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Federal Budget provides an opportunity to reform apprentice training

19-Apr-2016

The peak body representing Australia’s apprenticeship employment network today called for the upcoming May Federal Budget to include an overhaul of government incentive payments to employers in order to improve completion rates among apprentices and trainees.
 
Group Training Australia said that the Commonwealth currently spends approximately $400 million on incentive payments to employers of apprentices and trainees under the Australian Apprenticeship Incentives Programme. 
 
The payments of between $750 and $4,000 each are designed to encourage employers to engage in the training of apprentices and trainees, thereby contributing to national skills formation.
 
However, with completion rates of apprentices at around 50 per cent, it is time to rethink the merit of these payments and whether they can be reconfigured to deliver better results.
 
In its Budget submission lodged in January, GTA recommends that employers should be required to  use the incentive payments to purchase specialist apprentice support services from approved organisations such as group training organisations in circumstances where they cannot deliver those services within their own organisation.
 
“There are many reasons why completion rates are so poor but one reason has to do with the systems that some employers have in place for overseeing the training experience,” the GTA submission said.
 
“Many businesses lack the expertise and other support services to deal with apprentice employment. Group training organisations have been delivering this specialist service for some 40 years and are ideally placed to offer it to employers and help to lift retention and completion rates.”
 
Group training organisations are collectively the largest employer of apprentices and trainees with some 26,000 in training. They work through networks of employers, schools and training providers to facilitate skills and jobs, built around the needs of the market.
 
While it has recently been fashionable to focus on the ‘new’ economy – disruptive, sharing and start-up business models – the May Budget should not overlook vocational skills and traditional trades and the role they play in innovation and entrepreneurialism.
 
Other measures recommended in the Budget submission include:
 
- A stand-alone group training fund which will allow GTOs to continue to support micro, small and medium sized businesses to engage apprentices and trainees.

 
- That all school-based apprenticeships be undertaken through group training and an investment fund established to enable GTOs to develop pre-vocational and pre-apprenticeship training.

 
- The restoration of payment of commencement incentives for Certificate III apprenticeships and traineeships to the three month mark.

 
- The doubling of the rural and regional skill shortage incentive from $1,000 to $2,000 

 
- Funding to support training and employment services in Indigenous communities

 
The modest support provided by government has enabled GTOs to weather the vagaries of the business cycle, but this has become increasingly difficult. 
 
The abolition of Commonwealth funding for the Joint Group Training Programme adversely impacted the capacity of many GTOs.
 
The May Budget should be an opportunity to look at how scarce funding can be better used, and to re-focus attention on the role of vocational skills and jobs in a dynamic, high performing economy.

 
Media Contact: Bob Bowden, Foresight Communications 0412 753 298  bbowden@bowmac.com.au 
 
Group Training Australia is the national peak body representing the network of over 120 Group Training Organisations (GTOs) employing apprentices and trainees throughout Australia. www.grouptraining.com.au