It’s a high-stakes gamble for industry groups to support unpopular government policy if the senate objects, as the experience of university chiefs shows. By Sophie Morris.

Universities Australia, Clean Energy Council's lobbying lessons

Universities Australia chief executive Belinda Robinson addresses the National Press Club last month.
Universities Australia chief executive Belinda Robinson addresses the National Press Club last month.

Last month, Universities Australia chief executive Belinda Robinson fronted a press conference with Christopher Pyne to urge the senate not to block the deregulation of university fees.

“If this bill is voted against, that is no solution,” said Robinson, adding that it would be very hard to come up with an alternative response to funding pressures faced by the sector.

Now she concedes it is unlikely the measure, which has been twice rejected by the senate, will get through parliament when the government reintroduces it later this year.

 Yet she says she has no regrets about her joint appearance with Pyne, endorsing fee deregulation after he offered a series of concessions to the lobby group, including promising to “hive off” big funding cuts into a separate bill.

And, despite appearances, she maintains UA was not technically supporting the government’s package.

“The reforms the government was prosecuting were not Universities Australia reforms, not UA policy,” says Robinson. “This was government policy. I don’t feel uncomfortable at all about the bill not having got through and us being associated with it, because we were only ever reacting to the government’s proposals, we were trying to soften it.”

Some see it differently.

University of Canberra vice-chancellor Stephen Parker says Robinson’s joint appearance with Pyne was “ill-advised” and that the lobby group was “suckered” by the education minister, as the 20 per cent funding cuts remained in the legislation that was rejected by the senate. He says UA is “fatally compromised” and has lost the trust of academics and students.

“Basically I think the leaders of the university sector should hang their heads in shame at the way they have conducted the last 11 months,” says Parker, who no longer attends UA meetings.

He’s been the only outspoken dissenter among university chiefs, but there are others who are questioning privately the tactics pursued by UA and whether it now has a future.

1 . A tale of two groups

This is a tale of two lobby groups – Universities Australia and the Clean Energy Council – which have both run the gauntlet of a fractious senate, with mixed results. Their experiences are a cautionary tale for other interest groups pursuing legislative change in this parliament.

Both these groups, purporting to represent their respective sectors, took a significant risk in pursuit of an outcome.

They stuck out their necks in a bid to provide the government with the cover it needed to secure senate support for controversial changes. Neither has yet achieved its goal and both are now dealing with recriminations from the sectors they represent.

In the case of Universities Australia, the peak group effectively struck a deal with the government, but then the government could not muster the senate support to deliver on it.

Now UA faces a challenge to hold together its membership as tensions emerge between institutions that have vastly different perspectives on deregulation of fees. Any deregulation would disproportionately benefit the more established “sandstone” institutions over smaller universities.

On the renewable energy target, the Clean Energy Council angered the solar sector by offering a compromise position, only to find itself exposed, as neither major party initially accepted it.

It stuck out there, like a shag on a rock, for a whole fortnight, until Labor eventually agreed on Wednesday to the council’s proposal that the RET be dropped to 33,500 gigawatt hours for 2020, down from the legislated 41,000. 

This was a shift from Labor’s previous preference, in talks with the government, for a figure in the mid-to-high 30,000GWh range. Other groups, including the Business Council of Australia and the Australian Industry Group, also joined the calls for a bipartisan deal to bring certainty for industry and investors.

Still, the stalemate on the RET continues, with Industry Minister Ian Macfarlane insisting the government would not budge on its latest offer, of 32,000GWh, and would prefer the target to be lower still.

The government would, he said, deal with the crossbench instead. On Thursday, Prime Minister Tony Abbott accepted that the deadlock on the RET needed to end but suggested that Labor, not the government, should shift further. But pressure is mounting on the government to end the uncertainty and the CEC’s high-stakes ploy might yet work, though this political compromise may not represent the best policy.

2 . Perils and pitfalls

As the Abbott government passes the halfway mark of its first term, these two case studies provide insights into the perils and pitfalls for lobby groups keen to wrangle legislative change of some description.

In short, it is risky to assume the government can and will deliver on a deal, even with the support of significant stakeholders. Groups that compromise their own position in the hope of securing change may be left with little to show for it but internal tensions.

An interesting contrast comes from the hardball tactics pursued by the Australian Medical Association. After the budget revealed radical changes to both health and higher education, the university chiefs offered conditional support to elements of the government’s proposals, but the doctors’ lobby dug in against the GP co-payment when it became clear the government would not seriously consider alternative models.

