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Education and Employment Legislation Committee
06/05/2016
Estimates
EDUCATION AND TRAINING PORTFOLIO
Department of Education and Training

Department of Education and Training

[18:33]

CHAIR: Minister Birmingham, do you wish to make an opening statement?

Senator Birmingham: Good evening, Chair.

CHAIR: Good evening.

Senator Birmingham: It is a wonderful way to spend a Friday night, here with you and all of our friends.

CHAIR: Where else would you like to be!

Senator Birmingham: The committee looks like it may have had a long day. I will not trouble you with an opening statement, aside from of course welcoming and introducing the new secretary, Dr Michele Bruniges. I welcome her to the role. We farewelled Lisa Paul previously. I want to place on record my sincere thanks to Tony Cook for his period of time acting in the role. I know that we have an excellent leadership team at the helm of the department now.

CHAIR: Thank you, Minister, and welcome. Do you have an opening statement, Doctor?

Dr Bruniges : No, I do not.

CHAIR: Excellent. We shall proceed to questions. In the cross-portfolio area we are just going to run through as outlined. Senator Lines.

Senator LINES: I have some questions on child care. I want to know why almost $7 million has been allocated for the childcare subsidy communication campaign in this financial year, and almost $9.5 million in 2017-18?

Ms J Wilson : You are specifically asking—

Senator LINES: You got the question okay, Ms Wilson?

Ms J Wilson : You are asking about the allocation of money?

Senator LINES: Yes.

Ms J Wilson : The funding has basically been rephased. There was funding in 2015-16, 2016-17 and 2017-18. Because of the timing now for the implementation of the new package, the communications funding has been rephased forward.

Senator LINES: But there is a $7 million allocation in this financial year.

Ms J Wilson : Sorry, what are you reading from?

Senator Birmingham: Do you have a PBS reference or otherwise that you are referring to?

Senator LINES: 1.6: 'Support for the childcare system'. My reading is that $7 million has been allocated for the childcare subsidy communication campaign in this financial year, and almost $9.5 million in 2017-18.

Senator Birmingham: By 'this financial year' you mean 2015-16, which we are still in? Or 2016-17, the year of the budget papers?

Senator LINES: This financial year.

Senator Birmingham: So 2015-16. Is that what you mean, Senator Lines?

Senator LINES: Yes.

Ms J Wilson : I have the budget paper—page 39. It has $6.7 in 2016-17 and $9,447 in 2017-18.

Senator Birmingham: And an actual of $173,000 for this financial year.

Senator LINES: Say that again, Ms Wilson.

Ms J Wilson : $6,715 in 2016-17 and $9,447 in 2017-18.

Senator LINES: And this is for the childcare subsidy communication campaign?

Ms J Wilson : That is right. And it is a rephasing of money that was already there.

Senator LINES: So what is the planned expenditure in 2016-17? What is that going to be spent on?

Ms J Wilson : That will be the work that had been previously thought to be spent this financial year—where we talked previously about doing a range of communication products, testing a range of concepts, developing a campaign and a theme. Because the implementation time frame has been moved forward, that work will be rephased into forward years.

Senator LINES: What is the spend of $9.5 million—you gave me a different figure. The 2017-18 figure, what is that spend going to be used for?

Ms J Wilson : The whole amount in the last budget was $16.5. We talked about this previously. It was for a range of different products to support service providers and families to become familiar with and understand the new system going forward.

Senator LINES: So a whole year before the change comes into effect—what is it precisely you will be spending money on?

Ms J Wilson : There is developmental research which has taken place. There is work to be happening—

Senator LINES: Have you done that?

Ms J Wilson : Yes. There will be work in terms of bench—

Senator LINES: So that developmental research is not out of this pot of money that we are talking about?

Ms J Wilson : There will be developmental—

Senator Birmingham: Campaign development.

Ms J Wilson : That is right. There will be continuing work in terms of development of the campaign product—

Senator LINES: Exactly what? What do you mean by 'campaign product'?

Senator Birmingham: It is a communications campaign. So the messages—how best to ensure that providers and parents in the public understand the reforms—

Senator LINES: A whole year before—

Senator Birmingham: So that there is absolutely no doubt: this is a reflection of what the budget allocations were, but all phased forward one year. The rephasing reflects the overall change. The 2016-17 budget figure you are asking questions about is what would have been and was budgeted to be spent in 2015-16, with an earlier implementation of those reforms. It is now budgeted to be spent 12 months later with a deferral by 12 months of implementation of those reforms. It is standard campaign preparation.

Senator LINDGREN: Ms Wilson, has money already been committed on creative or research?

Ms J Wilson : The only work that has been done so far has been in relation to some developmental research—

Senator LINES: That is not the question I asked. I asked: has money been committed on creative or research?

Ms Gleeson : In terms of expenditure to date, developmental research is $205,070. We have paid some money toward the creative concept testing, because we had the pictures for the childcare campaigns. That is where the advertising agencies come in and pitch their ideas and their concepts and we take those and test those with target audiences. We have paid $77,644 for that work.

Senator LINES: How far did you get? You tested the messages?

Ms Gleeson : Yes, that is right. We had completed the first round of concept testing.

Senator LINES: What else have you spent or committed to?

Ms Gleeson : We have spent a small amount of money in terms of pitching fees, and also some travel reimbursement.

Senator LINES: Who was the travel reimbursement for?

Ms Gleeson : For two of the creative agencies that were pitching for the campaign.

Senator LINES: So you have trialled some ideas that you are now going to run with—some messages. Is that correct?

Ms Gleeson : We have tested those with target audiences; that is right.

Senator LINES: And have you made a decision about using those?

Ms Gleeson : The government has not made a decision as yet, no.

Senator LINES: Have you made a recommendation to government to pick those up?

Ms Gleeson : No, we have not.

Senator LINES: Have you committed any money to a media buy?

Ms Gleeson : We have not.

Senator LINES: What is the department's understanding? When did you do the message testing, in what months?

Ms Gleeson : In terms of the concept testing, I will give you some details. That testing took place from 30 January to 2 February 2016. There were eight focus groups and three minigroups. The total number of people was 90. It was across a range of locations, including Melbourne, Adelaide and Toowoomba. We were testing concepts—which is broader than just the messaging; it is the whole creative concept—with families using child care with varying levels of income and work hours per week. We were also testing those with groups of parents-to-be, members of the general public and childcare providers.

Senator LINES: Given that, from that time in January, the package has now been pushed back 18 months effectively—

Senator Birmingham: 12 months.

Senator LINES: No, the testing was done in January. The package is to come into effect on 1 July.

Senator Birmingham: The reforms are due to come into effective on 1 July 2018, as distinct from a previous start date of 1 July 2017, which is a 12-month deferral.

Senator LINES: That is 18 months. Senator Birmingham, if you would listen to my question.

Senator Birmingham: Actually, if you did not interrupt when I was answering.

Senator LINES: No. I said: you have done the creative work in January; you have come up with some concepts. So between January 2016 and the date of the implementation is 18 months. How do you know that that message is still going to be relevant?

Ms Gleeson : We do not.

Senator LINES: Thank you.

Ms J Wilson : Just adding to what Ms Gleeson said: we have a process we are going through for the election period. We will have to come to the end of that and we will be informed by the government of the day on the position on child care after that.

Senator Birmingham: The government's position is to see its reforms fully implemented. The reforms of course remain exactly the same. The communications campaign is about explaining the nature of those reforms to parents and providers. We are sure we will still need to have the same fundamental principles applied to it.

Senator LINES: A message that is now 18 months old.

Senator Birmingham: The reforms are the same.

Senator LINES: Ms Gleeson, you said you have made some recommendations about the messaging but—

Ms Gleeson : No. No recommendations have been made to government.

Senator LINES: You tested the concepts. Where are they? What did you do with them?

Ms Gleeson : The concepts are still with the department.

Senator LINES: Are they just sitting in a box somewhere or what?

Ms Gleeson : No, they are on a secure drive.

Senator LINES: Have they been shelved? What is their status?

Ms Gleeson : They do not have a status until after the government has the opportunity to consider where it wants to go in the future with its advertising campaign.

Senator LINES: So between testing in January and now, in May, they have sat in the department and not moved?

Ms Gleeson : There were a number of other RFQ processes running at the same time.

Senator LINES: What is an RFQ process?

Ms Gleeson : A request for quote.

Senator LINES: But this is your creative stuff. What else was running?

Ms Gleeson : If I could just clarify that at the end of the testing period is not when the department receives the report from the company that is providing that information. It actually takes them four to six weeks to compile it.

Senator LINES: So, at best, you got the report in late February or early March?

Ms Gleeson : I would have to take that on notice and provide the information to you.

Senator LINES: So you have had those concepts. They sent them to you and what did you do with them? Were they just put on a secure drive for some time in the future?

Ms Gleeson : Correct. That is right.

Senator LINES: Does that mean that back in January you knew that there was going to be trouble with the package?

Senator Birmingham: There is no trouble with the package, aside from the fact that the Labor Party will not support the savings required to pay for it.

Senator LINES: Does it mean that back in February there was no plan to push the childcare package?

Senator Birmingham: No.

Ms Gleeson : There are a number of approval processes that we have to go through in government to be able to bring advertising to the market. We have to commence that work a fair way in advance of when it actually might go live.

Senator LINES: You have spent close to $100,000 on an idea that has sat in your secure drive, at best, since February.

Ms Gleeson : There were a number of ideas.

Senator LINES: What else have you—

Senator Birmingham: Sadly, it was evident earlier this year that you were not being terribly cooperative with the passage of the savings required.

Senator LINES: It is not our package. It is your package.

Senator Birmingham: And do you have the numbers in the Senate that could have supported the passage of the savings?

Senator LINES: When was the decision taken to push the childcare package back and to put these changes on hold?

Senator Birmingham: It was a budget decision.

Senator LINES: But you have been holding off. What work have you done on the childcare package, that you were looking to implement a year earlier, since you did the creative work in January up to the time of the budget?

