Skills Funding Overhaul Gets Mixed Industry Response

Wednesday, May 14th, 2014
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An overhaul of funding arrangements regarding skills and training in the federal budget has received a mixed response from construction and industry lobby groups, who welcome the introduction of some new programs but express disappointment at the abolition of others.

Unveiled by Treasurer Joe Hockey on Tuesday, the budget included $439 million over five years to establish the previously announced Trade Support Loans Program under which apprentices undertaking Certificate III or Certificate IV qualifications in carpentry, plumbing, tiling or a range of other occupations featured on the National Skills Apprenticeship Needs List can access up to $20,000 in loans at concessional rates over the course of their training.

But the government will save $914.6 million over four years in tax-exempt payments to support apprentices to purchase their own tools by scrapping the Tools For Your Trade Program.

A further $1 billion will be slashed from the training budget over five years by scrapping ten further programs including the Accelerated Australian Apprenticeships Program, the Australian Apprenticeships Mentoring Program, the Workforce English Language and Literacy Program and the Apprenticeship to Business Owner Program – albeit with this being partially offset by an allocation of $476 million over four years to establish a new Industry Skills Fund which is expected to deliver 121,5000 training places and 74,300 support services supporting the needs of small to medium enterprises which cannot be readily met by the national training system.

Australian Industry Group Chief Executive Officer Innes Willox welcomed the new skills fund and the Trade Support Loan Scheme.

“We are, however, concerned with the cessation of the longstanding Workplace English Language and Literacy (WELL) program,” he added.

“Currently, over four million working Australians do not have adequate literacy and numeracy skills for the modern economy.  We must ensure that developing these vital skills does not lose priority.”

Like Willox, Housing Industry Association Chief Executive – Industry Policy and Media Relations Graham Wolfe also welcomed the new apprentice loans, the terms of which he added are comparable to university students under the Higher Education Loan Programme.

But Wolfe slammed the abolition of the National Workforce Development Fund (one of the ten aforementioned programs to be cut) and some of the other programs, noting that the new skills fund has a much narrower focus in terms of sectors covered (health and biomedical products; mining, oil and gas equipment technology and services; and advanced manufacturing, including defence and aerospace) of which construction is not one.

Wolfe further expressed disappointment at a decision to abandon the final round of the National Rental Affordability Scheme (saving $235.2 million over three years), which he said had delivered thousands of affordable homes to moderate and low income families, as well as a lack of investment support for housing to complement a $50 billion plus splurge on transport infrastructure.

“Tonight’s Federal Budget has delivered spending cuts across the board, many impacting on Australia’s residential building industry,” Wolfe said.

“While it is framed in the context of addressing the budget deficit, this will be at the expense of a number of worthwhile programs.”

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