Sunday Agenda

PETER VAN ONSELEN: Let's bring in Christopher Pyne, the Leader of the House, also obviously Cabinet Minister within the Government. Thanks very much for your company.

CHRISTOPHER PYNE: Morning, Peter. and good morning, Simon. Thanks for having me.

PETER VAN ONSELEN: Let's get straight into- well I guess the easier questions from your perspective to start with. Anthony Albanese vs Bill Shorten. This has broken out during the week and it comes off the back of that, you know, ill-thought through advertisement prior to that, which Anthony Albanese shot down in flames that Bill Shorten was involved in. Let me ask you this from your perspective, does this have the potential to be every bit as destabilising as some of the issues that have happened on your side, as well as previously on the Labor side when they were in Government?

CHRISTOPHER PYNE: Well, Bill Shorten suffers from being chronically unpopular in the public, regardless of what the two-party preferred vote is or the primary vote is. Bill Shorten never gets in front of Malcolm Turnbull as preferred PM and he has a chronically bad negative approval rating.

Whereas Anthony Albanese, on the other hand, appears to stand for something. He seems to have strong views and conviction politics, which is very popular with the Australian public, and obviously he much more popular in the Australian Labor Party membership than Bill Shorten and Bill Shorten effectively used the numbers within the caucus to dud Anthony Albanese a few years ago.

So, there are a lot of tensions on the Labor side about leadership and Bill Shorten of course is in that zone. Less than a year after losing that election, it doesn't look like Labor is going to win an election anytime soon. We are a couple of years away from the next poll, and of course, Anthony Albanese is seeing- trailing his coat as they say to see what kind of support he gets, and that's only going to get worse for the Labor Party over the coming months.

SIMON BENSON: Who would you like to see or who would you like to go into a battle with an the election against, Anthony Albanese or Bill Shorten?

CHRISTOPHER PYNE: Well, I guess the way I would answer that Simon, is to say that if the Liberals were to not be in Government, who would I prefer to be Prime Minister? And to be fair I'd rather Anthony Albanese was the Prime Minister to Bill Shorten ...

PETER VAN ONSELEN: [Interrupts] Is that because you do morning TV together?

CHRISTOPHER PYNE: No, I just don't think Bill has any convictions and I think he runs very dishonest campaigns. Whereas I think Anthony Albanese, on the other hand, actually believes in things and I think he would run a much more honest campaign, a much more honest Government. I think he's there for the person who'd I rather as Prime Minister to Bill Shorten. Of course, I don't want either of them to be Prime Minister. I want Malcolm Turnbull to stay exactly where he is because I think he's doing an excellent job.

PETER VAN ONSELEN: Do you agree with Simon's analysis though that for what's going on inside the Labor Party to manifest itself in some sort of challenge or anything to that effect, the polls are all important? I mean, it's not to happen while Labor is in front?

CHRISTOPHER PYNE: Well, when you look over the Labor side there is a lot more tension there than is being reported in the mainstream media. And of course, that's one of the things about opposition is that you can get away with doing a lot of things that don't get reported in the press because you're not in Government, but there's a lot of tension on that side of the house. We saw the vicious knife fight between Kim Carr and Anthony Albanese straight after the election and Bill got in between that and took the side of Kim Carr. So, there is some pretty bad blood there between the Albanese forces and the Shorten forces.

There are members of the left who supported Bill Shorten against Anthony Albanese a couple of years ago when he ran for leader. I don't think those wounds have healed and there's a lot of people in the Labor caucus who vastly prefer Anthony Albanese and his views than support Bill Shorten. So, Bill is being kept there of course by the unions. Anthony Albanese wants to reform the union movement and its relationship with the Labor Party.

Bill Shorten's effectively handed over policymaking decisions to the CFMEU and the AMWU, and so forth. And as a consequence, they are using their numbers to keep him there at the moment, but I think if Labor falls behind in the polls, we'll see a pretty quick campaign from Anthony Albanese to replace Bill Shorten.

