John Hogg (Queensland, Deputy-President) Share this | Link to this | Hansard source

The President has received a letter from Senator Wong proposing that a definite matter of public importance be submitted to the Senate for discussion, namely:

The Government’s decade-long neglect of training, resulting in the failure to build a modern, competitive economy to ensure the prosperity of future generations of Australians.

I call upon those senators who approve of the proposed discussion to rise in their places.

More than the number of senators required by the standing orders having risen in their places—

I understand that informal arrangements have been made to allocate specific times to each of the speakers in today’s debate. With the concurrence of the Senate, I shall ask the clerks to set the clock accordingly.

Penny Wong (SA, Australian Labor Party, Shadow Minister for Corporate Governance and Responsibility) Share this | Link to this | Hansard source

I rise to speak on the matter of public importance which has been submitted in my name, which relates to:

The Government’s decade-long neglect of training, resulting in the failure to build a modern, competitive economy to ensure the prosperity of future generations of Australians.

The fact is the skills crisis is an inconvenient truth for the Prime Minister. Australia’s skills crisis is hurting Australian families and Australian businesses, and now we know it is hurting the Prime Minister. It is hurting the Prime Minister and that is why he has been forced to act. It is an inconvenient truth that he has had to address, not through conviction, not out of a desire to implement good policy and not out of a desire to ensure more young Australians have the opportunities that they deserve but because he is conscious that the public is highly concerned about the skills crisis and the shortage of training opportunities for so many Australians.

The fact is that, while this inconvenient truth of a skills crisis may not be something that the government wants to acknowledge, it can hardly argue that it is a truth of which it has had no warning. I want to briefly go through some of the warnings that we know our own Reserve Bank of Australia has issued on the issue of skills over some time which for some reason this government has chosen to ignore for so many years. Let us start with the Reserve Bank’s November 1997 Statement on monetary policy, in which was the following statement:

This judgment is consistent with persistent reports of skill shortages and pressure on wages in the construction sector.

The November 1999 statement talked about the fact that there was ‘evidence that the strength of the labour market may be generating skills shortages in some areas’ and referred to the fact that a Department of Employment, Workplace Relations and Small Business survey demonstrated that skills vacancies were ‘at historically high levels’. In a statement on 5 April the governor said:

Pressure for higher wage rises appears to be building ...

The November 2004 Statement on monetary policy said:

... business surveys suggest that a broad range of firms are finding it increasingly difficult to find suitable labour ...

It went on to say:

These developments are consistent with survey data showing that firms are finding it increasingly difficult to attract suitably skilled labour, pointing to the possibility of stronger wage pressures emerging in the period ahead.

Perhaps what is most concerning is that last year we started to get from the Reserve Bank further discussion of the potential macroeconomic impacts of labour shortages. For example, in the May 2005 Statement on monetary policy the following statement was made:

... labour shortages are becoming increasingly broadbased across industries and skill levels. Consistent with this, business surveys indicate that difficulty finding suitable labour has become a key factor constraining output.

So what we have from those persons who are charged with the conduct of monetary policy in this country is an indication that the lack of suitable skilled labour was constraining economic activity. This was continued later that year in the August 2005 statement:

Shortages are becoming more widespread across industries and occupations, but remain most pronounced among skilled workers in the non-residential construction and resources sectors ...

In the May 2006 statement there was reference to an NAB survey as follows:

The ... survey suggests that labour scarcity remains a greater constraint on activity than the more traditional concerns about lack of demand ...

The Reserve Bank’s August 2006 statement said:

Business surveys report that firms are experiencing difficulty finding ... labour, and employers note that this remains a key factor constraining their output.

So it does seem extraordinary to note, if you track back through the various statements on monetary policy from the Reserve Bank, the repetition of warnings to this government about skills shortages in this country and, just as importantly, their effect on economic growth: the fact that skills shortages were constraining output and were reducing firms’ opportunities to exercise their capacity.

What has the Prime Minister done? In the other place, the Leader of the Opposition, Mr Beazley, indicated there was really only one key statistic that people listening to the debate needed to recall: the comparison between Australia and our competitor economies in terms of public investment in education. He referred, as have many Labor people, to the OECD’s Education at a glance report. It is interesting to note that when the OECD says something that the government want to talk about the government certainly trumpet it all over the parliament and in the media, but, when it says something that they do not like, ministers somehow slip away from the topic.

The OECD’s report has shown us that Australia has the rather extraordinary honour of being the only advanced economy in the world that has reduced its public sector investment in education since 1995. On average, other nations, our competitor economies, have increased their investment by how much? It is 48 per cent. What has Australia done? We have reduced our investment by seven per cent. So, over the 10 years of the Howard government, public investment in education has gone backwards while that of our competitor economies has gone forward very significantly on average.

