Jill Hall (Shortland, Australian Labor Party) Share this | Hansard source

I rise to speak on the Trade Support Loans Bill 2014 and the Trade Support Loans (Consequential Amendments) Bill 2014. This bill establishes the Trade Support Loans program for Australian apprentices. These loans will be concessional and income contingent, with a lifetime limit of $20,000 indexed from 2017. The loans are repayable when the person's income reaches the Higher Education Loan Program—that is, HELP—repayment threshold. The bill allows for a 20 per cent discount to be applied for the loan incurred when an Australian apprentice completes their apprenticeship.

The opposition will be supporting this legislation, but there still remain a number of concerns in relation to its position as far as apprentices are concerned. This government has a record of saying one thing before an election and another thing after the election. Prior to the 2013 election, Tony Abbott announced the Trade Support Loans. He did not tell apprentices that the government was going to scrap Labor's $1 billion Tools For Your Trade Payment, which is $5,500 per apprentice. I think this was a mean and tricky trick. This is the government only telling part of the truth: 'Yes, we'll give you a loan, but, no, we're not going to pay for the tools of trade.' It is an absolute disgrace that this government says one thing before an election and another thing after the election and tries to trick the Australian people by using words with double meanings and framing all of its comments in a way that can mislead people.

I am really appalled at what this government has done in so many areas. Like many members in this parliament, I have been contacted by a number of apprentices, and even by employers who are committed to employing apprentices. They can see that this legislation is going to cause some hardship and leave young people with debts into the future. I think about one of the employers not far from my electorate, Heather, who has a hairdressing salon, Feathers. She has been employing apprentices for well over 20 years. She is totally committed to employing apprentices. She has two apprentices at the moment. One is a school-based apprentice. With no access to Tools For Your Trade Payments, this legislation forces school based apprentices—and the apprentices that Heather employs—to borrow money to buy the scissors, hair dryers and all the other equipment that hairdressers need. It forces young people into a situation where they will incur debt. I want to put on the record my thanks to Heather from Feathers for the great job that she has done and the commitment that she has made to apprentices. She is a model for employers throughout this country for the fact that she understands that, at one time, there was a hairdresser employer that gave her the opportunity to undertake her apprenticeship. She took that opportunity and is now providing that opportunity to young people in the electorate I represent. I encourage more employers throughout Australia to do what Heather does and to take on apprentices.

In doing so, I have to say that I am very disappointed with the government—particularly with the minister, when he said that young people were using the money that they received from the Tools For Your Trade Payments to buy mag wheels for their cars and to get tattoos. I was listening to the debate a little earlier today and heard one of the previous speakers in the debate saying that apprentices can borrow the money that will be available through the Trade Support Loans Bill to buy a car. On one hand, you had a situation where apprentices were getting money to purchase their tools of trade, and now they are going to be forced into a situation where they must borrow the money to access those tools of trade. To be quite frank, I do not think it is good to force young people into a position where they need to access loans to be able to purchase tools and equipment. It really puts them in a position where they are incurring a huge cost right at the beginning of their working life.

The provision of the optional loan is not opposed by us on this side of the House, but it should not have come at the expense of the tools of trade scheme. The two schemes should run together. Unfortunately, the Abbott government is showing its real commitment to apprentices by axing the tools of trade scheme, the Australian Apprenticeships Access Program, and another scheme that I am particularly supportive of, and have been over a number of years: the Australian Apprenticeships Mentoring Program. That program works to help those young people who are undertaking an apprenticeship and who may be struggling, for either financial or social reasons. They might be struggling with one aspect of their apprenticeship, and that mentoring service program allows them to get the support that they need to get through their apprenticeship. I have spoken to apprenticeship organisations, and they have told me just how important that scheme is and how so many of their apprentices have benefited from the scheme. This government is cutting those programs that have helped so many young people when they have been undertaking their apprenticeships. There are a number of issues that I don't think are very clear at this stage: the government hasn't been very clear about the financial considerations, which are a major barrier for apprentices taking up training or completing it; and the measures will have little impact on the skills shortage.

In Australia we have had a chronic skills shortage for a number of years. When Labor was in power, we addressed this shortage by putting in place a number of programs that helped young people take up apprenticeships and by targeting areas where we needed apprentices. Unfortunately, this legislation will do very little to attract young people to undertake apprenticeships.

In the Hunter and the Newcastle, many young people have undertaken apprenticeships over the years. I remember years ago when I was working in the employment area young school leavers or final-year students would come in and I would ask them what they wanted to do. A very high percentage of those young people said they wanted to be hairdressers—that tended to be the girls—boilermakers or fitters. I truly believe that young people who express a desire to undertake apprenticeships in the future will struggle to access them with this legislation.

A person taking out one of the loans will not completely repay it until they have paid back any HELP debt they have. That is pretty hard for a young person, and it has the potential to extend the time taken to repay the loan considerably. The relatively low income of many tradespeople, particularly when they first start out, is going to lead to this period being drawn out and to the possibility of there being a high default rate. This could mean that the program is going to cost the taxpayer a lot of money. The program is available to cert III and cert IV courses, and the loan must be paid to the apprentice at the completion of each instalment period.

In the shadow minister's contribution to the debate, she said that the government did not advise the Australian people before the last election that they were going to abolish the Tools for Your Trade program. Also they have not adequately explained this legislation, the interest rate or the full liability of the loans in plain English. They haven't offered adequate protection for school based apprentices under the age of 18, and that raises a question: is this government asking young people under the age of 18 to sign a contract? If not, they will need to involve their parents or guardians. They need to explain to the Australian people how this will work and make sure that career counsellors—who no longer have access to the Job Guide or myfuture, because this government is defunding those fantastic tools—in schools know how this program will operate so that they can give the right advice to the young people who are leaving school.

The shadow minister also raised the issue of fair and reasonable transition arrangements for current apprentices. This legislation is pulling the rug out from under the feet of young apprentices—those who have made decisions based on the programs that were in place. There is no grandfathering of the previous program and it is not allowing young people who have made a commitment to undertake an apprenticeship to finish their apprenticeship under the rules that were in place when they started. It is changing the rules and shifting the goalposts in the middle of a game, and that isn't good enough. The government needs to rethink that aspect of it, make sure that there is adequate privacy protection—that is, point 5 of the amendment that was moved by the shadow minister—and offer apprentices the option of lump sum payments in order to purchase expensive items.

There are a number of very short-sighted moves accompanying this program. The apprentice mentoring program and Tools for Your Trade program are ending, and this undermines the legislation. As I said at the commencement of my contribution to this debate, we, on this side of the House, will not be opposing this legislation but we certainly have a number of concerns. I hope I have outlined fully the concerns that I have for those apprentices and the employers who have made the commitment to offer young people apprenticeships. While supporting this legislation, I have some serious concerns.

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