Steve Hutchins (NSW, Australian Labor Party) Share this | Hansard source

The point is that, as I said, Senator George Campbell has never been a Trotskyite. I know Senator McGauran has tried to correct the record now. Senator Campbell has probably been many things, but he did draw the line at that. I am also aware that Senator Campbell was an apprentice on the shipyards in Northern Ireland. I think he may have served one of the longest apprenticeships because of his political and industrial activity at the time. Nevertheless, he did get apprenticed and did come to Australia and make a fine contribution to our political and industrial life.

In speaking to the Australian Technical Colleges (Flexibility in Achieving Australia’s Skills Needs) Amendment Bill (No. 2) 2006 I would like to raise some significant concerns about the nature of this bill and about this country’s future as a skilled nation. The bill seeks to increase the funding allocation to the government’s 25 Australian technical colleges by around $100 million.

In principle, Labor supports the funding of vocational training in this country. But this bill and the government’s policy approach represent a political solution to a very real problem. I question this government’s commitment to vocational education in Australia. I question it on the basis that it has been one of the most neglected sectors in education for the past 10 years. I question it because we have faced a very clear shortage in key skills over the past few years and the other side refuse to even acknowledge the seriousness of the situation.

Australia stands in the grip of a very profitable commodities boom. We are in the midst of a once-in-a-generation opportunity to make the most of the growing demand for our natural resources. As the record profits from mining companies keep rolling in, so the business tax revenues keep lining the coffers of the government. We have seen massive surpluses almost entirely off the back of this boom.

A government with foresight would have had the wisdom to make use of this extraordinary period to reinvest that revenue so that we could lay the groundwork for our future prosperity, because anyone with common sense will tell you there is always an end to a boom, and we need to make sure that, when that comes, it will be a transition to a new stage in our economic development, rather than a drop in our fiscal health. What we have seen from this government, however, indicates that they have no such foresight. I fear the opportunities we had now lie squandered because the coalition has been too complacent and too driven by ideology to adequately address the challenges of the future.

In particular, I make reference to the skills shortage that currently grips Australia. The government is eager to pin this shortage entirely on the mining and commodities industries in Western Australia, Northern Territory and Queensland. And, of course, the strength of the sector in those regions is attracting many of the country’s skilled workers—mechanics, truck drivers, engineers, miners, even plumbers—but it is not the only cause for the shortage we face.

If we were to indulge in an exercise of finger pointing, we would have to take aim squarely at this government. After 10 long years of the coalition, there is still no optimism from industry as to Australia turning around its skills shortage.

Dan O’Toole, the head of Coffey Mining, told the Australian Journal of Mining earlier last year that the lack of skilled employees is eating away at the profitability of Australian companies. He said:

We believe the problem will become so bad that public companies will eventually be required to report to the ASX on issues such as succession planning and sustainability of their professional staffing. This will be seen as a significant factor in determining the profit viability and capital growth value of a company.

Mr O’Toole talked specifically about the difficulty in recruiting engineers, with some companies spending up to 12 months to find a candidate, and the all too familiar overseas recruitment from China, India, Turkey, Canada or Zambia. This all, of course, comes at a significant cost. And that is just one example.

The scale of the skills shortage is huge: the Australian Industry Group estimates that to fill the current demand we need an additional 270,000 trained people. The February skilled vacancies index showed that vacancies had risen by 6.1 per cent over the past year. The information and communications technology sector, which has seen a decline in personnel since the dotcom bust, recorded a 35.1 per cent increase in vacancies since February 2006, the highest point since August 2001. The Reserve Bank of Australia has continually pointed to capacity constraints as a key contributing factor to inflationary pressures. Business is butting up against a labour market that cannot meet its needs simply because it does not hold the skills.

Despite these obvious barriers to the expansion and sustained profitability of Australian business, the government’s response has been woefully inadequate. Surely if we have such a dire skills shortage, the reasonable thing to do would be to invest in the education and vocational skills infrastructure we already have in this country. Our TAFE schools have the staff and expertise to be leading the way in vocational training in Australia. Instead of investing in this valuable resource, the government has ignored it. We have seen 325,000 people turned away from TAFE because there were not the funds to accommodate them.

Australia is the only country in the OECD to have actually disinvested in its education and training. Over the long decade of the Howard government, Australia has gone backwards in its spending on universities and vocational education by some seven per cent. Comparable countries in the OECD have increased their spending by almost 50 per cent over that same period.

We are being overtaken not only by OECD countries but also by developing countries like China and India, who are beating us on the skilling of their workforces. They are turning out engineers and scientists from their universities at a rate we could only dream of, and it is helping to stoke and sustain the economic growth these countries are experiencing.