The AMA drummed up public opposition to the co-payment proposal and talked to senate crossbenchers to ensure it would not pass.

The doctors’ mission was aided by the fact that, in the current senate, it is much easier to block change than to make change. If measures are opposed by Labor and the Greens, then it only takes three crossbench senators to prevent their passage.

This was what gave Clive Palmer his power for the five months last year when he still controlled three senate votes. Now that Jacqui Lambie and Glenn Lazarus have each gone their own way, leaving Dio Wang as the Palmer United Party’s sole senator, Palmer has lost that power to block legislation. 

Securing change, on the other hand, requires at least six of the eight crossbenchers. And that’s a lot harder. While the splintering of the PUP dilutes Palmer’s power, it is still a major challenge for the government to corral support from six individuals, all with their own agendas.

With the senate numbers on their side, the doctors succeeded where the university chiefs failed. Now the government has declared its GP co-payment “dead, buried and cremated” and is kowtowing to the AMA, with Abbott conceding doctors must support any changes. 

The university chiefs are in a less enviable position. They played their ace and they lost.

Pyne is vowing to again pursue the fee deregulation legislation, unchanged, through the senate. This potentially sets up another double dissolution trigger to add to the one the government has already secured, relating to the abolition of the Clean Energy Finance Corporation. 

Don’t expect to see Robinson appearing again with the education minister to argue for senate support.

She says her members still believe the current funding regime is unsustainable, but she is realistic now about the will of the senate.

“While ever fee deregulation is part of the bill, it’s hard to see the government getting sufficient crossbench support for the bill to pass through this parliament,” she says. “In a way, I think that the crossbenchers actually have done the community a service, in that without them the bill as it was would have gone through and I don’t think, given there were problems with it, it would have been particularly sustainable in the long term.”

Robinson, a former gas industry lobbyist, says UA’s advocacy was effective in persuading the government to adopt amendments that made its package fairer. No one doubts that she was assiduous in her efforts to woo crossbenchers. When Palmer was proving hard to contact as the legislation came before the senate last December, she took the opportunity of his National Press Club address to have a word with him about university funding pressures.

The lobby group even published an open letter to senators in major newspapers last December, urging them to pass the package, albeit with amendments to ensure fairness.

Robinson argues that one positive to come out of the whole episode is that there is now widespread recognition the current funding regime is not sustainable. While there may be that recognition, there is still no solution in sight.

And Universities Australia faces an existential crisis. 

The Group of Eight elite research-intensive universities has now distanced itself from the government’s proposals, calling for a review rather than any further revision of the existing legislation. This is significant because these sandstone institutions were the most enthusiastic supporters of fee deregulation.

“We are still quite ardent supporters of deregulation but we are political realists,” says Group of Eight executive director Vicki Thomson. “It’s not going to get through in its current form and we don’t want to see it diluted so much it’s meaningless.”

Individual vice-chancellors, including Attila Brungs of the University of Technology, Sydney, and David Lloyd of the University of South Australia, have also let it be known they were not really persuaded by the unfettered fee deregulation of Pyne’s legislation and are not disappointed it was blocked.

In a speech in December, Parker said fee deregulation would “ring the death knell of our peak body” in a new era of “dog-eat-dog” competition for the sector.

 “Whether it breaks up soon because the tensions are too great, or it survives until the interest group factions have no more use for it and spit it out, UA is doomed because it has lost its moral compass,” he told the National Alliance for Public Universities forum.

Parker still thinks the lobby group is doomed, even though the legislation did not pass. He says he cannot see UA holding together as a useful force, given internal disagreements over the most fundamental issue to confront the sector in years.

“I think UA took a wrong turn at a very early stage,” he says. “If they’d come out and absolutely opposed the 20 per cent cut and said, ‘We’re not going to even be at the table until that is dropped’, then Pyne would not have been able to say that 40 out of 41 VCs agreed with him and I think we’d have had the review or reflection back in May or June that people are now still calling for.”

He is unconvinced by Robinson’s argument that UA was seeking to improve, rather than just support, the government’s reforms.

“The message the public was getting was they supported the package, they regretted the 20 per cent cut, they would like it a bit smaller pretty please, but, frankly, in the 24-hour media cycle, it’s the big message that’s going to come across, not the subtle one,” says Parker.