SIMON BENSON: You mentioned bad blood. There's quite a bit of bad blood brewing in your own party, particularly over the issue of education and the claims by the Catholic Church- the Catholic education system about the Gonski reforms. You've in the past have described yourself as the fixer. How are you going to fix this problem? Or how should this problem be fixed?

CHRISTOPHER PYNE: Well, Simon, it's an interesting point. I mean, I heard what you said in the introduction about how significant this was as a political issue, and I cast my mind back to my own electorate office over the last couple of weeks. I have not had one email, one phone call, one letter or one visit from a constituent complaining about school education announcement from the Catholic Church or any of the Catholic schools in my electorate. Not one of them have complained about it.

So, I'm not sure how significant of an issue it is outside the pages of The Australian newspaper. We aren't getting any heat in my electorate office about it at all and I think that's because the Catholic education system really is running a very dishonest campaign. They're getting an extra billion dollars out of this agreement, an extra 3.5 per cent a year from- year on year for the next 10 years. And the idea that if you get a billion dollars extra and a 3.5 per cent increase, that means you have to close schools and increase school fees, does not make common sense to the person who is sending their children to Catholic schools.

Now, if the Catholic Church actually does start putting school fees and closing schools, it's not because they are getting less money because they are actually getting a whole lot more money, and I think that's why their campaign isn't taking off and won't take off.

PETER VAN ONSELEN: But you say it's a dishonest campaign, Mr Pyne. Since when in politics did that prevent it from being a successful campaign? I draw your attention to the Medi-scare campaign at the last election.

CHRISTOPHER PYNE: Sure. That was a very dishonest campaign.

PETER VAN ONSELEN: [Interrupts] And it worked.

CHRISTOPHER PYNE: I think it does go to the credibility of the campaign and what purchase it gets in the electorate. Now, I haven't had any heat about this political issue at all because we are putting an extra $18 billion into school funding over the next 10 years. That is a big achievement. David Gonski has agreed to be part of a review of the current system of schooling in terms of getting outcomes, in terms of quality teaching. And I think a lot of people feel that we have solved or fixed, Simon to use your expression, fixed the war between the various school systems.

Under Labor, there were 27 different agreements across the country. That wasn't Gonski. And the truth is Labor never implemented the Gonski reforms, which is why I described it as a Conski at the time and I was pilloried by a lot of people at the time because it was a con. It was not actually the Gonski reform. What we have done is actually implemented what David Gonski and his team wanted to do across Australia. It's a fair system. Every school is treated the same way. Every student is treated the same way and I don't think the Catholics are going to get away pretending that they have been dudded when they simply haven't.

I think they are more concerned, quite frankly, about the transparency in the new system than they are about the money and I think that when the Catholic parents realise that what the Catholic Church wants is for those schools to be the only ones in Australia where a parent can't find out how much money the Federal Government is allocating to their children, I think parents of Catholic schools are going to be very disappointed in the National Catholic Education Commission for trying to shut down information getting to those parents.

SIMON BENSON: Well, I guess we'll see where that campaign goes. But would you- so you disagree with the Catholic education system that the independent schools did better out of this deal than they did? And the figures are pretty clear. I mean, the figures were released by the Minister that showed the independent schools did better out of this deal and they admitted it last week than the Catholic education system?

CHRISTOPHER PYNE: Well, whether one system did better than another system is really neither here or there. The question is every school and is every child being treated the same way and the answer to that is yes. Under the 27 agreements that Labor had, were different schools getting preferential treatment to others? The answer to that is yes.

So, what we have done is remove those advantages and disadvantages that were inherent in Labor's system and smoothed out the fairness across Australia. Now, the Catholics have had a special arrangement for some period of time and they've allocated their own money.

