I believe that private education should not only not be funded by the state, but should be banned completely. There's not a lot I want to ban in this world, so it's an unusually extreme position for me, but I really don't think there is an ethical way to run private schools.
This is not a question of choice, because only wealthy people get to make the choice. Also, the choice they are making is to segregate their children on the basis of class or religion (or both). The closest private school to us costs $30,000 a year, per child, in year 12 (it starts at about $18,000 in year 3). The argument that such a school can provide better resources for your wealthy child is a very weak one. Imagine how much better any local public school's resources would be if all the families who could afford that kind of money donated even half of it to the school and sent their kids there? By allowing children to be stratified based on parent income, we are ensuring that wealthy children have access to more resources than poor children, and thereby reducing the choice and options of the most disadvantaged kids in our community. That's wrong.
Australia makes claims to multiculturalism, but allows kids to be segregated on the basis of religion for 13 years of their young lives. Understanding is crucial to successful multiculturalism, but it's hard to achieve if you have little contact with people from differing backgrounds. School is the primary source of social interaction for most kids, and should involve a diversity of people. If we're going to live together, we should be learning together.
Private schools promote themselves as a better choice, providing a better education. The truth is that the range of educational experience is as great in private schools as it is in public schools, however I've never heard a public school graduate argue that they would never consider sending their child to any school other than the one they attended. There is a fine line between pride in your school and the smug belief that your school is inherently superior to all others. I'm not arguing that all private school graduates believe this (I know that is patently false), but a system in which schools are competing for students is going to breed an increased rate of superiority complexes.
Educational outcomes are highly variable across both the public and private sector, but the private sector faces a significant roadblock to good education - they are a commodity. Parents are paying for education as a service, and as such are far more likely to demand the outcomes they want, as opposed to those that their children have earned. This happens in the public sector too, but the demanding parent doesn't have a financial hold over the teachers and the school. Education is too important to be caught between a teacher and the finance department.
Education as a commodity also has the potential to undermine education at the systemic level. If schools are competing for the educational dollar, it's in their interest to make their school look the most attractive. A tried and tested method to do so is promoting year 12 examination results, but to do that, a school needs results that look good. One way of doing so is to only allow students to take courses they will do very well in, rather than those in which they may be competent, but not outstanding. For example, a student working at a fair to middling level in an advanced level maths course may be required to take the intermediate level course so they get a high mark in lesser course, which looks better on the school's published results. I am certainly not arguing that all private schools do this, but some do, and it wouldn't happen if education was not allowed to be bought and sold.
Other systemic problems can arise from a school's marketing department. A great way to get good exam results is to teach students how to pass exams. While I understand the usefulness of that skill, it should always be secondary to learning how to learn, fostering a love of learning and promoting independence. We don't spend all this public money on education for exam results, we spend it to have an educated society that is able to continue learning their whole lives. These qualities, however, are very hard to measure, so it's easy for a school to claim to promote such values, while spoon feeding their students to pass exams really well and make their self promotion that much easier. Same caveats apply - not all private schools do this, quite possibly some public schools do this, but if education was not a competitively sold commodity, it wouldn't happen. Public schools are explicitly told they need to compete with private schools and market themselves to the community. This is wrong.
Perhaps the most abhorrent argument in favour of sending a child to a private school is that they'll make connections that will make it easier for them to get ahead socially and financially. It's probably also the most accurate - at least for the very expensive schools. Schools should not be a government funded and sanctioned process for ensuring rich people look after other rich people and maintain the divide between rich and poor. I really would have thought that was self evident. Of course, our government is largely made up of people who have benefitted from that process, which probably explains the bipartisan support for maintaining the status quo.
This is one of the greatest issues of equity in Australia at the moment. It gets no press. Occasionally there might be mention of funding, but it's quickly swept under the rug (how many media owners went to public schools?), and nobody ever questions the continuing existence of education as commodity. It's not an impossible dream (however unlikely),