Minister for Education Dan Tehan National Press Club address Q&A

SUBJECTS: Job-ready graduates, Regional reforms, Cyberattack, Child care, International education

Jane Norman: Minister, thank you very much for your address today. It was a big overhaul of higher education, you’re announcing. But, just before we take questions from the floor – and there are lots of questions today – can I just ask you about some news that’s broken in the past few hours, and, that is, the Prime Minister’s confirmed that sophisticated state based actors are behind a series of cyberattacks on Australia – government agencies, businesses. You were, of course, once the minister responsible for this area. But, in your role now as Education Minister, can you confirm whether any universities have been targeted? They have in the past. And, if so, what information were the cyber-attackers after?

Dan Tehan: Well, thanks for that question, Jane. And, I can’t add further than what the Prime Minister has said this morning. But, what I would say, and I want to give a shout-out to Martin Bean, the Vice-Chancellor of RMIT, because I’ve worked with him, and he has worked with our intelligence agencies and the university sector to ensure that we’re putting in place foreign interference protocols, which mean that we now can ensure that we are addressing things like the current cyber threat, or other types of foreign interference. But, I really can’t add anything more to what the Prime Minister said this morning.

Norman: Alright. Well, first question today is from Shalailah Medhora.

Journalist: Shalailah Medhora from triple j. Minister, thank you for your speech. Minister, many people in this room – yourself and myself included – have studied those courses that have incurred higher fees, or will incur higher fees – humanities, arts, law – and we are now in the very privileged position to be able to help drive national conversations. But, Minister, when I look around this room, I’m one of the few people of colour here. We know from the last few weeks that these particular areas – politics, journalism, arts and entertainment – have a really big diversity issue. Are you concerned that by raising the cost of some of these courses, you’re effectively limiting who sits in this room in five, 10, 20 years’ time? And, do you think you’d be standing where you are if you hadn’t studied arts?

Tehan: Thanks, that’s an excellent question. And, one of the key things that we’ve announced today is, in particular, we want to lift attainment rates amongst those from low-SES backgrounds and from Indigenous backgrounds. And, my hope is, what that will lead to is more people from diverse backgrounds being in a room like this in 25 years. When I look back at my education, one of the things that I regret is that I didn’t do a language at university. Because, I studied politics and then international relations, and wanted to get into the Department of Foreign Affairs and Trade. And, one of the things that nearly prevented me from getting a job at the Department of Foreign Affairs and Trade was the fact that I didn’t have a language. So, I’m not saying to students, study art, study humanities, but think, also, about your job prospects at the end of your degree. So, if you want to do history, think about doing teaching, as well, so you can teach history. If you’re wanting to do philosophy, which will be great for your critical thinking, also think about doing IT, so that you can help in a new and emerging area, where we know that there is going to be jobs. And, we’ve got to remember, no student pays a single dollar up-front to study in this nation. We have the best FEE-HELP scheme in the globe. And, the only way you start paying back is when you start earning more than $46,000. So, what this is designed to do is to get more people from more diverse backgrounds into our higher education system, and we are putting the funding in place to help drive that.

Norman: Right. Next question is from Richard Ferguson.

Journalist: Richard Ferguson from The Australian. Minister, thanks for your speech. There is a lot of support in this package for students, but universities are not getting extra new funding for the expected expanded places. Are we expecting universities to be able to do more with less in this post-COVID environment?

Tehan: So, universities will get CPI indexed funded, funding, going forward. So, that means that they can grow as the population grows, as the demand for the sector grows. But, we also want to make sure that universities are continuing to drive efficiency, and, also, that, as we realign funds, it is going into the areas where we think it will drive our recovery from the coronavirus pandemic. So, we think that we’ve got a package here that we can help universities deliver the type of graduates that we will need, as we will grow our economy going forward. And, we think that the way that we’ve shaped it will enable them to be able to meet the demand that is coming into the system – 38,000 new places will come into the system by 2023, and 100,000 by 2030. So, we think, we’ve reshaped the architecture in a way which will enable universities to continue to grow, along with the record funding that we’re already providing them, but, also, ensure that we get those job-ready graduates that our nation needs.

Norman: Just on that, Minister. So, are you going to be providing any additional funding to universities to fund these 38,000 new places?

Tehan: So, what we are doing is we are locking in growth into the system. So, we’re already providing record funding into the system. What we are saying is, that we will lock in CPI indexed growth into the system. And, one of the things which has enabled us to make the announcements around regional, low-SES, and Indigenous students, is the fact that under our HEPPP program, there was extra growth in that program over the next four years, and into the future. So, what we’ve been able to do is take that extra growth in the HEPPP program, and dedicate it to ensure we get those outcomes that we need for regional, rural and Indigenous students.

