Industry has welcomed the federal government’s review of the Australian Apprenticeships Incentive System to address abysmal completion rates.
The incentive system, which was introduced in 2022, provides support to employers and apprentices.
Employers can receive financial support through wage subsidies and apprentices can receive direct payments to help with cost-of-living pressures.
It also covers jobs on the Australian Apprenticeships Priority List which targets jobs in high demand.
Financial supports are scheduled to change from 1 July, 2024.
Announcing the review yesterday, Minister for Skills & Training, Brendan O’Connor, said apprentices and trainees are vital for economic growth and prosperity, especially as Australia transitions to a net zero economy.
“The Incentive System should play a key role in building our labour force, by supporting apprentices and trainees to receive quality training and opportunities for secure, well-paid work and encouraging businesses to take on apprentices and trainees,” he said.
The Review is accepting written submissions until 15 May 2024 and will establish a national program of online and face to face consultations in the coming weeks.
“We know that almost half of all apprentices don’t complete their training,” O’Connor said.
“Addressing the completion rate is not just vitally important for individuals and employers, but also for the Australian economy.”
Ai Group chief executive, Innes Willox, said for an employer, the cost of supervising and training an apprentice can sometimes be prohibitive.
“Well-targeted financial incentives can help ease those impediments. For the apprentices themselves, incentives to encourage them to see their training contract out to the end will help improve completion rates, which remain stubbornly low,” Willox said.
"Skill shortages are an acute and protracted problem in our economy and a high performing apprenticeship system has a central role to play in developing skills in demand.”
The Electrical Trades Union (ETA) described completion rates as abysmal and blamed rock bottom wages.
ETU National Secretary, Michael Wright, said a complete overhaul was necessary.
“"The rapid transition to renewable energy sources is creating a worldwide surge in demand for electricians. It simply won’t work to rely on the same lazy solution of importing temporary skilled migrants,” he said.
“We need a robust, well resourced, industry-led training effort and it needs to start immediately. Apprentices need to be supported at every step of their time, we can’t afford for anyone to be slipping through the cracks.
"Rather than allocating funds to programs that fall short of expectations, it's crucial for the Government to collaborate closely with people who are actively involved in energy.
"The review needs to delve into how we design an apprenticeship system that lifts completions. Industry knowledge and higher wages must be at the centre of this review.”
The peak body representing independent providers in the skills training, higher education, and international education sectors, the Independent Tertiary Education Council Australia (ITECA) said the review is overdue.
ITECA chief executive, Troy Williams, said incentives are appealing to employers and have shown to boost commencements and completion rates, but they come with significant costs.
“We need sustainable, long-term solutions that offer employers certainty in workforce planning,” he said.
“It’s essential for employers to feel confident and have the certainty that the support available now will remain in place when they are looking to employ their second and third apprentice.”