The Morrison government will spend an additional $1.5 billion to extend wage subsidies for apprentices and has pitched a $1 billion funding deal with states in a bid to reform vocational education and training.
In a bid to curb the growing ranks of unemployed Australians in the wake of the COVID-19 pandemic, the federal government will continue to prop up apprentice numbers until March 2021, with 50% wage subsidies now also available to medium-sized businesses (with up to 2oo workers).
First announced in March, the apprenticeship program was due to expire in September against a $1.3 billion price tag and previously only covered small businesses. The changes will more than double the cost of the program and extend its total reach to an expected 180,000 workers and about 90,000 businesses.
Additionally, $500 million in federal funding has been pledged to training programs in a pitch to states that would see them match the Commonwealth commitment and agree to overhaul the vocational training sector.
Minister for Employment, Skills, Small and Family Business Michaelia Cash said on Thursday states had agreed to sign on to improve the quality and relevance of VET, a policy priority for the federal government following Morrison’s earlier criticism that the National Skills Commission was not working as intended.
Morrison later clarified NSW, Tasmania, South Australia, Queensland, The Northern Territory and the ACT had all “either fully signed up” or were about to put pen to paper on the $1 billion vocational training deal.
That leaves Victoria and Western Australia outstanding, although Morrison said he had discussed the matter with Victorian Premier Daniel Andrews.
The backdrop of spiking unemployment will put pressure on both state and federal legislators to secure opportunities for Australians who are out of work due to the pandemic, or those who are leaving school as the first recession in almost 30 years hits the economy.
The unemployment rate rose from 7.1% to 7.4% in June, while hours worked rose 4% but remains 6.8% lower than March, according to Australian Bureau of Statistics figures published Thursday.
Small and medium business owners can expect to benefit from the extension of apprentice wage subsidies, which will now continue to exist after JobKeeper expires in September, and promised reforms to address skill shortages.
The apprenticeship subsidies are capped at $7000 per quarter and only cover 50% of wage bills, meaning they’re likely to be smaller than existing JobKeeper payments, which run at $1,500 a fortnight for each eligible worker.
New training programs set to be subsidised by today’s announcement will be provided by TAFEs and the private sector — a policy vehicle that’s previously failed in meeting the needs of small business owners.
The Morrison government hopes about 340,000 school leavers and unemployed Australians will be able to access low fee, or even free, vocational training courses.
Cash told ABC News on Thursday morning the National Skills Commission was already working with states and territories to identify “areas of demand” for training programs.
Thursday’s overall $2 billion federal funding pledge is the biggest policy push from the federal government since the $70 billion JobKeeper program was unveiled in late March and comes as Treasurer Josh Frydenberg prepares to make his highly anticipated economic statement next Thursday.
That statement will include the results of a review into the JobKeeper program and cover changes to the scheme, alongside new economic forecasts.