Norman: Right. Our next question is from Fergus Hunter.

Journalist: Fergus Hunter from The Sydney Morning Herald and The Age. Thanks for your speech, Minister. You, the whole premise of this rearrangement of funding is this price signal to send people into certain areas where you desire them to be, for the economy. But, you’re also saying – so, presumably they take into account expense and their capacity to pay there – but, you’re also saying that under our HECS system, no one misses out because of an incapacity to pay. Can you reconcile those two things? Surely, if you are creating $45,000 arts, commerce, economics degrees, law degrees, surely that is going to price out people from these degrees? That debt burden, you know, it’s under a great HECS system, but they still take, get that taken out of their salary, it affects their credit rating, it affects their disposable income, when they are earning an income – and, that’s especially an issue for low-income people you would think, who are trying to make more money. Is this going to affect equity? I mean, can you avoid that? Is it going to price out people?

Tehan: Well, Fergus, as I said before, no student pays a dollar up-front through our FEE-HELP scheme. And, what we’re encouraging students to do, if they do want to go into the arts, as I said, is not silo their degree. We want to make sure that they’re getting skills which will enable them to get a job once they finish their degree. So, that will actually help them, that supports them. Because, it means that they can repay their FEE-HELP loan, because they will have a job. What we don’t want to see is students entering the higher education system, undertaking study, and then not have the skills that they’ll need to take these jobs of the future. And, I point to what we’ve done in the microcredential areas, as proof that, we think, that we can succeed. Because, in two months, or a bit over two months, what we’ve seen – and, all those microcredentials, all those short courses, were done in the same areas, where we’re offering the discount – what we’ve seen is huge demand for those courses. We’ve seen universities respond, or the higher education sector respond, by putting 350 short courses in place, and demand from students has come along with it. We’re estimating 20,000 students have come into the system as a result of those microcredentials. And, that is what we’re hoping to see – incentivising students to go into those areas where we are going to need the skills of the future. This is the biggest economic shock that this nation has faced since the Great Depression, so we want to make sure that our students have the right skills to grab the jobs that will be there, and that’s what this package is designed to do.

Norman: Minister, are you trying to, effectively, send a price signal here, though? So, you’re telling some humanities students that there are too many arts graduates for the number of jobs, so we’re going to make humanities degrees more expensive to make people think twice. Is that part of your thinking here? To sort of intervene, in a price signal?

Tehan: Well, there already was a price signal there. But, yes. What we’re trying to do is encourage and incentivise students to go in those areas where we know the skills will be. We know we’re going to need more teachers. We know we’re going to need more nurses. We know we need more people in allied health. We know we need more engineers. We know we need more clinical psychologists. I mean, one of the things that deeply concerned the Government as a result of the bushfires was the fact that we didn’t have the clinical psychologists to go into – especially, regional and rural communities – to be able to offer that clinical counselling that was needed in those communities. There is a real shortage in that area, and we want to incentivise people to go into those areas, because we know there are jobs there.

Norman: Alright. Next question, Sarah Ison.

Journalist: Sarah Ison from The West Australian. Thank you so much for your speech today, Minister. I’d just like to move to another part of your portfolio, which is child care. Recent surveys say that families say the cost of child care directly impacts how much they will spend on basics, like groceries. Given that, will you commit to a review of how this works? And, if not, why?

Tehan: Well, I’m always in close consultation with the sector. We designed the child care package when demand was falling out of the sector, with the sector. And, can I once again, say to all those early childhood educators, thank you for what you did during the pandemic, because you provided care for emergency services workers, for vulnerable children, right throughout the pandemic – 99 per cent of our service providers remained open. Now, we’ve seen demand come back into the system, as schools reopened, as the economies reopen, and that’s reached 74 per cent. So, we’ve now designed a package that is fit-for-purpose as demand has come back in, and it’s focused on making sure that we keep fees affordable for families. And, as I’ve said before, when it comes to centre based day care, 20 per cent of families pay no more than $2 an hour. Over 70 per cent of families pay no more than $5 an hour. And, we also know that our system, our subsidised system, which is means tested, works for female participation. We saw a 7 per cent increase in female participation in the nearly two years that we’ve had the system in place. So, I’ll keep working with the sector to make sure, absolutely, that they’re an important part of our economic recovery, because they’ve played such a crucial role over the last two and a half months.

Journalist: Some families are struggling. Some families are saying its impacting how their, how many groceries they can buy. What are you going to do about that?

