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Monday, 6 December 2004
Page: 66

Senator GEORGE CAMPBELL (4:51 PM) —On the surface, the Vocational Education and Training Funding Amendment Bill 2004 is a routine piece of legislation. This bill amends the Vocational Education and Training Funding Act to reduce the appropriated limit of total funds for vocational education and training to the Australian National Training Authority, for distribution to the states and territories for 2004, from $1.136 billion to $1.131 billion, to reflect the outcome of the ANTA negotiations. It will also appropriate funds for vocational education and training, to be provided for distribution to the states and territories for the year 2005, up to a limit of $1.154 billion. But in reality this bill is much more than a mechanism used to provide federal funds to the states and territories for vocational education and training; it is an annual reminder of this government's terminal failure to properly fund vocational education and training in Australia. More importantly, it is a constant reminder of the failure of this government to understand the importance of the role played by TAFE in our vocational training system in this country.

We have noted the decision by the government to establish 24 technical colleges which will be run by the private sector. One has to assume that this is the beginning of the transfer by this government of the training agenda out of the hands of the public sector or the state systems and into the hands of the private sector. I wonder to what extent the private sector will fulfil the role that TAFE plays in the community in terms of both our training infrastructure and dealing with some of the other peripheral issues that surround that. I had the privilege of visiting the South-West TAFE in Sydney, about a month or so before the election, to see at first hand the training being provided to our boilermakers, welders, sheet metal workers and plumbers and those in a range of other trades that were being serviced by that TAFE. I also had the privilege of watching the teachers in that TAFE system spend time and energy on dealing with young disadvantaged workers—young people who had not completed year 10. They were giving up their time to train them in the basic skills that would enable those kids to get a place in the TAFE system and, more importantly, get a place in the apprenticeship system so that they would be given hope into the future. I also watched teachers at Miller TAFE spending time with young kids who had severe learning difficulties, teaching them no more than how to read a train timetable so that those kids could get to work on time. I wonder to what extent the private training providers—the new technical colleges—will put time and energy into trying to assist those sorts of kids to get through our system, to work their way through our system, and get a place in the trade areas where there are skills shortages.

Over their nine years in power, the Howard government have run vocational training into the ground, in the process denying a generation of young Australians a chance to embark upon worthwhile careers and nurturing a skills crisis that threatens to stunt economic growth both now and in the years to come. While Labor will not stand in the way of this bill being passed, we will not let the government's disappointing attitude towards vocational education go unchallenged. Every year that this bill has been introduced into the chamber has been a demonstration, again and again, of the short-sighted nature of the government's approach over the past nine years as to the way it has funded the VET system. It is a constant reminder as to why we are suffering a major crisis in terms of the skilled work force of this country at this point in time. The funding to VET has been reduced cumulatively, I think, by over $200 million. We have seen something like 50,000 young Australians, including 15,000 school leavers, miss out on TAFE every year. With a youth unemployment rate that is stuck at around 19.7 per cent, we can hardly afford this situation to continue.

But it is not just a question of whether or not young people are able to get into good paying job opportunities for the future. This approach by this government over the past nine years has had and will have a severe impact on our economy. There is currently on the drawing board in this country $25 billion to $30 billion of major project work from the North-West of Western Australia right across to Gladstone in North Queensland. There is no question that those projects will suffer from skills shortages. They will not, because the salaries that will be available to the skilled workers on those projects will be at a level sufficient to attract labour from all around the country. But the impact on our economy when those projects start to suck labour out of our general engineering sector in the metropolitan areas will be that much of our general engineering and metal-working sector, which underpins our economy on a day-to-day basis, will be struggling to survive as a result of those labour shortages. Many of those businesses will collapse as a consequence of that, resulting in the fact that when people come off those projects they will join the unemployment queues. More importantly, the damage done to the economy in the interim will take a very substantial period of time to repair. Thanks to this government's short-sightedness we are facing that sort of a skills crisis in this country now and, in the short to medium term, very significant difficulty in even coming close to overcoming it.

There is evidence in abundance as to what is happening in that area. We know, for example, that over the next five years something like 170,000 tradespeople will leave the traditional trades. We also know that only around 40,000 people will enter them. According to the Department of Employment and Workplace Relations skilled vacancy index, vacancies for skilled tradespersons have increased by a staggering 54 per cent over the last three years. In the manufacturing sector alone, there are currently between 18,000 and 21,000 unfilled vacancies for tradespeople. Skills shortages are now regularly listed as one of the top constraints, if not the top constraint, on investment by Australian businesses—and that is not just large Australian businesses; that is small and medium Australian enterprises, the same enterprises we hear this government talk about daily and dearly.

We heard the Minister representing the Minister for Employment and Workplace Relations in this chamber during question time go on about the fact that if only we could get rid of the unfair dismissal laws, if only we would pass the legislation, we would create 77,000 new jobs in the small business sector. What the small business sector is crying out for is not 77,000 new jobs; it is crying out for skilled workers who are available to go and work in their industries to meet the shortages that they have currently and are not able to meet out of the current labour force, the skilled workers they do not have the capacity or the resources to train in order to meet their skills needs. AiG, for example, say that over half the businesses they regularly survey face skills shortages. In regional areas the situation is even worse. In New South Wales alone, for example, 60 per cent of regional businesses face skills shortages.

