Many of the nation's lite private schools have decided to boost fees by up to 10 per cent, although Australia's inflation rate remains at only 3 per cent.
Several of the top schools have set new fee levels of more than 10,000 dollars (#163;5,000) this year but the cost of uniforms, books, excursions and other charges will mean an additional outlay for parents of #163;1,000 or more.
The schools argue that the price rise is necessary to cover increases in teacher salaries and to purchase new computer technology that is needed to keep the schools competitive.
But parents' organisations attacked the increases, saying that spiralling fees would impose an even greater burden on families struggling to give their children a private education.
Almost 30 per cent of Australian students attend private schools although the great majority of these are in the Catholic system. While the fee increases may force some parents back into the public education system, they also coincide with the introduction of a new federal government policy that effectively deregulates private schools.
The conservative government of prime minister John Howard announced last August that from the start of this year it would scrap the previous, Labor-imposed guidelines that placed limits on the establishment of new private schools. The restrictions meant that any proposal to set up a new school with backing from the government had to take account of the effect on existing government and non-government schools.
Supporters of state schools fear that lifting the restrictions will result in a flood of new schools opening, with a devastating impact on the state system. Under the new policy, for every student who moves to a private school, government schools will lose Commonwealth funding equivalent to nearly five students.
l The former headteacher of an lite Sydney private school, who once taught Prince Charles, is to chair a Dearing-style inquiry into higher education.
Roderick West was head of Trinity School for 21 years until his retirement last year. His appointment, which has shocked the education unions, led to further alarm after he said in a radio interview that education and training were separate.
Sharan Burrow, president of the Australian Education Union, said the comment revealed "appalling ignorance about the nature of tertiary education in Australia".
The committee has been asked to identify options for the financing of higher education teaching and research, including the balance between private and public funding.