Tehan: Well, working with the sector, we also made changes to the activity test, which, also, means that where there’s financial hardship, that families will pay less. We also have the Additional Child Care Subsidy, as well. So, in some instances, where families have real financial hardship and they’re eligible, they can get access to free child care. So, we’ve put in place the safety nets there, and we’ll continue to work with the sector to make sure that those safety nets continue to work.

Norman: Alright. Next question from Annika Smethurst.

Journalist: Annika Smethurst from The Sunday Telegraph. My question is similar to Fergus’, in terms of incentive. You talk about incentivising students to go into certain areas, but there’s been countless studies that prove fees don’t actually do that. In the late 1990s, when they introduced the tier system, there was no change in preferences, and it’s more about location of the university, prestige of the university, or, just what people want to do. I did journalism. No amount of discount would have made me do nursing. So, I just wonder, how much do you actually think this will change people’s decisions?

Tehan: Yeah. Look, that’s a really good question, Annika. And, the best that we’ve got to go on, is really two things. One is, what we saw with our microcredentials. Because, we saw when we offered discounts in those areas – which are the same areas that we’re offering discounts in – that students have voted with their feet, and sought out those courses, and want to study in those areas. So, that’s one of the reasons which gives us hope. The other is, that we think that the price incentives and the price changes that we’ve made, that students will pay attention to them, and will focus on them. And, one of the other changes that we’ll be making, at the moment, universities have a census date. That’s where a student has to decide whether they’re going to continue on with that course, and then they know that they have to pay for that course. But, we’re not going to call it a census date anymore. We are going to call it a payment date. So, students know that that’s the time where they sign up to, that they will pay back the amount, or the cost, of undertaking that study, to the Government through their FEE-HELP scheme. So, we want to drive a greater price signal in. Because, what we don’t want is students finishing their degree, having had a HECS debt, and not be able to get a job. We want to make sure we’re giving them the skills, so when they come out, they can get a job.

Norman: Next question is from Paul Karp.

Journalist: Paul Karp from Guardian Australia. Thanks very much for your speech. Is money being taken out of universities’ teaching and learning budgets to pay for the regional and research announcements you’ve made today? And, why, when the Government is spending $150 billion on economic supports, has the Government taken a budget neutral approach to the university sector, where for one student to gain, another must suffer?

Tehan: Well, we’re putting indexed growth into the system. What we’ve done, by aligning the cost of a degree with the contribution that both the student makes and the Commonwealth makes, is that that has provided us with money to build this Industry Linkage Fund. Now, there is no money which is going out of the sector. That money goes into an Industry Linkage Fund, which goes back into the sector, in those priority areas. And, as I’ve said, in areas around STEM, is where we really want the key focus of that fund to be, because we know that’s going to drive our economy into the future. And, then, when it comes to the regional education package, every now and again, as a Minister, you’re able to come across a funding profile which works in your advantage. HEPPP was growing significantly more above CPI indexation. So, what we’ve done is we’ve quarantined some of that money, or all of that money, to make sure that we can afford what we’re delivering for regional and rural education.

Journalist: So, no money out of the sector. Is there any money out of the teaching and learning part of the Budget?

Tehan: So, the teaching and learning funding, the part that goes out of that Budget, goes into the Industry Linkage Fund, and then will come back into the sector.

Journalist: How much?

Tehan: How much? At this stage, as I’ve said, we’re estimating around $900 million goes into that Industry Linkage Fund, and then comes back into the sector, in those priority areas, to drive that key, those key initiatives of engaging with industry, so we can get students being able to undertake practical placements, in industry – something which wasn’t funded before. So, what we’re doing is redesigning the architecture, to really focus on making sure we’re getting graduates that will be ready for the workforce.

Norman: Alright. Katina Curtis.

Journalist: Thanks, Minister. I have many questions, but I will limit myself.

Norman: We have a bit of time, just go.

Journalist: Looking back to some of the arguments from, made five and six years ago, when your predecessor also tried to change price signals, and I guess building on Fergus’ question. I don’t think you got to the bottom of the, I mean, there were many experts –Andrew Norton, Glyn Davis, and, even, Deloitte in 2011, who said that the whole point of the HECS system is that it blunts the price signal that’s put in place. So, how can you now say, well, the price signal will work now, when back then it was blunting it?

Norman: Sorry, Katina, do you mind just coming a bit closer to the mic, so we can hear you? Thank you.

Journalist: Sorry. And, your predecessors, Christopher Pyne, Simon Birmingham, they didn’t have that much luck with the Senate. What will be different for you?

