Funding for apprentices and young people in the recently announced federal budget falls short of Australia’s needs, and leaves public institutions like TAFE out in the cold.
By Mark Burgess, ETU National apprenticeship officer
This year’s budget had a spotlight on apprentices and young workers. One of the key announcements was a $1.2 billion wage subsidy for apprentices…or should I say employers.
Let’s drill down into this announcement.
While we are pleased there is some funding towards encouraging more school leavers to get an apprenticeship, the ambitious target of 100,000 new apprentices is not enough. It will still fall short of the number of apprentices we had before the Abbott – Turnbull – Morrison Coalition Government took over in 2013.
This government has had a history of cuts to vocational training. They have cut funding to TAFE, promoted privatisation of educational institutions through contestable markets and cut funding that flowed directly to apprentices such as the ‘tools for your trade’ scheme. This $3 billion in cuts by the Liberal Government equates to a loss of 162,456 apprentices since March 2013.
The $1.2 billion wage subsidy allows any employer to get a subsidy that will cover 50% of the wages of any new apprentice they employ until September 2021. It is capped at $7000 a quarter or $28,000 for the full 12-month period.
Some problems with the subsidy include:
- no background checks on employers. Employers that have a history of wage theft, exploitation of apprentices, breaches of safety or poor training records will still be eligible for the subsidy.
- There is no obligation on employers to see that an apprentice finishes their trade. We are concerned that when the subsidy runs out in 12 months, we will see a lot of out-of-work second year apprentices.
Around one in two apprentices that start a trade, do not finish it. The reasons for this are:
- wage theft
- safety concerns
- lack of mentoring
- lack of appropriate training by both unscrupulous private training providers and employers
- low pay.
The subsidy does not address these issues. Instead of focussing on these and increasing funding to public TAFE institutes, the government is giving employers $1.2 billion in subsidies with no checks and balances.
JobMaker Hiring Credit
The government has also announced a ‘Jobmaker Hiring Credit’ to incentivise businesses to hire people between the ages of 16 and 35. Employers will receive a handout of $200 per week for hiring a 16 to 29-year-old and $100 per week for 29 to 35-year-olds. The only real requirement for employers to be eligible is that they have to employ the young person for 20 hours per week.
While it’s good to create more opportunities for apprentices and young workers, this scheme will create a situation where the government is encouraging part-time jobs instead of full-time permanent stable jobs. The government needs to address the high rates of youth unemployment, but not at the expense of other workers. Will we see people aged over 35 be made redundant and replaced by people under 35? That is surely not a solution to our problems.
The employer handout doesn’t increase the minimum wage either. The minimum wage in Australia is a dismal $19.49 an hour, meaning taxpayers will be funding $10 an hour of that money if new employees are given just 20 hours a week of low-paying insecure work.
National wage increase to modern awards
Another thing apprentices need to be aware of is the national wage increase to the modern awards coming into effect on 1 November 2020. Apprentices working under the Electrical, Electronic and Communications Contracting Award will be eligible for a 1.75% increase. Although it is not the increase we would have liked to see, it is still your money.
For apprentices who want to be paid a decent training wage, please join the ETU. By uniting with our members and fighting for better wages and conditions through enterprise agreement bargaining, you’ll be part of the solution to improve wages and conditions for all.
This year the national office has supported apprentices in things like underpayment claims (returning 15K to one of our apprentice members) travel time allowances claims and unpaid annual leave claims.
If you’re already a member, then sign up an apprentice at your workplace and strengthen the movement. For our apprentice members going to TAFE or trade school, talk to others about joining the Union or encourage them to get in contact with the ETU if they have any questions about their apprenticeship. We can give advice about wages, safety, training or general support. We’re here to help and support you throughout your trade and career.
Below are the new minimum rates of pay for junior apprentices who have completed year 12 and began their apprenticeship on or after 1 January 2014.
There are other allowances within the award that apprentices may be entitled to, e.g. a meal allowance or multistorey allowance. There are other rates of pay for mature aged apprentices and those apprentices who have not completed year 12 too. For more information on these, please contact your state branch of the ETU.