Martin Ferguson (Batman, Australian Labor Party, Shadow Minister for Primary Industries, Resources, Forestry and Tourism) Share this | Hansard source

I appreciate the cooperation of the House in enabling me to make my full statement this afternoon by moving the adjournment debate out by five minutes or so. I say that because I think this debate on skills is exceptionally important. As the member for Capricornia has indicated, all around Australia, in our capital cities and our major regional cities and towns, we have a major skills crisis. It is about time we accepted that we do have a major skills crisis which is now a barrier to investment in Australia. Our real problem is that once you start losing investment it goes to other countries and it is then harder to attract it back to Australia in the future.

I therefore want to make a few remarks about the Prime Minister’s Skills for the Future package of last week. The Australian Labor Party has been banging on about the issue of skills for some years now. It is not a new issue to us. We have been championing for a long time the requirement for national leadership and action on the issue of skills.

Australia’s skills crisis is widely recognised as the largest problem facing the nation’s future sustainability on the economic front and its growth possibilities. Time and time again, the Reserve Bank of Australia has sung in tune with the nation’s top banks, which have identified the difficulty for business in finding suitable labour as the key constraint on output. It is across the whole economy—in the mining and resource sector, the energy sector and the service sector, for instance in hospitality. It is not confined to one sector of Australian industry or one state or territory or region of Australia. It is a national problem.

It is obvious to me from my shadow ministerial responsibilities that this is a problem that is prevalent in the mining and resource sector. I do not need to remind anyone in these sectors of that. Just look at the wages on offer because of the skills crisis—the wages this sector now has to pay to try to attract and retain people. It is actually adding to the cost of running a business in Australia.

It is also an issue on the tourism radar and it has been there for some time. In tourism and hospitality, it goes to the ability to service growth in the inbound sector, which is under question due to labour shortages. It was only last week that the Australian Tourism Export Council came out and said:

Tours are being cancelled—not for want of tourists but for a lack of drivers and tour guides.

Rooms in hotels and motels are being shut and investment plans are being put off. Hotels are being built but the owners are facing the prospect of being unable to staff them ...

That says it all. We are losing business because we cannot get the workers to actually perform the services required by tourists.

We also have problems in some of our major resource and civil engineering projects in getting the skilled workers to undertake the work, with investment decisions having been made. This is, unfortunately, at a time when industry has been enjoying reasonable prospects. But now we have the prospect of not being able to fulfil our potential capacity, and that is the last thing industries such as the tourism industry—which is struggling, domestically—need at this point in time.

It is a nationwide issue that the government should have fronted up to long ago. I am pleased that, in trying to at least partly confront this problem, the government has chosen to turn to the Labor Party for some policy ideas. I believe it is a welcome U-turn from the Prime Minister—a late convert to the need for skills upgrades—that they have actually decided to do something about this crisis.

But it would be an even more welcome outcome if it were a serious package. It is typical of the Howard government that when there is a problem they shove a few dollars on the table and hope that the problem disappears. You now need a long-term strategy to overcome the skills shortage that exists.

What the government has proposed is a start, but there is a hell of a lot more to be done. That is part of the government’s approach when there is a problem: they spend a few dollars, brush it under the carpet and move on to some other problem, if one arises; or, otherwise, they go back to sleep at the wheel. That lack of government attention goes across a whole range of sectors in Australia at the moment.

It is fair to say that some aspects of the package are comprehensive in their design, but it is going to be hard to implement them in time to overcome the problems in the foreseeable future. At the last election, we had the new techs. Based on enrolments today, we will not get a tradesperson for another 3½ years. The cost per apprentice is $63,000 and we will not get any results for about four years. That is the real cost of the Australian government’s tech schools initiative so far—and there is a skills crisis!

Let us go to some of the issues. The package is obviously designed to sway the minds of voters, not to actually solve the skills problems. The government is trying to look as if it is doing something on the skills front when actually it is not doing anything. The government is not doing the hard yards, getting its hands dirty and trying to work out, for example, how to streamline the apprenticeship system in Australia. Do you do it trade by trade? Do you do it on a competency basis? The government should investigate how to reduce the period of the apprenticeship, like the Victorian government did in the automotive repair industry in Melbourne. If you do your pre-vocational period of three months in years 11 and 12, you go into a shortened apprenticeship of three years with higher rates of pay—higher apprentice wages. The rates for each of those years are the second, third and fourth year rates. That is an encouragement for kids, some of whom live in a poverty-stricken way because of the lower wages historically paid to apprentices, to stay in their apprenticeship and complete it. One of the biggest problems is young people not completing their apprenticeships.

This is a start, but it is disappointing that the government has not done enough. There is $800 million, almost half of which will go into the training voucher, which is the government’s centrepiece. But the money allocated is spread over five years. That is $160 million a year. Not only has government got to do more; business itself has got to do more. All too often in the past, business has regarded training as a cost. I think it is about time they adopted a culture that training is an investment in their future. They should not have closed apprenticeship centres in the major mining towns, as they have done in the last 10 to 15 years. Now they are paying the price because of a lack of attention to detail by both government and business itself.