And what we've seen by figures published in your own paper, Simon, is that some schools that should have got more money from the Federal Government, we're getting less and that was being reallocated by the Catholic system to inner-city schools and elite schools, who were getting more than they would've if the money was coming straight from the Federal Government. Now, Catholic parents might be happy to do that.

They might be quite prepared to let that money be reallocated by the Catholic systems, and I for one as a parent of children in Catholic schools, am happy for that to happen. But at least that should be transparent and people should know, and I must admit, I'm surprised that more of that money wasn't being allocated to disadvantaged schools and too much of it was being allocated to not-disadvantaged schools.

I can say the St Aloysius in Sydney — one of the Jesuit schools and I am a Jesuit-trained Australian — they have said, they have written to their parents saying that they knew this day was coming for a long time and they have made provision for it and there will not be any fee increases and they are pleased that finally the system is being put to right so that everyone is treated fairly. And I think that is an excellent attitude and I'm quite disappointed in the Catholic education system now, nationally, for running a campaign using their parents' money that is dishonest and trying to keep in place a system, which is not fair to all Australians.

SIMON BENSON: That might be the case- some of those points may be valid, but in the end you are about to go into battle with a significant stakeholder in the education system. And as one of your colleagues said to me, we've just giving a Minister $18 billion and they've managed to alienate one of the largest stakeholders in this education debate. How do you explain that?

CHRISTOPHER PYNE: I don't think that's true. I just don't think that's true. I think it's exaggeration. I think it is panicking and I think it's not right, and as I pointed out: not one Catholic, not one Catholic has said to me since the Budget, or since the announcement of the school reforms, has said to me that they think the Catholic Church is being dudded.

Now, it might be that the National Catholic Education Commission are talking to each of the other Catholic education commissions in Australia, and in their own circle are deciding that this is a major issue that people are up in arms about. They are not, and I can tell you as a former Education Minister, the idea that I had to implement 27 different agreements, left to me by Labor, that was a concern to parents and that should have been a concern to education systems around Australia, and it was. And the Turnbull-Birmingham method of dealing with this has fixed it and has fixed if fairly. And that is the feedback I'm getting from the electorate, and I think the National Catholic Education Commission is making a mistake, and that they will come off the losers of this campaign, not the Government. And any of my colleagues saying that, I don't think that they are correct. I think that they are unnecessarily listening to a very tiny group of people. Get out and talk to Catholic parents. Catholic parents want fairness as much as anybody else does and I know because I am one of them.

PETER VAN ONSELEN: Stay with us on Sunday Agenda. We are talking to the Leader of the House, Christopher Pyne. When we come back. We'll look at the weeks ahead legislatively for the Government, as well as getting to Mr Pyne's portfolio.

PETER VAN ONSELEN: Welcome back. You are watching Sunday Agenda with Peter Benson and I are speaking to the Leader of the House, Christopher Pyne. Thanks very much for your enduring company. I want to get your thoughts on what's coming up in the next few weeks in terms of the legislative priorities for the Government. Obviously, a lot to get through now in the winter recess.

CHRISTOPHER PYNE: Yes. Obviously, this week we will start debating the Budget and getting the appropriation bills through the House of Representatives and into the Senate. Also, this week we will start debating the Australian Education Bill — the amendments to the Australian Education Bill — which will put in place the new school funding model. We also have to get the higher education reforms through both houses of Parliament. So, there's quite a lot on and this week is also the 50th anniversary of the 1967 referendum that included Indigenous people in the Constitution and removed the prejudices against them in the Constitution. So, Bill Shorten and Malcolm Turnbull will talk about that on Wednesday this week. So, it will be another very positive week for the Government.

SIMON BENSON: There's two issues I want to talk to you about, one in your portfolio and one in not, but both involve boats. The Immigration Minister, Peter Dutton, this morning announced quite a significant policy in dealing with the legacy case- so it's called of irregular maritime arrivals- asylum seekers. From what I understand, 7500 IMAs who've been here for up to five years and who haven't yet lodged an application claim for asylum. Now, they've been given a deadline for October 1 to lodge an application or they will be returned. Are you across this announcement?