Ms Gleeson : We talked about the research that was being conducted beyond the February date that I provided.

Senator LINES: The research was done when? What periods?

Ms J Wilson : 30 January to 2 February.

Senator LINES: About the same time as the creatives or a bit later.

Ms J Wilson : That was the concept testing research—

Senator LINES: What research were you doing from 30 January?

Ms J Wilson : It was the creative testing of the four concepts that Ms Gleeson outlined for you before.

Senator LINES: The one we just talked about. I asked you what else you have done?

Ms Gleeson : From 1 February to 3 February we had concept testing in the field and—

Senator LINES: Which we just talked about, so we can tick that off.

Ms Gleeson : Correct. That is right. We also commenced an RFQ process—request for quote process—for the benchmarking, tracking and evaluation report. That RFQ was issued on 7 December 2015.

Senator LINES: What was the closing date on that?

Ms Gleeson : 5 February was when the submissions were received.

Senator LINES: What work did you do on that?

Ms Gleeson : We were progressing it in terms of being able to provide a recommendation through the department's executive to the minister's office—

Senator LINES: How long does it take to progress?

Ms Gleeson : I would have to take that on notice.

Senator LINES: From February until when were you progressing?

Ms Gleeson : We were progressing the development work in terms of—

Senator LINES: When did you stop progressing it?

Ms Gleeson : I would have to take that on notice. I do not have those details.

Senator LINES: You do not know? You knew what you were doing with the RFQ. Surely you can give us some estimate of when you stopped doing work on that.

CHAIR: Ms Gleeson took the answer on notice.

Senator LINES: I am still pursuing questions, thank you, Senator McKenzie.

Ms Gleeson : May I take it on notice?

Senator LINES: I am asking you to give me a ballpark of when you finished—

Senator Birmingham: You do not need Senator Lines's permission to do that.

CHAIR: You have already taken it on notice, Ms Gleeson. Senator Lines can you ask the question 50 times—

Senator LINES: Thank you. Ms Wilson?

Ms J Wilson : I am adding to the discussion. There were multiple RFQs, as Ms Gleeson mentioned, so it is not just one and a date you are after. There were a whole series of things happening in parallel.

Senator LINES: How many RFQs were there then?

Ms Gleeson : My estimate is five in total. I can run through those if you like.

Senator LINES: Yes, please.

Ms Gleeson : There was the creative RFQ, issued on 7 December, which preceded the concept testing. There was an RFQ for the concept testing as well, which was part of the developmental research RFQ. There was also an RFQ issued on 7 December for CALD and Indigenous communications translations. There was also an RFQ put into the market on 22 January for a public relations supplier.

Senator LINES: Public relations supplier—what is that for?

Ms Gleeson : In anticipation of the campaign, to run in parallel to the campaign. To support the campaign.

Senator LINES: What would they do?

Ms Gleeson : They tend to focus on looking at the effectiveness of the national advertising campaign messages, and make assessments and help the department assess whether or not further below-the-line communication is required.

Senator LINES: I think we are up to three.

Ms Gleeson : I have covered off the developmental concept and refinement research; the creative, benchmarking, tracking and evaluation research; CALD, which is culturally and linguistically diverse; Indigenous communication services and the public relations.

Senator LINES: Were all of those concepts completed? You sent the RFQs out, and they all got back on the required dates?

Ms Gleeson : They did. That is right.

Senator LINES: What has happened with that work?

Ms Gleeson : They were being evaluated by the department.

Senator LINES: Up until when?

Ms Gleeson : I would have to take that on notice, because there were multiple RFQs that were being evaluated.

Senator LINES: Were you still evaluating these RFQs four weeks ago?

Ms Gleeson : I would like to take that on notice.

Senator LINES: That is the whole of the work that you are doing in relation to the child care package?

Ms Gleeson : There were also discussions with the master media agency—the government's media agency—in terms of developing a media plan, but that did not develop. We have a—

Senator LINES: Why didn't the media plan develop?

Ms Gleeson : The media plan did not develop because the media strategy, which needs to be approved by government, was not progressed.

Senator LINES: Is that normal for the government not to progress a media strategy?

Ms Gleeson : At this point in the development of a campaign, yes.

Senator Birmingham: Particularly given it was increasingly apparent that the savings required for this proposal were not going to be passed prior to the end of this financial year, and of course the government did not want to be in a position of proceeding with an advertising campaign prior to the passage of necessary legislation.

Senator LINES: Then the department had an idea that the package was not going to proceed?

Senator Birmingham: The answer I just gave is the answer, which is: it was increasingly clear to the government—the government being all of us sitting at the table, and others—

Senator LINES: Well, the department is not the government.

Senator Birmingham: The department actually is a part of the government of the day—

Senator LINES: Okay. So I asked the department if they were clear.

Senator Birmingham: The department of course—like almost anybody who looked at the behaviour of you and your colleagues, Senator Lines—was clear that it was going to be very difficult to pass those savings—

Senator LINES: This is not about Labor. This is about your failure to deliver a package.

Senator Birmingham: Actually, the failure to pass the savings is very much about Labor.

Senator LINES: No. We never even got the opportunity. So was it clear to the department that the package was not going to proceed?

Senator Birmingham: The package of reforms remains the government's policy.

Senator LINES: I am trying to asked the department questions. So I will ask you, Senator Birmingham: was it clear to the department the package was not going to proceed?

Senator Birmingham: It was clear to many people that the intransigence of the Labor Party—

Senator LINES: No, you said? Not going to pass? Clear to government but somehow not to the department?

Senator Birmingham: —in passing the savings was going to make it difficult for the legislation to be dealt with this financial year.

Senator LINES: Has the FTB been banked in the budget—the FTB save?

Senator Birmingham: That would be a question for Social Services.

Senator LINES: So you have no idea.

Senator Birmingham: That would be a question for Social Services.

CHAIR: The minister has answered the question. He has referred you to the appropriate department.

Senator LINES: Minister, if the whole child care package is not going to happen now—

Senator Birmingham: That is not true. It has been deferred by 12 months.

Senator LINES: So what has happened to the FTB then?

Senator Birmingham: That would be a question for Social Services.

Senator LINES: So you have no idea.

Senator Birmingham: I am saying that we are in the Department of Education and Training estimates, and the questions about family tax benefit are questions for the Department of Social Services.

Senator LINES: Right, so you have no idea?

CHAIR: That is not what the minister said.

Senator LINES: The minister has seen a wide-ranging—

CHAIR: It is Senator Cameron's tactic, and I had assumed you would not adopt it. Do not put words into the minister's mouth.

Senator Birmingham: I am doing my best to not take the bait.

CHAIR: He referred the senator the other department.

Senator JACINTA COLLINS: Can I suggest you chairing and not defending your colleague?

CHAIR: I am chairing.

Senator JACINTA COLLINS: If you are defending him, you might want to rely on another colleague to do that whilst you are in the chair.

CHAIR: And that other colleague is absolutely competent to do that. The minister has answered the question.

Senator Birmingham: I am just trying to not to take the bait, Chair, so as not to waste the time of the committee.

CHAIR: You can put that to the other department, which is two doors down the hall.

Senator LINES: So you have a wide-ranging view about Labor's position on your childcare package but you cannot tell us about the FTB or what is happening with that.

Senator Birmingham: If you want to ask questions about the FTB, they are questions for the Department of Social Services.

Senator LINES: I will go back to the department seeing as you cannot answer that question. At what point was the department told the government was not proceeding with the original start date for the package?

Senator Birmingham: That was a budget decision.

Senator LINES: But at what time were you told? You just opened the budget papers and there it was?

Senator Birmingham: No, I do not think it is practice or has ever been the practice of any government to go through at what point decisions of the Expenditure Review Committee of cabinet might be made.

Senator LINES: When did you stop the work on all this creative work you were doing?

Ms Gleeson : We did not notify tenderers through the quotation process until after the budget this week. So we just advised those companies that have tendered that those tender processes would not be proceeding.

Senator LINES: So you have just sent them now? So when did you stop the work that you were doing?

Ms Gleeson : We have never stopped the work.

Senator LINES: So you were working on the implementation date right up until when you saw it in the budget papers?

Senator Birmingham: I am sure up until the decision was taken by government. We are not going to go around a backdoor means for you to find out at what point the Expenditure Review Committee decision was taken by the cabinet.

Senator LINES: Senator Birmingham, I do not need patronising lectures from you, thank you very much.

Senator KIM CARR: Chair, the minister is entirely within his rights to say he does not wish to discuss matters at cabinet but it has been custom and practice in this place, for as long as I can remember, for the government to indicate the date on which a decision was made. This is not going to the detail of the cabinet discussion but to the date on which a decision was made.

Senator Birmingham: Senator Carr, I do not think it is custom for the date on which budget decisions are made—

Senator KIM CARR: Cabinet made a decision and surely you can advise the committee the date on which cabinet made a decision.

Senator Birmingham: I will happily take it on notice and see if there is any precedent for disclosing when cabinet decisions about the budget are made. I certainly cannot think of one, not sure if you can.

Senator JACINTA COLLINS: Dr Bruniges, welcome back to the Commonwealth. Can you remind me of the position you were in before you went to New South Wales.

Dr Bruniges : I was Associate Secretary of Schools and Youth.

Senator JACINTA COLLINS: I wish you a change of government and you can see Gonski fully implemented. The question I want to ask about government goes to Victoria. I am interested in the Victorian IBAC decision around school funding or around the public school misappropriation issues. I am attempting to gauge some sense of what impact or what scale of Commonwealth funds might have been involved in that conduct, if any.

Dr Bruniges : I might ask Mr Cook to give you some details around that.

Mr Cook : We certainly do not have that information. We would have to write to the Victorian government and seek that information. As you know, Commonwealth funding goes as a single cheque. Because Commonwealth funding is not traditionally used for infrastructure, which is predominantly what some of the capital thing was around the IT system—I think it was called the ultra net—

Senator JACINTA COLLINS: It was not only capital but yes.

