Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The original question was that this bill be now read a second time. To this the honourable member for Perth has moved as an amendment that all words after ‘That’ be omitted with a view to substituting other words. The question now is that the words proposed to be omitted stand part of the question.

Kelvin Thomson (Wills, Australian Labor Party) Share this | Link to this | Hansard source

Before question time today, I was speaking in support of the opposition’s second reading amendment to the Social Security Amendment (Apprenticeship Wage Top-Up for Australian Apprentices) Bill 2007 and indicating my view to the House that the bill is not only belated but also insufficient. It funds only the first and second years of an apprenticeship, whereas Labor’s trade completion bonus targets the completion of an apprenticeship. The bill also does not address the fundamental structural issues at the heart of the current skills shortages and is simply, I believe, a bandaid on what is a structural haemorrhaging in vocational education and training. The TAFE system alone has turned away over 325,000 people while the government has been in power and is in desperate need of increased funding and investment in infrastructure. This neglect has left the nation facing acute skills shortages.

Young Australians who have not completed year 12 and are not fully engaged in the workforce and low completion rates for apprenticeships are issues that need to be addressed in order to rectify these skills shortages. A skilled workforce is essential for our long-term economic prosperity. It is essential that vocational qualifications are attractive to all Australians—and this begins at the school level. This bill falls seriously short of fulfilling the claim by the Minister for Vocational and Further Education that it will encourage young people to consider technical and trade training. It does not address the root causes of the problem. Providing assistance to only first- and second-year apprentices does not fundamentally resolve the low completion rate of apprenticeships which I referred to earlier. Labor’s trade completion bonus for apprentices would make one payment of $1,000 halfway through an apprentice’s training and a further $1,000 payment at the completion of the apprenticeship. This would help facilitate the completion of traditional trade apprenticeships by providing payments to reward those who continue beyond the first two years and complete their apprenticeships in traditional trades on the national skills shortage list.

This bill does not acknowledge or address the structural root of the existing problem of skills shortages, which is at the school level. At a structural level, Australia needs to lift the number of students who complete senior secondary school and increase the number of people with vocational and skilled trade qualifications. Of those young Australians who have not completed year 12, a significant number are not engaged in the workforce in a meaningful way. Apprentices and trainees who commenced their training contract without completing year 12 have a lower probability of completing their training than apprentices and trainees who have completed year 12. In May 2005, 20 per cent of school leavers who had completed year 12 were not fully engaged in study or work, compared with 40 per cent of year 11 completers and nearly 50 per cent of year 10 or below completers. There were over 48,000 early school leavers not fully engaged in learning or work. Those who finish school are relatively advantaged in terms of education and labour force destinations. So we need to skill up and fully engage young people in our labour force.

This is something that many people are aware of. The Australian Chamber of Commerce and Industry has identified the importance of growing a skilled workforce locally. The evidence is apparent that increasing secondary school completion rates and establishing clear avenues to post-school education and training are imperative for increasing productivity and individual prosperity as young Australians are equipped to avoid unemployment and/or underemployment. The OECD has identified a clear link between increasing retention rates and increasing productivity with better employment outcomes and social inclusion available to individuals.

Many young people see education solely as a means to employment. This means that there is less incentive to complete year 12 if there are opportunities as unskilled workers, and senior schooling is unfortunately too often seen as simply a means of gaining entry to university. Improved access to vocational education and training in schools and to school based apprenticeships will make schooling more relevant for the almost two-thirds of students who do not go on to university study. A school environment that is more engaging for students with vocational programs could be integrated with mainstream subjects and thereby capture the imagination of students. This would provide a disincentive to leaving school before year 12 as the value of remaining becomes apparent.

