Rachel Urquhart
At the National Jobs and Skills Summit, the federal government unveiled major initiatives to address Australia’s skills crisis. But industry insiders warn that the real work is still to come.
During the summit, the government announced 465,000 additional fee-free TAFE placements, along with planned changes to Australia’s skilled migration system.
Working with industry, unions and other stakeholders at the Summit, the Albanese government agreed to 36 immediate initiatives. Among these was an additional $1 billion in joint federal-state funding for fee-free TAFE in 2023, and accelerated delivery of 465,000 fee-free TAFE places, with 180,000 to be delivered next year.
According to the government’s Jobs and Skills Summit Outcomes white paper, the $1 billion one-year National Skills Agreement will provide additional funding for fee-free TAFE, while a longer-term agreement is negotiated.
The white paper also notes that this will “kick-start skills sector reform” and restart discussions for a five-year National Skills Agreement based on guiding principles agreed by the National Cabinet and Skills Ministers. Under the one-year National Skills Agreement, the government is already providing (unmatched) $50 million to modernise TAFE technology infrastructure and $24 million to support vulnerable students to be successful.
Work begins on new National Skills Agreement
The new National Skills Agreement will replace the National Agreement for Skills and Workforce Development (NASWD), which identifies the long-term objectives of the Australian, state and territory governments in skills and workforce development.
Prime Minister Anthony Albanese and state and territory leaders agreed on a vision statement and guiding principles for the new National Skills Agreement before the summit.
The six principles to underpin the skills negotiations included endorsement of the view that TAFE was “at the heart of the VET sector”, and that the new agreement should involve “upgrading TAFE facilities, prioritising wrap-around supports for priority groups, supporting a quality teaching workforce and strengthening collaboration with industry and unions”.
The agreement is scheduled for implementation in 2024.
According to Skills Minister Brendan O’Connor, the federal government is prepared to provide $3.7 billion over a five-year period for a new agreement to fund vocational training.
“That’s certainly the amount that we’re hoping to be able to provide,” says O’Connor, “but it’s predicated on an agreement with the states and territories in order to ensure that we have the reforms so that it’s fit for purpose for students, current workers and the labour market.
“We need to focus on the structural, systemic and even cultural challenges to reform our [vocational education and training] sector and our higher education sector. Investing in our future workforce is as important to us as ensuring we have effective skilled migration pathways.”
Changes to skilled migration
Another immediate initiative agreed to during the summit is an increase in the permanent Migration Program ceiling to 195,000 – an increase of 35,000 – in 2022-23. Additionally, the government will extend visas and relax work restrictions on international students and provide additional funding to resolve the visa backlog.
The government will direct $36.1 million towards additional visa processing, which will fund 500 staff over nine months. A major review into Australia’s immigration system was also announced.
Australian Chamber of Commerce and Industry chief executive Andrew McKellar told the summit that announcements were a “significant step forward”.
“It’s important that employer-sponsored temporary and permanent migration needs to return to the sorts of settings that we had prior to 2017, which allowed sponsorship of all skilled occupations,” says McKellar. “Employer sponsored migration in Australia is the most successful form of migration for Australia, as well as for the migrant.”
Moves to increase the minimum salary of temporary skilled migrants well beyond the current $53,900 would potentially shut out certain occupations, says McKellar, and adversely impact regional areas.
In addition to the immediate immigration fixes, Minister for Home Affairs Clare O’Neil announced a major review of Australia’s immigration system, that would take a “fiendishly complex” migration system and “consider how we can rebuild our immigration program in Australia’s national interest”.
Response from industry
Tony Palladino, Executive Officer at NSW Utilities and Electrotechnology Industry Training Advisory Body (ITAB), says the announcements were welcome, but more detail on roll-out and allocation was necessary.
“Does everyone get a slice of the action or is it targeted to key occupations or, more importantly, apprenticeships in demand?” says Palladino. “It’s all well and good to have targets but the focus is on training, and not employment and training.
“Just because you make available training places, doesn’t mean that the right people will be trained in occupations that need them – for example, a combination of off-job and on-job learning where we need employment for this. Nor will it necessarily result in improved labour matching and good quality jobs for the long term.”
While the summit tackled some important issues, Palladino says it lacked meaningful discussion about real labour shortages and solutions.
“We have thousands of young people in Year 11 and 12 atrophying in classrooms around the country who probably don’t want to be there,” he says.
According to Palladino, this potential labour pool was the “elephant in the room” that the forum failed to discuss, and which could readily be guided to apprenticeships given good labour-matching and recruiting processes.
“But the knee jerk reaction is to shift people to training solutions instead of job solutions that require training,” he says. “Skill shortages are a myth if you have a buoyant labour supply; training can follow employment in such occupations that have apprenticeships in a government-declared in-demand occupation and quality pathway.
“Additionally, by getting this pool of labour into apprenticeships like electrical and HVAC&R at an early stage, we will get an extra two years out of them in the labour market and lifetime tenure.
“Electrical and HVAC&R occupational apprenticeships have high retention rates in the industry. That is, graduating apprentices are more likely to stay in their occupation in one form or another – including supervisor roles – for a very long time. Government investing in them is a good return on investment.”
For the HVAC&R industry, says Palladino, the apprenticeship model is tried and tested, suits the industry, and has been successful for many years.
“I am not sure the summit focused on these issues in any detail, as it was too focused on macro matters with a belief that the macro decision will fix the micro decisions,” says Palladino. “The focus for this type of activity should be from the micro, up – that is, a bottom-up approach. HVAC&R, electrical, electricity or gas know how to address the issues, but are hampered by bureaucratic processes that are more interested in getting their ministers quantity instead of quality. The quality is where you get longevity and the quantity results in high attrition rates.”
In Palladino’s experience, the way to promote HVAC&R, electrical, electricity or gas occupations would be through an apprenticeship model headed by an industry-based apprenticeship commission that looked after respective apprentices.
“Contracted, developed and helped them for the future of the industry,” says Palladino. “The commission would be responsible for monitoring RTOs, employers and mentoring apprentices with a clear goal of increasing competency, quality and numbers in the industry sectors it was responsible for.
“It would also be the prime champion and advocate of apprenticeships to schools, the education system, parents and stakeholders of the benefits and rewards of taking up an apprenticeship.”
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