Mr Cook : There was a lot of that. I think there was $160 million or something—sorry, I might have to correct the record on that. We would have to ask the Victorian government. We would not know.

Senator JACINTA COLLINS: So you have not at this stage received any report or conducted any assessment of the IBAC report that came out recently?

Mr Cook : I have seen the IBAC report and I am aware of the IBAC report.

Senator JACINTA COLLINS: Are there any governance issues that come out of it that are relevant for the Commonwealth department?

Mr Cook : As to the governance issues, the Commonwealth department writes to all state and territory governments, as we do to all recipients of Commonwealth funding, asking them to acquit through their auditor-general, or an appropriate person, that the Commonwealth funding has been spent for the purposes of education. The Victorian government have done that. They have done that every year and they have not raised anything with us consequential to the IBAC finding.

Senator JACINTA COLLINS: As a rough guess, what proportion of the funds provided to Victorian government schools would be Commonwealth funds?

Mr Cook : That would be available on the My School website at a school level.

Senator JACINTA COLLINS: Yes, but I am wondering at a system level.

Mr Cook : At a system level, I would have to take on notice because we would have to break down the funding. I am happy to take that on notice.

Senator JACINTA COLLINS: I am trying to get a handle of the reports about the losses that have been involved through this. It would roughly be that figure that would be the Commonwealth loss through that process, I suspect—except the point you make about infrastructure.

Mr Cook : I could not verify that. The majority of Commonwealth funding, I am assuming, has gone to schools. The auditor-general, or the appropriate person accountable, has verified that in an annual statement to us. I have no reason to believe that that is not correct, but I do not have any evidence around that.

Senator JACINTA COLLINS: I am not questioning that aspect of it. There are questions about this business school model, and I think there are decisions around that issue and that it will not proceed in the future. Are there any other lessons that you think apply to other government school systems that the Commonwealth supports?

Mr Cook : It is really a state matter it in terms of their own internal processes, I think. We have a system in place around getting the most authoritative advice from a state that the funding has been used for that purpose.

Senator JACINTA COLLINS: Sure.

Mr Cook : If a state does not realise it has not been used for that purpose, which seems to have been the case in Victoria, then I think it is a state lesson as much as anything.

Senator JACINTA COLLINS: I appreciate it is a state lesson, but the question I am asking is whether there are lessons that Victoria has learnt through this that would be relevant to other states as far as you would understand. To your knowledge, do other states run the business school model?

Mr Cook : I am not aware; I am sorry. That would have to be a question for the states. They may have looked at the findings of IBAC but I am not sure. I have had no discussions with state or territory bureaucrats around the IBAC investigation.

Senator JACINTA COLLINS: So you will come back to me on notice about what proportion of the Victorian government schools—

Mr Cook : If I look at the national figure, in terms of funding to government schools, about 18 per cent of that at the moment comes from the Commonwealth. Back four or five years ago, I think it would have been, when this was focused, it was a much lower percentage. It would have been probably about 12 per cent or 13 per cent. Victoria, of course, depending on whatever the model was, might have had slightly less or slightly more, because every state or territory is different.

Senator JACINTA COLLINS: That is right.

Mr Cook : We can take it on notice. Would you like to know for that approximate period? We would have to project back five years, I think.

Senator JACINTA COLLINS: I do want you to go to that level of work. I appreciate what you are saying—that the proportion of Commonwealth dollars has risen somewhat—but I was more interested in simply getting a handle on the problems that have occurred in Victoria and what proportion of those would have, in general terms, been Commonwealth dollars. From what you are saying, it is roughly one in five.

Mr Cook : That is right. It is probably a little bit less; probably one in six.

Dr Bruniges : If I could go to your broader question about other jurisdictions and looking at what other states and territories do, that certainly happens. I guess, from a jurisdictional perspective, if something of that nature happens, often internal governance procedures within departments will refer to those particular reports and then reflect on their current practices. There could be in different states and territories or education systems, whether that be the Catholic system or the public system, a reflection on findings on audit reports and making sure that systems within their governance, or risk management systems, often pick up on significant findings.

Senator KIM CARR: I do appreciate the opportunity you have provided with the cross portfolio. The only question I have, in regard to the VET, goes to the loans program, which is a departmental responsibility. It is not a subdivisional responsibility.

CHAIR: We will leave that up to the officers.

Senator KIM CARR: Firstly, Madam Secretary, I congratulate you on your appointment as secretary and I look forward to working with you. The government is about to call an election. How do you see the caretaker conventions operating?

Senator Birmingham: That is a rather broad question.

Dr Bruniges : It is. As they are written down, the caretaker conventions I circulated to all members in the department.

Senator KIM CARR: Under your understanding of the caretaker conventions, at what point do they cut in?

Dr Bruniges : When the writs are issued, I understand.

Senator KIM CARR: What do you understand to be the key elements of the caretaker conventions?

Dr Bruniges : For the public servants, it is incredibly important that we abide by those. That means, for us, not providing policy advice, that we are in caretaker mode, that we are very conscious of the fact that factual information can be supplied to government but nothing more than that.

Senator KIM CARR: That is right. And access for the opposition?

Dr Bruniges : I understand that there are times when the opposition will request briefings of a factual nature, and the department will, indeed, provide that information.

Senator KIM CARR: And your assessment is that this is from the point at which the writs are issued.

Dr Bruniges : My understanding is that, yes, that is correct.

Senator KIM CARR: Is there anything else you want to add? You have just been given a note.

Dr Bruniges : They have just given me a hard copy. This is the hard copy I circulated to all the department's officers.

Senator KIM CARR: Are you able to table that?

Mr Cook : It is public information.

Dr Bruniges : It is public information.

Senator KIM CARR: I would like to see the note that you have tabled—can you table that?

Dr Bruniges : I think—

Senator Birmingham: This is a PM&C document. It is not the note.

Senator KIM CARR: Yes, but that is the note you have distributed to departmental officers.

Mr Cook : No, that is the conventions themselves.

Dr Bruniges : Yes, the conventions themselves, not the note I distributed. That was an email.

Senator KIM CARR: I ask you to table the document that you are reading from. I turn to the Auditor-General's report, No. 31, which is the Administration of higher education loan program debt and repayments. It has a number of quite extraordinary statements. It says, for instance, on page 9:

… Education was unable to demonstrate that it routinely monitored and analysed factors affecting the repayment of HELP debt. Improving its analysis of the growth in HELP debt and repayment rates would enable Education to better assess the sustainability of the program and inform program design.

It also says:

The ATO and Education do not meet their risk management responsibilities under the Memorandum of Understanding, and consequently do not effectively manage HELP risks.

Madam Secretary, what is your response to that report?

Dr Bruniges : With all the recommendations in that audit report, the department has agreed to implement those. Coming new to the position, I have done that response to the National Audit Office, and I know each and every one of those recommendations we have agreed to implement.

Senator KIM CARR: When did you receive this report?

Dr Bruniges : I would have to take the exact date on notice, the final—

Senator KIM CARR: But you would be able to indicate roughly when it was. A draft copy would have been provided to you for comment.

Dr Bruniges : That is correct. I think it was the second week in April.

Senator KIM CARR: What steps have been taken since that time to actually improve the department's capacity to routinely monitor and analyse factors affecting the repayment of HELP debt and the other matters relating directly to the ANAO's assessment of the department's capability?

Ms Borthwick : I think the audit report notes that in fact the department already took some steps before the tabling of this report to improve its monitoring and analysis of the HELP program, together with the ATO. In fact, I think it was in late 2015 that the government endorsed a program of data sharing and data matching with the ATO which will enable us to have a much better capacity to monitor and analyse the HELP loan system.

Senator KIM CARR: I am thinking here about the number of media reports, Senate committee reports and estimates discussions with various agencies concerning a number of rorters that exist within the vocational education system. What steps have you taken to clean that up?

Senator Birmingham: A number of reforms have been applied there and continue to be applied—

Senator KIM CARR: That is not the question I am asking. I am asking a question that particularly relates to the ANAO report on the monitoring of the loans program.

Senator Birmingham: Actually, you asked a much broader question that was far broader than the ANAO report or any findings within that report. You asked what steps have been taken to address rorting within the VET sector. As we did indicate, they really are questions for Senator Ryan, who is more than happy to appear before the committee, and we are happy to swap right now if you want to conduct VET questioning, and we can bring the VET officials to the table.

Senator KIM CARR: I have a few questions about the administration of the loans program. I would like to know what the department has done about cleaning up the operations of the loans program in regard to what has become a demonstrable scandal in regard to the VET FEE-HELP arrangements.

Senator Birmingham: That is fine. I am happy to ask for a suspension for two minutes and we will get Senator Ryan here.

CHAIR: I was happy to work through the program. If this is something that would be better dealt with in outcome 2 we can deal with it in outcome 2.

Senator KIM CARR: If that is the way you want to deal with it, but—

CHAIR: Or we can suspend and get Senator Ryan here.

Senator KIM CARR: I want to deal with this. As I said to you, I have very limited time tonight. I want to know—straightforward—what the department has done about an ANAO report which they received in April. What have you done about it?

Senator Birmingham: The secretary has been answering questions specifically about the ANAO report. If you want to ask questions more broadly about the operation of VET FEE-HELP and the availability of those loans—

Senator KIM CARR: And the loans program, and—

Senator Birmingham: and the availability of those loans—

Senator KIM CARR: We well know what the billions have been in the blow-out. It has been through this scheme.

Senator Birmingham: Yes, Senator Carr, we do 'well know'. We well know how appallingly you set this program up. We well know the failings of the program over the years—

Senator KIM CARR: And how you have been asleep at the wheel for three years.

Senator Birmingham: We well know that there have been many changes—

Senator KIM CARR: We have had four ministers.

Senator Birmingham: and we well know that your reforms that you announced last night will see students paying up-front fees.