CHRISTOPHER PYNE: Well, not across it as course as Peter Dutton. But, we of course, when we came into Government we had 50,000 arrivals under the previous Labor Government on 800 boats. We had 17 new detention centres opened and we lost 1200 people at sea that we know of.

So, Labor's legacy from their weak approach to border protection was quite catastrophic. In the years we've been in Government since 2013, we've managed to close almost all of those detention centres, if not all of them, almost all of them. We've had no arrivals because of the policies of this Government, first under Scott Morrison and now under Peter Dutton. But we do have legacy caseload of people left over from the Labor Government that we're still working through and 7500 of those are former asylum seekers, so called, who haven't even lodged a claim and are simply living here and are refusing to cooperate with the Government. Now, they're getting welfare, Medicare support, being schooled in our schools if they have children.

And what Peter Dutton has announced today, very fairly, is that we will give them to October 1 to cooperate and if they don't cooperate we'll cut them off from government handouts. We'll stick look after them from a health point of view and education point of view if they have children at schools, but we won't continue to support them on the Government welfare unless they cooperate with the Government to resolve their particular cases.

PETER VAN ONSELEN: [Indistinct] Christopher Pyne [indistinct] on these new helicopter carriers because they are not working. What, what is the problem there? I mean, it is not a partisan issue because it has been through both cycles of the major parties, the procurement and the development and then the arrival of them have occurred. It is bizarre to me that a well-resourced navy could find itself in a situation where both are effectively out of action, right at a time where we are going to be having these defence drills with the United States, and it looks like they won’t be able to involved. Can you give us a bit of an update on how this has even happened and how you feel about it?

CHRISTOPHER PYNE: Well there’s a couple of assumptions there, Peter. Ah, we can’t be certain that they won’t be part of Operation Talisman Sabre. They might well take part in the operations with the United States and other nations, and, of course, we have millions of pieces of equipment in the army, the air force and the navy. From the largest ones like the helicopter carriers through to the smallest pieces of equipment, and everyone knows that with equipment you have maintenance issues, sustainment issues and sometimes things happen where they need to be fixed.

That’s the very nature of these kinds of pieces of equipment. This very significant platform of course is just like any other. Things can go wrong, and on both of LHDs there are issues with the propulsion systems. They are being fixed. We anticipate that at least one of them will be out at sea in a matter of a couple of weeks, and then we hope the other will be as well. One of issues are more serious, on one of the ships is more serious than the other. Of course we want them to be operating at their peak capacity at all times.

Sometimes these things happen, and when they do you simply have to fix them and get them back out to sea, or up in air, or whatever it might be, but I don’t think it is the end of the world. Obviously I’m disappointed, so would everybody be, especially the people on the ships who want to be able to use them all the time, but these things do happen.

PETER VAN ONSELEN: Surely they are under warranty?

CHRISTOPHER PYNE: I don’t know what that means. People keep asking me this question about being under warranty. It’s not like buying a vacuum cleaner. Of course, there are contractual arrangements with the builders of the ships, and we have ongoing arrangements with the maintenance and the sustainment of those helicopter carriers, but look it is not a light-hearted issue. It is an important issue, but we are fixing it and getting on with it, and that is just all we can be expected to do.

SIMON BENSON: Minister, you make it sound as though one of them has lost a hubcap or something? You say that they are not serious issues and they can be fixed readily?

CHRISTOPHER PYNE: That’s right.

SIMON BENSON: But your navy chief at the weekend suggested that there could be major design flaws in the boats themselves?

CHRISTOPHER PYNE: Well I’m not aware of those statements. The information that I have had from the navy is that they are minor issues with the propulsion systems. They can be fixed, they are being fixed, and the helicopter carriers will be out at sea before too long, and they are not damaging our national security. Certainly nobody has suggested to me that there are any major design flaws at all.