We also know that since the Howard government was elected it has turned away from TAFE 300,000 young Australians—that is, 300,000 people who could have had the opportunity to learn a trade, to learn a skill, have been turned away because of this government’s budget cutbacks in 1996-97, the restrictions on TAFE spending up until 2000 and of course the slashing of university budgets. It was rather extraordinary to hear the Prime Minister’s statement on skills last week. It was one of the more brazen attempts to paper over an issue. On the one hand, he says there is no skills crisis; on the other hand, he throws a whole heap of money at some aspects of the skills shortage in his so-called Skills for the Future announcement.

What needs to be emphasised is that this government has had 10 years where it has presided over an underinvestment or, worse than that, a going backwards in public investment in education. It has ignored warnings from the community, from senior economists and from the Reserve Bank. And now it expects us to believe that there is actually no skills crisis while, on the other hand, it needs to spend all of this money on skills. This is catch-up politics that is driven not out of a belief that education and skills development are essential to a productive, high-wage, high-growth economy but out of the recognition that the community no longer believes the government when it says there is no skills crisis. That is the motivation for the government’s approach last week.

The government deny there is a skills crisis but they know the public do not believe it, so they had better throw some money, belatedly, at an area that they have consistently underinvested in over the 10 years of the Howard government. What we saw from the Prime Minister last week was, frankly, nothing more than a desperate attempt to catch up and deal with an issue that Labor has been talking about for years. It is quite extraordinary, as I said, that the Prime Minister says there is no skills crisis yet still provides $800 million to fix a crisis that he does not believe exists.

What is the government’s answer to the productivity challenge of this country? We know what they want in their workplace relations policies. Their idea is to drive wages down and, if workers refuse to work for those lower wages, to bring in more people from overseas. That appears to be the Howard government’s approach to the productivity challenge facing this country.

What is Labor’s answer? We have been saying for years now, particularly on the skills front, that you have to invest in the skills of Australians. The answer to the demographic and economic challenges this country will face in the future is to invest in the skills of our people now. That is because the key mismatch in our labour market is not simply about participation and not simply about demand and supply. The key mismatch is skills. We have over two million people in this country who are officially unemployed, who want more work than they can get, who are underemployed or who are out of the labour market but still want to work. Many of those people simply do not have the skills to fill the available vacancies, and yet we have a government that has continued to ignore the warnings from so many people in this country about the need to invest in skills—a government that has presided over a reduction in public investment in education and has turned away from TAFE 300,000 young Australians. That is the government’s answer to the labour market challenge and the demographic challenge that the country faces.

It is somewhat extraordinary that the package that was announced last week had nothing in it for people under the age of 25. There is absolutely nothing in the government’s skills package that is going to address the issues that affect the people who are the country’s future—the young people of this nation. There is nothing in this package to invest in their future and nothing to help them complete their training. One of the more shameful statistics under the Howard government is the 40 per cent drop-out rate of apprentices in training. The government needs to take responsibility for that. Forty per cent of apprentices drop out of their training. There are a range of reasons for that, and one of them, of course, is the fact that, for many people, those wages are so low.

I do want to congratulate the Howard government for picking up the policies Labor has been arguing for for some time. The government has actually picked up a number of the policies Labor has been putting forward for some time in terms of suggesting additional funding for apprenticeships and additional funding for—I cannot recall the name that the government used for it—the business skills aspect of the funding for apprenticeships. These are the sorts of things Labor has been talking about. I suggest to the government: why don’t you go a little bit further and pick up a whole heap of things that Labor has suggested, because they are good ideas? Why don’t we have specialised trade schools in each school district, making sure that young people in years 11 and 12 have the choice to go to the specialist trade schools? Instead, the government has 25 technical colleges around the country. How many of them are actually up and running? I think we are still in the single digits—is it three, four or five? Every estimates we come to, this great centrepiece of the government’s trades training policy is inching along tortoise-like in terms of actually delivering an outcome. What about Labor’s suggestion of a skills account—$3,200 in the skills account for apprentices to use to make sure they do not face up-front TAFE fees? What about Labor’s suggestion in relation to investment in the traditional trades—that is, things like a trade completion bonus, which would assist in lifting the appalling rates of completion of apprenticeships that have come to pass under the Howard government?

But, no, the government are not interested in this. You might see something before the next election, if they realise that the skills funding they announced last week for the crisis that does not exist actually has not fixed the crisis that does exist. We might see more funding then. One of the suggestions that Labor has been putting on the table for some months now is a trade completion bonus to try and lift the rates of apprenticeship completion, which are so poor in this country.