Senator KIM CARR: Asleep at the wheel!

CHAIR: Senators; Minister: it is late, after a massive week for everybody. I would appreciate it if we could approach this calmly. Senator Carr, you are entitled to have your questions answered, and I will support your efforts to have that happen. Would you like to have the committee suspended, and we will get Senator Ryan in?

Senator KIM CARR: I have told you I have one question on the VET FEE-HELP loan. This is it. I would like to know what you have done, in the department, to monitor this, given what the ANAO has said—

CHAIR: We are happy to get the appropriate minister for you.

Senator Birmingham: Can I seek clarification of your question, Senator Carr? Is your question, 'What has the department done specifically in response to the ANAO report since its receipt?' or is it 'What has the department and the government done in relation to VET FEE-HELP'?

Senator KIM CARR: No. In regard to this report, what have you done?

Senator Birmingham: Calm down, Senator Carr, please. So, the report that the department got a couple of weeks ago: you want to know what they have done—

Senator KIM CARR: What have you done?

CHAIR: That was Senator Carr's question, Minister.

Senator Birmingham: The report the department got a couple of weeks ago: you want to know what the department has done in the past couple of weeks with that report, and the secretary has advised you that she has accepted all the recommendations within that report.

Dr Bruniges : That is correct.

Senator KIM CARR: That is what you have done: you have accepted the recommendations.

Dr Bruniges : Not only that. I have agreed with all the recommendations, in consultation with the Australian Taxation Office. I have had a number of team meetings over that report with the officers in the areas to discuss our way forward. And very shortly we will again meet with the ATO on data exchange and make sure that we put in place all the recommendations we have agreed to do.

Senator KIM CARR: I want to go to some measures regarding the budget announcements but, before I do, Minister, can you indicate to me whether a decision has been made within government to provide support for the Warrnambool campus of Deakin University?

Senator Birmingham: I have had some discussions with vice-chancellors on that matter. The discussions between those institutions are somewhat sensitive.

Senator KIM CARR: Well, perhaps I can enlighten you. Is it the case that Federation University has in fact deferred the decision to the next council meeting, which I believe to be on 13 June?

Senator Birmingham: I think that is a question for Federation University.

Senator KIM CARR: But you would have been apprised of that.

Senator Birmingham: I am aware that consideration of their involvement, potentially, with the Warrnambool campus is still live and underway.

Senator KIM CARR: I asked the question earlier about caretaker arrangements, and that is why I ask whether you have made a decision, because the support for other governments depends on a decision being made and announced before the caretaker conventions take effect.

Senator Birmingham: There are two different matters there. The government has made a decision and, as far as I am aware, that decision has been conveyed to the government of Victoria.

Senator KIM CARR: And the Victorian government's support for it is conditional upon it not being used as a campaign element but being announced prior to the election being called. Is that not the case?

Senator Birmingham: Well, I would be horrified if that was the condition of the Victorian government—

Senator KIM CARR: Of course it is the condition!

CHAIR: Is that public?

Senator Birmingham: This government has made a decision and conveyed it in confidence to the parties and to the government of Victoria, and if it—

Senator KIM CARR: I can only rely on the press reports that you have issued!

CHAIR: The minister is answering your question, Senator Carr.

Senator Birmingham: If that decision preserves a campus at Warrnambool, I hope you are not implying that somehow, should there be a change of government, you would not honour that decision.

Senator KIM CARR: I did not say a word about that! I want to know whether you have made a decision to provide $14 million to the university conditional upon the Victorian government putting money in and Deakin University putting money in. And is it the case that that depends upon Federation University engaging in this project?

Senator Birmingham: As I said, there are discussions between institutions, which include Federation University, about the future of the Warrnambool campus. The government has made a decision in relation to what it might be able to do to help ensure that the campus at Warrnambool is preserved into the future. I do not wish to jeopardise those negotiations by running them publicly.

Senator KIM CARR: But you have run them publicly!

Senator Birmingham: I am aware of media speculation—

Senator KIM CARR: With your picture on it, and the local member. It is a bit more than media speculation; you have placed the article.

Senator Birmingham: I have not placed the article, and neither has my office. We have, so far as I am aware, communicated the decision of the government to the government of Victoria. We have been trying to work cooperatively with the government of Victoria and the institutions involved to ensure that the Warrnambool campus stays open. I would hope that is an outcome that you, as a senator for Victoria, would want to see and that you would not wish to jeopardise that by playing any politics with it at Senate estimates here tonight.

Senator KIM CARR: Does that decision depend upon the Federation University coming to the party?

Senator Birmingham: Obviously, somebody has to operate the Warrnambool campus, and Federation University is a party to discussions as somebody who may potentially be interested in operating out of the Warrnambool campus.

Senator KIM CARR: Where will I find this allocation of $14 million dollars in the budget papers?

Senator Birmingham: The decision of government, for which I am not confirming values, figures or otherwise, is budgeted for.

Senator KIM CARR: Where will I find that in the budget paper?

Senator Birmingham: It is budgeted for.

Senator KIM CARR: That is not the question. Where will I find it in the budget papers?

Senator Birmingham: I will take that on notice.

Senator KIM CARR: What about Berwick—are you providing support for Berwick?

Senator Birmingham: I am aware that institutions are having conversations in relation to Berwick.

Senator KIM CARR: Have you made a decision in regard to Berwick as well?

Senator Birmingham: No such request has been made.

Senator KIM CARR: And Launceston—have you made a decision with regard to Launceston?

Senator Birmingham: That is a matter that is under consideration.

Senator KIM CARR: You have not made a decision, then?

Senator Birmingham: That is a matter that is under consideration.

Senator KIM CARR: This is a very straight question because, as I said, the caretaker conventions apply here. Have you made a decision?

Senator Birmingham: It is a matter that is under consideration.

Senator KIM CARR: So you have not made a decision?

Senator Birmingham: You can interpret that answer as you wish. It is a matter that is under consideration.

Senator KIM CARR: Madam Secretary, at what point do you actually have to register a decision under the terms of the caretaker conventions?

Senator Birmingham: What do you mean by 'register'?

Senator KIM CARR: That is why I am asking the secretary. At what point do you have to determine whether or not a decision has been made prior to the caretaker conventions cutting in?

Dr Bruniges : I would need to seek advice on that, Senator.

Senator KIM CARR: Advice from who?

Dr Bruniges : I guess the Prime Minister's unit, on that. I am aware of the caretaker provisions, and I presume that as soon as a decision is made I would need to log or register that somewhere. I would need to clarify that.

Senator KIM CARR: Do the caretaker conventions go to the question of contracts, or do they go to the question of just announcements?

Dr Bruniges : No, they go to the question—a new contract cannot be signed during caretaker period.

Senator KIM CARR: But you can announce new expenditure? Can you announce new expenditure?

Dr Bruniges : I would have to take that on notice.

Senator KIM CARR: It would depend entirely on whether a decision has been made prior to the caretaker arrangements being entered into, would it not?

Senator Birmingham: The coalition can announce intended expenditure in a campaign just as the Labor Party can announce intended expenditure in a campaign. They are separate matters.

Senator KIM CARR: What is the difference there, Minister? One is an election commitment and one is a decision of government.

Senator Birmingham: That is correct.

Senator KIM CARR: That is why I am asking the question: have you made a decision? Because at this point—on Friday night at this time—you are still the government.

Senator Birmingham: We are still the government, and the matter is under consideration.

Senator KIM CARR: But no decision has been made at this point?

Senator Birmingham: The matter is under consideration.

Senator KIM CARR: I look forward to that little exercise. Are there any other appointments that you need to announce, Minister, before the writs are issued?

Senator Birmingham: Not that I am aware of.

Senator KIM CARR: So you have announced all the appointments? There are no further appointments pending announcement?

Senator Birmingham: Not that come to mind.

Senator JACINTA COLLINS: Advertising?

Senator KIM CARR: They have got no advertising, have they? There is no more government advertising running at the moment for this department, is there?

Ms Borthwick : Sorry, Senator—on what?

Senator KIM CARR: On anything.

Ms Borthwick : Not that I am aware of.

Senator Birmingham: Not that comes to mind.

Senator KIM CARR: I just thought I would ask the question. I am not aware of any, but you never know with this show. Under the caretaker convention—

Senator Birmingham: It was an automatic 'yes' when you were there, but—

Senator KIM CARR: advertising does finish, does it not—is that correct?

Dr Bruniges : That is correct.

Senator KIM CARR: All paid government advertising must finish?

Dr Bruniges : Yes, that is correct. It goes to a committee, doesn't it—a decision?

Senator Birmingham: Actually, not all paid government advertising, because—

Senator KIM CARR: Which are exempt?

Senator Birmingham: I would have to refer to the details, but there are certain areas of government information that can still be paid for.

Dr Bruniges : It could be. I think an earlier example today was Defence recruitment.

Senator KIM CARR: Yes, but that is not campaign advertising at all.

Dr Bruniges : No, it was government advertising about recruitment.

Senator KIM CARR: It is generally regarded as a different category, and I accept that. Thank you very much. In regard to the government's budget savings, what is the total savings in the forward estimates from the education department?

Dr Bruniges : Let's see if we can bring up the CFO for that.

Ms Monkley : I am looking up the savings—

Senator KIM CARR: What is the total?

Ms Monkley : I would have to go through and work through that line by line. The measures tables presented in the portfolio budget statements do not go to the information as cleanly as you are talking about.

Senator KIM CARR: In the PBS—do you have a page number for me?

Ms Monkley : The budget measures tables are all contained on pages 19 to 21 of our portfolio budget statements.

Senator KIM CARR: What is the total?

Senator Birmingham: I think the official just indicated that she would have to go through and calculate that line by line.

Senator KIM CARR: Do you want me to come back to that?

Ms Monkley : That would be good.

Dr Bruniges : Would you mind, Senator? We will take it on notice or we will come back.

Senator KIM CARR: You know damn well we will never get any of these questions on notice. I will ask the officer. If she wants to come back, I will come back in a minute.

