The Federal Government has announced a $2 billion training support package aimed at helping businesses retain existing apprentices and trainees and upskilling individuals to gain employment in growing sectors of the economy.

In this latest development, the medium-sized businesses who were ineligible for the existing Supporting Apprentices and Trainees (SAT) subsidy, many of whom saw their apprentices at risk of losing their jobs, now find themselves able to take advantage of the scheme.

Employers (including all small, medium or large businesses and Group Training Organisations) who re-hires an appropriate apprentice or trainee who was displaced from a small or medium-sized business may also continue to be eligible for the subsidy.

Critically, with concerns from employers that the existing scheme was going to end on 30 September, the SAT subsidy has now been expanded six months to cease in March of 2021, giving more business and their apprentices and trainees security.

If you think your business may be eligible for any of the new incentives, reach out to your local AASN provider, including ASA Victoria, who are administrating these subsidies, for more information.

Why support is needed

The Victorian Chamber knows young people are going to be some of the hardest hit by the COVID-19 pandemic. During April and May of 2020, as tough restrictions were enforced, the VCCI estimate that Victoria experienced a 60% year-on-year decline in apprenticeship and traineeship commencements.

As a result of this, the VCCI fears many Victorian businesses are likely to face long-lasting impacts with skills shortages potentially lasting up to eight years (Mitchell Institute Report, 2020). 

This latest round of government support comes at a time when the number of Victorians who are unemployed is growing exponentially. Data released by the ABS today shows Victoria’s unemployment rate has hit 7.5% for the month of June – the highest it’s been in over 20 years. That equates to 265,700 Victorians who are now unemployed, an increase of 23,000 from the previous month and 95,000 more than the same time last year.

The Victorian Chamber has been advocating for urgent support to ensure young people and job seekers can continue employment and training during the COVID-19 pandemic. We are pleased to see some of our recommendations adopted by the government.

Extension of apprentice, trainee wage subsidy program for business

When the SAT wage subsidy was announced earlier in the year, the program was set to expire on 30 September of 2020, where only small businesses with an apprentice or trainee were eligible.

So far, the SAT program has seen the Federal Government approve 81,212 claims for apprenticeships and traineeships across Australia, supporting 46,573 employers. These claims have totalled $365.5 million in payments.

On 16 July, the Federal Government announced a $1.5 billion expansion of the program to help businesses keep apprentices and trainees in work and continue their training. 

Critically for many Victorian businesses, the scheme will now allow payments to employers with up to 199 staff who have an apprentice in place at 1 July of 2020, with a 50 per cent wage subsidy up to a cap of $7,000 per quarter.

Along with the expansion, the scheme has been expanded six months to cease in March of 2021.

Employers (including all small, medium or large businesses and Group Training Organisations) who re-hires an appropriate apprentice or trainee who was displaced from a small or medium-sized business may also continue to be eligible for the subsidy.

Claims from small businesses are now open, while claims from medium-sized businesses will open on 1 October 2020.

JobTrainer

The JobTrainer scheme is the latest in the Federal Government’s ‘Job’ programs, following JobKeeper, JobSeeker and JobMaker. The intent of the program is to “ensure more Australians have the chance to reskill or upskill to fill the jobs on the other side of this crisis,” according to Prime Minister, Scott Morrison.

The new scheme will commit $500 million to provide access to low-cost or free training courses in growth sectors. What those particular growth sectors are, have not yet been identified by the Government.

By investing in school leavers and job seekers being able to access pre-apprenticeships, short courses and full qualifications, it is estimated the new JobTrainer scheme will support around 340,700 new training places across Australia.

Before each state can access the government funds for the JobTrainer program, each state must sign up to a new Heads of Agreement, “with the agreement setting out immediate reforms to improve the vocational education and training sector.”

The list of approved qualifications and skill sets to be eligible for the JobTrainer scheme will be identified by the National Skills Commission and each state’s government. State and territory governments will then determine which qualifications and skill sets are the top priorities from the agreed list, with focus on training in areas of anticipated employment growth.

Minister Michaelia Cash said “we will work with States and Territories to develop a list of qualifications and skill sets that will provide job seekers with the skills that are in demand by employers and are critical to the economic recovery.”

Ongoing advocacy

The Victorian Chamber will continue to work with both Federal and Victorian Governments to ensure the state can implement the necessary support for young people and job seekers so they can continue to be employed and receive important training and skill development during the COVID-19 pandemic.

If your business is facing skills shortages or would like to be involved in our advocacy work, please contact policy@victorianchamber.com.au.