PETER VAN ONSELEN: Can you understand the public being sort of cynical about all of this. I mean we had obviously the ongoing saga for years about the Collins-class submarines, now we’ve got this. There’s a big debate more broadly about defence spending in terms of naval shipbuilding. A pertinent issue for yourself and your portfolio, as well as the home state that you represent. Is this something that can be dealt with, or is it just something that is inevitable across such complex machinery that is in permanent operation.

CHRISTOPHER PYNE: Well it is definitely the latter, Peter. I’m sorry, I’m having a bit of trouble with my ear piece today. It is definitely the latter. The reality is that there are very many platforms in our armed forces, and sometimes things go wrong with them and then you fix then, and I think the public perfectly understand that. It is just common sense, and when it happens they get fixed and you move on. Nobody ever expects a piece of equipment to never have a problem in its entire lifetime. It’s good that these problems have been discovered now when the ships are not in any kind of active duty.

Of course, it is very significant to make sure that all issues, teething problems, whatever, are fixed along the line, but we are about to, we are actually right in, we’ve embarked upon the largest military build-up in our peacetime history. A $200 billion build-up of our military capability over the next ten years, and I have the privilege of laying the foundations for that as a Defence Industry Minister, and it is going very well.

Last week we released the naval shipbuilding plan. We have chosen DCNS to build and design 12 submarines. We will turn a sod at Osborne South in July to start infrastructure on the naval shipyard there, to build to first OPV, offshore patrol vessels, which will then move to Henderson in Western Australia, and then the future frigates. These are very significant decisions creating thousands and thousands of jobs and investment in our economy, and quite frankly that is a much more important issue, the fact that we are having our largest military build-up, the jobs that are being created, the fact that the Government has made the decision that that be spent, as much of it as possible, here in Australia to build our manufacturing base and our technological capability and our sovereign capabilities, that is a much more important issue than a couple of minor propulsion issues on the helicopter carriers which will be fixed.

PETER VAN ONSELEN: How important is it that that Defence spending is occurring now, and in particular that a lot of it, in building terms, has been targeted into your home state of South Australia? And what I mean by that, Minister, is how important is it to the South Australian economy? And equally the timing- you know, in a period where we’re being told about the need to get back to surplus. I get that these are long term decisions in terms of spends, but it does strike me that the two run counter one another, to some extent.

CHRISTOPHER PYNE: Not at all. The reality is that we will hit two per cent by 2020-21 of our GDP as a percentage- defence spending as a percentage of our GDP. That is very significant; only four other countries in NATO- or four countries in NATO are at two per cent of their GDP. So we are making our contribution because this Government takes our national defence seriously, as we should.

We want to be the kind of country that is a good ally to the United States and our other allies; that has the capacity to have a forward projection in terms of our defence; to project our power; to be able to have a serious influence in our region, in the Indian Ocean, the Pacific and Southeast Asia, and we can’t do that by just talking.

Now, Labor got the spending of GDP as a percentage down to 1.56 per cent, the lowest since 1938, the last years of appeasement. We are never going to allow that to happen again; we are getting on with it, we’re making the decisions and this is creating thousands of jobs. The difference between the Turnbull Government and previous governments is rather than just buy our equipment platforms from overseas we are investing here in Australia driving technology; innovation; an advanced manufacturing base; high value jobs. In naval shipbuilding alone, it will be 5000 jobs at Osborne in South Australia by the mid 2020s, and I think that is a- something we should be very proud of.

This is a national endeavour, it’s the largest project in Australia’s history- the largest Commonwealth investment, twice the size of the National Broadband Network by the way, and we should be very proud as a nation that the Government’s decided to do this here in Australia, because it’s going to have a very lasting effect on our economy. And in fact for the first time in living memory the defence industry showed up in the last quarter of last calendar year as one of the drivers of the economy, so the job that Malcolm Turnbull asked me to do we are doing, and we’re getting on with it and it’s working.

