E&OE TRANSCRIPT

Press Conference - Parliament House

Wednesday 28 January 2015



SUBJECT: Higher education reform.

CHRISTOPHER PYNE: Gentlemen. Ladies. Well, first of all, Happy New Year. Welcome to 2015. My first press conference, but not probably my last for the year. Today John Dawkins has exposed the paucity of principle in the current Labor Party by calling on the Labor Party to sit down with the government and negotiate a good outcome on the Higher Education Reform Bill. He's pointed out that it was Labor who were the architects of the higher education contribution scheme in the late 1980s. He's made it clear that while he thinks that our package could be amended and changed and certain ways around scholarships, et cetera to make sure that they are targeted towards disadvantaged young people.



He supports the fundamental principle which is that we need to deregulate the university system. He makes the point in fact that there is no great principle in the Melbourne University and Charles Stuart University charging the same fees for exactly the same course in spite of them being at different institutions. He's exposed that Kim Carr has bought effectively his old-fashioned left-wing Whitlamite agenda to the education policy to the current Labor Opposition and and Bill Shorten has let Kim Carr run this. I'm going to write to Bill Shorten this afternoon offering to sit down with him to negotiate a way of Labor being part of this national conversation because the government believes that the higher education reforms are vital.



Vital for universities, vital for students in spreading opportunity, in promoting equity and in making our universities the best university system in the world with some of the best universities in the world. So that's what I will be doing and I hope that Bill Shorten will respond positively.

It's not just, of course, John Dawkins. Gareth Evans has also called on the Labor Party to support our reforms. Maxine McKew, while not quite a lion of the Labor Party in the way that Gareth Evans and John Dawkins have been, still a recent member of the Labor Caucus and of course Andrew Leigh, the current Shadow Assistant Treasurer is also in favour of the higher education reforms but has had to recant publicly because of his leader's position. So we do call on Labor to sit down and talk with us and we will try and work out the best outcome possible.

QUESTION: Mr Pyne, by writing to Bill Shorten today, is that an admission that you won't get the votes needed from the Senate cross-benchers?

CHRISTOPHER PYNE: No, not at all and of course I've already extended the olive branch to Labor and the Greens in the past on this issue. Lee Rhiannon, to her credit, came and met with me, but we didn't get very far with Lee Rhiannon on this issue, but at least we talked about it. Labor didn't take up the offer last year to talk, because Kim Carr just wants to play politics, and I think Bill Shorten in his heart of hearts knows that the status quo is not an option for universities. And in fact all the vice-chancellors in Australia are saying just that. Even the University of Canberra vice-chancellor admits the status quo is not an option. And so Universities Australia has universally supported our reforms with amendments.



We'll continue to talk with the cross-benchers too and I'll be having a meeting with them in the coming few weeks, refreshed from my summer holiday. I'm looking forward to the opportunity to sit down with the cross-benchers and talk about what they need to support these reforms. At the heart of our reform is de-regulation of the university sector and I believe that we can come into a landing. We will deal with any partner to bring that about, whether it's the Greens, Labor or the cross-benchers.

QUESTION: What's the status of the 20 per cent funding cut and can I ask is that tied to the scholarships? If you don't cut the funding do the scholarships still materialise?

CHRISTOPHER PYNE: No, the scholarships are tied to the increased fees that some universities will charge in some courses. One in every five dollars will need to be put aside for a scholarship for disadvantaged young people and people from rural and regional Australia. That's quite separate to the reduction of the Commonwealth grant scheme subsidy. I have no idea where the story in the front page of The Australiancame from a couple of weeks ago. It certainly did not come from me. It didn't come from the Prime Minister's office and therefore it's mere speculation and I won't be engaging in a public running commentary based on speculation.

QUESTION: Minister, how can you say you're inching closer to success on these reforms when you don't have the support of Labor, the Greens and you don't now have any support from any of the cross -benchers locked in?

CHRISTOPHER PYNE: Well, I think that is a false analysis of the situation.

QUESTION: The fact that we're discussing extra scholarships and so forth - an admission that it is going to drive up the price of education for those that have to pay. And what do you say to the middle class, the 80 per cent of middle class kids from middle class families who will just be paying more?

CHRISTOPHER PYNE: Well, Phil, that displays an ignorance of the higher education contribution scheme and how the university sector works. It's the same hackneyed argument that was used when HECS was introduced in the late 1980s. The suggestion that somehow charging students for their university degrees would lead to a lower number of students going to university and a demographic shift to upper middle class and higher incomes. In fact, quite the opposite happened.



