Australia's Largest Islamic School Just Got Stripped of Government Funding

Australia’s largest Islamic school is considering next steps after the federal court upheld a decision to strip its government funding. Malek Fahd Islamic School in western Sydney has been locked in an ongoing legal battle with the government for almost two years, after losing $19 million of annual taxpayer funding in April 2016.

The school, which runs three NSW campuses in Greenacre, Hoxton Park, and Beaumont Hills, teaches some 2,500 students from prep to Year 12. For the past two years, it's been able to continue operating by making legal appeals and serious changes to how it runs.

Despite these reforms, the federal court still upheld the decision to cut funding, which was made by the NSW Administrative Appeals Court last year.

At the centre of Malek Fahd's legal troubles is rent paid to the Australian Federation of Islamic Councils (AFIC), which owns the land its three campuses are on. A court initially found the AFIC ballooned the cost of rent above market rates, earning profit from the school. This violated education funding laws.

Justice Nye Perram said the school “did its best” to stop paying rent but were thwarted by the lease arrangement and growing rental costs. The judge said the school's appeal should be dismissed, and it should pay costs. "The appropriate course is for the Applicant to make a fresh application," he said, instructing Malek Fahd to ask education minister Simon Birmingham for funding.

Minister Birmingham criticised the school’s “misuse of taxpayer funding” and demanded Malek Fahd immediately outline “their plans to give their school community certainty for the future."

“I have contacted the NSW Minister for Education Rob Stokes and our departments will work together to support the school’s students, families and staff,” Minister Birmingham told The Australian. “I urge Malek Fahd’s management to clearly outline their plans to give their school community certainty for the future.”

“It’s the students and the staff and the parents who are being penalised for things that happened well before this board was in place,” said the school’s board chair, David Bennett.

Meanwhile, the Islamic School of Canberra has won its own legal battle to have its federal funding reinstated. The decision comes after a year-long battle to prove its independence from the AFIC.

For Malek Fahd the next, and only, option to keep the school open will be advancing the case to the High Court in front of the Education Minister himself. In the meantime, the school remains open with “business as usual," says Bennet.

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Additional reporting by Maddison Connaughton.