Brett Whiteley (Braddon, Liberal Party) Share this | Hansard source

It is a pleasure tonight to speak in support of the Trade Support Loans Bill 2014. This is one of the many exciting initiatives in this year's budget with an eye to the future, with an eye to ensuring that our economy is sustainable and that every person in this nation has an opportunity to get ahead. The announcement by the Treasurer, on budget night, to introduce a new student loan scheme to assist young people with the costs associated in undertaking and completing an apprenticeship represents one of the most important shifts in a generation in the way the government and the community treats young people considering apprenticeships.

These reforms will have a significant positive impact on many young people in Braddon and Tasmania. For too long, some within previous governments and the wider community have viewed those who have chosen to undertake an apprenticeship as being of less value to the economy—that those who choose to go to university hold some sort of superior status. An apprenticeship is too readily viewed as the easier, inferior option for a young person and that they only do it if they are not smart enough to go to university. This bill goes an awful long way to dispelling that myth.

Unfortunately for many young people in the past, undertaking an apprenticeship was made all the more difficult by this attitude. This attitude resulted in young apprentices not having access to deferred low-interest loans and financial arrangements similar to university students. The Trade Support Loans Bill puts an end to this act of social discrimination. This bill will reverse this damaging attitude and place apprentices on level pegging with university students—as does another great reform of this year's budget, to place more courses under the FEE-HELP scheme, in line with most university undergraduate degrees. As part of this reform, apprentices may be eligible for concessional income-contingent loans, in a similar fashion to FEE-HELP loans or the old HECS loan scheme.

Under this new arrangement, apprentices in a priority occupation can receive up to $20,000 over four years, to be repaid at the same income thresholds as university students, which are currently set at about $53,000 per annum. Under the Trade Support Loans payments will be made in arrears, with $8,000 available in the first year, $6,000 in the second, $4,000 in the third and $2,000 in the final year. In addition to providing many apprentices access to these loans, the government will also provide a 20 per cent discount on the loans—meaning apprentices will only pay $16,000 as a maximum, of the loan, when and if they complete the training.

I find it hard to accept the basis on which many of the speakers opposite have contributed tonight—that is, that there is something obviously wrong with a loan-scheme system when, in fact, the university-loan system has been working like this for years. I see this as a hypocritical approach to this particular bill and it has a slight reek of elitism.

In addition to providing many apprentices access to these loans, it is really important to understand that there is currently a 30 per cent dropout rate in the first two years of an apprenticeship and about half of all apprentices who begin an apprenticeship fail to complete it. This is another reason that makes this Trade Support Loans Bill so important. It provides increased support to apprentices in the earlier stages of their apprenticeship, when their wages are lowest and when they need it most.

Furthermore, this money can be used to assist apprentices purchase tools, attend training in other towns and help with living expenses, under those circumstances, while earning lower wages, particularly in the first and second years.

In my state of Tasmania and particularly in the electorate of Braddon, these loans will have a significant impact on the ability of the region to recover from the dearth of skills needed to meet labour-market needs. One of the common issues facing many small and medium businesses in Braddon is simply that there are not the young apprentices undertaking training in skills-shortage areas. There is a mismatch between what businesses need and what the apprentices are taking up. Often this is not their fault. In fact, this is one of the many reasons the Gillard Trade Training Centres were such a dismal failure. They set some young people up with skills and trades that were not in demand in the area where they lived. It was a lose-lose situation for both the student and the industry.

This issue was highlighted recently in a joint report by the Devonport Chamber of Commerce and Regional Development Australia—Tasmania. A key theme in the report is the need for more collaboration between the job seeker, industry and educational providers to ensure young people are undertaking skills development that is needed in the region.

Trade Support Loans will achieve this by encouraging people to undertake training in skills-shortage areas, without the need to then move interstate because the Trade Training Centre did not offer the training that local industry required. Under this program, an apprentice will be eligible for loan support if they are undertaking any trade on the skills shortage list. This may sound overprescriptive, but the list has over 60 trades, including fitters, turners, electricians, hairdressers, sheet metal workers, gasfitters, welders and mechanics—and the list goes on.

In addition to traditional trades, I am pleased to note that those undertaking a certificate II, III or IV in agriculture and horticulture will be eligible for these loans. This is hugely important for Braddon as the local dairying industry embarks on a massive expansion in coming years. There is also an expansion coming when it comes to horticulture, particularly in the area of berries. I hope that this scheme will encourage more young people to consider a life in the agricultural industry and that more of the jobs can be filled by qualified Tasmanians rather than mainlanders and workers from overseas.

In the six weeks since the budget, I have been overwhelmed by the support for this Trade Support Loans scheme from apprentices and parents, particularly parents of young people who are coming to that stage of life where they are considering what to do following school. Not only are current apprentices, future apprentices and their parents welcoming of this scheme for the financial support it provides to buy tools and to cover the cost of travelling to training courses, clothes and living expenses, but, just as importantly, it gives young people the confidence that they are making the right decision by going into an apprenticeship. They are contributing to the economy and they will be acknowledged by the government and the community for the contribution they make to the community. I thank the House.

Debate adjourned.

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