Senator Birmingham: Senator, I would have thought anybody in your office could add it up if you really wanted it.

Senator KIM CARR: Yes, sure they can; that is why I am here at estimates. That is part of the estimates process.

Senator Birmingham: To get officials to do basic calculations for you?

Senator KIM CARR: Basic calculations? We are trying to get this government to do basic calculations, and then we would be ahead, wouldn't we? In regard to the measures that you have announced, Minister, what is your position on fee deregulation?

Senator Birmingham: The government is not proceeding with the previously proposed model of full fee deregulation.

Senator KIM CARR: When you say full fee deregulation, does that mean you are ruling out all fee deregulation or do you see a prospect that there would be some deregulation?

Senator Birmingham: The government has proposed an alternative policy of flagship courses similar to what was recommended by Dr Lomax-Smith in a report that I note you were rather rude about the other day.

Senator KIM CARR: Yes, because it is not the same report you are referring to, but we will get to that. I will let you tell us the story.

Senator Birmingham: The model of flagship courses that the government has outlined would allow universities to designate certain programs as courses of excellence or innovation and to have flexibility in relation to how those courses were structured or funded.

Senator KIM CARR: How many flagship courses do you see that there would be, under the government's policy, at any university?

Senator Birmingham: The government has suggested that a maximum number that could be contemplated would be 20 per cent. But it is a matter for further consultation as to whether that could or should be lower.

Senator KIM CARR: So you are saying that a 20 per cent maximum would be the proposition that government would put in place?

Senator Birmingham: Correct.

Senator KIM CARR: Would that be 20 per cent of courses or 20 per cent of enrolments?

Senator Birmingham: It would be 20 per cent of student load.

Senator KIM CARR: Student load—that is individuals?

Senator Birmingham: Correct.

Senator KIM CARR: How do you see that in terms of numbers? How many people would that be across the system?

Senator Birmingham: I would have to take that on notice.

Senator KIM CARR: You surely have that information?

Senator Birmingham: We can see whether somebody can tell us how many currently enrolled students there are.

Senator KIM CARR: You must have that information.

Ms Borthwick : I will add that the proposition is up to 20 per cent of student load. It would depend on what the university wanted to do and how many students they could attract into such courses. It would not be a definitive number in any event.

Senator KIM CARR: Yes, but in budget terms you must have calculated what it means, because the budget papers specify that over and over again within the context of the savings announced by the government. You must have made an assessment of how many you would see fitting in with these flagships?

Ms Borthwick : Not necessarily.

Senator Birmingham: The policy paper that is being released makes clear that any of the changes within that policy paper would have to fit within the existing budget envelope.

Senator KIM CARR: What is the budget envelope for this matter?

Senator Birmingham: The budget envelope is what is outlined in the budget papers for continued funding.

Senator KIM CARR: Yes, and I want a number. What is the number?

Senator Birmingham: You want to know what the funding is—

Senator KIM CARR: Yes, for the flagships.

Senator Birmingham: Do you want to know what the funding is for Commonwealth government supported places?

Senator KIM CARR: No, the flagships—the 20 per cent for the flagships.

Senator Birmingham: Of course, the flagships are outlined in the policy paper. The policy paper makes it clear that, if flagship courses are adopted as part of the final reform proposal, they will need to fit in with the budget forward estimates as they are currently outlined.

Senator KIM CARR: What number is that?

Senator Birmingham: You want us to talk you through the budget forward estimates?

Senator KIM CARR: Yes, I want to know how much money would be tied up with these flagships involving 20 per cent of university students. We know roughly how many students there are.

Senator Birmingham: What do you mean by 'tied up' with them?

Senator KIM CARR: You have made a budget estimate of what the cost is. We see in the budget papers there is over $2 billion cut directly from the Commonwealth supported places. Is that the figure? I do not think it is.

Ms Borthwick : The 20 per cent flagship courses are prospective, so they are subject to consultation. So there is no direct line item in the budget papers that describes the 20 per cent.

Senator KIM CARR: No line item?

Ms Borthwick : Correct.

Senator Birmingham: However, they would be funded out of existing funding in the budget for Commonwealth government supported places.

Ms Borthwick : Yes, and that is what the budget figures say.

Senator KIM CARR: Yes. It is just that you have mentioned the Lomax-Smith paper, and my recollection of it is that it had a few characteristics which are a bit different. They included 50 per cent higher fees versus no limit on fees, which is your proposal, I suppose. Lomax-Smith actually proposed, if I remember rightly, that they be limited to five per cent of load, not 20 per cent, and that they be funded at 150 per cent of the regular funding rate. Is that true or not?

Senator Birmingham: Dr Lomax-Smith's paper, from my recollection, did flag some of those possibilities. If you look at the policy paper released that canvasses the idea of flagship courses, it asks a number of questions, including what a maximum proportion might be, identifying 20 per cent as a figure. Certainly that is the maximum the government would countenance.

Senator KIM CARR: Yes, but that is not the Lomax-Smith position, is it?

Senator Birmingham: No. I said the concept was taken from Dr Lomax-Smith.

Senator KIM CARR: I see—the concept. Is it your proposal that there be a choice between 50 per cent higher fees and no limit on fees, with ACCC monitoring? Is that the proposal that you have been advancing?

Senator Birmingham: We have proposed that the ACCC may have a role to monitor, that there could be other mechanisms used to constrain fees, and that we will work through those options with the sector to ensure it is a sound policy approach.

Senator KIM CARR: But you are proposing no limit on the fees.

Senator Birmingham: That would be one option.

Senator KIM CARR: That is right. Lomax-Smith talked about five per cent of student load; you are proposing 20. That is another difference—is that not the case?

Senator Birmingham: I think we just canvassed that.

Senator KIM CARR: Yes. She actually proposed higher government funding—50 per cent more—did she not?

Senator Birmingham: I have some recollection of that. Without the report in front of me—

Senator KIM CARR: That is right, so it is not Lomax-Smith's proposition that you are actually putting here, despite the attempts that you have made in public to present it as such.

Senator Birmingham: Don't tell me you were so rude about Dr Lomax-Smith's report yesterday without having consulted it, Senator Carr. Now you seem to have a much higher regard for it.

Senator KIM CARR: I just think that, if you make an assertion that you are basing this on a particular study and it is not that study, it is dishonest.

Senator Birmingham: No, the concept was one mooted. All of those propositions of Dr Lomax-Smith could well be put forward in the process that has been outlined by the government.

Senator JACINTA COLLINS: Is the doctor owed an apology?

Senator Birmingham: By Senator Carr, yes. He was very rude about her report yesterday.

Senator JACINTA COLLINS: About the government misusing her report.

Senator Birmingham: I think Senator Carr probably should apologise.

Senator KIM CARR: Can I just go through the propositions that we do have before us. You have indicated that you are putting a number of different positions. Is it the case that publicly funded courses at registered private providers is still on the table?

Senator Birmingham: That is still factored into the budget papers. Whether or not that should proceed is identified in that—

Senator KIM CARR: It is in the budget papers?

Senator Birmingham: As costed.

Senator KIM CARR: Is the public funding for sub-bachelor courses in the budget papers?

Senator Birmingham: Yes, it is, Senator Carr.

Senator KIM CARR: You are going to have an evaluation of the HEPPP. What are the parameters of that evaluation? That is on page 13 of your paper.

Senator Birmingham: I would be happy to invite officials to detail that.

Ms Borthwick : The final terms of reference for the review have not yet been finalised but the intent is to look at whether the higher education participation program is sufficiently targeted to offer the best support to disadvantaged students.

Senator KIM CARR: The savings that you have been proposing here over four years are what? $20 million? Is that right? How much are the savings for this particular area with regard to HEPPP? How much are they? Sorry, $152 million.

Ms Borthwick : And $52 million of which has been redirected: $40 million to fund AIATSIS and to enhance its collections; and $12 million—

Senator KIM CARR: I see. We are funding AIATSIS out of the equity program?

Ms Borthwick : The international educational strategy.

Senator KIM CARR: How much for the international educational strategy?

Ms Borthwick : $12 million.

Senator KIM CARR: Why wasn't that in the paper released last weekend?

Ms Borthwick : Sorry, which paper that was released?

Senator KIM CARR: The international educational strategy.

Ms Borthwick : The budget had not yet come out, Senator.

Senator KIM CARR: I see. There are savings of $208 million from the program overall. Have I got that correct?

Ms Borthwick : No, Senator: $152 million.

Senator KIM CARR: The $208 million would be the total savings over the life of the government? That would be correct, wouldn't it?

Ms Borthwick : I am not familiar with the figure. I would have to take it on notice.

Senator KIM CARR: In previous budgets there have been reductions as well, haven't there?

Ms Borthwick : I will have to take that on notice. I don't know.

Senator KIM CARR: It is now up to $208 million. You are saying to us that $9.7 million goes to the Batchelor Institute of Indigenous Tertiary Education. Is that right?

Ms Borthwick : No.

Senator KIM CARR: None at all?

Ms Borthwick : No, Senator; that is a different item. That is a different issue. They are funds that were transferred into the National Institutes Program from the Department of the Prime Minister and Cabinet.

Dr Bruniges : Senator, perhaps I can help. Out of the $152 million over four years, $40 million over four years will go to the Australian Institute for Aboriginal and Torres Strait Islander Studies; $12 million over four years will support the implementation of the National Strategy for International Education; and then $100 million over four years for budget repair.

Senator KIM CARR: Back to consolidated revenue—the equity program. How much was left in the equity program before this reduction?

Ms Borthwick : There is now $553 million remaining in the higher education participation program over the forward estimates.

Senator KIM CARR: And you took $100 million out.

Ms Borthwick : And $553 million is remaining.

Senator KIM CARR: Yes, but you took $100 million out of the equity program for consolidated revenue. Minister, how is that justified?

Senator Birmingham: Senator, it was budget decision.

