How will our children cope??

As we watch our child and his friends wander merrily through primary school we seriously doubt the validity of the current Western Australian Education System. To me it seems that our children are being dumbed down. Perhaps partly because of increased class numbers, it appears the class moves forward at the slowest students pace, or, alternatively, the slow ones get left behind to fend for themselves. I know of families that have relocated to other states and have had to put their children back one year because they were behind for their age group.
It seems lots of kids cant spell, do their 1 - 12 times tables, divide or multiply without a calculator and with all this there is no homework.
Children seem to have lost their ability to go outside and invent a game to play that can keep them occupied for hours. They need computers, game boy, X-box etc.
And I can't help but mention their punishments which include "reflection time" and a "time out" room.
Our son is in the public school system, but having met quite a number of children that have come through the Private system I am skeptical that there is that much difference.
If a child comes out of Grade 6 without being able to write moderately well, spell correctly, add and subtract in their head and their idea of discipline is 5 minutes spent staring at the wall......what real chance have they got???