QIS BGA ensures that its principles of application assessment are in line with the legislation and guidelines provided by each level of Government (Australian and State). Such principles are applied when making decisions on the capital grant recommendations provided to the respective Ministers for Education.
QIS BGA provides the following as overarching guidance for school authorities making applications for capital assistance.
- The Similarity of Australian and State Government Legislation and Guidelines
- Minimum Viable Project
- Maximum Financial Contribution
- The Management Capacity of the School
QIS BGA administers both Australian and State Government capital assistance for independent schools in Queensland. QIS BGA will apply the similar intent of both sets of legislation, thereby ensuring that all funds are allocated on the basis of the determination of educational and financial need. In the same vein, both sets of legislation support that all eligible applicants may not necessarily receive capital assistance, as a matter of course.
However, there will be instances where either Commonwealth or State legislation will dictate how application information will be assessed or how capital assistance will be allocated. An example of difference is the requirement that, when assessing whether a school is eligible for Australian Government grants, QIS BGA is obliged to take into consideration how the project will contribute to the CGP objectives.
It is the responsibility of the BGA to determine the minimum viable project which will satisfy the identified educational need for the proposed project. The project will be consistent with sound educational planning, within the school and the environment in which it is operating.
If the proposed project is in excess of that which has been established as the minimum viable project, QIS BGA will be obliged not to recommend that the Minister/s contribute any funds towards the excess. On occasions, QIS BGA is requested by applicant schools to contribute to more than the minimum viable project. The school authority would need to present a compelling argument for such consideration.
After the school visit, the primary task of the Education/Buildings Capital Advisory Committee is to confirm the minimum viable project established, and advise the Finance Capital Advisory Committee if capital assistance should be considered for allocation to the proposed project.
When determining the financial need of a school, in relation to the minimum viable project, QIS BGA will establish the maximum amount a school can contribute towards the proposed project from its own resources. Resources may come from fees, loan funds, cash reserves, budget surpluses, Parents and Friends Associations, or foundations. It is, therefore, a primary task of the Finance Committee to determine the maximum financial contribution a school can make to the minimum viable project without detrimentally affecting the school’s recurrent effort.
The two primary sources of funds available to schools for capital purposes are usually loans raised and fees charged. In establishing the maximum amount a school could be expected to contribute from its own resources to a project, QIS BGA will consider such issues as:
- The school’s debt position
- The school’s income
- The school’s costs of operation.
QIS BGA is obliged to consider a school’s total income and any capacity it may have to contribute further to the cost of a capital project. The school will be required to supply QIS BGA with financial data, including audited documents, that validate the school’s financial position.
QIS BGA must be convinced of the future solvency of a school before making a recommendation to the Minister/s for a capital grant. It is recognised that what may be regarded as an appropriate, finance based benchmark will vary from school to school, so a range of criteria have been developed that enable broad finance based indicators to be established. The Finance Capital Advisory Committee has the responsibility of advising the QIS BGA Board of Directors on matters such as:
- Debt per student
- Expenditure per student
- The cost per student of “other” teaching and administration expenses
- Teacher salaries (per teacher average)
- Student/teacher ratio
- The fee structure as a source of income
- The appropriate surplus in recurrent income which is available to service debt – annual debt servicing as a percentage of income
- Future cash flow projections.