Illiteracy costs the nation up to $44 billion per year, Code Read report finds

An investment of $942 million in five measures to improve reading instruction in schools would deliver a $12 billion return, according to the "Saving Money by Spending: Solving Illiteracy in Australia" report commissioned by the Code Read Dyslexia network.

Report co-author Jessica Del Rio of Equity Economics said it had been submitted to the National School Reform Agreement expert panel to give suggestions on how taxpayer money could be spent most effectively.

"There's a lot of money flowing into schools and there will be more money with the increase to the schools resource standard. The question is how can that money be put to best use?"

About $60 billion was spent on education in 2020 but Australian reading levels have not been improving on national and international benchmarks.

The report identifies the ACT as being a top performing jurisdiction in NAPLAN and the international PISA test scores, but among the worst for NAPLAN progress from years 3 to 5.

Victoria and ACT are identified as the poorest performing jurisdictions when it comes to consistent implementation of an evidence-based curriculum and use of best practice training and pedagogy.

ACT and Queensland are ranked the worst for consistent screening and progress monitoring.

South Australia, NSW and Tasmania are leading the way when it comes to implementing evidence-based instruction in their school systems, however Ms Del Rio said all systems had room for improvement.

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She said the education system could borrow the health system's concept of hospitalisations that could be prevented through easy interventions such as vaccination or a visit to a general practitioner.

"We need to be looking at what are the potentially preventable instructional casualties that are arising from poor pedagogical and curriculum materials and practices in schools, which are well known and have been well known for over 20 years.

"Because at the moment there does not seem to be any appetite to try and reduce the number of children who are falling below the benchmark."

The report says funding should be spent on:

Ms Del Rio said the $12 billion in return on investment was calculated based on research which showed small-group tutoring provided a child four months of extra learning and that each additional year of learning increased income by 10 per cent on average

"We use this to estimate the lifetime earnings for the 20 per cent of children with lower levels of literacy who are likely to need extra support and that comes to an overall figure of $12 billion," she said.

"But that's a conservative figure, as it assumes that only the students behind in reading who require intervention benefit, and it doesn't include the learning gains of other students in the class and it also doesn't include the benefits arising from all the cost of recommendations for which there are data limitations."

Ms Del Rio said lower literacy levels affected a person's quality of life because it impacted their health, mental health, ability to gain employment and their income level.

"It's almost impossible for a person who has lower levels of literacy and who has not got a job and poor health and poor mental health to be able to escape that lack of advantage."

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