism.' All this will require courage and money, but above all a will to fight and to adapt. There are more profound threats today than in the past 900 years, but also more opportunities.