Sky News Richo

E&OE TRANSCRIPT Sky News Australia, Sydney 09 July 2014 SUBJECT: Higher Education reforms GRAHAM RICHARDSON: Christopher Pyne, welcome to the programme! CHRISTOPHER PYNE: Good to be with you, Graham. GRAHAM RICHARDSON: I’ve missed you, I haven’t spoken to you for a few weeks but I’m not going to miss you right now! You’d have to say, this Budget has been going down so badly, is it a catastrophe or merely a minor hiccup that’s temporary? CHRISTOPHER PYNE: Well it’s a new Government’s first Budget, and new Governments’ first Budgets are always pretty difficult, because they have to make the tough decisions that the previous Government didn’t make, and we’ve had six years of Labor spending money that they didn’t have, borrowing from overseas, giving people things that they couldn’t afford, and this Government, the new Government has to make the difficult decisions to live within our means, to balance the budget, and that means a bit of pairing back of programmes and tightening our belt, and that was always going to be difficult. But my takeout from being out amongst the public is they know why we’re doing the things that we’re doing, they don’t like some of the individual measures, but they certainly don’t want to go back to the profligate spending of the Labor Party, which they are continuing to demonstrate in the senate as we speak. GRAHAM RICHARDSON: Well you and I must be speaking to a different public, because I’ve found anger that I never expected, a degree that I just find extraordinary for this early, you’ve only been there nine months, it’s pretty hard to get that unpopular that quickly but you seem to be managing it. Now let’s go through some of these measures that are unpopular. One of the things that’s marked in the polls is the drop in support for the coalition amongst the young. 18-24s warmed to John Howard, stayed away from Labor during the Rudd, Gillard years – a little bump for Rudd but only a little one – 18 to 24s… there’s been a dramatic change. Does any of that, does any of the blame for that lie at your feet with the changes to university funding? CHRISTOPHER PYNE: Well the changes to universities are extremely important in terms of a mark [indistinct] of economic reform, we have to spread opportunity to more students, we need a more productive, smarter workforce and university education gives people the chance to earn 75 per cent more over a lifetime than people without a university degree. And we also have to give universities the chance to be their best selves, to be able to be excellent, in order to compete with our Asian neighbours who are getting better and better in terms of quality and reputation. Students don’t like paying fees, they don’t like paying any fees, they’d rather education was free. But the simple fact of the matter is that the Australian taxpayer can’t afford that, and right now the Australian taxpayer is subsidising a student’s education to the tune of 60 per cent, with the student paying 40 per cent. So we’re going to ask them to pay 50-50. I think 50-50 is a fair share, and I think that most Australian members of the public believe that. I’d also add that no students don’t go to university because of fees, which they know they can borrow upfront from the Australian taxpayer, and pay back at the best loan rates of any loan they’ll ever have in their lives. They don’t like paying fees, but they’ll still go to uni in huge numbers – 750,000 university students. All of that, all of those, while fees are being introduced. GRAHAM RICHARDSON: We always hear about these numbers of university students and the amounts their borrowing, because I mean a lot of these courses are very expensive today, they’re borrowing, you know, 50, 60 grand or more, how many of them are actually paying it back? CHRISTOPHER PYNE: Well Graham, the actual average HECS debt is $16,800. So these wild numbers that people like the Greens are flinging about, about what students’ debts are, bear no relationship whatsoever to the reality – that’s actually that the HECS, the average HECS debt is $16,800 per student. Which is - whilst it’s a significant amount of money, certainly repayable when students start earning over $50,000 a year. To answer your question specifically, about 18 per cent don’t pay back their HECS debt, and some of those are living overseas, and we’d like to pursue those overseas, particularly those living in the UK, and I’ve established a working group with the UK higher education minister David Willetts to do just that. GRAHAM RICHARDSON: Well I think you should, I mean if there’s a deal that I’ve done, I’ve signed on the dotted line and I owe you money, then I’ve gotta pay it back. But I think the thing that’s hurting you most, in this area, is the idea- the way you’re freeing up universities to charge what they want. There is this fear that there’s going to be a dramatic rise in university costs, in the cost of courses, and that of course means that you’ve got to get a much, much bigger debt, doesn’t it? CHRISTOPHER PYNE: Well there is a fear that’s being stoked by