Australia’s skills and vocational training sector is headed for another major overhaul as Prime Minister Scott Morrison prepares to deliver a speech on Tuesday outlining his “JobMaker” plan for raising the economy out of the “ICU”.
Morrison will address the National Press Club in Canberra today, and according to excerpts of his speech published by media outlets overnight, there will be new conditions attached to the $1.5 billion in federal skills funding that is handed out to states.
Morrison calls it “JobMaker”, and while further details about the policy will be announced this afternoon, we know the skills push will be a key part of the Morrison government’s plan for reforming the Australian economy post-COVID-19.
Businesses are being promised better access to workers with skills tailored to their needs under proposed reforms targeting the National Agreement for Skills and Workforce Development, Nine News reports.
The agreement, established by the Council of Australian Governments (COAG) in 2012, has poured funding into states in a bid to increase qualification rates across the economy.
But the program has failed to keep track with three of its four key performance indicators, and has even presided over a decline in employment outcomes for VET graduates.
Morrison appears set to shake the pot by attaching new Commonwealth oversight to federal skills funding, such as implementing new return on investment measures.
The “JobMaker” proposal will be welcomed by business groups, including the Australian Chamber of Commerce and Industry, which has been vocal about skills shortages.
The number of apprentices and trainees undertaking vocational education has fallen in recent years, according to National Centre for Vocational Education Research data, which shows a 10% decline in completions between 2017 and September last year.
But if the government overhauling its skills and vocational training policy sounds familiar, that’s because it is.
In last year’s budget Treasurer Josh Frydenberg pledged to create 80,000 new apprenticeships across the country, committing $525 million.
Previous to that, the then Turnbull government created the youth-focused PaTH jobs program, which was designed to move young people into the workforce by providing training, but that scheme has been criticised as unworkable and poorly implemented by businesses.
The latest push comes as the federal government continues to mull how Australia will respond to the economic devastation wreaked by the COVID-19 pandemic and the earlier bushfire crisis in January.
Several stimulus and business protection measures outlined by National Cabinet in March expire at the end of September, raising fears many companies could fall off financial cliffs once schemes like JobKeeper end.
Get SmartCompany FREE to your inbox every weekday.
Morrison has stressed federal government stimulus, which was exposed last week as $60 billion lighter than forecast, is temporary, and the economy needs to be brought out of the “ICU”.
But there are growing calls among business advocates for the stimulus programs to be tapered off, or at least not ended all at once.
In a wide-ranging report published yesterday, Australian Small and Family Enterprise Ombudsman Kate Carnell called for additional loans to be made available for businesses transitioning out of JobKeeper.
“Businesses in the early stages of recovery are unlikely to be in a position to immediately pick up full payments to their staff once JobKeeper payments cease,” the report argues.
“These businesses should be supported by access to a Government-provided HECS-style limited recourse facility.”
Carnell said the loans could be capped and paid back once businesses reach a set turnover threshold, similar to the way public university loans work in Australia.
Paul Drum, general manager of external affairs at CPA Australia, has called for the government to implement a staged rollback of the subsidies, saying the business disruption of an instant stoppage would disrupt SMEs and their accountants.
“We’re expecting an increase in insolvencies and business windups in Q4,” Drum says.