Senator KIM CARR: So there is no justification.

Senator Birmingham: In budgets, decisions have to be made about what funding is available for different programs. More than $500 million remains available in this program.

Senator KIM CARR: There is a 20 per cent reduction in the CSP program—Commonwealth supported places. Is that correct?

Senator Birmingham: As you have discussed before in terms of the higher education reforms that are budgeted for, there remains budgeting for expansion to sub bachelor. There remains budgeting for expansion to NUHEPs. There remains that adjustment to CGS. All of those matters will be considered within the policy paper that the government has released. As long as that policy paper comes to a landing point that operates within the current budget envelope then that is how reforms will proceed and the budget within which those reforms will proceed.

Senator KIM CARR: I read in Budget Paper No. 1:

Expenses under the higher education sub-function are expected to decrease by 2.4 per cent in real terms from 2015-16 to 2016-17 …

That is correct?

Ms Borthwick : What page is that?

Senator KIM CARR: It is with table 7. I am just trying to find the page number. On page 3-25, it says:

The Government remains committed to implementing reforms, which continue to be delayed in the Senate.

I take it that is the case? I am just trying to find the particular table.

Dr Hart : Senator Carr—

Senator KIM CARR: Have you got it? You are going to assist me here, are you?

Dr Hart : Yes, I am. There is a table 7 on page 5-19, a summary of expenses for education. Is that the table you are alluding to?

Senator KIM CARR: Yes, that is right. There it is. Thank you very much. You were very helpful indeed.

Dr Hart : Can I just point out that that table only covers expenses, so it will be CGS amounts and the expenses in relation to HELP.

Senator KIM CARR: Yes.

Dr Hart : It will not have HELP outlays, which would be an additional amount on top of that.

Senator KIM CARR: That is why I have asked the office if it could tell me what the total reductions are across the department. How are we going with that little calculation?

CHAIR: Senator Carr—

Senator KIM CARR: Sorry. There are just a few confusing tables here.

Ms Monkley : As I referred to earlier, the financial information is presented in the revenue measures on pages 19 through to 21 of the portfolio budget statement. If you take the total expense measures and the total revenue measures, noting these are in fiscal balance terms as well, then the net figure is a $2.47 billion saving. That is rounded too.

Senator KIM CARR: Yes. And that is over what period of time?

Ms Monkley : That is over the forward estimates, through to 2019-20.

Senator KIM CARR: There are a couple of figures here that do interest me. On page 5-15 of Budget Paper No. 1, it says:

Total expenses under this sub-function are expected to decrease by 5.1 per cent in real terms—

this is in regard to the research program—

and increase by three per cent in real terms—

in the out years. So the research program is being reduced at a faster rate; is that right?

Mr English : The financial year profile for the research funding does show what I might describe as a lumpy profile, but in fact the underlying calendar-year profile, which as you know is actually how we fund the universities, has a much smoother profile. It was an artefact of the way measures were put into the budget last year around the transfer of funding from the Sustainable Research Excellence fund to the National Collaborative Research Infrastructure Strategy.

Senator KIM CARR: Can you give me a table on a calendar-year basis?

Mr English : I will have to take that on notice, but yes, we can.

Senator KIM CARR: Thank you. I trust that will arrive before next week—otherwise, I will have to come in and have a talk to you about some factual information, won't I? I am sure the officers are looking forward to the prospect!

If I can come back to 15 and 19, it says: 'expenses between 16 and 17 and 19 and 20 are estimated to decrease by 7.7 per cent in real terms, which relates to the reductions of the Commonwealth grant subsidies from 2018.' Have I understood that correctly to mean that that is a 20 per cent reduction in the Commonwealth supported places?

Dr Hart : Correct. A part of the government's recent announcement was the delay of the introduction of higher education reforms, which means the 20 per cent cut to CGS would not commence before 1 January 2018.

Senator KIM CARR: Yes, thank you—

Senator Birmingham: But that figure would of course be net of additional outlays in relation to sub-bachelor places—

Senator KIM CARR: But that is what the budget papers show us: the decline—7.7 per cent.

Senator Birmingham: I am not disputing it, Senator Carr; I am just adding further information.

Senator KIM CARR: But that is what this table shows: a 7.7 per cent decline in support for Commonwealth supported places at universities.

Senator Birmingham: You have quoted the budget papers accurately. Just as your government had $6.6 billion of savings towards higher education in its final couple of years—or 'cuts' or whatever word you want to use; your party apparently likes to call tax increases 'savings' nowadays, too, but that is—

Senator KIM CARR: Can I just go through that. You have indicated a number of items have now been deferred. But it is incorrect to say that fee deregulation is off the table. What you are now proposing to us is that partial fee deregulation is the government's policy.

Senator Birmingham: Full fee deregulation is off the table. It has been taken out of policy, budget et cetera. The government has outlined in its policy paper an alternative proposition, of flagship courses, which we have discussed tonight and which is outlined there in black and white for the world to see, which we will now discuss the detail and merits of with the university sector and others.

Senator KIM CARR: So partial fee deregulation remains government policy?

Senator Birmingham: I know you will run a scare campaign whatever I say or do tonight, so—

Senator KIM CARR: I would say it will be a fact campaign—that would be a fair way to describe it.

Senator Birmingham: No. I am pretty confident it will be a scare campaign, but that is okay. You were always going to do that.

Senator KIM CARR: You have written the ads for us. What can I do?

Senator Birmingham: You were always going to do that, so I am pretty relaxed about knowing there will be a scare campaign.

Senator KIM CARR: I have no doubt you will be really relaxed on 2 July!

Senator Birmingham: You will run your campaign; we will run ours.

Senator KIM CARR: As to the specifics, though: I will describe it as partial fee deregulation—but, nonetheless, fee deregulation—of up to 20 per cent of courses and 20 per cent of load. But I would also like to know: will there be a cessation of the HECS-HELP benefit?

Ms Borthwick : That was part of the original package, so that has been deferred.

Senator KIM CARR: Deferred?

Ms Borthwick : Correct.

Senator KIM CARR: And the changes to the HELP repayment threshold—are they being deferred?

Ms Borthwick : There is a proposition in the paper to look at the threshold again—is that what you are referring to?

Senator KIM CARR: Yes, it is, but also, though, in the budget papers is a figure which we have been over now—this is our third estimates on these matters. Is that still the official policy of the government?

Ms Borthwick : I am not sure which version of the threshold—

Senator KIM CARR: Well, you tell me what the current version of the government's policy is. I am only here from the opposition, so perhaps you can enlighten me. What is the government's policy?

Ms Reardon : The deferred package in the measure that is in this budget included a lower threshold.

Senator KIM CARR: To what level?

Ms Reardon : To $50,400-and-something, I think.

Dr Hart : Approximately $50,000.

Senator KIM CARR: That remains the government's budgeted position.

Ms Reardon : Yes.

Senator KIM CARR: The efficiency dividend on the ARC—is that the government's position?

Dr Hart : Yes, and deferred.

Ms Borthwick : All of the measures that were in the—

Senator KIM CARR: We are having some confusion as to what the government has deferred and what it has not. I want to know: has it deferred the efficiency dividend or the Australian Research Council, or has that been removed from the package?

Ms Borthwick : The things that have been removed from the package—I stand corrected—are full fee deregulation and a deferral to 2018 of the start date.

Senator KIM CARR: Everything else is there?

Ms Borthwick : Everything else is in the budget to 2018.

Dr Hart : Can I just add: the efficiency dividend has been removed from the Commonwealth Grant Scheme and the NDCO program as well.

Senator KIM CARR: Including the ARC?

Dr Hart : Sorry: the disability support program.

Senator KIM CARR: Including the ARC?

Dr Hart : No, they have been reversed.

Ms Borthwick : So that is on page 328 of Budget Paper No. 1.

Senator Birmingham: That would be the efficiency dividend that your government first proposed.

Senator KIM CARR: We have been through this before and we are not voting for it. The cuts to the research—

Senator Birmingham: And we will not be asking.

Senator KIM CARR: We did indicate to the you at the time, because you double-crossed everyone on Gonski and you are still doing it. I asked with regard to the student contribution for higher degree research—is that still part of the government package?

Ms Borthwick : It is part of the deferral, yes.

Senator KIM CARR: Yes, but I am saying: is it part of this budget?

Ms Borthwick : It is part of this budget.

Senator KIM CARR: Thank you. You have already indicated the HEP program. Is there a provision in this budget for the VET FEE-HELP loan cessation?

Ms Borthwick : Yes.

Dr Hart : Yes, deferred.

Senator KIM CARR: But it is part of the deferred package.

Dr Hart : That is correct.

Senator KIM CARR: We have accepted that you cannot get it through this year—accepted. It has been deferred to next year. What is the effective start-up date proposed in this budget for all of these measures?

Dr Hart : It is not next year, Senator Carr; it is 2018, which is the deferred date.

Senator KIM CARR: Yes, but what is the start-up date in 2018?

Ms Reardon : It is 1 January 2018 for the majority of the measures. But keep in mind that our HELP measures are run on a financial year basis, because it is based on your tax return, so they start in the middle of 2018.

Senator KIM CARR: My point is: to get a start-up date of 1 January 2018, you will need legislation in 2017.

Ms Reardon : Correct, yes.

Senator KIM CARR: Would it be fair for me to describe it as being deferred till next year?

Senator Birmingham: No, Senator.

Senator KIM CARR: Why?

Senator Birmingham: Legislation might be considered next year—

Senator KIM CARR: The legislation will be required to pass the parliament by next year.

Senator Birmingham: Sure, Senator, but the start date is the start date; and the start date is 1 January 2018.

Senator KIM CARR: We have accepted that start date as 1 January 2018. Legislation will be required prior to that date.

Senator Birmingham: Yes, Senator.

Senator KIM CARR: The revised higher education indexation—what is the rate that you are proposing?

Dr Hart : The HEGI rate—is that what you—

Senator KIM CARR: Yes.