The AIG, the Australian Industry Group, says we need 270,000 extra tradespeople in this country. The Prime Minister’s proposal is to give a wage subsidy to 10,000 people. That is his answer to Australia’s skills crisis: let us address 10,000 people at a time when the AIG says we need 270,000. Isn’t it interesting that that is around the same number of people who, under the Howard government, have been turned away from TAFE as a result of the budget cuts the government made in 1996-97 and what the government did to growth funding over the decade. The fact is that not only has this government presided over a skills crisis but it is a skills crisis of the government’s making. (Time expired)

Judith Troeth (Victoria, Liberal Party) Share this | Link to this | Hansard source

I actually feel very sorry for Senator Wong in trying to put forward the Labor Party’s view on this topic, because she just does not understand. On almost every statistic and every aspect of this debate that she has mentioned, I have an answer. If we can gauge that her ideas are the ideas or policies of her leader, Mr Beazley, could I point out the attitude of Mr Beazley, which he evidenced in 1993, when he had responsibility for education and training. In his biography, which was published in 1999, he said:

… I had sort of finally got to accept that I would never be Defence Minister again, so I lost a lot of ambition and I stopped straining. … I thought that there was less capacity to achieve in that portfolio—

that is, the education portfolio—

than just about any I have had.

What damning words they are, and most of the Labor policies since that time bear out that comment. I would remind you, Mr Deputy President, that that comment was made at a time when Australia had between 10 and 11 per cent unemployment. What capacity did the then Labor government have to ensure that students were trained, whether they went to university or to TAFE, in order to fit them for the years ahead? Those years under the coalition government have seen not only a boom in the economy, maintained for 10 years now, but also a boom in the money and the attention that is devoted to apprentices and in the amount of funding that is put towards training. When Mr Beazley was minister for education—when he finally, we assume reluctantly, took up that portfolio—the number of apprentices in training was 122,600. Today, under the coalition, there are more than 403,000 Australian apprentices in training—

Opposition Senators:

Opposition senators interjecting—

George Brandis (Queensland, Liberal Party) Share this | Link to this | Hansard source

Order! Senators on my left, let Senator Troeth be heard in silence.

Judith Troeth (Victoria, Liberal Party) Share this | Link to this | Hansard source

Thank you, Mr Acting Deputy President. So that amazing leap in the number of apprentices, which has been buoyed by incentives provided to apprentices and their employers when they start their apprenticeship—money for tools, and mid-term and later payments to both employers and apprentices—means that we are very well attuned to the sort of training that should be provided in this country.

The Leader of the Opposition, I point out, was not the only guilty party. Recently, the Victorian Minister for Education and Training, Lynne Kosky, confessed the sins of the Victorian Labor Party, when she admitted the mistake of closing that state’s technical schools in the 1980s. I taught in a state technical school in Portland, western Victoria, where I lived—a town with a great mix of manufacturing and heavy machinery, which was to lead to the establishment of the Alcoa aluminium smelter. That town desperately needed apprentices and people to train in those skills, and the technical school provided it. The schools were merged into a secondary college. I am not saying that the secondary college did not provide them with adequate training, but there is no doubt in my mind that technical schools, particularly in a more advanced stage, such as the ones we provided in last year’s budget, make that difference and will continue to do so. Labor, state and federal governments have a track record of failure and a lack of commitment to do this.

The Prime Minister recently announced a major package of skills initiatives, worth $837 million over five years and, appropriately, it is called Skills for the Future. I will start at the chronological end of this package, and I will go into the details of some of that in a moment. It includes a major investment in improving the basic skills of Australia’s workforce. It refers to assisting adults to gain literacy and numeracy skills that are basic requirements in the workforce. New financial incentives can help more Australians take up a trade apprenticeship mid career, and apprentices in traditional trades—I am sorry that Senator Wong is not still here to hear this—will also receive support to help them gain the necessary skills to run their own businesses. Not only do graduating apprentices work for bosses but some also run their own very successful small businesses. That is a substantial new investment. Not only does it aid the apprenticeship level but it also funds more university engineering places.

Of course, we must never forget that vocational and technical education is a joint responsibility of the Commonwealth on the one hand and the states and territories on the other hand. For instance, the states and territories run TAFE colleges, about which I will have more to say later. They should also invest in workforce education and training to complement the Commonwealth’s initiatives. I was interested to see that, after our budget initiative of 25 Australian technical colleges last year, again, in a very ‘follow my leader’ type of move, the Victorian Labor government is now announcing, as part of its election policy for the forthcoming election, that it will also look at providing technical colleges. So we have incentives for a whole range of initiatives there.

Senator Wong said that we had come very late to this debate. In the 1990s, unless I am mistaken, almost as soon as we attained government, we provided many prevocational training places in the trades, through group training arrangements. I think as far back as 1998, two years after gaining government, we worked in partnership, again with group training organisations, to provide an additional 7,000 Australian skill based apprenticeships. We have worked on this all along, because we know that 70 per cent of secondary exit students do not go to university. They seek a job or a career in other areas.

I would be the first to admit that there is a skills shortage in Australia, partly due to the resources and mining boom in Western Australia, which is sucking many, many qualified tradesmen into Western Australia to work in that industry. As a consequence, the eastern states are feeling the shortage. But we have seen this coming and we are moving to address it. It is not a question of discovering you have a shortage one day and the next day being able to provide apprenticeships and trained people. This process takes time. We want apprentices and trainees to be trained properly, and that can mean anything up to four years training. We have had many goes at this and we will continue to bring forward many more initiatives.

