Second reading – Migration Amendment (Skilling Australians Fund) Bill 2017
Mr PITT (Hinkler) (18:44): I rise to speak on the Migration Amendment (Skilling Australians Fund) Bill 2017. It’s a great pleasure to speak on this bill, simply because, as someone who has been the recipient of trade training in a regional centre, I remember with great fondness my first day of work at a local sugar mill, the Fairymead mill—which, of course, is not there anymore—on 13 January 1987. When we compare that to the levels of training and skills that are needed in our current workforce across the country, clearly this is something which we need to address. In fact, the sugar mill I went into was a unionised workforce with very strict demarcation and, I have to say, very strong Labor morals. There was an outrage at the time that I was employed, because the company in question—which I won’t name here, because they’re still a very large part of the community—put on only 23 apprentices, down from 46. Unfortunately, that organisation now employs none. We find ourselves in a difficult position. In my maiden speech. I spoke about the fact that, if we do not manage to transfer the skills from our existing workforce to our new workforce through apprentice training and all of those types of training opportunities, there’ll be a great loss of corporate knowledge in this country.
There are many out there who think that an electrician is an electrician, a fitter and turner is a fitter and turner, and a guy with a welder is just a boilermaker, but there are so many classifications amongst all of those trade descriptions, whose skills take years to build. They are master tradespeople. If we do not transfer those skills, they’ll be lost. If I look at my own experience in a sugar-milling operation, there were people in that organisation who were experts in particular areas—whether it be a boiler, a fugal or a sugar-milling trade—and those skills can’t be replaced on the run from people around the country who have worked in other areas. We need to ensure that there is enough funding and job opportunities provided to bring those skills on for the youth of this nation.
These are long overdue changes. The amendment has three key aspects. It will require employers who nominate a worker under temporary and permanent skilled migration programs to pay the nomination training contribution, because training costs money. Unfortunately, in this country we have moved in a direction where people simply do not hire apprentices. In my local region there were always dozens of carpenters, builders and plumbers that would put on someone they knew—a friend, an associate or someone that was related to them—on the basis that they could deliver them a skill. In certain industries they knew that, if they built their skilled workforce, in the long term that was in the interests of their business. When they moved to other places, those skills advanced, and, if they came back, that was fantastic.
It allows the nominations to be accepted from persons that have applied to be an approved sponsor, and allows the minister to determine by legislative instrument the manner in which labour market testing in relation to the nominated position must be undertaken. There’ll be changes in the visa categories, but the key here is that businesses with an annual turnover of less than $10 million will pay $1,200 per year for each temporary overseas worker and a one-off Skilling Australians Fund levy of $3,000 for each permanent overseas worker. If you have an annual turnover of $10 million or more, it’s $1,800 and a one-off payment of $5,000. This is absolutely critical, because in recent years the increase in apprentice wages—and I certainly wish them well—has made it very difficult for small businesses in particular to employ apprentices in those trades.
As someone who has run a business, who built a registered training organisation from the ground up and was heavily involved for 15 or 20 years, I know the reality is very straightforward: small businesses in particular have to be able to afford the apprentices they have under their supervision. If they cannot, they just don’t employ them. That is to the detriment of everyone: their business, the youth who are looking for work and our economy moving forward. We need to ensure those opportunities can be filled. This is an additional 300,000 apprenticeships over the next four years, and I think that is an outstanding result. This is something which is desperately needed, particularly in regional areas.
We all know that the economy is going through a transition into a far more technical arena. When I speak to employers, the challenge that they have, particularly around apprentices, is ensuring they can find the candidate that has done the right training through high school—particularly around STEM, because there is more and more argument for STEM support before they go to TAFE or before they go to a technical trade—and the one with the right aptitude. Unfortunately, the anecdotal feedback my office and I are receiving is that, around year 2, things get very difficult and we lose an awful number of people who have commenced, so the completion rate has become absolutely appalling.
We’re looking to reverse the decline in Australian apprentices in training and to restore those numbers. In the long-term, we need to ensure that opportunity is around the country—not just in capital cities but also in the regions. As we all know—and the member for Riverina is sitting here at the dispatch box—people who are raised and trained in the regions tend to stay there rather than migrating to the cities where we find a lot of the population is siloing. Without those skills, it’s very difficult to produce the food, the fibre and the things we trade as a nation, which are essential to our economy and essential to providing highly-paid and highly-skilled jobs in the regions.
It’s unfortunate and it disappoints me a great deal that the biggest ever annual decline in apprentices in training occurred, unfortunately, under the previous Labor government, between June 2012 and June 2013, when the apprentice numbers collapsed by 110,000 or 22 per cent. Over the life of Labor’s national partnership agreement, apprenticeship numbers in Australia halved. In my electorate of Hinkler, there was a drop of 38 per cent from 2011 to 2016, and that is quite simply unacceptable. I spoke in this place this week about the challenges that my electorate faces, particularly around the fact that we continue to be the lowest median income statistical area in the country. We also have an unacceptably high level of unemployment, particularly for youth. This fund will help us address those challenges. But this is not a one-way street. It takes two to tango, and we need businesses to be willing and absolutely encouraged to employ apprentices and trainees. Without the support of business, this will simply not work. That is very, very straightforward.