Dr Hart : It is 1.7—it is the same as CPI for this year.

Senator KIM CARR: Thank you. Are there any changes to the cluster funding arrangements?

Ms Borthwick : Where?

Senator KIM CARR: In terms of the underpinning of this budget, have you got the published funding cluster arrangements, or is there are a new set?

Ms Borthwick : The current budgeted cluster rates are the five cluster rates that were announced as part of the original package.

Senator KIM CARR: Thank you.

Senator Birmingham: The policy paper does make some discussion around cluster rates.

Senator KIM CARR: Yes, but those budgeted arrangements are what we are dealing with—

Senator Birmingham: That is right, Senator.

Senator KIM CARR: what the government policy is. The discussions we had in 2014-15 indicated that there was a cost associated with full fee deregulation. Do you have any assessment of the current costs of partial fee deregulation?

Ms Borthwick : I think I would need to take that on notice, Senator.

Senator KIM CARR: Minister, with regard to the consultations you have adopted for the discussion paper—who was consulted about it?

Senator Birmingham: Who was consulted?

Senator KIM CARR: Your discussion paper. Since you have been sworn in as minister you have made a great thing about the consultations. Exactly who did you talk to about this?

Senator Birmingham: I have spoken with a lot of people: most of the nation's vice-chancellors, if not all; all of the usual representative organisations in the university sector; many—

Senator KIM CARR: So, the 'usual suspects' is what you are telling me—is that right?

Senator Birmingham: Many figures, yes. I imagine if you drew up a list of who you would think might want to talk to the education minister, I have done my best to be available and accessible to them.

Senator KIM CARR: Thank you. An expert advisory panel has been referred to on page 5. I understand that the panel has not been appointed. Have you set down any criteria for membership of that panel?

Senator Birmingham: I have not set criteria as such, no. I have some—

Senator KIM CARR: Have you indicated that there would be no serving vice-chancellors on it?

Senator Birmingham: I do not know that I have indicated that, but I think my instinct would be that that might be the case.

Senator KIM CARR: I see. Your instinct? You have not actually told anyone that?

Senator Birmingham: I may have—I actually do not recall.

Senator KIM CARR: Okay. On page 24 you refer to a 'Higher Education Group'. I am just wondering who that is?

Senator Birmingham: Page 24 is blank on the document I have—is this in relation to feedback?

CHAIR: The old classic!

Ms Borthwick : Senator, I think that is—

Senator KIM CARR: It is not blank on the one I have—let me just get it. I have it here as page 24, and it talks about feedback opportunities. It speaks about a reference group:

Higher Education Reform Options Paper Feedback

Higher Education Group

GPO Box 9880 CANBERRA ACT 2601

Senator Birmingham: I think that is a section within the department.

Ms Borthwick : It is.

Senator KIM CARR: Who is it?

Ms Borthwick : It is Dr Hart.

Senator KIM CARR: I figured that it is the department, but who exactly in the department?

Ms Borthwick : Dr Hart is the—

Dr Hart : I am not the whole group, but I am the group manager!

Senator Birmingham: He is very talented, Dr Hart!

Senator KIM CARR: So who else is in the group?

Dr Hart : There are three areas within it: the Funding Policy and Legislation Branch, which Ms Reardon heads up—

Senator KIM CARR: Right.

Dr Hart : There is the Governance, Quality and Access Branch and there is also the Student Information and Learning Branch, which Ms Wedell—

Senator Birmingham: This is the Higher Education Group—

Dr Hart : It is the group, yes. It is a group within the department.

Senator Birmingham: But if I look at what you have quoted here, Senator Carr—lest you think it is the Higher Education Reform Group, which I think is what you said—the document says that—

Senator KIM CARR: No, I called it the 'Higher Education Group'—

Senator Birmingham: higher education reform feedback—

Senator KIM CARR: Sorry—I called it—

Senator Birmingham: can be sent to the Higher Education Group.

Senator KIM CARR: what you called it: the Higher Education Reform Group! That is what it says here on the back of your paper.

Dr Hart : What I have before me for feedback opportunities says, 'Higher education reform feedback,' and then it says, 'Higher Education Group'.

Senator KIM CARR: Oh, I see—there is a difference, is there?

Dr Hart : You would provide your higher education reform feedback to the Higher Education Group at the below address.

Senator KIM CARR: I can see that. I have been out of the loop for too long, haven't I, if I cannot even follow that! Hey?

CHAIR: Bravo!

Senator KIM CARR: Righto—thank you very much. I am just about done, but I do have some questions that I would like to pursue which are more of a technical nature with regard to the loans program and the thresholds. The library tells me that the number of additional graduates who would be caught by lowering the threshold to $42,000, which was in the paper, would be 200,000. Are you able to advise me as to whether or not that is a reasonable estimate?

Ms Borthwick : I am not sure what that would be based on. Is it—

Senator KIM CARR: The Parliamentary Library has provided this on ATO statistics.

Ms Borthwick : That would be the income 'gap', if you like, between $42,000 and the current $54,000. I think that is what that figure is saying, that there may be 200,000—

Senator KIM CARR: Yes. I could give you the millions and all the rest of it, but I am short-handing it here.

Ms Borthwick : It would depend, obviously, on how many of them are enrolled at university.

Senator KIM CARR: Yes. Would you agree that 200,000 is a reasonable estimate?

Ms Borthwick : I do not know. I would have to take that on notice.

Dr Hart : We do not have that figure available.

Senator KIM CARR: If you could, that would be good. You do not have a similar figure?

Ms Borthwick : No.

Senator KIM CARR: You have no idea how many extra people would be affected by a reduction of the threshold to $42,000?

Dr Hart : We do not have that information with us. We would have to take it on notice.

Senator KIM CARR: You do not have it with you or you do not have it?

Dr Hart : I would have to check whether we do have it, in fact.

Senator KIM CARR: I am advised that most of those would be younger taxpayers—57 per cent would be aged 29 or younger. Would you agree with that?

Ms Borthwick : I do not know. We will have to take it on notice.

Senator KIM CARR: What numbers have you done to give the government confidence in the $42,000 figure?

Senator Birmingham: The government is not expressing confidence in the $42,000 figure. I think the government identified that that figure had been proposed by others.

Senator KIM CARR: Who was that? You are relying on Grattan, are you?

Senator Birmingham: Grattan is one of many commentators in this space.

Senator KIM CARR: Who else has offered a figure of $42,000?

Senator Birmingham: I would have to go and check.

Senator KIM CARR: The officers here could tell us. Surely they are experts in this area.

Ms Borthwick : I believe that figure did come from Mr Norton.

Senator KIM CARR: He is the only one that I can recall. Can you enlighten me? Am I wrong?

Ms Borthwick : I would have to check. I have not got it with me.

Senator KIM CARR: Do you have a figure for the average full-time starting salary for a graduate under 25? These are well-published figures, aren't they? They are pretty well known?

Dr Taylor : What was the question again? I was just flicking through the—

Senator KIM CARR: What is the average full-time starting salary for graduates under 25 years of age?

Dr Taylor : Fifty-four thousand is the median graduate starting salary.

Senator KIM CARR: And it has been proposed to reduce the threshold to $42,000, because that is roughly what the current threshold is, isn't it—about $54,000?

Ms Borthwick : That is right.

Senator KIM CARR: So it has been proposed to reduce that to $42,000.

Senator Birmingham: By Grattan.

Senator KIM CARR: Not by the government?

Senator Birmingham: The government has said that it is willing to discuss and look at options for repayment thresholds and whether they are appropriate.

Dr Taylor : Just to clarify: for those aged less than 25 in first full-time employment, it is $54,000.

Senator KIM CARR: So they are just under the threshold and they do not pay HECS repayments until they get to $54,000 or thereabouts. Is that correct?

Ms Borthwick : That is right.

Senator KIM CARR: Under the current policy. But in this discussion paper it is proposed that the government consider reducing it to $42,000.

Senator Birmingham: I am actually struggling to find the $42,000 figure.

Ms Borthwick : I am not sure that $42,000 appears in the paper.

Senator KIM CARR: Yes. Is it proposed?

Senator Birmingham: The paper asks questions about changes to repayment threshold and rates and whether commencing repayment at a lower threshold income than the current minimum and/or introducing an additional higher contribution rate for high-income earners might be possible.

Senator KIM CARR: I am interested to know how many professionals would be earning an income of $42,000. What sort of percentage would that be?

Ms Borthwick : I do not know. We would have to take that on notice.

Senator KIM CARR: I am told it is about 36 per cent, but that would pick up people in a range of occupations like delivery drivers, receptionists, cleaners and laundry workers—because that is the sort of money, in that range, less than $50,000, that they earn.

Senator Birmingham: It would also depend as to whether somebody was working full time or part time. There would be a range of factors there.

Senator KIM CARR: That is right. There would be.

Senator Birmingham: Of course, as you well know, HELP loans are also acquired by people outside of higher education nowadays, as we were discussing earlier.

Senator KIM CARR: But there is also an element of social justice in these arrangements, and hitting people at this level fundamentally changes the nature of the scheme. Is it the government's proposal to look at this in terms of household incomes as well?

Senator Birmingham: That idea, again, has been publicly reported, and so the government has said it is happy to hear feedback on that idea.

Senator KIM CARR: Two part-time workers with a combined household income of $42,000 may be caught up in this.

Senator Birmingham: No, I can comfortably rule that out. If there were to be any household application of payments it would clearly not be at an individual, one-salary level.

Senator KIM CARR: What would it be? What would be your assessment of the household income?

Senator Birmingham: The purpose of consultation and seeking expert analysis is indeed to consult and to seek expert analysis, not for me to prejudge the final decision. In terms of what you were trying to set up there, I can comfortably say that that is something that would be completely unacceptable to the government.

Senator KIM CARR: I am pleased to hear it. Your paper talks about ranges of 40 to 45, but you are saying that is for individuals, not for families?