As I said, the state and territory governments are responsible for TAFE, and the 2005-08 Commonwealth-state agreement provided a contribution of almost $5 billion in recurrent and capital funding for the vocational and technical education system. The states do not necessarily make their own arrangements or look after their own people. We as a federal government come to the party and do that, but the states and territories are responsible for all aspects of training in their jurisdictions. The decisions on what courses are offered and the level of fees charged are made by the relevant authorities in each state and territory. There is a great deal more to be said about that.

I would like to remind senators that at the time we came into office, after five successive budget deficits, we had an Australian government debt of $100 billion. Labor managed that while they also privatised Qantas and the Commonwealth Bank. How bad is that? Interest rates peaked at 17 per cent for home owners and averaged 12 per cent under Labor, with unemployment at 11 per cent and inflation at more than 5 per cent. We have now had a number of years of economic expansion. We as a government have paid off that $100 billion. From the interest saved, of course there is more money for education, roads, health and infrastructure. The average interest rate under the coalition has been just over 7 per cent. Do not let anybody ever forget that. Unemployment has dropped to a record low of 4.9 per cent. Around 40 per cent of Australians hold private health insurance and have choice in the delivery of their health needs. Average annual inflation well below three per cent has been maintained. On every point, we have provided an answer to the untruths that Senator Wong has put in her statement for this matter of public importance. It is a matter of public importance, and we accord it its due priority.

Kerry Nettle (NSW, Australian Greens) Share this | Link to this | Hansard source

I am not going to spend the five minutes that I get here talking about whether or not we have a skills shortage. It is quite clear to everyone that we do, including the government. I am not even going to spend my time talking about how that has been caused, because I think that is quite clear too when you look at the nearly $2 billion that would have gone into the TAFE sector if this government had not changed the funding formula in 1997 to take away the growth funding that was provided for vocational education and training, under which the more students you got in, the more funding you were provided with. I think that is there on the record for everyone to see.

What I want to talk about is the way in which the government should be responding to this situation. Just last week we had the announcement by the government of their so-called Skills for the Future package, which was about providing people with $3,000 vouchers that they could use at any range of providers, particularly the vast number of new small private providers that this government has encouraged to flourish in the vocational education and training sector. These small providers can go nowhere near competing with the strong public system of TAFE that exists throughout our country and that provides so much value to the Australian community.

It is worth mentioning the TAFE futures report that has been launched today by Dr Peter Kell, which talks about the way in which the Australian community values the TAFE sector in this country, which recognises that two-thirds of employers want training done through the TAFE system. I have just had in my office a number of TAFE teachers from across the country—from Western Australia and from New South Wales—who spoke with me about an example of where private providers had been set up in Perth. Apprentices had done their full training course with the private provider. Alcoa had to send the whole cohort of apprentices back through the TAFE system because, under the private provider, being run by the Chamber of Commerce and Industry, they had not learned the skills they needed to do the job. Alcoa had to put them back into the public system that this government has taken $2 billion out of in the last 10 years so that they could get the quality education and training that they needed in order to be able to do the job. That is what we have seen in this government’s approaches. Rather than recognising the value of the public system that exists through TAFE, they have supported the propagation of all these private providers that simply cannot provide the same quality of training that exists in our TAFE sector. The $3,000 vouchers that were announced last week are a further example of that.

If you get a $3,000 voucher from the government, clearly you can only spend that somewhere where you are going to be charged $3,000 worth of fees. For example, if you are a Sudanese refugee who has recently arrived in the town of Goulburn and you want to gain some English language skills and you go to the public TAFE in Goulburn, you will find that the TAFE does not charge for its English language courses. So you can do the course there, but that $3,000 does not go into providing support to the public education system through the TAFE in Goulburn that teaches you English language skills. So this system that the government is introducing encourages people to charge fees for the courses they are currently running that do not require fees in order for them to be able to get any support from the government. That $3,000 for that Sudanese refugee studying an English language course at Goulburn TAFE could have gone into Goulburn TAFE. But, no, this government has decided it wants to put that $3,000 into a private provider who will all of a sudden up their fees to $3,000 to get that money and who just cannot provide the same quality of English language courses that the TAFE sector can provide.

