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Wednesday, 14 September 2005
Page: 143

Senator WONG (6:39 PM) —After all the fire and brimstone of the guillotined Telstra debate we now come to the Australian Technical Colleges (Flexibility in Achieving Australia’s Skills Needs) Bill 2005. The bill before the Senate provides for the establishment and operation of the government’s proposed Australian technical colleges. Labor’s position on the Australian technical colleges is clear: we believe they duplicate existing world-class programs and infrastructure in our TAFE colleges and schools. We believe that the government should be increasing its investment in what is already in place and working—building on what we already have rather than reinventing the wheel. But Labor will not stand in the way of the technical colleges. Any action is better than the Howard government continuing to do nothing, and Labor will support the bill in the parliament.

Our support for the bill should not be mistaken for uncritical and unquestioning support of the technical colleges proposal. Labor question the motivation for the technical colleges, and we have many questions, which have not been answered by the government, about their implementation. Those are questions we were unable to hear answers to after public hearings before the Senate inquiry into this bill were cancelled—yet another display of arrogant misuse of power by this government in the chamber today.

Australia’s skills crisis needs action now, and not in 2010, 2011, 2012 or whenever these colleges will finally produce their first qualified tradesperson. The lack of skilled workers has already emerged as a critical issue for the Australian economy. It is a crisis of the Howard government’s own creation, a crisis born of their disregard for adequate investment in Australia’s skills base during their nine long years in office. Australia has a shortage of skilled workers because the Howard government has massively cut education and training investment since coming to office. A recent report by the OECD revealed a damning lack of investment in our skills base. The report revealed that over the last decade Australia has had one of the largest declines in public investment in universities and TAFE of any OECD country. Australia dropped by 8.7 per cent, while the majority of our competitors increased their investment. Australia is one of only seven OECD countries to reduce government funding for tertiary education per student between 1995 and 2001. Since 1997, there has been a declining percentage of the year 12 cohort going on to TAFE or university.

The government’s priorities in this area are all wrong. Figures uncovered by the Senate estimates process reveal that seven out of the 10 companies that received the most taxpayer funding between 1998 and 2004 through the government’s new apprenticeship employer incentives are employing only 0.6 per cent or less of their new apprentices in the traditional trades. The government’s top priority should be training new apprentices in the traditional trades and other areas of skill shortage, and not subsidising salaries in companies that do not provide training in areas of skill shortage. Nine long years of Howard government incompetence have created a skills crisis that is threatening Australia’s economic performance. The Howard government missed the opportunity to reform Australia’s education and training system to address skills shortages. From the time it was elected it has confused cutting education investment with real reform. It is no wonder that a shortage of skilled workers is hurting Australian businesses and families.

Warnings about Australia’s skills crisis are being shouted by everyone from the Reserve Bank to the OECD. Our economy needs action now. A report on Western Australia’s skills needs conducted by Monash University and released a few weeks ago pointed to the alarming need for an immediate 30 per cent increase in apprentice commencements in the mechanical and fabrication trades and a 15 per cent increase in the electrical trades. The report said that in Western Australia alone an extra 20,000 workers will be needed every year until 2010 to meet employment demand. The strong demand for extra skilled workers is being felt right across the country, yet the technical colleges will not produce their first qualified tradesperson until 2010 at the earliest, and that is only if the colleges are running next year. The minister ducks and weaves every time he is asked how many colleges will be open next year.

This government should be training more Australians now in areas of skill need. Instead, all the key indicators of skills development are pointing backwards. This government has presided over the most significant drop in a decade in the number of Australians in training. There were 122,000 fewer people in training in 2004 than in 2003. That is a seven per cent decline in the last year alone. The number of new apprentices in training also fell by four per cent during 2004. The latest figures from the National Centre for Vocational Education Research show that apprentice cancellations and withdrawals are at a record high, up a massive 61 per cent since March 2001. Most disturbingly, cancellations and withdrawals by those in trades, and related workers, are up a staggering 54 per cent since March 2001—all this at a time when businesses are crying out for more qualified tradespeople.

Completion rates for traditional apprentices have been in decline under the Howard government. Forty per cent of people who commence an apprenticeship do not complete their training. These declines are the product of a sustained neglect of skills development during the nine long years of this Howard government. As soon as the Howard government took office, it slashed funding for vocational education and training. In 1996 and 1997 $240 million was slashed from the VET budgets. In the 1997-98 budget, the government abolished the stand-alone National Skills Shortage Strategy. In 1998 the so-called ‘growth through efficiencies’ policy effectively froze Commonwealth VET funds, resulting in a loss of growth funding estimated at around $377 million over the 1998-2000 period.

The misnamed Skilling Australia’s Workforce legislation, which was recently considered by this chamber, contains no significant new money for the funding of VET in conjunction with the states and territories over the next 3½ years. At the same time that the government was cutting and freezing funds, businesses were crying out for more skilled staff. We all know there has been a major shortage of TAFE places. These matters are a direct result of the Howard government’s education and training policies. This skills shortage has developed under this government’s watch. It cannot pass the buck and it cannot shift the blame. This government must own up to its own failings and incompetence.

Now we have before the Senate the matter of the Australian technical colleges. The idea was dreamt up on the run during the last election campaign and announced with scant detail. Only now is the government figuring out how the colleges will be implemented. In July the government announced out of the blue that it is increasing the number of technical colleges to 25. The government has now decided to fund two technical colleges in Adelaide instead of one. Clearly, Labor welcomes the extra college. More effort in skills development is always welcome. But, whilst it added on an extra college, the government has not increased funding to the technical college program. That can only mean one thing: less funding for every individual technical college.

The implementation of the policy is turning into yet another Howard government mess, because, without an immediate increase in the technical college funding pie, every area that has been promised a technical college will receive less money. Minister Hardgrave’s announcement of the extra college in Adelaide is yet more evidence that the technical college program was dreamt up on the run and is changing day by day. The Pilbara, Port Augusta, Western Sydney, Gosford, Lismore, Warrnambool, Dubbo, Queanbeyan and Sunshine Coast regions have all been left out of the Howard government’s announcement, despite being promised a technical college in the 2004 election campaign. These forgotten regions will now have to wait until after the next election for a technical college to open.

These colleges, the Prime Minister said in his election announcement, were designed to accelerate national skills development in traditional trades. If the government definition of accelerated skills development means waiting until 2010 for a handful of the colleges to produce their first qualified tradesperson, I would hate to see this government take its time. The government’s confusions and contradictions reveal a lack of proper thought in the original policy which has seen that policy unravel during implementation.

The government has been rendered breathless by its repeated exhortations that these colleges would not be able to charge fees or run at a profit. It has been forced to find a position after a shambolic performance during question time in the House last year, when the Prime Minister, Minister Nelson and Minister Hardgrave all gave different interpretations of the government’s policy regarding the fees to be charged. But the truth finally slipped out when Minister Nelson admitted in June that private training providers associated with these colleges will be able to make profits. This admission follows comments made by the Australian Council for Private Education and Training in relation to technical colleges. They said:

It would need to be a commercial arrangement ... where there needs to be the opportunity to cover costs and have a return for the operator ...

Debate interrupted.