There's been an explosion of students going to universities since the Higher Education Contribution Scheme was introduced which has born no relation at all to the cost of universities. When Brendan Nelson allowed universities to increase their fees by 25 per cent in 2004 the number of students going to university increased. The demographic breakdown of students at university has progressively increased from low SES backgrounds since 1988. Not because of the Higher Education Contribution Scheme deterring kids from lower SES backgrounds going to university, but actually for the first time giving them the impetus to know they could go to university with no up-front fees. It's also of course led to a large increase in revenue into universities, which has meant they’ve been able to expand their courses, expand their universities, so I think now something between 750,000 plus Australians are getting to go to university. So that old Whitlamite argument that you've just rolled out again doesn't actually bear any relation at all to the facts.

QUESTION: Can I ask a follow up there?

CHRISTOPHER PYNE: Because your first one didn’t go so well.

QUESTION: I was asking a question, Minister, I wasn’t making an argument.

CHRISTOPHER PYNE: I think you were making an argument. But nevertheless, I’m in a very happy mood today, so I’m not going to argue with you about it.

QUESTION: Twenty per cent funding cut, that would add to the cost of a degree because the university would have to make that up as well as charge what they feel they need to charge. Do you think you will have a better chance of getting Labor on board if you got rid of that 20% or you whittled it back?

CHRISTOPHER PYNE: Well I'm not going to have an ongoing commentary about what the government's negotiating position's going to be. We've said all along that there will be an increase in some course fees, all of which will be able to be borrowed from the taxpayer at the rate of indexation of the consumer price index. It's the best loan a student will ever get in their entire lives. We also are expanding the demand-driven system to the pathways programs so that 80,000 more people get the opportunity to do the kinds of courses that lead to undergraduate degrees.



We're also expanding the Commonwealth Grants Scheme to non-university higher education providers. This reform is about expanding opportunity to more Australians to get the private benefit of going to university. Now why is it that students have gone to university in ever increasing numbers and in spite of the debate over the last 12 months the number of students enrolling this year at university is actually the same or increasing across courses because they know that in spite of fees being charged they can borrow every dollar from the taxpayer under the Higher Education Contribution Scheme.



They can pay it back when they start earning over $50,000 and they get on average 75% increase in earnings over a lifetime, better health outcomes, longer life expectancy and the lowest unemployment rate in Australia. Now that is a fantastic outcome and Kim Carr's argument that somehow students will be put off going to university because of these reforms has already been exploded this year because the facts are enrolments are the same or increased on last year.

QUESTION: To say that you can’t count on any cross-bencher’s support is a false analysis, what’s the correct one? Whose support can you rely on?

CHRISTOPHER PYNE: Well, last year when the government introduced the first reform Bill, four cross-benchers out of eight voted for the second reading. So the analysis that we have no support from the cross-bench is false. If you actually analyse the statements being made by the cross-benchers they are not very different to the statements they made at the end of last year and therefore I take great heart from what has been said by the cross-benchers earlier this year and even today that I have every prospect of this bill passing.

QUESTION: That wasn't enough support.

CHRISTOPHER PYNE: I've got to get six votes. I'm in politics, I have won eight elections. I know you have to actually get 50 per cent plus one and that’s what I’m working to achieve. And I believe we will achieve it.

QUESTION: Mr Pyne, the thing that Senator Xenophon has said is that he will support an increase fees but caps remaining on them and some vice-chancellors have also supported that. Something that might appeal to Senator Leyonhjelm is that the HECS debt would remain capped, it wouldn’t be such a risk for the tax payer. Is that something you would consider having a look at?

CHRISTOPHER PYNE: We will consider every suggestion by the cross-benchers because the fundamental core of this reform is the deregulation of universities. Now, I will talk to the cross-benchers one-on-one. I certainly won't talk to them through the lenses of Sky Television. I will talk to them one-on-one and I will get from them what they think they need to pass this bill and if the government can meet their requests then we will meet them.

QUESTION: But would an increased cap on fees - would that be something - that is considered, is that deregulation?

CHRISTOPHER PYNE: Matthew, I’m not going to speculate on what the Government will or won't do in its negotiations. We are a long way from resolving this matter. I think there's a lot of water to go under the bridge before this vote is put to the Senate and I'm looking forward to higher education reform being at the centre of our legislative agenda.

QUESTION: When will it go to the Senate?