Through DIMIA funding, Goulburn TAFE have the contract to provide the AMEP program that exists there and other programs because they are recognised as a quality provider. But they cannot get the $3,000 referred to in the Prime Minister’s announcement, because they do not charge the fees. What his announcement does is encourage them to charge fees. What the government should be doing is investing in the quality vocational education and training system, the public system that already exists in our country—the TAFE system—that desperately requires support. This study, TAFE futures, indicates that the greatest problems the TAFE system across this country face are underfunding and under-resourcing from the federal government and, indeed, state governments, who are failing to ensure there is a quality educational service that will fuel the economy in regional sectors of this country. Those economies suffer because they are not supported. (Time expired)

Anne McEwen (SA, Australian Labor Party) Share this | Link to this | Hansard source

I also wish to speak on this matter of public importance, and I thank Senator Wong for bringing this matter to our attention. There cannot be too much attention given to the skills crisis in Australia. It is the single biggest issue holding back Australia’s future economic progress. The skills shortage has arisen despite this government’s claim during the last federal election that only they could be entrusted with managing the economy. They have mismanaged and neglected this crucial component of Australia’s economic and social future. But we should not be surprised that the government has neglected the nation’s training imperatives during its decade in office. After all, they have spent the same 10 long years neglecting the environment, neglecting our defence forces, neglecting our future energy needs, neglecting the future security of our water supplies—and the list goes on.

When you have spent 10 years working on how to implement long held vendettas against trade unions and student unions, I guess you do not have too much time to worry about things like the future of Australia’s skills needs or how we are going to have enough skilled people to make sure that we are a prosperous country with the industries and infrastructure we need to be competitive with other nations. This government, under the Prime Minister, has spent 10 long years finetuning its extremist, low wage, American style Work Choices—or no choice—legislation and no time building Australia’s skills base. The government apparently thinks that the future for Australia is to compete against other nations on the basis of who can pay the lowest wages, when we should be competing on the basis of how much better educated, how much more highly skilled, how much more innovative and how much more competitive and productive our workers are—not on how cheap their labour is. We are, after all, talking about a government that has spent a decade working out how to kick single parents and people with disabilities off welfare and onto the dole—so it has not had time to worry about the skill shortages.

The government also spent the last decade addressing some issues to do with education, including the crazy notion that teachers in our schools are somehow closet Maoists who need to be retrained and re-educated in Latin. So instead of working out how to get people trained for the jobs that need to be done, we have some bizarre teacher bashing exercise perpetrated by the minister for education and the Prime Minister. It is a classic example of how this government fails to address the things that really matter to Australians.

The government’s neglect of Australia’s training needs came despite Labor’s continued warnings about the skills crisis—and not just Labor’s warnings, as we heard from Senator Wong. As we know, the Reserve Bank has been ringing the alarm bells since at least 1997, when the bank’s November statement on monetary policy noted that there were persistent reports of skill shortages and pressure on wages in the construction sector. Again, in November 2004, the bank noted that a broad range of firms was finding it difficult to obtain suitable labour. In 2005 the bank noted skills shortages in industries including construction, engineering, accounting, information technology, the resources sector and the business services sector. So the Reserve Bank and other commentators and organisations have been noting since at least 1999 that skills shortages would, if they were allowed to continue, push up inflation and put upward pressure on interest rates. We saw the interest rate prediction come true this year. There are strong suggestions of another interest rate rise before Christmas. That will be an unwelcome Christmas present, I am sure, for those Australian families who are already wondering how they can afford to pay their mortgages.

Maybe it was the interest rate rise that finally made the government do something, or maybe the Prime Minister smelled the winds of electoral change, but now we have the recently announced desperate, cobbled together attempt by this government to buy its way out of a crisis and back into public favour. Maybe the government read the tea leaves and saw that Australians were becoming increasingly suspicious of the use of 457 visas to fill a skills gap that we should never have had in the first place—270,000 people have had to be brought into this country under the Skilled Migration Program to fill skills gaps, while we have denied 300,000 people access to TAFE courses. Maybe the 25.7 per cent of teenagers in metropolitan Adelaide, in my state, who are unemployed have been asking why they could not get into an apprenticeship and why they could not get into TAFE. Why are the doors of that ATC down at Kingston electorate still closed, and how many enrolments are there at the moment? Not many, I would think, if any at all. So at this late and desperate stage we have the government reaching into its budget surplus to buy the Prime Minister some favour with an increasingly sceptical Australian public. It is a desperate plan that borrows heavily from Labor’s ideas announced earlier this year. Indeed, the wage subsidy for mature age apprentices goes back a lot longer than that. It was an initiative of Labor’s Working Nation plan, which this government dumped when it came to office.

Still, as the Labor Leader Mr Beazley said this week, we do not mind the government resurrecting our old ideas and pinching our new ones. We are concerned abut the future of the nation. We are not precious, in the Labor Party, about sharing our ideas. I will talk more about Labor’s plans for our skills future in a minute, but let us go back to the government’s recent announcement. We can see just how this is going to go from here on in until the next election. Having built up a budget surplus—in part by slashing investment in and spending on Australia’s education system by denying our young people opportunities to go to TAFE and by increasing university fees to the second highest in the world—the Prime Minister is now going to plunder that budget surplus to buy himself some electoral advantage. Having taken the money out of skills development over the last 10 years, he is now going to put a bit of it back in. We can expect some sort of glitzy advertising campaign to accompany the government’s too late, too little response to the nation’s skills crisis. But the Australian people will not be deluded by this strategy, because they have already seen and suffered the consequences of the complete failure of this government to plan a skills future for Australia.