Vocational education and training should be seen as a genuine choice for young people and should be reflected as such in the standard of facilities available at secondary school level. Facilities at secondary school level accommodating vocational education and training need to be upgraded and improved. State and territory governments have recognised the importance of a high-quality vocational education and training system and its integration within the school system. A federal Labor government would, with a national school based vocational education and training system, invest some $2.5 billion over the course of the next decade to lift secondary school retention rates and to create high-quality vocational education and training opportunities throughout Australia’s secondary schools. This kind of approach to vocational education and training and trade skills goes to the heart of the problem and invests in our human capital. By increasing retention rates in schools and rectifying the underemployment that characterises a significant number of early school leavers, productivity and workplace participation will be lifted. I believe that a high-quality national system of vocational education and training at the school level that engages students will facilitate higher retention rates and increase the reputation and perception of vocational education as a first-class career choice. This will go a long way towards meeting our skills shortage and providing a long-term solution.

The government has also substantially increased the number of skilled migrants coming into Australia. During 2004-05 the government increased the number from 63,300 to 97,500—a 50 per cent increase. Skilled migration to Australia is now more than four times what it was in the last year of the Labor government, jumping from 24,100 to 97,500. That jump is so big that it has caused total migration levels in Australia to almost double what they were in the first year of the Howard government—from 73,900 to 146,500. Over the years I have taken a big interest in unemployment because of its impact on the community that I represent and I have come to the conclusion that unemployment nowadays is all about education and skills. If you have got the education and the skills you will get a job. If you have not, best of luck. It is a mistake to import skilled migrants to meet our skills needs and allow our own young people to languish on the scrap heap for lack of decent investment in skills and education. This goes on in tertiary education. Domestic undergraduate commencements have increased by the very meagre amount of 3,000, from 132,000 to 135,000. That is a bare two per cent increase—essentially flatlining. During the same period undergraduate commencements by overseas students in Australian universities have increased by 20,000, from 16,000 equivalent full-time students in 1996 to 36,000 students by 2003—a 125 per cent increase. As you might expect, this has led to a dramatic increase in the percentage of Australia’s student population who are overseas students. In 1996 it was 10.8 per cent of the student population. By 2003 it had doubled to 21.1 per cent. This means that young Australians are missing out on university places and the job opportunities that come with the university places. It is the same with apprentices and trade training. We have seen cutbacks in federal government support and a move to import our need for skilled labour, essentially outsourcing our demand for skills and training.

Labor believes that we can do better. In May 2005 we called for the budget to include a trade completion bonus for apprentices to address the skills crisis. It is regrettable that the government has failed to take up this initiative. In 2005 the government decided it would make income support through Youth Allowance and Austudy available to apprentices, but the harsh participation requirements for these payments have meant that only a small number of apprentices have been benefiting from this support. Of the 60,000 apprentices that the Department of Education, Science and Training estimated would receive youth allowance in 2005-06, only a quarter of this number—15,000 apprentices—actually received income support. When the government was challenged, the explanation it gave for the low take-up rate was that apprenticeship and parental incomes were higher than anticipated. Yet, in the bill before the House, we can see that the government acknowledges through the apprenticeship wage top-up measure that these wages need to be supplemented.

Along with a failure to provide adequate financial support for apprentices and to address the appalling completion rates, particularly in traditional trades, the government has presided over neglect and underinvestment in the vocational education and training sector. We have seen a slashing of investment in vocational education and training. The government’s own estimates show Australia facing a shortage of more than 200,000 skilled workers over the next five years. Part of its response to this has been to spend half a billion dollars on a stand-alone network of Australian technical colleges that will at best only produce 10,000 graduates by 2010. The other side of the coin here is that the TAFE system has turned away over 325,000 people and is crying out for additional recurrent funding and investment in infrastructure. In order to seriously address the magnitude of the current skills crisis, we need to focus on the areas of maximum impact. That includes the TAFEs, which are responsible for the substantial majority of post-secondary vocational education and training. We need to focus on vocational education and training in schools. We need to focus on on-the-job trades training. That is why Labor has announced a 10-year $2.5 billion trades training centres plan aimed at the million students in years 9, 10, 11 and 12 in Australia’s 2,650 secondary schools. This plan will provide secondary schools with between $500,000 and $1.5 million in order to build or upgrade the vocational education and training facilities in order to keep kids in school, enhance the profile and quality of vocational education and training in schools and provide real career paths to trades and apprenticeships for students. I commend the amendment to the House.

