Sky News Richo

E&OE TRANSCRIPT
Interview - Sky News Richo with Graham Richardson
9 December 2015

SUBJECT: National Innovation and Science Agenda

GRAHAM RICHARDSON: I’ve got to introduce Christopher Pyne. Now, Christopher Pyne is an extraordinary character. I remember going to interview after interview with him. He was so confident he was going to get through the higher education through, he never did. Now we’ve got the innovation statement which I just don’t think captures the imagination of the mob. He does of course – he’s the optimist. Have a look at this.

Christopher Pyne, welcome to the program.

CHRISTOPHER PYNE: Thank you Graham, good to be with you and happy Christmas to you.

GRAHAM RICHARDSON: And the same to you. Now, last night on Alan Jones- or Richo and Jones, we had a talk about the innovation statement, and I think I made the point, unhappily for you probably, that as far as I was concerned around the dinner tables in Australia last night and the night before they weren’t discussing it. I think they- you know, when Bronwyn Bishop, they found out she’d flown to Geelong in a helicopter, every dinner table spoke about it, and when the budget’s out everyone does. But isn’t it a problem that things like the innovation statements, important as it may be, are really for the elites. The masses don’t seem to care about them.

CHRISTOPHER PYNE: Well, with the greatest of respect to you, Graham, I just don’t agree with you, and I’ll give you a real world example. Today I did the Morning show on Channel 7 and when I went into the make-up people who do our make-up, as you would know, this doesn’t just happen, there were two people in there. The bloke said that he didn’t know anything about the innovation statement but he’d heard of the ideas boom, which was not a bad start, this has only happened on Monday, and the lady who was in the make-up room, she knew all about the innovation statement because she wants to start her own start-up business selling brushes and make-up material to people. She knew all about the different changes to the Income Tax Act, the capital gains tax relief, accelerated depreciation – she knew about it all.

GRAHAM RICHARDSON: [Talking over] Wow. I’ve got to say, they’re making [indistinct] …

CHRISTOPHER PYNE: And she told us all about it, and I thought well we are cutting through it here.

GRAHAM RICHARDSON: Mate, the make-up girl at Silk Studios didn’t know any of that, and neither did the girl getting us the tea and bikkies. But nonetheless …

CHRISTOPHER PYNE: Well in my real world example two out of two knew all about what was happening, or they’d heard of the ideas boom. And I think in two and a half days of selling, that is not a bad start. And I have to tell you, the ideas boom hash tag out-trended Barack Obama’s statement on gun control in Australia on Monday.

GRAHAM RICHARDSON: So it should, that was so weak. But that’s another story. I want to go into some of the detail. I want you to explain, because in my view most people watching won’t know much about this statement, and so I want you to tell me. First off, it always seems to me that every Government has a crack at this. I can remember my own experiences back in the Hawke-Keating days, everyone says they’re going to deliver it but we still have a situation where the big ideas are taken somewhere else to be developed. What have you got in there that’ll stop that happening?

CHRISTOPHER PYNE: Well, the big-ticket item in the innovation and science agenda is the changed arrangement for support for research grants at university. It’s worth hundreds of millions of dollars. We’re going to abolish publications, being the chief reason why you attract research grants, we’re going to change that into research impact. Impact is collaboration with industry, the potential to commercialise ideas. We’re going to go from being last in the OECD for commercialisation to being near the top of the table. Because you’ll attract research support if you can show that your idea is going to be able to be commercialised. So we’re going to say to universities and national institutes we’re happy to keep supporting you for research, but we want to know how it’s going to lead to jobs and growth. That is a massive cultural change, but the universities have embraced it because they see it as a way to gain extra revenue for good research.

GRAHAM RICHARDSON: But what about banks? I mean, it seems to me that our banks have always been very reluctant, and we don’t want them spending money willy-nilly. We want good prudential rules to make sure they stay sound, but they have been very reluctant to fund business, let alone business innovation and start-ups, haven’t they?

CHRISTOPHER PYNE: Well I’m not too fussed about what the banks decide to do, Graham. The four big banks are very risk averse, they’re very conservative. It’s served them well – they’re amongst the 10 biggest banks in the world because they’re very good at what they do. But what this National Innovation and Science Agenda is about is unlocking mum and dad investors and venture capitalists to support start-up businesses, not just to look at property or stocks and shares, but to actually look at the way businesses can grow and create profits and jobs and growth. And the changes we’ve made around the Tax Act, the corporate law reform, support for venture capitalists, income tax, a relief- capital gains tax relief will attract investment to start-up businesses.

In the last 10 years, and this is not esoteric stuff, in the last 10 years there’s been 1.4 million new jobs created in start-ups, while 400,000 jobs have been lost in traditional industries. So this is the way of the future. We’re moving from the resources boom to the ideas boom, and the Turnbull Government is leading the way. That’s what this statement is all about – unlocking potential, commercialising research, and it’s comprehensive.

GRAHAM RICHARDSON: Well I hope you’re right on all counts, but I’m still a sceptic. I mean, as I said, I’ve seen plenty try before. Now, venture capital in Australia – how big is it? Are we in the billions, or are we still in smaller amounts?