Senator Birmingham: I can comfortably rule that out as any notion that a couple would repay.

Senator KIM CARR: Can you comfortably indicate to the committee what you regard as a reasonable family income to be caught up in the government's proposals?

Senator Birmingham: No, I am not going to start speculating. That is the purpose of having expert analysis.

Senator KIM CARR: No, it is not.

Senator Birmingham: The idea that a family income, if that were to be contemplated, would to be the same as an individual income is not something that would be acceptable. Would my income, if my wife had a HELP debt that needed to be repaid, be appropriate? Maybe. Maybe your income, Senator Carr, would be appropriate in those circumstances.

Senator KIM CARR: I look forward to you explaining that to a lot of women in this country. When it says in this discussion paper:

In finalising legislative reforms and meeting the financial sustainability savings outlined in the Budget the Government will consider options—

and so on and so forth, is it the underlying principle of this discussion paper that you must meet the financial sustainability savings outlined in the budget?

Senator Birmingham: It is indeed the principle of this paper that reforms within this paper must come within the budget projections.

Senator KIM CARR: If I then turn to page 59 of the PBS statement and I look at the assessments of the targets in terms of the performance of the loans scheme, I notice here that there seems to be an assumption underpinning this, that the HELP loan repayment arrangements will grow. If I look on page 59, it goes from 8.8 years on average to 8.9 years, and then through to 9.1 years. What is the basis for that presumption, that there will be a growth in the period in which it takes people to repay their loans?

Ms Borthwick : That figure is calculated by the Australian Government Actuary, not by the department.

Senator KIM CARR: What is the assumption that underpins that figure?

Ms Borthwick : There are several assumptions: the growth in the system overall, the numbers of people taking out loans, as well as the size of the loans.

Senator KIM CARR: The numbers of people who are not going to repay their loan remains at 18 per cent. What is the presumption—

Ms Borthwick : I think it has actually come down. I think the previous—

Senator KIM CARR: That is not what the paper says though, is it?

Ms Borthwick : No, that is not what that paper says, but the previous budget estimates had it at around 19 per cent, if I remember correctly.

Dr Hart : It had it higher. It does expect that on new debt 18 per cent will not repay.

Senator KIM CARR: Ms Borthwick, what are you referring to? Is it some other figure that we should know about?

Dr Hart : Ms Borthwick is referring to previously in PAES.

Senator KIM CARR: I see what you mean. It used to be 19 per cent. Is that what you are saying?

Ms Borthwick : Yes, that is what I am saying.

Senator KIM CARR: But I can rely on these figures?

Ms Borthwick : Yes, absolutely.

Senator KIM CARR: That is very good, thank you.

Senator REYNOLDS: I just have a couple of follow-up questions on Senator Carr's questions. Secretary, in relation to higher education, what are the sorts of things you want to do with QILT with the extra $8.1 million in the budget?

Dr Bruniges : Enhancing some of those QILT measures is incredibly important. Looking at the quality of data that sits in QILT and making sure that we can enhance that for transparency reasons is incredibly important, so we would want to work through it in detail. There are a number of things that the group that are working on that are looking at, and someone might help me out with a bit more detail on exactly what measures—

Dr Hart : Based on market research, we know that students are interested in more information about their courses and about the fees associated with their courses as well. I think we have also flagged and identified that, subject to the process that Professor Shergold is running in admissions transparency, there may be information there about admissions to universities et cetera.

Senator REYNOLDS: With the ongoing discussions about admission standards, do you think caps should be reimposed as Senator Carr, I believe, has proposed?

Senator KIM CARR: Sorry, what am I proposing?

Dr Hart : That is really a matter for the government of the day.

Senator REYNOLDS: Minister? I asked a question about admission standard caps.

Senator Birmingham: About admission standard caps?

Senator REYNOLDS: There have been discussions about admission standards. Do you think caps should be reimposed?

Senator Birmingham: I think that that would, of course, be a significant intervention by government in the autonomy of universities. It would deprive students of admittance who may otherwise receive admittance to university. A much better policy is the one that the government has advocated, which is to expand access to subbachelor places, which ensures that students have a variety of pathways into university and that universities have a more flexible range of pathways with which to accommodate students, particularly students from equity backgrounds whose participation we want to encourage to increase.

Senator REYNOLDS: I note the investment in STEM through NISA. Given that the only alternative policy so far is HELP write-offs for 100,000 or so STEM graduates, what can you say about the merits of this policy alternative and the maths skills of the authors of that policy? That is possibly one for the minister.

Senator Birmingham: That is probably one for me. Yes, we did see numerous iterations come out of last year's budget reply speech from Mr Shorten in which he proposed that change. It is a shame that Senator Carr has gone. I do not know whether Senator Lines or Senator O'Neill can inform us of whether if it is still the Labor Party's policy to extend—

Senator LINES: If you want to swap spots with us, we will answer all the questions you like. When we are in government, you can ask—

Senator Birmingham: You are that evasive on your policy that you will not just give a simple yes right now. But, yes, within a 24-hour period there were three different costings provided for that policy, and I am sure that over the coming days we will see various iterations of the VET FEE-HELP cap that was announced last night as well. I note that Mr Husic admitted on 7.30 tonight that it will result in students paying up-front fees.

Senator REYNOLDS: Really?

Senator LINES: This is a paid political advertisement!

Senator O'NEILL: It sounds like it.

Senator REYNOLDS: That was tonight, was it?

Senator Birmingham: No, I doubt that Mr Husic paid for it—

Senator LINES: No, you are.

Senator O'NEILL: What was that number? About $48 billion?

Senator Birmingham: but he certainly said that if you are capping—

Senator REYNOLDS: Chair, I cannot even hear the response to the question from the minister.

Senator O'NEILL: Because it is not a response.

Senator Birmingham: He certainly said: 'If you're capping it, there are going to be some people who will have to pay more. That's the reality.' I note—

Senator REYNOLDS: That was definitely an answer to my question. Thank you, Minister.

Senator Birmingham: that that is confirmation from a Labor Party frontbencher that they are applying up-front fees in vocational education.

Senator LINES: I just want to go to page 8 of the budget overview. I want to ask questions on a quote. I can read you the quote.

Senator Birmingham: Is it page 8, about 'Responsible spending restraint'?

Senator LINES: That is it.

Senator Birmingham: I am pleased to see you reading it, Senator Lines!

Senator LINES: The last paragraph says:

It is essential that the Government continues to focus on responsible spending restraint. The Government is committed to ensuring that the $13 billion of unimplemented expenditure savings measures are passed by the Senate or alternative savings measures identified to continue on the path to a balanced budget.

Doesn't that mean, in the light of that statement, that the government has taken the FTB save and pushed back the childcare package? Doesn't it prove, once and for all, that the FTB and the childcare changes are not linked?

Senator Birmingham: I think that statement, which of course is a statement applying to the overall approach that the government has applied to the budget, is a statement that the government stands by the need for savings measures—savings measures that are real savings measures and reductions in expenditure, rather than what you call savings measures, which are actually $100 billion of additional taxes.

Senator LINES: Does it mean, once and for all, that the FTB and the childcare changes are not linked?

Senator Birmingham: No, Senator. The government wishes that you had facilitated passage of the FTB savings measures so that we could have proceeded to try to secure passage of the childcare reforms.

Senator LINES: So you are still clinging to your view that—

Senator Birmingham: I am not clinging to anything, aside from the pen that is in my hand, perhaps!

Senator LINES: I think you are!

Senator Birmingham: But I am being crystal clear that the government wishes that you had facilitated passage of the savings measures that would have enabled us to get—

Senator LINES: It is not about Labor, Senator Birmingham.

Senator Birmingham: It would have enabled us to—

Senator LINES: These are your—

Senator Birmingham: Actually, Senator, you do have a vote in the parliament.

Senator LINES: This is your policy—

Senator Birmingham: You could have helped to pass the savings measures—

Senator LINES: It is your policy.

Senator Birmingham: that would have enabled the government to proceed with the childcare reforms as planned.

Senator LINES: It is your policy. What will you do if the new Senate does not pass FTB savings? Will you dump the childcare—

Senator Birmingham: That is a hypothetical question.

Senator LINES: You were happy to try to have a view about Labor! Will you dump the childcare changes altogether?

Senator Birmingham: Senator, the government stands very much by the childcare reforms. We hope that they will be strongly endorsed at the election and that we will be able—

Senator LINES: What if the Senate does not pass the FTB savings?

Senator Birmingham: to get them legislated.

CHAIR: That is a hypothetical question, Senator.

Senator LINES: There has been quite a bit of hypothetical from the minister! Minister, what happens if the new Senate does not pass the FTB savings?

Senator Birmingham: The government is intending on having the savings passed and the reforms passed and implemented in the time line outlined.

Senator LINES: Right. What—waving a magic wand?

Senator Birmingham: I hope that, after the election, if we are the government, we will have your cooperation in doing so.

Senator LINES: Let's hope you have a magic wand, if you get re-elected. Thank you.

Senator O'NEILL: I am not sure if this question is for the minister or for the department. Have you been in conversations with the University of Newcastle with regard to the medical facility that is proposed as part of the Gosford Hospital development?

Senator Birmingham: The University of Newcastle has had discussions with me.

Senator O'NEILL: Have you had discussions about supporting that facility with any capital investment?

Senator Birmingham: I would have to refresh my memory of the exact nature of that because there are a few different moving parts there. There are, I know, some capital proposals, but offhand I think, from memory, there are also some CSPs for medical positions that are capped that are proposed to be shifted. I would have to check as to exactly which components we might have been talking about.

Senator O'NEILL: Have you made any decisions to fund any of those elements that you just identified?

Senator Birmingham: Again, I would have to take that on notice, given I was struggling to recall the different pieces and where each was at.

Senator O'NEILL: At this point in time, there is no decision by government to put $12.5 million into that project?

Senator Birmingham: I would have to take on notice whether any components of decisions might have been made.

Senator O'NEILL: Thank you.