Tehan: So, look, they’re really good questions. I would say, one of the key differences now, compared to five or six years ago, is that we’re about to see the biggest contraction of the Australian economy since the Great Depression. So, all of us are going to have to focus on making sure that we are ensuring young people are getting the skills in the areas that we know there are going to be jobs. And, I think, what we’re going to see is students, once again, having a really key focus, not only on their degree and the degree that they want to undertake, but, also, on what the employment outcomes will be, once they do that degree. And, as I’ve said, one of the things which gives us confidence is what we’ve seen through microcredentials. So, what we did these, in exactly these same priority areas. Now, we, what we’ve seen there – the innovation from the higher education sector, plus, the strong demand we’ve seen from the students – we think, really demonstrates that students, now, do have an eye to making sure that they want to get educated in the areas where jobs will be. So, they’re the things that give us confidence. With regards to the Senate, I will do with the Senate what I’ve done with the sector and with industry in putting this package together. I will consult with them, I will put the case, and my hope is that they will understand that this is going to be really, really important for how we, as a nation, deal with the coronavirus pandemic, and growing our economy out of that pandemic.

Norman: Alright. Next question is from Amber Austin-Wright.

Journalist: Minister, under these changes, you’re effectively asking humanities students to subsidise other disciplines. Given that you did study humanities yourself, I just wanted to ask, how helpful did you think that your arts degree was in preparing you for your own career?

Tehan: Well, I could say that what’s been happening up until now is the, your engineers and your scientists have been subsidising your arts graduates. But, what I think we need to focus on is, we want our arts graduates making sure that they’re thinking about the employment outcomes that they’re going to get from their degree. Now, as I’ve said, when I did my arts degree, looking back, I wish that I had have done a language. It nearly cost me the opportunity of getting a job, and a job that I loved and wanted to do and really had a passion for. So, I want to make sure that students now, given what we’re about to face in terms of the economic climate, are really thinking about the employment outcomes that they will get from their degree. So, as I’ve said, if you want to do an arts degree, think about also doing IT. If you want to do an arts degree, think, also, about, okay, is there aspects of that that I’ve got a real passion for, that maybe what I could do is a teaching degree, and focus on those areas that I love. Because, I know there will be teaching jobs that I will be able to fulfil. So, that’s what we’re seeking to do. And, if they do that, if they don’t silo their degree, if they look at other units where, hopefully, it will help their employability, that will reduce the cost of their degree, and, I think, improve employment outcomes for students, once they finish their degrees in three to four years.

Journalist: Can I just ask, though, would this have deterred you from doing humanities?

Tehan: Look, I definitely think if something like this had have been done, I would’ve looked at it and said, okay, well, what do I need to do to make sure that I’m going to have the skills that I need to get a job afterwards. And, maybe, yeah, I think I should look at doing a language, maybe I should look at continuing on doing maths, or, maybe I should look at doing IT. I mean, that’s one of the things that I would have loved to have done now at university that I didn’t, given, you know, the way that digital economy now is growing, and more and more dominating our economy. So, they’re the sorts of things that, looking back with a bit 20-20 hindsight, that, yes, you know, I wish I had of been thinking more of. I think, it would have been helped me with my ability to get a job, if I had of been focused on ensuring that I did have the relevant skills for the economy at the time. Thank you.

Norman: Minister, just before I go to our next question. I wanted to ask you about international education, because we’ve heard from universities that their revenues have been hit hard by the border closure, which is locked out a chunk of their foreign students. Are you able to say, though, exactly how much this fall in international students has cost the university sector?

Tehan: Look, there are some estimates. But, what we have to remember is, that over 80 per cent of our international students were able to get into the country this year. So, the biggest challenge for us in the higher education sector is to make sure that we can get the pipeline reopened by 2021, and for the start of semester one. And, that’s very much what we’re working towards. And, that’s the goal. And, that’s why these pilots are going to be incredibly important. And, I look forward to continuing my discussions with the ACT and the, our South Australian Governments, as we look to embark on these pilots. Because, if we can get them right, if we put the right health protocols in place, and we’ve got the medical experts giving us that advice – and the Chief Medical Officer Brendan Murphy has been fantastic in providing assistance to the sector, and feedback to the Government on how we need to do this – if we can get these pilots right, I think, it can make a big difference to university revenue next year. Will it fill, completely, the hole? No, it won’t. But, it will go a long way to rebuilding that pipeline. And, as that EY analysis stated, which I quoted in my speech, we think we’re going to get more international students wanting to come here, and, remember, we have the ability, also, through what we’ve learnt over the last two months in being able to teach online, that we’ll be able to say to international students, ‘Look, why don’t you engage online, then, while you’re waiting to return to Australia?’ So, there’s a number of things that we can look at to make sure we start to grow the pipeline.