Senator Wong mentioned earlier the OECD figures which clearly illustrate how Australia’s investment in education compared to that of the rest of the developed world has gone backwards. It has gone backwards to the tune of eight per cent while other nations are investing upwards of 48 per cent more in their education systems. How can we possibly hope to compete on the international stage when our investment in education is going backwards? It beggars belief.

The nation’s HECS debt has almost reached $20 billion. No wonder our young people are thinking twice about enrolling in university. I mentioned before the ATCs that the government announced with much fanfare, and I think five of them are open at the moment. That is a woeful record. Under this government, the non-completion rate for trades apprenticeships, as we heard earlier, is higher than 40 per cent. There are no measures in the government’s latest desperate attempt to address the skills crisis to tackle the high attrition rate for our young tradespeople. I note that, when Mr Beazley was minister for education, the completion rate for trades apprenticeships was 80 per cent. It is half that under this government.

The Australia people can tell the difference between a plan for the future and a shambolic, cobbled-together, desperate attempt to address the skills crisis. Labor have real plans for our training future—plans that include HECS relief for degrees in areas of skills shortages, expanding associate degrees to address the national shortage of technical skills, creating extra university places in areas of skills shortages and scrapping full-fee degrees for Australian undergraduate students at public universities.

In the area of the traditional trades, we have a plan for a future as well. It includes a skills account for every trades apprentice that will give each of them $3,200 towards offsetting TAFE fees and other costs associated with their training. That will benefit some 60,000 people per year in our TAFE system. We will reward people who complete their apprenticeship with a trade completion bonus of $2,000. Labor has other plans to get young people into well-paid, meaningful jobs in the traditional trades areas with our trade taster program for years 9 and 10 secondary students and a national system of specialist trades, science and technical senior high schools.

The differences between the government’s neglect of the training needs of the nation over 10 long years and Labor’s plans for the development of Australia’s skills for the future are stark. Once again, I thank Senator Wong for allowing us the opportunity to debate this important issue.

David Johnston (WA, Liberal Party) Share this | Link to this | Hansard source

There is one major devastating skills crisis in Australia, but it is not in industry—it is in the federal Labor opposition. It is chronic! It has a chronic skills shortage. Not three months ago, not four months ago, the opposition was screaming about Work Choices, about the sky falling in and about conditions of employment being eroded and unemployment going through the roof. The Howard government has created almost 200,000 new jobs since 30 March this year. What does the opposition do? As they have to do, they must change tack. What do they change tack to? Where else can they go? Oh! Unemployment is at a 30-year low in Australia, thanks to the Howard government, so let us complain about that. It has to be a skills shortage.

Here is the leader of the most underskilled opposition this nation has ever known, who, when he was minister for training, presided over the most paltry number of apprentices in Australia’s employment history. As the minister for training in 1993, Mr Beazley presided over 122,000 apprentices. The current level is 403,600 apprentices acquiring trade skills under the Howard government. It is absolutely amazing that Labor can suddenly go from screaming about workplace conditions and terms under Work Choices to thinking about and turning turtle onto a skills shortage. You have got to take your hat off to them—duplicity and disingenuousness is the principal skill they bring to the party.

The Howard government has contributed $43.7 million to apprentices in the form of a living away from home allowance to enable them to be more mobile so that they can acquire their skills in various parts of the country. We have also provided the Commonwealth Trade Learning Scholarship. We have provided $28.2 million for tools of trade initiatives for Australian apprentices so that they can acquire assistance in getting top level tools of trade. As I said, 403,600 apprentices is in stark contrast to the achievements of the now leader of the most underskilled federal opposition this country has ever known, when he could only preside over 122,000 apprentices in 1993. Labor cannot have it both ways.

This is the lowest level of unemployment in 30 years. The economic management of the Howard government has achieved the modern miracle in the OECD in growth, stability and low inflation. That is the galling thing. It is the thing that galls Labor. They cannot believe that, whilst they were in power, real wages rose by a paltry, insulting 1.3 per cent and, in the 10 years that John Howard has presided over this economy, their constituents have benefited to the tune of a 16 per cent increase in real wages. It really has to stick in their craw. It really has to hurt them.

Let us have a look at what they are saying about 457 visas. Western Australia, with an unemployment rate of about 3.1 per cent, has been the huge beneficiary of Minister Vanstone’s initiatives on 457 visas, and what a great job she has done. My state is absolutely humming with the assistance of skilled migrants. None of those migrants would have come into Australia unless the state Labor governments specifically made a request for them. So Mr Beazley is utterly at odds with his state Labor colleagues. A divided opposition, a divided Labor Party: it is a wonder to behold.