the Labor Party and Greens, who are both being entirely irresponsible about every single aspect of Government policy, I mean the Labor Party and Greens are voting against a savings measures that Labor introduced themselves, whether it’s in higher education, or other parts of the Government’s budget. We are legislating their savings cuts, and they’re voting against them, that’s how irresponsible Labor’s become, and at the next election, Graham, the media will hold them to account, and ask them where’s the money coming from for all these new spending measures that they’re proposing, they haven’t come up with new revenue measures, they haven’t come up with their own savings, they’re just vandalising the Government that they… that replaced them. Now, at the next election the public will have to choose whether they want an economically responsible political party in the coalition, or the economic vandals that Labor have become and were in Government. To answer your question particularly, yes there is some fear about higher fees, but the truth is when the new system comes into place in January 2016 there won’t be a massive spike in fees. Some fees will go up, some fees will go down and competition will ensure that unis can’t charge exponentially, otherwise they won’t have any students. GRAHAM RICHARDSON: Well not quite, what if I’m one of the big time universities, and I decide to whack up the prices of courses, obviously the rich are still going to come there, because that’s where they want to be. CHRISTOPHER PYNE: Well, there are 39 universities, under our reforms there will probably be about another 100 or more non-university higher education providers, who can access the Commonwealth Grant Scheme, we’re expanding the places in the diplomas and associate degrees, so that people from low socio-economic status background can use those as pathways into universities, into undergraduate courses. If any of the Go8 universities, the so-called sandstone universities, charge exponential fees they’ll be undercut by the market, and they’ll have empty lecture theatres, because there’s a very high level of quality right across the sector. GRAHAM RICHARDSON: Yeah, I’m not sure that’s the perception but I’ll tell you one perception you can’t argue with, this perception of fairness. Now in my view, you’ve lost the fairness argument on the Budget, whether you can ever get it back is a moot point but I doubt it, the fairness argument has been run, and won. And isn’t that one of the things that’s dragging you down? At the same time you’re saying it’s fair, and people from low socio-economic backgrounds don’t have to worry – at the same time you’re saying that, you’re saying to a family on $65,000 a year - which is roughly average weekly earnings – I know it’s not exactly – roughly it, and they’re going to lose 10 per cent if they’ve got three kids and 10 per cent of the – you know, $6500 of government funding and then you’re saying to them but at the same time I’m going to give $50,000 to some woman to have a baby, whereas in that single income family, the women who has a baby gets nothing. I mean, how do you sell that, Christopher? It’s just not possible, now or ever. CHRISTOPHER PYNE: Well, Graham, we dispute the figures about $65000. They’re, I mean, they’re the ones bandied around by the Labor Party… GRAHAM RICHARDSON: Say it’s $5000, it can’t be less – I’m not arguing about the figure. The figure’s very significant if you’re on $60,000 mate, that’s the point, very significant. And then you’re trying to tell them you’re paying a woman almost as much as they earn totally, to have six months off to have a baby. You’ll never convince them. CHRISTOPHER PYNE: Well, I think, when people find out that the public service is currently paid in exactly the same way as we want to pay all women who have babies under the Paid Parental Leave Scheme, I think they start to recognise that there shouldn’t be one rule for the public service and one rule for everybody else. I mean, that’s just one example. GRAHAM RICHARDSON: I don’t disagree with that. If you were at a time, though, when you’re trying – you’re telling us that this is not an out-use problem, this is a really serious Budgetary dilemma that we’ve got to cut now. We haven’t got time to waste and here you’re going and you’re put everything [audio skip] over the next five or six years, $20 billion and it is – I mean, how do you explain it? I mean, aren’t you arguing against yourself? Yes, we’re broke, we’ve got to cut now but I’ve still got $20 billion to throw at these women having babies. I mean, nobody accepts that. CHRISTOPHER PYNE: Well, Graham, let’s wait and see. I mean, we’ve got two years and three months before the next election’s due. GRAHAM RICHARDSON: Ah but you haven’t got that long before it comes before the Senate. CHRISTOPHER PYNE: We’re not going to react to the [audio skip] day slings and arrows of outrageous fortune that politics throws up. I mean, you’ve been in politics, you know what it’s like. If we responded to the 12 hour or 24 hour news cycle to short-term