Interview with Kieran Gilbert Sky News - Higher Education reforms

Transcript
  • Minister for Education
  • Leader of the House

KIERAN GILBERT:

Mr Pyne, thanks for your time.

CHRISTOPHER PYNE:

Morning, Kieran.

KIERAN GILBERT:

The head of the National Network of Technology Universities Peter Coldrake has warned of a thermonuclear strike on higher education if your deregulation of the sector fails but the funding cuts proceed.  Is that possible, that that scenario will eventuate?

CHRISTOPHER PYNE:
Well of course it is possible and it is a worst case scenario.  We don’t want to see cuts to universities without reform.  This reform is vital for Australian universities, it is also very important for students.  There are a lot of moving parts, the biggest Commonwealth Scholarships Fund in Australia’s history, an expansion of the demand-driven system to the diplomas and associate diploma courses which are used typically by low-SES and first-generation university goers to break into universities, the expansion of the Commonwealth Grant Scheme to non-university higher education providers.  All of this is going to spread opportunity to students and we are simply asking students to pay fifty per cent of the cost of their education, rather than forty per cent.  At the moment the taxpayer is paying sixty per cent and we are simply asking the students to lift their contribution to fifty/fifty.  That seems like a fair deal to me but if the reforms don’t go ahead, our universities have a very bleak future.  There will not be more money from the taxpayer because the taxpayer has no more money to give.  We are already in deficit, we already have a large debt that we are trying to pay back and our Asian competitors will overtake us, destroying our international education market if we don’t make these reforms.

KIERAN GILBERT:

Can I ask you to just respond to some of the criticisms and some of the concerns about the reforms, first of all, women in universities.  Will women who have to essentially pay more because they will have to pay more over time if they take time out to have families and so on? Will these reforms impact adversely on women going to universities?

CHRISTOPHER PYNE:
Look Kieran, I don’t think they will.  At the moment the taxpayer is paying 3.42 per cent which is the ten-year government bond rate on the debt that they are lending students so that students can go to university and earn seventy-five per cent more on average over a lifetime than people without higher education qualification. At the moment the students are paying back at the CPI rate, we are simply asking them to pay it back at the same rate as the taxpayer is paying rather than continuing that inbuilt subsidy.  The average HECS debt is $16,800, $16,800.  It is not the debts that you read in the newspapers, these doomsday scenarios for students.  It is all just wild speculation.  We expect the HECS debt to rise marginally, maybe to around $20,000.  That is a debt that easily paid back once students earn over $50,000 a year and they can only be asked to pay two per cent of their income at $50,000 a year.

KIERAN GILBERT:

But for women who take time out, won’t this adversely affect them, vis-à-vis men doing the same degree?

CHRISTOPHER PYNE:
Well I don’t believe so.  And there has been no evidence produced to me that would suggest that was the case.  But obviously that would form part of the negotiations we have with the Senate over the course of the next three months.

KIERAN GILBERT:

In terms of the figures that you are referring to that HECS debts will rise to $20,000, obviously that is an average.  What about less well-off individuals from homes where they don’t have any assets, are they less likely to pursue a degree do you think, in a Group of Eight university doing law or medicine you’d think they’d be the most expensive? If you come from a home with no assets, no home - no family owned home - wouldn’t you be reticent of taking on a bill of tens of possibly thousands of dollars?

CHRISTOPHER PYNE:
No, there is absolutely no evidence of that at all.  The great thing about the HECS-HELP scheme is that it doesn’t matter what your background is, you can access it.  You can’t start paying it back until you earn over $50,000 a year.  The interest rate of the loan is the lowest loan you will ever get in your life and you can’t pay it back at more than two per cent of your income rising to eight per cent of your income at over $100,000 a year.  So it is a very generous scheme.  There is no evidence at all, I’ve talked about this for months, it is not like this has come as a surprise to people, people are yet to be able to produce any evidence that upfront fees that are being charged since the 1980s has made - has stopped anyone - from going to university whatever their background.

KIERAN GILBERT:

That is when you are talking about fees of $15,000 or $16,000…

CHRISTOPHER PYNE:
And the fees…

KIERAN GILBERT:

We’re talking possibly fees in the 100 of thousands?

CHRISTOPHER PYNE:
No, we’re not.

KIERAN GILBERT:

That’s not viable?

CHRISTOPHER PYNE:
That’s not possible because the competition won’t allow it to happen.  If a University decides to charge exponentially higher fees they will have empty lecture theatres and empty tutorials because part of this of course is the expansion of competition, the capacity to compete on price.  If a university charges fees that are too high, people won’t go to that university and because we have so many universities and so many private providers, there will always be other options.  Now there won’t be these exponential rises in fees, not only because of competition but because universities have no reason to raise fees to that level.  They should be able to value their courses so that they gain revenue based on what they do well, rather than what they are doing now which is cramming as many students in to as many courses as possible because they all get exactly the same.

KIERAN GILBERT:

But you’re confident, you’re adamant that those from less well-off areas won’t be excluded from elite universities and the best courses, if they are smart enough to go?

CHRISTOPHER PYNE:
I’m absolutely certain… even more so because I am even more certain of it because we have the Commonwealth Scholarships Fund, the biggest Commonwealth Scholarships Fund in Australia’s history, which means our brightest young people from whatever background will be able to get to go to the best universities in Australia, and why shouldn’t they?

KIERAN GILBERT:

A fifteen to seventeen percent of loans, student loans, already its assumed aren’t repaid…

CHRISTOPHER PYNE:
Seventeen per cent.

KIERAN GILBERT:

Seventeen per cent.  Won’t that just worsen if their charges increase?

CHRISTOPHER PYNE:
Kieran, you are putting whole lot of assertions to me.  There is no evidence that students are disengaged in universities because of fees.  None whatsoever and this debate has been around for months.  There is no evidence at all that raising fees, these reforms will lead to a lower repayment threshold – none.  Now what a lot of this is a - so called vibe – you know like from The Castle – it’s the vibe.  People have to make decisions based on research, on facts, not on anecdotal evidence.  And there is no evidence at all that these reforms will lead to a lower repayment.

KIERAN GILBERT:

And finally, the prospects through the Parliament – how are you feeling at this stage as we are just an hour or so away from you introducing it to the Parliament – what are the prospects of these reforms?

CHRISTOPHER PYNE:
Well I feel the momentum is with the reforms. It is very hard to turn back the reform wagon once it starts moving, universities want these reforms.  The Palmer United Party won’t be thanked by the universities at the end of the year if they have kept the status quo.  Nobody in the university sector supports the status quo; they all recognise the need for reform.  There must be a reform to universities by the end of the year and if Palmer United Party’s starting point is that they should do not harm and keep the status quo if they don’t understand the changes.  Well nobody in the university sector is saying that is what they want.  So I hope the crossbenchers will listen to the universities and we can work together to negotiate a reform to universities that will be good for them, good for the students and good for our international education market which is $15 billion a year.  It is our third largest export, after iron ore and coal.

KIERAN GILBERT:

Mr Pyne, thanks for your time.

CHRISTOPHER PYNE:
Pleasure.

[ends]

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