Mr Beazley claims that 300,000 young Australians have been turned away from TAFE at the same time that the government have imported 270,000 extra skilled workers. Here we have a situation where the economy is booming, unemployment is at a 30-year low and Labor is casting around like a drunken sailor to complain about something. This is the opposition of whinging and bleating. This is the opposition of nothing to contribute but, ‘How can we attack the government?’ Since 30 March, 200,000 new jobs under Work Choices say that that reform is one of the truly great reforms of the labour market in Australia, ever. All Labor can do is hope and pray that their Chicken Little predictions will come home to roost, but they will not. This economy is on a firm foundation. It is on a firm footing and is doing very well. So what do they complain about? They complain about the skills shortage.

Turning back to how well Work Choices is doing, the other day I received a press release from the Master Builders Association in Western Australia, which states:

The Master Builders Association rates the first six months of the federal government’s Work Choices industrial relations reforms in conjunction with the construction industry reforms introduced in October 2005 as a huge success.

Bear in mind that Western Australia was ravaged under the CFMEU, who the Labor Party defended. Industrial strife, extortion—you name it, we had it:

The Master Builders Association Construction Director Kim Richardson said the initial six months of these reforms and the specific construction industry reforms have seen a welcome turnaround in the behaviour of the CFMEU and its officials on major construction projects with them now conducting themselves in a responsible, reasonable and lawful manner which contrasts greatly with the unions behaviour prior to these reforms.

Well, six months later the reforms that the opposition in this chamber screamed about, predicting that the sky would fall, have not come to fruition—surprise, surprise. They have a track record of screaming about things that do not come true. Just look at the GST. Here is the interesting point:

Another positive spin identified by the Master Builders Association since March involved the changes to the unfair dismissal laws which have seen builders now confident enough to employ more building workers directly rather than through labour hire agencies.

A huge turnaround. (Time expired)

Andrew Bartlett (Queensland, Australian Democrats) Share this | Link to this | Hansard source

This is an important area of debate and there can be no doubt that there is a significant skills shortage in Australia. Like many political debates, there are a range of perspectives and it is not as black and white as either side thus far has presented. It is clear that one of the reasons there is a skills shortage is the extra employment places due to the health of the economy, but it is also beyond denial that there has been massive underinvestment in training, higher education, skills development and knowledge development across the board by this federal government over a 10-year period. Even to use the argument that the skills shortage is a sign of economic success is to ignore the fact that there has been a failure to plan adequately to ensure as much as possible that significant and problematic skills shortages did not develop in the Australian economy through underinvestment. We cannot have an honest debate about this issue without acknowledging that basic fact. To that extent, the Democrats strongly support the suggestion put forward by Senator Wong that the government must bear a lot of culpability for its failure to adequately invest in training as well as other areas of skills development.

It simply cannot be avoided in this debate. The linkage with skilled migration and skilled visa categories is raised continually. It has been raised again today and is intertwined in a public debate. While it is totally valid to criticise this federal government for their lack of forward thinking, their lack of investment in skills development, in training and in higher education, it is completely invalid to use that as a reason to attack the skilled migration program and the 457 visa category. There are certainly issues there, as I have acknowledged a number of times. One reason there has been that dramatic increase is the government’s failure to adequately invest in skills development among Australians, but I get very uncomfortable with juxtaposing the two and saying that we need to be training up Australians or else foreigners will be coming in and taking our jobs. They are not saying that that specific statement has been made by people in this chamber today, but that is part of the political debate and the argument out in the community. Any notion that migrants are coming here to take Australians’ jobs is not only very dangerous, with a long historical legacy which we need to avoid, but on the whole it is not borne out by the facts. The skills migration program, as long as it is administered properly, is an important component.

I draw the Senate’s attention and the attention of people who are interested in this issue to the survey done in a report by Graeme Hugo, Peter McDonald and Siew-Ean Khoo from the ANU titled Temporary skilled migrants’ employment and residence outcomes. It makes positive findings about the overall gains to Australia as well as to migrants themselves from the skilled visa categories. Developing the skills and the knowledge base of Australians will not just mean that they are all going to immediately jump into jobs in Australia and fill those gaps here. In the same way, having a liberal—in the proper sense of the word—migration program that allows people with skills into Australia, within appropriate protections and frameworks, means that Australians have the opportunity to go overseas and utilise their skills elsewhere. That is often portrayed negatively as a brain drain, but in many cases there are long-term benefits for Australia. It is part and parcel of the global economy and the free flow of skills and labour around different parts of the world. While some people are uncomfortable with that, I think that is a very positive thing. It always needs to be managed well, but it is certainly better than trying to prevent that from happening or curtailing it.

The core of this MPI is one that I support. I think it is a very valid point that needs to be continually made. I think the fact that the Prime Minister made his sudden announcement about this matter is a recognition of the failure of this government to date to do more. Frankly, I think the federal government needs to do more again. But at the same time it should not be intertwined with unreasoned attacks on the underlying substance of migration programs.