PETER VAN ONSELEN: Is this because governments now need to help drive economic growth in these ways? I mean in a sense I’m asking, is the tail wagging the dog here, is it mostly about that rather than about the defence outcomes in an era of, let’s face it, ever increasing tensions in our region?

CHRISTOPHER PYNE: It’s because we want to be a serious nation with the capacity to not just be a supporter of the United States and other countries, but be able to actually do something about it.

One of the hallmarks of our nation’s history is that when we’ve been called upon we haven’t just been waving a flag on the sidelines saying we support liberty and freedom, but actually we can’t contribute. We’ve been a country that, since the First World War, has been able to be willing and actually able to do something about it, and that’s the way- that’s the kind of country that we want to be living in. So this military build up is not about driving the economy, it’s about our national security, and our number one priority, of course, is capability. But our second priority is not to be a very welcome customer around the world by other people’s platforms, it’s to be able to have our own sovereign capability that allows us to drive our economy in a way that supports advanced manufacturing and technology.

As a South Australian I can tell you manufacturing is in my blood, and it’s a great part of our economy and it has a very bright future. And if the Government can use its heft to support manufacturing through the defence industry, why one Earth wouldn’t we? Why would we send that money overseas? And that’s the decision the Turnbull Government’s made, and I’m implementing it, and it’s working; the jobs are being created; new offices are being opened; companies from overseas that didn’t previously have a presence here are coming here, they’re all increasing their workforces, and it’s a very exciting time to be in defence and defence industry.

SIMON BENSON: Minister, in that context of defence and our major alliance partner the US, you would be obviously keeping a close eye and taking a great interest in developments and all the curiosities around the President, Donald Trump, and the White House at the moment. What do you make of what’s going on there at the moment, and is it a serious issue or is it a media hype issue?

CHRISTOPHER PYNE: Well I don’t think President Trump has been given an even break by the media, really from the first moment he announced he was running for President of the US, and certainly not since he was elected as President. There does seem to be something of a feeding frenzy against the Trump administration by the media in Washington and in the northeast of the US. I’m not sure how that’s reflected across the electorate.

I think that Donald Trump has inoculated the US voter about this campaign because his position doesn’t seem to move very much in the polls. I think a lot of people across the US expected this avalanche of abuse of Donald Trump by the media and the establishment in Washington. I think its- these issues are all serious, of course they’re serious. Are they affecting our relationship? No they’re not. Julie Bishop is either in Washington still or on her way back in New York where she has been visiting the UN, and she’s reported from there that the relationship is in very good standing; the members of the administration are getting on with the job there. Of course I’ve had several interactions with Jim Mattis, the Secretary of Defence in the US. Our standing in Washington and in the northeast of the US. I’m not sure how that’s reflected across the electorate.

I think that Donald Trump has inoculated the US voter about this campaign because his position doesn’t seem to move very much in the polls. I think a lot of people across the US expected this avalanche of abuse of Donald Trump by the media and the establishment in Washington. I think its- these issues are all serious, of course they’re serious. Are they affecting our relationship? No they’re not.

Julie Bishop is either in Washington still or on her way back in New York where she has been visiting the UN, and she’s reported from there that the relationship is in very good standing; the members of the administration are getting on with the job there. Of course I’ve had several interactions with Jim Mattis, the Secretary of Defence in the US. Our standing in Washington, and in the US in general, has never been higher, and I think these stories will come and go in the media. But President Trump seems to be powering on, he has just had a very successful visit to Riyadh in Saudi Arabia; announced a $110 billion deal with the Saudis for the build up of their military, so I guess he’ll just have to sort of power through it, and we as a country will continue to enjoy a good relationship with the US.

PETER VAN ONSELEN: We appreciate your time this morning on Sunday Agenda, thanks very much for joining us.

CHRISTOPHER PYNE: It’s a pleasure, thank you for having me.