In announcing the package, the Prime Minister suggested that there is not a crisis. I find that an exaggerated and breathless statement. It is outrageous for the Prime Minister to assert, as he did in this parliament last week, that ‘some level of skills shortage was part of the healthy and dynamic labour market’. I simply say that we did not need to have this skills shortage. If the government had been attending to the detail of running this economy and investing in our future—and investing in our infrastructure and our skills base is what it is all about—we would not be confronting this skills problem at the moment and having to rely on section 457 visas to bring people from overseas whilst we fail to train our own. I am not just talking about our young people. Obviously, there is also the question of adult apprenticeships.

We have $800 million spread over five years in the lead-up to an election. I simply say, in terms of my shadow responsibilities, that I cannot see this producing the outcomes that we need. The package will, I think, be rushed in its implementation, because the government has failed to admit that there is a skills problem.

Let us go to the issue of the voucher system that is due to commence at the beginning of 2007. When you think about the detail of implementing the system, this does not leave much time for those implementing it—and, given the seriousness of the issue at hand, there is no room for error. It is reasonable to ask whether the package can be delivered as promised.

We also have to be careful in developing this package that we avoid some of the fly-by-nighters who always come in when there is government money on the table. All of a sudden there will be growth in the number of training consultants. If there is a voucher, we have to have a serious look at the quality of the training that might be delivered as a result of some of these initiatives. If we are going to spend taxpayers’ hard-earned dollars, we have to make sure that a quality product is delivered. This is not just about throwing a few dollars on the table 18 months from the election. This has to be a serious investment in overcoming our skills problems.

I am seriously worried about the potential quality of some of the providers that will be chasing these vouchers and trying to induce unsuspecting people who are desperate to get some skills to enrol in courses that are not properly competency based and will not make them even more employable and advance their career prospects.

It is appropriate that the government does something, because the skills crisis is of its own making. In 1998 the government abolished the national skills shortage strategy. That strategy and that move coincided with the number of traditional apprentices in training falling to its lowest since 1972—a move that reflected the government’s attitude to education throughout its 10 years in government.

This poor track record was highlighted in a recent OECD report entitled Education at a glance. The report showed that Australia is the only advanced economy in the world that has reduced its public sector investment in education since 1995. The average investment level across the OECD was a 48 per cent increase, yet Australia’s investment was a cut of seven per cent. I simply ask: why is the government leading the nation in the wrong direction with respect to the issue of skills?

I turn to the opportunities for an additional 30,000 mature age trainees. This is a figure, however, that reflects only 10 per cent of the number of students who have been turned away from TAFE under the Howard government because of its cuts. These 300,000 students included some mature age workers as well as young Australians, all of whom want to make a contribution to our nation and improve their life opportunities. The package last week included nothing to help youth access apprenticeships, yet almost two-thirds of Australian apprentices are under the age of 25. There were no financial incentives for them to complete their training or courses. A report released into Australia’s TAFE system found that cost is a major deterrent to some people accessing TAFE courses. It then referred to the drop-out rate of 40 per cent because of those associated issues.

Alternatively, the opposition’s blueprint goes a long way to addressing the skills crisis. It refers to the proper creation of a skills account. It refers to completion payments and trying to assist apprentices—where some employers do not assist—with the cost of TAFE. Traditional trades underpin the Australian economy. Both domestic and international visitors in the tourism industry, for example, depend on a quality service delivered by well-trained people. Basic qualifications have to be the order of the day, as are experience, attitude and a willingness to decasualise industries such as tourism and hospitality to actually bring a greater sense of permanency back to the workforce.

It is about time the government did something serious about reviewing, industry by industry, the periods of apprenticeship training on a competency basis and addressing the problems that some apprentices face trying to live on the low apprenticeship rates that exist in Australia.

The tourism industry, as I have said, is an example of serious skill shortages, especially in small business and regional and rural based operations that are suffering—and those businesses are very important to the Australian community. I refer to a submission by Tourism Alliance Victoria to the House of Representatives Standing Committee on Employment, Workplace Relations and Workforce Participation inquiry into workforce challenges in the Australian tourism sector. It highlighted a case study that focused on a small tourism business in the west Victorian town of Pomonal, near the Grampians. It detailed that the single biggest block to business expansion was staffing—another example of where we are losing business because we do not have skilled workers.

Today, the number of vacancies on Australian Job Search stands at 71,036; the food, hospitality and tourism sector accounted for nearly 13 per cent of those vacancies. A shortage of labour is the last thing the local industry needs, after five years of external shocks such as September 11, Bali, the threat of terrorism and the SARS crisis in Asia.

So the opposition simply say: it is about time the Australian government, led by the Prime Minister, John Howard, actually did more on the trades front. We need a productive Australia. We need a nation that is prepared to invest in education and skills training rather than regarding them as a cost. The budget process for the last decade has actually been very easy. There has been money available for these decisions. You have not had to find the savings. It was a question of choice. Cuts in TAFE expenditure and a failure to do something seriously on the apprenticeship front are now seriously hampering Australia’s economic future.

I say in conclusion that the skills package is a start. It is long overdue, it is not enough and it lacks real commitment to some of the other serious work that is required, such as shortening apprenticeship periods of training, based on a proper accreditation process, to guarantee that sooner rather than later we get the tradespeople in the field. We can therefore secure investment and guarantee Australia’s economic future. I commend to the House the opposition’s blueprint on skills training, because it is a more focused, practical endeavour to do something about the skills crisis. (Time expired)

Debated adjourned.

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