CHRISTOPHER PYNE: When it's finished being debated in the House of Representatives.

QUESTION: Minister, is it still possible to achieve big budget savings with the higher education package given you had to sacrifice about $3.5 billion in the negotiations with the cross benchers?

CHRISTOPHER PYNE: I think you’ll find, though, Andrew, that the savings in the amendments that we've already put were off the cash balance sheet of the budget. They were about the value of the HECS debt owed to the Australian taxpayer by former students. So now we're dealing with the issue of the actual savings on the cash balance sheet. It's a different matter. It was always a rather an inflated sense of savings because in fact the HECS debt is something that we have to collect in the future. It's an asset owned by the taxpayers of Australia.

QUESTION: Is the Prime Minister out of touch with the Australian people?

CHRISTOPHER PYNE: No.

QUESTION: Do you support his decision to grant a Knighthood to Prince Philip?

CHRISTOPHER PYNE: Well the Prime Minister's dealt with that today. He has said that there will be more consultation in future about the people who will be awarded the Knighthoods and those who might be Dames in the Order of Australia and I welcome that announcement that he's made and I don't intend to be distracted by it. I'm not only trying to bring about higher education reform, we also have to review the curriculum and I'm working with the states and territories in a very positive way on that, and soon we'll have the announcement of the Teacher Education Ministerial Advisory Group report which means we will be thrust into the debate about teacher training. So there's a lot on my plate and Knights and Dames is not a high priority for me.

QUESTION: … What do you make of Rupert Murdoch’s tweets today about an hour ago calling for Peta Credlin to be sacked or resigned?

CHRISTOPHER PYNE: Well I have the highest regard for Rupert Murdoch. I think he's one of the great Australians that we've produced in the last century or more since Federation. I think his achievement is becoming probably the most significant media mogul in the history of the world and certainly currently. It's an amazing achievement for an Australian and I'd point out that he started in Adelaide at the Adelaide News and then the Advertiser and he's a proud son of South Australia.

However, I support the Chief of Staff, Peta Credlin. I don't think there is any prospect of his suggestion being pursued by the government. Peta Credlin and Tony Abbott have played a remarkable role in getting the Coalition into government after just two terms. We couldn't have done it without PetaCredlin, and as a senior member of the Cabinet, Leader of the House,and a person who was actively involved in all of those campaigns over the last seven or eight years, I think that Peta Credlin is absolutely intrinsic to our success.

QUESTION: You don't think the PM needs to be getting any better political advice?

CHRISTOPHER PYNE: I think the Prime Minister has an excellent political antenna. Certainly we've had certain issues over the last 15 months that have been trickier than others. We have a difficult message to sell. The reality is that every Australian knows we have to repair the budget. We have to reduce debt and we have to reduce deficit. The Labor Party left us in a very bad state economically. That said, most people don't want it to affect them at all and that makes it tricky in the political environment where the Labor Party is going to be a political opportunist party rather than a constructive builder and try and help us in the repair of their damage.

QUESTION: How damaging do you think that the issues you talk about have been to the Queensland campaign?

CHRISTOPHER PYNE: Well, I'm not going to be a commentator on the Queensland campaign. I fully expect that Campbell Newman will be re-elected and his government this Saturday because they deserve to be. They've made the decisions for Queensland certainly in an economic sense that has put Queensland back on its feet after the hopeless government of Anna Bligh and before that Peter Beattie and I wish him all the best but I'm not going to be a commentator on his campaign.

QUESTION: If there is a swing against the LNP, will you accept that some of that sentiment is reflecting on the Federal Government?

CHRISTOPHER PYNE: No.

QUESTION: Minister, you keep your finger on the pulse of the party, is there disquiet within the party about the Prime Minister's performance?

CHRISTOPHER PYNE: Not that I'm aware of, no.

QUESTION: [Indistinct] If you don't get the bill up, do you still plan to take the money out of universities otherwise through research grants and so forth or is that..?

QUESTION: Well Phil that question has been asked of me for some time. I have absolutely every expectation that the government's reform bill will pass because it's the right reform. It is definitely the right reform for Australian universities and for students. The core principle of these reforms are the de-regulation of universities.

