The Department of Education should review its "heavy-handed" process for closing down small schools, a NSW parliamentary inquiry states, recommending that Martins Creek Public School in the Hunter Valley should not be shut down in December but stay open until at least 2019.
The report found that small schools can provide a positive impact in communities.
"In light of the educational and social significance of small schools, the NSW Department of Education carries a weighty responsibility to ensure that the decision about the future of any school is well-informed, carefully judged and managed effectively," the inquiry says.
It emphasises that the Department should treat parents' concerns with respect when considering the closure of a small school.
Lobbying from parents at Martins Creek and Wollombi PS, another small Hunter school closed down last December, prompted the Upper House inquiry.
The inquiry chair, Christian Democratic Party (CDP) MLC Paul Green, urged Education Minister Adrian Piccoli to adopt a compassionate approach, noting especially that a child with complex needs studying at Martins Creek should be allowed the opportunity to complete primary schooling there.
The finding of the inquiry is, "That there is evidence that small schools, particularly at the primary level and particularly for small and regional communities, can contribute to positive outcomes for students and for local communities."
The inquiry makes a series of strong recommendations on the process through which a small school is closed down.
The inquiry recommends the Department should amend its Protocols for Schools where Recess, Closure, Amalgamation or Other Educational Provision Models are to be considered.
The report says the protocols should require the Department's Director and the small school principal to consider at Stage 1 any strategies to boost enrolment and for the School Consultative Group to not proceed to closure until these strategies had been developed and implemented.
Pointedly, the report says the language of the protocols ought to be changed to make it clear whether they are intended to genuinely facilitate consultation with parents and other stakeholders on a proposed closure or to merely help stakeholders along the path of accepting that a closure decision had been made.
The Department should make publicly available the evidence base it uses to support educational outcomes and small schools and also the criteria it adopts to place the future of a small school is placed under review.
The report says: "The [inquiry] committee is concerned by the heavy-handed way in which the Protocols themselves, and the broader process of school closures, have been implemented in some cases. There is a strong pattern in the evidence before us - from Wollombi, Martins Creek, Crowdy Bay, Grong Grong, Gosford and beyond - that this is a very significant issue. It appears that the Executive Director and Directors have not fully appreciated the enormous personal investment that parents make in the education and life of their child, nor the immense value that families and community members place on their school as a pillar of their community."
The Department should publish on its website "an action plan on the organisational culture surrounding school closures with particular reference to the need to be respectful and understanding towards parents".
There should be an independent audit into the Department's methods of handling the concerns of parents at Martins Creek and Wollombi.
Mr Green expressed sympathy to the families at Wollombi that the inquiry came too late to save their school.
A spokeswoman for the Education Minister said Mr Piccoli had asked it to carefully consider the Select Committee's recommendations and findings.
Greens MP John Kaye noted the report came from "a multi-party inquiry, where everyone agreed that for once we should put the best interests of the child, and the compassion for his specific needs, ahead of the chequebook policies that normally dedicate the closure of small schools".