Ross Lightfoot (WA, Liberal Party) Share this | Link to this | Hansard source

People on this side who have been listening to the debate this afternoon, notwithstanding the lack of enthusiasm that often comes from the other side, would be surprised at the lack of cogent argument that has come from the opposition, the Greens and the Democrats. The facts are that there have never been more student places in Australian educational history. They have never been better off. Senator Johnston said there are chronic skills shortages in the Labor Party. Of course there are. When you have such a small pool of people to choose from, other than the union movement, to augment the benches on the other side, you must be at a disadvantage.

It is true that the union movement, in which the ALP is a satrap, covers only, in rounded figures, 10 per cent—maybe a little more but certainly below 11 per cent—of the private sector. How can you pick the best people on that side when you have such a small gene pool, if I can put it that way, from which to choose? How can you then add the problems of further dilution by having a quota for females? This means you must have a certain number of females, whether they are better or not. Some are delightful and some are in fact intelligent women. Some are not as good as the people who could be chosen if they were chosen on merit rather than on their sex.

I know something about the union movement. I have been a member of the Australian Workers Union, the Plasterers Society, the police union, the actors union—which is now the media and actors alliance—the Waterside Workers Federation for a short period when I was 13 years old, and even the meatworkers union when I worked in an abattoir when I was 12. I know what the union movement is about. The union movement can only survive if it uses propaganda and untruths to try and entice people to join. It can only survive if it uses those things in order to stack branches and to convince people to join. That is what is being done today with this bill.

Robert Ray (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

What bill?

Ross Lightfoot (WA, Liberal Party) Share this | Link to this | Hansard source

This matter of public importance; thank you. I will pick you up when you get up to speak shortly, I hope.

Robert Ray (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

You hope! You’re going to have a long wait, Ross!

George Brandis (Queensland, Liberal Party) Share this | Link to this | Hansard source

Order, Senator Ray! Let Senator Lightfoot be heard in silence.

Ross Lightfoot (WA, Liberal Party) Share this | Link to this | Hansard source

I appreciate your assistance.

Robert Ray (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

It only takes two—

George Brandis (Queensland, Liberal Party) Share this | Link to this | Hansard source

Senator Ray, please let Senator Lightfoot be heard in silence.

Ross Lightfoot (WA, Liberal Party) Share this | Link to this | Hansard source

Thank you, Mr Acting Deputy President. Senator Wong, who introduced this matter of public importance today, said, ‘It’s a truth that the government has chosen to ignore over so many years.’ She was talking about the dearth of education, students and so on. She went on to ask: ‘What has the Prime Minister done? Government investment has gone backwards by seven per cent and 300,000 students have been turned away from TAFE.’ These were generic references by Senator Wong but there were nothing specific, apart from those erroneous examples. She said that over two million people are unemployed—or underemployed; she corrected that statement some time later.

It is not that Senator Wong was perhaps misleading the Senate in the sense that we should take the matter further, but let me read from a grab by the ABC, quoting a Dr Kell, who said:

The skills shortage is no accident when ... underinvestment for 10 years. I think the key issue is resourcing needs to be contextualised differently. As we explain in the report, it’s not more of the same; it’s about shifting the resources in a different way to enable and energise the system.

I am not quite sure what that means, but it was a criticism of the government and its education policy. But it was a union, the Teachers Federation, that commissioned that report. That is the trouble: the truth is not necessarily contained in union organised reports of this nature.

Senator Wong talked about investment sliding backwards and she referred to a figure of 300,000-odd students. Let me read out the facts quickly, in the short time remaining to me. Australian government funding for VTE in 2005-06 was $2.6 billion. That represents, in comparison with the figure in March 1996, a real increase of 88 per cent. Total Australian government funding for VTE over the four years from 2006-07 to 2009-10 will be $11.3 billion. Total funding over five years was $837 million.

Under the 2005-08 Commonwealth-State Agreement for Skilling Australia’s Workforce, there are 128,000 places. There will be 7,500 places in Australian technical colleges in 2005-08, and 20,000 places under the Australian Apprenticeship Access Program. The figure for group training in the trades program is 11,500. This gives a total figure of 167,000 places. With respect to training, in the year ending June 2006 there were 403,600 Australian apprentices.

The major reason that apprentice numbers are down is that we are going through boom conditions never before seen in my 55-odd years of work and probably never to be seen again—certainly in my lifetime. One of the other reasons is simply this: when I was in the union movement it was illegal for a lot of people to employ apprentices unless they had a ratio of tradesmen to fit that particular request. It was not so much a request as an obligation for employers to make sure that where they had one apprentice they also had one skilled tradesman. In some cases, it was two skilled tradesmen for one apprentice. The reason that we do not have enough apprentices and we do have a skills shortage today is simple because the apprentices did not pay full union fees, if they paid union fees at all, and the union movement wanted full fee paying, skilled tradesmen before they would agree to apprentices coming along and taking their places.

George Brandis (Queensland, Liberal Party) Share this | Link to this | Hansard source

Order! The time for consideration of the matter of public importance has expired.