Figures from the National Centres for Vocational Education Research show that in 2011 there were approximately 8,800 people training in my electorate of Hinkler, with 1,400 commencements and 1,000 completions. That was, of course, earlier on in 2011. Compare that to the figures of December 2016: 5,400 in training, 850 commencements and just 600 completions. As a proportion of the population of Hinkler aged 15 to 74 years, the 2016 figures represent about five per cent in training, just under one per cent commencing training and about half a per cent in completions. In Queensland, for the same period, it was seven per cent for commencing training, and completions were slightly higher, at 0.7 per cent. The numbers for the nation were six per cent, one per cent and 0.6 per cent respectively. In 2011, the comparable figures represent almost nine per cent in training, 1.4 per cent commencing and one per cent for completions. There are different averages around the country, but the numbers are very, very stark.
In recent weeks I have spoken to a number of large employers in my region, trying to encourage them to take on apprentices—and they’re interested. They are very long-term organisations and they have been committed to our region for decades. In fact, some of them were some of the highest apprentice trainers in the country. I’m a recipient of that training. I was very fortunate to actually get an opportunity, and I want to ensure that we can provide that opportunity for our youth now, for the people who are completing high school and are looking for an opportunity and—if I can be very frank—don’t want to go to university. We need to admit to ourselves and to everyone else that not everybody wants to go to university. If you do a trade, you can earn incredibly good money. You can run your own business. If you want to work in the resources industry, you can do very long hours and earn incredible salaries. But you cannot do that if you don’t get the initial opportunity and if you don’t complete. This fund is about trying to ensure that we can get that done.
In my electorate, it’s nearly all small businesses. I would really like to see a focus on the money from this fund being provided to small business, in particular, because they are passionate people who work long hours and they don’t have the time to sit around doing assessments and doing the paperwork that’s necessary. With the change in the way that training and skills are assessed, it’s no longer simply the case that the apprentice goes off for a seven-week block at the local TAFE. They can be trained and assessed of a night-time. They can be done individually. They can be assessed locally onsite. All of those changes have changed the way that vocational training is being delivered. There are a number of reasons for the reduction in the number of apprentices taken on, but regulatory processes, more red tape and more costs absolutely contribute to that reduction.
If the Australian government, the federal parliament, cannot make the changes necessary, then why are we here? This is a good proposal. It is a substantial proposal. And the challenge, of course, is the 457 visas versus the use of Australian workers. Now, I’m fairly pragmatic, and my practical view is very straightforward. I think we need to get the balance right. We need to get the balance right, and the reality is that the balance hasn’t been right. But what do you say to someone in a regional area who runs a business that might employ 30 people who requires one critical staff member? Without that critical staff member, their business closes. If they can gain that through a 457 and provide 30 people with employment, then that’s something we should support. But what we should not support is people who might rort the system to their benefit and not the benefit of the people of this country.
It is absolutely essential that we continue to put Australian workers first. This fund will help do that. The Skilling Australians Fund will seek to achieve much greater training completion rates by investing in more than 50,000 pre-apprenticeship places. But, as I said earlier, we need to ensure that we get the right candidates, who’ve got the right mindset and who have done the right training, in particular in secondary school and through high school, and we can get them to complete. There is nothing more disappointing, not only for an apprentice or a trainee but for the business, than for them to get halfway through and quit, because they lose all of the skills they’ve gained.
The absolute reality is very straightforward. For a business operator, the people in the trades, particularly in heavy industry, start to become viable as an employee in terms of payment by the time they get to around their third year or halfway through the third year. That’s just the nature of training and the development of skills. It can’t be done overnight. We need to ensure that we get them through and we get them completions and they do have somewhere to go for a job. This fund is absolutely critical to making that happen.
So I’d say to the opposition: please support it, because there are people out there, particularly in regional Australia, who straightforwardly need the help. They absolutely need the assistance. I’m still astounded at the number of reductions of apprentices and trainees, particularly in regional areas. We can continue to reach out to business. We can encourage them to put people on. We can ensure that they are supported, that there are people out there who can help them with red tape and everything else. But without this fund it becomes far more difficult.
This nation was built on the hard work of a lot of people. It has been an incredibly successful country. As the economy transitions, we need to transition with it. One of the ways to do that is to continue to build our workforce and its skills and its capability and its experience. I spoke about this in my maiden speech in 2013 and about the loss to our economy of those master tradespeople and their skills. The time is here. The time is now. We need to take the opportunity. I absolutely support the Migration Amendment (Skilling Australians Fund) Bill 2017, and I would encourage those opposite to do the same.