CHRISTOPHER PYNE: Well if you added all the venture capitalist investments in the- across the economy we’d probably be in the billions. But what we’re doing in this statement is establishing two new venture capital funds – it’s a big leap for Government – the CSIRO Innovation Fund to put money into national institutes, universities and CSIRO public research, and the Biomedical Translation Fund to put resources behind good medical research that the Medical Research Future Fund is doing, and accelerating its commercialisation to create jobs and growth.

CHRISTOPHER PYNE: So, we are- this is- I have had people say like Ian Chubb, who’s not always been known to be a supporter of the Coalition, right across to Alan Finkel, the new Chief Scientist- so the old chief scientist and the new Chief Scientist saying that this package exceeds wildly, any of their expectations and that’s why I think it has grasped the imagination of the public and the business community because they certainly expected a statement. I don’t think anybody expected us to cover everything from visas to science, technology, engineering and maths in schools, to support for quantum computing, to win the war on quantum computing internationally, to Synchotron, the Square Kilometre Array, fixing the National Collaborative Research Infrastructure Scheme in all these areas where we’d been receiving advice and consultation, we have acted.

GRAHAM RICHARDSON: Well, I’m glad, I accept all of that. I mean, I think hope springs eternal and you’ve always been an optimist as you’ve said…

CHRISTOPHER PYNE: Stop being such a cynic.

GRAHAM RICHARDSON: But- no well, cynicism sometimes works you know. I think…

CHRISTOPHER PYNE: No, it’s the Christmas season, you have got to be more positive.

GRAHAM RICHARDSON: No, but I remember how confident you were on the higher education stuff and I remember telling you on this show it wasn’t going down that well.

CHRISTOPHER PYNE: Confidence is my middle name.

GRAHAM RICHARDSON: It certainly is. Now, but I hope this time it’s not as misplaced as it was then.

CHRISTOPHER PYNE: Well, we’re spending $1.1 billion here, with the university reforms we were cutting them by 20 per cent and establishing a 10 year government bond rate for interest, it was a hard sell. But I did my level best as you know.

GRAHAM RICHARDSON: I know. And no one could have tried harder and no doubt there’ll be another attempt further down the line. I don’t think you’ve given up- well, when I saw you, a plural you. I suspect that you’ll bat on. Just getting back to this innovation statement, if I’m a small businessman today and I’ve been working the guts out for 20 years, do I look at this and say well god, they’re doing nothing for me, why should they be doing something for someone new?

CHRISTOPHER PYNE: Well, we are doing something for them. If they have intangible assets like patents or intellectual property or another kind of intangible asset, we’re going to allow them to depreciate that asset over the economic life of it rather than the statutory life because of the fast moving nature of our economy.

That’s a big plus. If they change the nature of their business or bring in an equity partner or a debt partner, they wouldn’t have been able to previously claim their tax losses for the last three years. We’re going to let them do that because we want a nimble and agile economy. We want businesses to be able to say well this isn’t working, we’ll try something new rather than the current system which is if you have a different business, you lose your tax losses.

So, we are doing something for them. If they bring in venture capitalists, we’re going to give them income tax deductions and capital gains tax relief. So, we’re doing something for every business. This is a whole of the economy change to the structure of the way we do our economic growth because Malcolm Turnbull is absolutely determined that the whole economy moves to a new economy while supporting advanced manufacturing high tech industry using the Government’s procurement dollar.

There’ll be a statement about defence industry in the next couple of months which will again reinforce our commitment to this area of the economy because everyone knows we’re moving beyond the resources boom. The ideas boom is the new economy and this government is well placed to make that happen.

GRAHAM RICHARDSON: So, what you’re saying is that Malcolm Turnbull is Santa and, what, you’re one of the elves, are you? A chief elf, perhaps.

CHRISTOPHER PYNE: [Laughs]

GRAHAM RICHARDSON: Now, one last questions because we’ve got to leave it, but obviously I watch- I’ve got to get a life some people would say but I do watch Question Time and you got up the other day and you moved that Labor not be heard. You didn’t move to get up there and defend Mal Brough, why?

CHRISTOPHER PYNE: Well, because Labor is practicing old politics Graham. For two weeks they busily attacked Mal Brough in Question Time, they wasted every single question on Mal Brough. The poll came out yesterday. It hasn’t moved one iota. In fact Bill Shorten dropped to 14 per cent because the public are over all that, the public are over inside the beltway, tit for tat politics. They want positivism, optimism and confidence.

GRAHAM RICHARDSON: And why did Malcolm drop eight points.

CHRISTOPHER PYNE: Because the idea that he would remain at 68 per cent into eternity, you know is completely unrealistic.

GRAHAM RICHARDSON: I don’t think he believes that and I tell you something else, I bet you- I just bet you this bloke Mal Brough doesn’t last until Christmas.

CHRISTOPHER PYNE: Well, I’d take 60 to 14 any day if I was Malcolm Turnbull.