Stuart Henry (Hasluck, Liberal Party) Share this | Link to this | Hansard source

The Social Security Amendment (Apprenticeship Wage Top-Up for Australian Apprentices) Bill 2007 is another demonstration of the Howard government’s commitment to young Australians in ensuring that they are able to access effective trade training in a way that ensures that it is both attractive as a career option and also, importantly, economically viable for employers and industry. This bill, along with many others that have been introduced during the term of the Howard government, is a very clear demonstration that this government is listening to the community, industry and individuals and responding in a positive and effective way.

Let us look at what has been achieved since the Howard government came to office in 1996. In particular, let us look at my electorate of Hasluck. In March 1996, there were 660 apprentices residing in Hasluck. By September 2006, I am very pleased to report, that figure had significantly increased. (Quorum formed) I can certainly understand the opposition whip calling a quorum. They do not want to hear about the success of the Howard government in providing apprenticeship opportunities for Australians and they do not want to hear about the disaster that they made of it during their term in government, because their performance was pathetic. I was saying that in March 1996 there were 660 apprentices residing in Hasluck. By September 2006, I am very pleased to report, that figure had significantly increased, to 1,430, an increase of some 117 per cent. We need to also look at the more mature age demographic, which reflects that significant change is occurring in our communities—which Labor would not recognise. Encouraged and supported by this government, older people are taking up apprenticeships. In 1996, in my electorate of Hasluck there were only 30 apprentices aged between 25 and 45, compared to 380 in 2006. This is a massive increase, of some 1,167 per cent, demonstrating the former Labor government’s lack of understanding of the evolving labour market.

These figures clearly demonstrate that the Howard government’s strong and effective economic management is flowing through our business communities, providing greater opportunity for those who wish to take up an apprenticeship and positively impacting on and benefiting many families in Hasluck and across Australia. Having looked at the positive changes in apprenticeship numbers and vocational opportunities in Hasluck, let us look more broadly. Since 1996, the Howard government’s policies and their effective implementation have ensured considerable growth in the opportunity for all Australians to access vocational education and training. Australian apprenticeship commencements have increased significantly. In fact, training opportunities for 15- to 24-year olds have increased dramatically, with Australian apprenticeship commencements in 2006 up a massive 154 per cent since 1996. There are now more than 404,000 apprentices in training, compared with only 154,000 in 1996. The number of young Australians aged 25 to 29 with at least certificate III vocational qualifications has increased from 40 per cent to 56 per cent, up 16 percentage points since 1996. The government’s commitment of $2.7 billion this financial year is an increase in funding for vocational education and training of some 90 per cent since the Howard government came to office.

In the lead-up to the last federal election the Howard government made a commitment to establish 24 Australian technical colleges across Australia to assist in the establishment of school based apprenticeships and to provide an effective school based model for the delivery of vocational training with industry and employers. The Howard government’s commitment to establishing these new Australian technical colleges to boost the status and quality of technical and vocational education in Australia is on target, with 20 Australian technical colleges currently operating at 33 campuses. In 2008 there will be 25 colleges at 39 campuses. By the end of 2009 they will be operating at up to 42 campuses.

I was very pleased to see that the recent budget announced further choices for those seeking to develop a trade based career, with a further three Australian technical colleges to be established. This will bring the number of Australian technical colleges to 28, providing training on state-of-the-art equipment, led by industry and business through their respective governing councils. Students will be provided with industry based trade and vocational training and workplace opportunities which will lead to an apprenticeship, a trade qualification and will also provide for a year 12 academic certificate. Indeed, the Australian technical college concept is a real innovation which is already established as a model for the future in developing vocational and trade training in specialist high schools. This Howard government initiative has already forced a number of state Labor governments who, as always, were dragging the chain, to recognise and belatedly introduce school based apprenticeships and to lift their game in those underresourced high schools that are struggling to deliver effective vocational programs.