After the measures were unveiled in the budget, Robinson says it was clear there was a spectrum of views within UA, from those who were “wildly enthusiastic because they had been advocating for fee deregulation on and off for many years, through to those who were opposed to fee deregulation, and I guess the rump of the organisation fell in the middle as pragmatic realists”.

“That,” she says, “led to the UA position, which was an acceptance that the sector would be prepared to accept this sort of approach given the absence of alternatives that anybody could really see in prospect for providing the level of resources that were needed, provided the rough edges were knocked off.”

Despite Parker’s protestations at a meeting of vice-chancellors in Perth last year, the lobby group settled on its stance of conditional support for the budget measures, which Labor was staunchly opposing, and which were unpopular with the public, amid concerns about $100,000 degrees.

Robinson thinks the lobby group still has a role, in formulating high-level strategy and principles for the sector, even if there is not agreement on detail on some central policy questions. She compares this role to that of the Business Council of Australia.

3 . Mending bridges

Since the defeat of the legislation, UA has sought to mend bridges with Labor. But there are still some hard feelings there, particularly with Labor’s higher education spokesman Kim Carr. At times, UA had sought to go over his head to talk to leader Bill Shorten.

Carr says he now welcomes engagement with individual vice-chancellors and smaller groupings of universities.

“They made some fundamental miscalculations about the public mood, about the strength of the Labor Party’s position on this issue,” he says of Universities Australia. “They misjudged the consequences of what was clearly unfair and unnecessary proposals that were sprung upon people after the government had said they would do exactly the opposite. They made a terrible miscalculation even from their own self-interest to have been so quick to endorse the government’s proposals.” 

The Clean Energy Council’s gamble is different to UA’s, in that it is pitching for a bipartisan deal rather than a stitch-up between the government and senate crossbenchers.

CEC chief executive Kane Thornton wrote to both major parties on March 25, proposing they meet in the middle at a figure roughly halfway between what each was prepared to go to on the RET.

He acknowledged this solution was imperfect but hoped it would help secure a deal on the target, as investment stalled and jobs were lost after 12 months of uncertainty.

The proposal triggered an immediate backlash from the large-scale solar industry, which fears it will lose out because wind projects will use much of the target before big solar schemes start towards the end of the decade.

“We’ve always said that no deal is better than a bad deal,” Australian Solar Council chief executive John Grimes told The Australian Financial Review.

Andrew Want, the head of the Australian Solar Thermal Energy Association, lashed out at the CEC in comments on RenewEconomy, a blog dedicated to coverage of the industry.

“This is an extraordinary capitulation and betrayal by the CEC,” wrote Want. “It appears Government strategy to divide and conquer has been swallowed by the CEC, and CEC has decided the wind sector is where its bread is buttered.”

A RenewEconomy analysis of the responses to the CEC’s offer, by journalist Giles Parkinson, led with the observation that: “First the Abbott government brought the renewable energy industry to a standstill. Then, this week, it brought it to its knees. Now, it has effectively told it to go and get stuffed.”

In short, the ploy by the CEC was looking fairly dicey, at least until Wednesday, when Labor decided to support it and adopt the 33,500GWh target as a floor that could later be increased. Now the lobby group is hoping that, despite Macfarlane’s bluster, he will eventually cave to the growing pressure to strike a deal.  

4 . False assumptions

The CEC’s gamble may yet pay off but Universities Australia seems to be out of aces.

Richard Denniss, the executive director of The Australia Institute and the author of the recently published book Minority Policy, says UA made a mistake in assuming the government could deliver on its policy.

“A lot of people have a minister-centric view of politics and policy. That’s the mistake the universities made. They did a deal with the minister that they and the minister are happy with but the minister does not have the final say on it,” says Denniss. “A lot of lobby groups will be looking at the mistakes UA made and will be quite cautious not to say early and loudly, ‘We’re with the government on this unpopular compromise.’

“The worst case is supporting an unpopular compromise that is unsuccessful. They made the mistake of coming out loud and clear and early that they were willing to make that compromise when they probably should have checked the numbers were there to support it.”

The government has already promised the budget will be “dull” by comparison with last year’s. And Abbott is paying close attention to whether legislation has a hope of passing the upper house. But if there are surprises, interest groups will no doubt make a careful reckoning of their prospects of political survival before considering them a done deal.

This article was first published in the print edition of The Saturday Paper on April 11, 2015 as "Falling off the lobby horse".

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