Of course we want to achieve savings and that revenue would flow back to universities to replace the $6.6 billion of cuts that Labor made when they were in office. Let's not forget the reason we have to do this reform of universities is because Labor cut $6.6 billion from universities over the course of their government. Somehow that revenue needs to be replaced. The taxpayers were already being squeezed enough when Labor was in office. Students are currently paying less than 50 per cent of the cost on average of their degrees. We're going to ask them to pay about 50/50 with the Australian taxpayer. I think that is a very fair deal. I think most Australians think that is a fair deal and that's what we will be pursuing.

QUESTION: Dawkins today also called on the Government to take a step back from the reforms, to consult more widely. Why won't you take a step back? Why is there such a rush to get these reforms up?

CHRISTOPHER PYNE: Well there's no rush. It was announced in the budget last May. We are still dealing with it in February and we'll probably be dealing with it into March by the time the debate unfolds. I wouldn't say that was a rush.

QUESTION: Ricky Muir says today he’s joined with Nick Xenophon in saying that any changes such as de-regulation should be taken to an election and the government should get a mandate for them, would that be something you will consider?

CHRISTOPHER PYNE: We will consider all of our discussions with the cross-benchers. I'd like to see Ricky Muir's actual comments before I comment on them. I haven't seen exactly what he's said but I have very good relations with both him and Nick Xenophon and we will continue to talk to them.

QUESTION: [Indistinct] Do you think the idea of an independent review is a good idea, especially considering it could take 12 to 18 months before de-regulation could get back on the table?

CHRISTOPHER PYNE: Well, we have the Kemp Norton review at the end of 2013 into 2014 which we have followed in these reforms. There have been dozens, literally dozens, of reviews since 1957 which I think is the year that Nick Xenophon mentioned as the last root and branch review. There's been many reviews since 1957, but I'm always open to more discussion and more reviews. I'm not ruling anything in or anything out. If it will secure the support of the cross-bench I will consider all of their suggestions but if by the time we've considered their suggestions the de-regulation of universities has been so watered down as to not be worth doing then the Government will not do it.

QUESTION: Just to be clear on that, Minister, if it means getting it right and getting what you want you are prepared to wait until after an election?

CHRISTOPHER PYNE: We want to get this reform through in February or March this year but we will not so adulterate the reforms that they're now meaningless and if that's the situation in Australia today, if the cross-benchers are not up to microeconomic reform because they don't want to be unpopular with any organisation in Australia or any particular individual, well the government will accept the decision of the Senate.

QUESTION: So is March the timeline to get it done?

CHRISTOPHER PYNE: The House starts sitting on February the 9th, so I would assume since this is the highest priority for the Government by, I assume, hopefully the end of March it will be resolved.

QUESTION: Can I clarify you're prepared to put the reforms to the Senate and see them fail?

CHRISTOPHER PYNE: I have no qualms at all about what happened at the end of last year. This is an important reform. I'm absolutely committed to it. I've argued for it since the Budget, I will continue to do so. I took it to the Senate in December, late November/December. It was defeated. There's no shame in that. If you believe in something you should fight for it. I've continued to fight for it since then and I will fight for it in the Senate. If the Senate votes against it well they will be voting for the status quo. Nobody in the university sector wants the status quo. The cross-benchers say they don't want the status quo. So it's a high stakes game... He said last question about 5 questions ago Phil.

QUESTION: This is a continuation of that question. Just trying to clarify what you're saying, you're not going to pursue this actively beyond March once the Senate resolves it if they resolve it against you?

CHRISTOPHER PYNE: The Government is putting a bill to the House of Representatives and the Senate for the second time which is a different bill, a bill that the cross-benchers asked for the amendments that have been introduced into it. I intend to bring that bill to a vote. If the Senate votes against it the Senate will have expressed its will and not wanted to have any microeconomic reform. The status quo will remain. People can't have their cake and eat it too. When a vote comes you have to say yes or you have to say no. If the cross-benchers say no they will be voting for the status quo. That also means the national collaborative research infrastructure scheme will not be able to be funded into the future. It also means the future fellowships, the Australian future fellowships for mid-term researchers will not be able to be funded into the future. The extension of the demand-driven system to the pathways programmes won't be funded. That will not happen. The extension of the Commonwealth Grants Scheme to non-university higher education providers including TAFEs will not happen. The cross-benchers can't take only the benefits and vote in favour of those but vote against everything else.

QUESTION: I understand that but would you then keep it as policy and take it to the next election seeking a mandate?

CHRISTOPHER PYNE: We will deal with these things sequentially and at the moment I'm about to debate this in the House of Representatives where I assume it will pass and then in the Senate where it will be a matter of negotiation. But let's not jump the gun.