Norman: But, sorry, if you know that 80 per cent of foreign students are here, surely, then, you know what that 20 per cent loss of revenue would look like, in terms of a dollar figure?

Tehan: Well, we do. But, it depends on exactly where those 19 per cent were going to study. We’ve got to remember, some of them go into vocational education, some of them are going into English teaching pathways. So, there’s a various mix. But, there is no doubt, and, you know, I’ve said this on many occasions, if we can’t get the pipeline right, and if we can’t begin to rebuild the pipeline for semester one in 2021, it will have a big impact on the sector.

Norman: Alright. Next question from Tim Shaw.

Journalist: Thanks, Jane. Minister, Tim Shaw, director of the National Press Club. At risk of getting a Friday detention from the Education Minister, I’ve got a follow-on from Paul Karp from the Guardian. We’ve seen massive change in Government contribution – humanities, arts, communications. What’s the net sum game here? What is the total new money that you’ve announced today, over the next four years, specific? Because, you’re assuming less will enrol in those humanities, arts, communications, go to other. What is the specific amount, net, new money, from the Federal Government today?

Tehan: Well, at the moment, we’re putting in $18 billion worth of funding into the sector. That will grow to $18.3 billion next year, and will continue to grow CPI indexed. So, putting a total figure on what that CPI index growth is, you have to go beyond the forward estimates. But, for the forward estimates, what we are announcing today is a budget-neutral package, which means that all the growth that was already there, is being realigned. But, you have to remember, Tim, that there was extra growth already budgeted for in the system, especially in what’s called HEPPP. So, we’ve grabbed that extra money that was already there, and we’ve realigned that to make sure that we can really boost that attainment fund for regional and rural, for low SES, and for Indigenous students.

Norman: Next question is from Misha Schubert.

Journalist: Minister, Misha Schubert. Here today as a director and vice-president of the Press Club, but, noting I am also CEO of Science & Technology Australia. So, I would ask you about STEM, but I’m going to impeccably manage those conflicts, or alignments, and, instead, I thought I’d ask you about Indigenous students. Really terrific to see the commitment to guarantee a place for regional and rural Indigenous students in any public university. Over the last decade, we know universities and Indigenous communities have worked really hard to build that representation of Indigenous students. We’re still at 1.9 per cent of the student population, whereas, if we were at population parity, equal chances for non-Indigenous, Indigenous Australians to go to uni, we’d be more like at 3.1 per cent. Would you keep open the door to make that guarantee available to Aboriginal and Torres Strait Islander students, no matter where they come from, noting that roughly the population is spread, sort of, a third, a third, a third – remote, regional and city-based – for Aboriginal and Torres Strait Islander people?

Tehan: Look, it’s a very good question, Misha. And, we have seen a rise in the number of Indigenous students from metropolitan areas going to university, but we need to do more work. But, our real focus in this package is on those in outer regional, rural and remote, and it’s because they’re the ones who have been really left behind. So, we really want to put the focus on them and lifting those students, because we think the outcomes we can get from that can be quite, quite significant. So, I would never say never to broadening that, but, with this package here, what we want to focus on is those students, because they’re the ones, and, in particular, in the demand-driven system, who really we didn’t see a lift at all in their attainment rate. So, that’s why we want to put the focus on them.

Norman: And, final question today from Michael Keating.

Journalist: Michael Keating from Keating Media, Minister. Universities have reported that they have a $16 billion black hole from the COVID crisis. Do you agree with that assessment, or do you think it’s more, or less?

Tehan: Look, there’s no doubt that there has been a big impact on the sector, and that’s why, on Easter Sunday, we announced that we were guaranteeing the Commonwealth Grants funding for the sector, that $18 billion that we put into the sector. That was the number one request that the university sector put to the Government, and that’s why, on Easter Sunday, we announced that we would guarantee that. So, it’s the international student revenue, which, in particular, has hit the sector hard. But, as I’ve said, we got 81 per cent of students in, and that sector makes up, across the board, about 25 per cent of the revenue of universities. So, the key focus for us has to be, what we can do to resume that pipeline going forward, and, in particular, for semester one. And, that’s why I want to work with the sector to get that pipeline reopened. There’s 250,000 jobs that were there, and we can either recreate or create, if we can get that international student market back up and opening. And, I think, all Australians understand how important it is that we grow jobs in this economy, and we know the international student market will do that.

Norman: And, on that note, let’s conclude. Thank you very much Dan Tehan for your address.

Tehan: Thanks Jane.