Quite frankly, the government's response to this situation has been farcical. First, we had the National Skills Shortages Strategy. Unfortunately, the most impressive thing about this so-called strategy was its title. I think the only thing it ever offered was a web site. It certainly offered no new funding to meet skills shortages. It had a web site and a grab bag of pilot programs and policy reviews. In fact, the initiative was so poorly received the government were sent scrambling back to the drawing board. And what have they come up with to supplement this flawed policy? We have seen the announcement during the election campaign of the technical colleges. I am not suggesting that these technical colleges will not add to our overall capacity to meet Australia's crippling skills crisis. Of course they will make a contribution in one form, but will they solve the problem? Of course they will not. There is no way in the world that 24 technical colleges, taking in people, I think, from years 11 and 12, will solve the crisis that we currently face across all of our industries in the quest for skilled labour at this present point in time, and they certainly will not serve them into the future.

The causes of the skills crisis that we face are complex, and there are no easy answers to fixing them. Last year, for example, I chaired a Senate committee which was dedicated to investigating the skills crisis. Our report tackled the complexity of the issue and gave over 50 separate recommendations covering areas as diverse as the collation of labour data and identifying current and future skill needs, improving VET in schools, developing pathways between VET and higher education, the role of industry and many other areas. But, despite the fact that the government has had this report for nearly a year, it continues to try to offer what it sees as simplistic answers like the one of technical colleges announced during the election campaign. While they may make great headlines in the context of a federal election campaign, they will not, as I said, solve the skills crisis that we are confronted with. The crisis needs to be dealt with today—not in 2006 and certainly not in 2008, when hopefully these colleges will be operating at their optimum level.

In fact, the government is spending something like $289 million on an initiative that is simply going to duplicate what we currently have in place when the money could be used much more effectively to build on the current system in order to deliver quicker results to our industry. For example, there are a number of skill centres around this country that could substantially maximise the contribution they are making to our skills shortage situation with a lot fewer resources than the government has planned to throw into these technical colleges. Some of those examples are Austool, in Ingleburn, and a construction industry training centre which is in the current minister's own electorate—and I suspect he has not visited it yet, let alone knows that it even exists. That centre has the capacity to deal with about 3,000 building industry apprentices every year. It is funded by a levy on the industry and works hand and fist with the local TAFE college to provide the training resources to train those apprentices, as well as training for subcontractors and independent contractors in the construction industry on how to run their businesses. That is an example that could have been followed in order to put something in place that could have delivered quickly the sorts of skills training outcomes required to meet the crisis that currently exists within our skilled labour force.

There are other examples, such as the Hunter Valley training facility, the Australian aviation centre in Brisbane and the Bosch/RMIT program in Victoria. With regard to TAFE, two technical colleges will be established in Bairnsdale and Warrnambool in Victoria, both of which have long-established TAFE institutes and group training companies. The millions that the government plans to spend on this handful of technical colleges would be better spent on providing new TAFE places for the close to 50,000 young Australians who are currently missing out.

What is more, this is an initiative with an exceedingly narrow scope. It attempts to address the skills crisis in isolation without consideration of a host of other important issues. For example, while this initiative is aimed at developing technical skills in new workers, it completely ignores the fact that employers also want their employees to have good interpersonal skills and high levels of literacy and numeracy. It also ignores the fact that thousands of workers in industry today with limited training could be cross-skilled or could shift their skills base to meet shortages in particular areas that they are not in at the moment. They will not be able to be catered for by these new technical colleges. Again, one comes back to the question I initially asked: why is the government so dead set on bypassing the TAFE system in order to meet this issue of skills shortages? The only conclusion that you can come to is that this is the start of the process by this government to shift vocational training infrastructure out of the public sector into the private sector and to hand over total responsibility for providing training for our skilled labour force, at whatever level that may be, to industry and the private sector.

The recent abolition of ANTA provides a stark example of the government's `my way or the highway' attitude towards the states and VET. The government summarily abolished ANTA without consulting state governments. In fact, even the federal department of education was not consulted. ANTA staff only learnt of their fate on the day of the announcement. Whilst ANTA was by no means perfect, it played an important role and gave equal voices to government, educational institutions, industries and unions. One of the important roles that ANTA played was keeping a national focus on the training agenda—keeping a national focus on the standards that were being provided for various skills within our society and ensuring the portability and interchangeability of those skills and their capacity to move flexibly across a labour market. What body will now play that role in ensuring that there is a standard set of skills that exist within our society that is flexible and capable of meeting shifts in the labour market as the labour market's demands change with movements in our economy? There is no body currently in place that has the capacity to do that. The reality is that this is a bill that was delayed. It is a bill that is necessary in one context for ensuring ongoing funding to the TAFE system, but it is a bill, in my view, that is starting to shift the provision of vocational education and training from the public sector slowly into the hands of the private sector and the direct responsibility of industry.