unpopularity then we’d become an ungovernable nation and an unmanageable parliament. Now, that’s not my view. I think the Australian public elected us to do a job. We’re calmly and methodically working through that job. I think the Australian public know what we’re trying to achieve and, while they don’t like individual measures, I think they’ll mark down the opposition and particularly Bill Shorten, if all he is is a complaints box for people who are unhappy about particular decisions and has no solutions of his own, particularly when the public know that we are trying to fix the mess that Labor left us in the first place. And Labor are trying to stop us from fixing it. GRAHAM RICHARDSON: Well, I’m one of those that accepts there was something of a mess, certainly, in the out-years I’m not sure it’s as bad as you’ve made out but it is bad and I’ve never tried to deny that. It does need fixing, never tried to deny that but I was talking to a woman the other day who’s exactly in the category I’m talking about - a family with a combined income of about $100,000 and looking at what they were losing and being very angry. And her words were he never told us he would do this to us. And I think this is the problem, you crept up on them, this is an ambush. CHRISTOPHER PYNE: Well look, I just don’t agree with your analysis. I mean, the truth is the Australian public knew… GRAHAM RICHARDSON: It was her analysis, really. CHRISTOPHER PYNE: …the Australian public knew that we couldn’t go on as we were borrowing money from overseas to the tune of $1 billion a month just to pay the interest repayment on Labor’s debt. Now, the public know that but they might not like individual measures but in two and half years when they see the benefits of a government that’s living within its means and they have to cast judgement on us, I think they’ll see a growing jobs market, a growing economy, a government that has balanced the Budget, has got the Budget back under control, stopped the boats, got rid of the Carbon Tax, got rid of the mining tax, done the things it’s promised it would do and I think they will re-elect us on that basis. GRAHAM RICHARDSON: Yeah, but at the same time, you’ve whacked family allowances, you’re bunging on co-payments and at the same time as you’re telling me all that, all these hard things that have to be done, you’ve got $40 billion that you can spend on the biggest government-owned medical research fund in the world for little, old Australia and the Paid Parental Leave Scheme. $40 billion. There’s 40 you can fix now, tomorrow, this afternoon, just say we won’t do that, there’s 40 off. Why can’t you do things like that? CHRISTOPHER PYNE: Well, we’re – we’ve only just started the process of getting our measures through the Senate Graham, I mean we’re not going to throw in the towel three days in to the new Senate. We have a lot of work to do, we believe strongly in our Budget and our measures and we’ll work methodically through those. In my area of education I strongly believe that my higher education reforms are for the betterment of universities and for students and for the country I want to protect our $15 billion international education market which is our fourth largest export after iron ore, coal and gold and I think the Australian public elected me to do a job, not just to try and be popular. GRAHAM RICHARDSON: Well, I – well I tell you what, you’re succeeding in every bit of that task because you’re not becoming popular and that’s fairly obvious. But I respect what you’re trying to do, it’s the fairness of it that I think people – has got just – got everybody so upset. And I tell you what, I [audio skip] if you’re a betting man, I’ll have you back on later on in the year, hopefully several times, but towards the end of the year. You’ll have to have a mini Budget, because I know you say you believe in your Budget and you’re going to get it through the Senate, reality is you’re lucky to get half through the Senate, lucky. And that means there’s going to have to be, if you’re serious about how much trouble we’re in, you’re going to have to have a very, very, very big second look at it, aren’t you? CHRISTOPHER PYNE: Well, there’s a lot more ground in this race to be run, Graham, and we’re not going to start worrying now so early in the piece. We’ve got a whole lot more to go before the end of this year and I am confident that the Senate will start to see the benefits of our policies and our reforms and I’m confident they’ll vote, for example, for most of my higher education reforms once I get the chance to explain, individual by individual, in the Senate, what those reforms mean. I’ve already, obviously, talked to a number of the cross-benchers and I’m getting a very fair response. GRAHAM RICHARDSON: You’re one of those blokes who could sell a fridge to an Eskimo, that much I’ll grant you… CHRISTOPHER PYNE: [Laughs] GRAHAM RICHARDSON: …I’m not sure all your mates can do the same. I’ve got to leave it there. Thank you very much for your time, Christopher Pyne. CHRISTOPHER PYNE: It’s a pleasure, thank you. [ends]