Despite the obvious solution presenting itself—that is, to commit to investing in Australia’s education and training—the government has sat idle for 10 years. Its greatest endeavour to solve the skills crisis has been to allow an explosion in 457 visas, which permit holders to enter Australia for up to four years. They do not have to hold specific skills; they do not even have to be able to read and comprehend safety signs; they can be paid below award rates and exploited by unscrupulous bosses. The government has said we need to solve the skills crisis, so we will make it easier for employers to bring in 457 workers. But the fairly sordid track record of that program has shown it goes nowhere towards fixing the skills crisis we have but goes towards creating a crisis of its own. The government would rather import workers than train Australians. The government prefers a short-term, stopgap measure to a long-term commitment to the skilling of our country’s workforce.

That brings me to the Australian technical colleges the government is building around Australia. We on this side have long pointed to the inefficiencies in the ATC system, quite simply because it seeks to duplicate the vocational training infrastructure we already have. TAFE still delivers around 70 per cent of the skills training in Australia and would be capable of more if only this government recognised its important role and funded it accordingly. But it cannot seem to overcome its ideological opposition to the TAFE system, nor can it get past the blame game and cooperate with the states.

Nationwide, the ATCs will only have 7,500 students by 2009. Faced with an immediate shortfall of 275,000 skilled workers, there would need to be 37 times this number of students to catch up. Seven thousand five hundred students in ATCs represent around two per cent of the number of prospective trainees turned away from TAFE colleges over the past decade. Faced with a yawning gap of a quarter of a million skilled people in the present workforce, the government proudly boasts that it will deliver three per cent of that shortfall by 2009.

I would like to focus, in particular, on Western Sydney, where I am based and where there is significant demand for vocational training in trades. I was extremely disappointed that, despite the rhetoric associated with the ATCs, it seems the government has very little intention of seriously delivering skills based education in Western Sydney. The ATC for my home region is based at Rouse Hill Anglican College and will, for 2007, offer 25 places. The promise is that this will expand to 150 by next year, but that is conditional on the selection of a site, which has yet to be finalised, the construction of the buildings and the development of a curriculum. Even the CEO of Sydney Anglican Schools Corporation, Dr Laurie Scandrett, is on the record as saying that opening the ATC by 2008 would be ‘ambitious’.

One ATC for Western Sydney is a joke. This is a region that contains 14 local governments, 150 of Australia’s top 500 businesses and around two million people. It is one of the largest economies in the country, contributing one-third of the gross regional product of New South Wales, with a massive industrial base perched on major transport corridors like the M7, M4 and M2 motorways. A quarter of the Western Sydney workforce is employed in the manufacturing and construction industries. And to service the skills needs of Western Sydney, to train the thousands of young people wanting to learn a traditional trade, the government offers up an ATC at Rouse Hill with 25 places, possibly growing to 150 if the permanent facility can be started and completed by next year!

Just by way of comparison, the University of Western Sydney in 2004 had more than 34,000 enrolments; South Western Sydney Institute of TAFE had 76,000 in 2005; and the Western Sydney Institute of TAFE in 2005 had more than 87,000 students enrolled. And in Western Sydney we get one college with 25 places! Adelaide, with a population half that of Western Sydney, at least has two of these technical colleges. What does a 16-year-old year 11 student in Penrith do if he or she wants to get a place in the Western Sydney ATC? The last time I checked, there were not many school buses headed to Rouse Hill from Penrith, so it would fall on the parents to make the 40-minute journey to and from the college. The same goes for students in Campbelltown or Liverpool, who are about 50 kilometres away.

We know the coalition is not really interested in doing anything long term about the skills crisis, and now we know it is not really interested in helping young people in Western Sydney train to be tradespeople. All it seems to want to do is pay lip-service to both. The warnings from industry and from the Reserve Bank are out there, as they have been for the past several years—and they are grim: train young Australians or we will continue to be crippled by a skills shortage; close the gap or business will be hamstrung by the constraint in capacity and see it eat into long-term profitability; broaden the skills base of Australians or see continued inflationary pressure and further rises, as indicated by Glenn Stevens last week, in interest rates; put the focus back on skilling Australia or fall behind every other competitor nation, both developed and developing.

The coalition’s response has been a disinvestment in education of seven per cent over the last 10 years, a reliance on overseas workers who do not necessarily fill the shortages we have, and a series of technical colleges that duplicate the services already available from TAFE and will ultimately deliver less than three per cent of the skilled workers we need to cover the gap. We deserve more. We need the government to pay far more attention than they have previously.