Australian apprentices can now access Trade Support Loans after the legislation was passed in Parliament last week.
Apprentices will have more support to take up a trade and complete their training.
Industry Minister Ian Macfarlane said the legislation allows loans of up to $20,000 over the four years of an apprenticeship.
The Government is determined to build the skilled workforce of the future to enhance Australia's productivity and international competiveness and Trade Support Loans are an essential part of the government’s Economic Action Strategy,” he said.
“These loans will ease the financial pressures on apprentices and help them complete their training and move into paid jobs.
“We want to encourage young Australians to undertake apprenticeships, and most importantly to complete their training. All too often apprentices don’t finish their training because they can’t afford the costs.
“Trade Support Loans will help apprentices with the cost of living during their training and provide them with the support they need while acquiring the skills to move into jobs."
Access to the loans is spread over four years of an apprenticeship, with most of the loan amount accessible in the first couple of years, which is the most critical period of time.
Eligible apprentices can opt-in and opt-out of the program as their needs change and may choose to borrow a few thousand dollars for work gear or equipment, save up the payments to buy a second-hand car, or use the full amount to cover living expenses during their training.
Under Trade Support Loans apprentices can access $8,000 in their first year, $6,000 in the second, $4,000 in the third and $2,000 in the fourth year.
Eligible apprentices may choose to take up the full amount or just part of it, depending on their needs. The loans are repayable once apprentices are earning a sustainable income. The loans are interest free but will be indexed once a year in line with CPI.
When apprentices complete their training they are eligible for a discount of 20 per cent on the loan amount, worth up to $4,000.
The Australian Chamber of Commerce and Industry, CEO, Kate Carnell, said industry and government must work quickly to restore incentives and reduce the cost for employers to take on apprentices.
“The number of apprenticeship commencements by those 19 years and under are now at their lowest level since 2001, amounting to some 40,000 lost job and training opportunities from the peak numbers in 2007,” she said.