I am unashamedly a strong advocate for Australian technical colleges and will be working hard on behalf of my electorate and constituents to ensure that one of the new Australian technical colleges earmarked for Western Australia is located at the Midland Railway Workshops. There is a very rigorous and dynamic group who are also determined to see an Australian technical college in Midland. They include the Swan Chamber of Commerce, the City of Swan, the North East Metropolitan Chamber of Commerce and the Eastern Metropolitan Regional Council. This objective already has the strong support of the community and local businesses. It effectively links the historic past record of apprenticeship training at the Midland Railway Workshops with the future.

The Prime Minister said in parliament last year, in his ministerial statement on Skills for the Future:

With our investment in ... Australian technical colleges the government has said quite emphatically that the days when a trade or vocational qualification was deemed ‘second class’ in our society are over.

Labor do not get it. Labor still do not get that a trade qualification is equal to a university degree as a pathway to a satisfying and rewarding career. Labor do not get the need for industry and employer participation in the education and training process to ensure that the skills being taught meet the needs of employers and industry, whether they are small businesses, such as the local master plumber, or big businesses, such as BHP or Alcoa.

Labor’s lack of understanding of this relationship is demonstrated by their actions in the dropping of industry based advisory committees in the trade sectors in TAFE colleges as far back as 1986. Talk about living in the past. It was further demonstrated by the Leader of the Opposition in his budget reply speech, where he announced that they would fund 2,650 schools to deliver vocational training, without any mention of industry or employer involvement and certainly not enough financial commitment to ensure that they would be adequately resourced. In fact, the member for Wills just mentioned that each school may be eligible for $500,000 to $1.5 million. If they are going to effectively provide vocational training, they will need substantially more than that. They will need to develop relationships and partnerships that assist in the delivery of that. There was no mention of that. They will not be adequately resourced by skilled industry trainers or indeed have the necessary tools and equipment to effectively deliver vocational training of real value.

I again quote Mr Brian Toohey, from his column in the West Australian recently:

Kevin Rudd has made a bad policy mistake by promising to give every high school in Australia a trade training role. The job is much better done in specialised technical and vocational colleges where the money can be concentrated on producing fully skilled graduates.

Quite clearly, the Howard government has got it right. We will continue to build on this record through specialised Australian technical colleges and by supporting apprentice wages and the costs of training fees and other innovation initiatives.

I will further expand on this by referring to last year’s announcement by the Prime Minister, the Hon. John Howard, of a major investment in upgrading Australia’s workforce and building its skills base by investing $837 million over five years to fund the Skills for the Future initiative. This important training initiative delivers a range of opportunities for Australians to gain new skills and will help to develop a more entrepreneurial workforce. It helps to highlight the understanding of the need to continuously upgrade one’s skills over the course of an individual’s working life or to even start a new career in a traditional trade.

Unlike the Labor opposition leader, the Prime Minister of Australia does get it. He knows and understands what Australians need to remain actively engaged in the workforce. He knows what industry and business need to increase productivity and profitability in the 21st century. He understands that requiring business and employers to pay an adult apprenticeship rate where a worker is older than 21 is a disincentive to employers and a barrier to older Australians changing career and taking on an apprenticeship.

The Western Australian government, only a few years ago, moved all apprentices over 21 onto the minimum adult wage without any serious consultation with employers of mature age apprentices. This decision, unfortunately, immediately led to many of those mature age apprentices losing their apprenticeship. It was a great and unnecessary tragedy for those affected. Instead, the Labor government should have adopted a similar approach to that announced under the Howard government’s Skills for the Future package, which provides support for mid-career apprentices of an amount of $307 million. Apprentices aged 30 and over will receive $150 per week—the equivalent of $7,800—in the first year of their apprenticeship and $100 per week, which is equal to $5,200, in their second year. This is paid to either the apprentice or the employer, depending on the industrial arrangement the apprentice is employed under. That is the way to encourage older people into the workplace and to take up apprenticeships.

Other initiatives announced under this program include work skills vouchers to the value of $408 million. The $3,000 works skill voucher is a great opportunity for those people over 25 to hone their basic skills, especially to gain the literacy and numeracy skills that are basic requirements in the workplace. Other initiatives include the business skills vouchers for apprentices, worth $12 million; more engineering places at universities, worth $56 million; and incentives for higher technical skills, worth $54 million. These are all worthwhile initiatives aimed at keeping apprentices of all ages in the workforce.

The recent budget announcement to provide apprentices with an additional $1,000 for the first two years of their apprenticeship was well received, particularly by those apprentices in a trade occupation included on the migration occupations in demand list. This initiative will see first- and second-year apprentices under 30 who are undertaking an apprenticeship in a trade occupation included on the migration occupations in demand list as experiencing skills shortages significantly advantaged by this additional tax-free payment. It is expected that, over four years, some 220,000 Australian apprentices will benefit from this initiative. These payments are planned to be made in six-monthly instalments until they have reached the end of their second year.

These incentives are targeted specifically at those areas identified by the Department of Employment and Workplace Relations as being areas of national shortage, and currently include such critical trades areas as bricklaying, cabinet-making, carpentry and joinery, drainery, gas fitting, general plumbing, mechanical servicing, air-conditioning plumbing, metal fabricating, metal machinistry, pressure welding, sheetmetal working, welding first-class, fitting, fibrous plastering, general electrical, general electronic instrument trades and lift mechanics—to name but some of those trades that would make terrific opportunities for many Australians.

These trades are necessary for the further development of essential infrastructure and future economic growth and prosperity. The coalition government has long been committed to restoring the status of trade and technical qualifications as an important part of ensuring that Australians see an apprenticeship as a valued and supported career choice. It is sad, though, to see that the Australian Labor Party has walked away from these essential trades in favour of an academic university qualification, irrespective of whether there is a job at the end of it or not. Indeed, today there are many mature age apprentices who have degrees but have seen the real opportunity that trades, such as those mentioned earlier, provide.

For a young person leaving school, there is nothing as important as having the opportunity to find work or an apprenticeship in a chosen trade or career path. In 2007, that opportunity is much more readily available than it was in 1996. In the early 1990s, 34.5 per cent of teenagers and school leavers were unemployed. In fact, the prospect of a job or apprenticeship was pretty remote. We even had the CES, as it was known, going into schools and advising leavers how to sign up for the dole, such were their prospects of employment. All of this was during the reign of what can only be described as an inept Labor government.

Let me demonstrate that ineptness. This is what the member for Brand, the then Minister for Employment, Education and Training, had to say in 1993 in respect of youth unemployment in an interview on 6 May 1993:

Interviewer: So this group are being told, in their twenties, by society, effectively: You’re the losers; go to the scrap heap?

Beazley: Well, those who haven’t made it into work and who are among the long-term unemployed, that’s a reasonable statement.

We all know that we ended up with over a million Australians unemployed. The then Labor government had no response, no solution and could not fix these problems or even kick-start the economy.

The member for Wills said, ‘Labor can do better.’ We have been looking at what they have done. Let us look a little bit further. At that time, with the Labor government’s focus on university degrees, Australia lost a generation of apprentices and tradespeople simply because of their inability to understand how to kick-start the economy. At that time I was a strong advocate for industry based training centres as an alternative to TAFE to provide retraining and upskilling for existing skilled tradespeople and to ensure their skill base and knowledge remained relevant in a market that was rapidly advancing with the introduction of new technology and systems. It was very difficult at that time to get TAFE to address the changes that were occurring through technology.

It was obvious that there was a crisis in apprenticeship training and a need for much more flexible training arrangements and competition in this critical area. I, with other like-minded people committed to ensuring future opportunities for school leavers in apprenticeships and a future skilling of existing tradespeople, set about establishing a training facility. This led to the innovative MPA Skills in Maylands being established. Initially, it was precluded from delivering apprenticeship programs through an unproductive and restrictive Labor government policy. It was the first industry based skills centre to serve the building and construction industry in Western Australia, if not Australia. It is now a significant provider of apprenticeships for the skilled trades of painting, plumbing and gasfitting. (Quorum formed) (Time expired)

Debate interrupted.