North Coast TAFE
Institute Council
The North Coast TAFE Institute Council welcomes the opportunity to provide the attached response on selected recommendations in the report “A Shared Responsibility - Apprenticeship Reform”. Our response endorses the Expert Panel’s call for a simpler system which better supports employers and apprentices and more strategically targets government incentives. It also highlights those recommendations that have potential to adversely affect regional areas and SMEs and suggests some alternative ways forward.
The Council is an independent advisory body for TAFE services in the North Coast region of NSW. The Council advises the management team and Minister on aligning TAFE services with the skill needs of regional industries, communities, disadvantaged groups, other education sectors and stakeholders and comprises 13 industry and community members and the Institute Director as an ex-officio member.
Our input to this consultation is informed by Council’s knowledge of TAFE’s extensive delivery of on and off-the-job training services for apprenticeships and traineeships in and beyond our region, and by intelligence from our industry, community, student and staff constituencies. But, just as TAFE is a comprehensive education and training provider that is more than just an RTO, our input provides much more than an RTO perspective. The Council includes members with experience in apprenticeships and traineeships as employers, HR professionals and group training provider for industries as diverse as resources, children services, aged care, meat processing, construction and transport, metals, manufacturing, electrical, local government, finance and customer service, hospitality and administration.
Our input is shaped also by our view that current arrangements and some of the report’s recommendations often overlook the needs of SME employers, apprentices, trainees, RTOs and other service providers in rural and regional areas – needs that reflect size, capacity, dispersal and distance, thin markets, regional skills needs and other local factors that may not be visible in broad brush state and national trends or in planned responses to them.
Our members also bring to this exercise their experiences, not only in the North Coast, but from the Hunter and other NSW regional areas, Western Sydney and SE Queensland. Therefore we provide the attached comments and suggested improvements for the system in the hope that they might assist in designing new arrangements that are responsive and flexible enough for the varied needs of enterprises, communities and service providers in metropolitan and non-metropolitan areas.
On behalf of the Council, I welcome the opportunity for this input to the apprenticeship reform process and would be pleased to arrange for these matters to be discussed further with our members. I can be contacted on 0400 441 976 or via the Council’s Executive Officer, Joy Corben on 65862215.
Yours sincerely
Warren Grimshaw AM
Chair, North Coast TAFE Institute Council
8 April 2011
North Coast TAFE Institute Council
A Shared Responsibility - Apprenticeships for the 21st century: Response to selected questions on the Expert Panel’s final report
Support required by apprentice/trainees or employers before, at commencement, or while progressing through a traineeship.
1. A distributed, locally responsive, easily accessible support service is needed at all stages of the process. Efforts to drive competition and efficiency in the current system have created conditions encouraging multiple intermediaries to compete unproductively to deliver minimal support services into regions where they have a limited, if any, physical presence or long term experience or commitment. This undermines the quality of support, customer service and communication for all players in the system.
2. Though financial incentives information is well-promulgated, there is evidence that the system is so multi-layered and dispersed that most employers are not aware of other useful support services and tools funded by the Commonwealth and States to support apprentice and trainee progression and completion. Providing a single, visible, genuine local one-stop shop (see point 3 in the section below) would lead to better communication and cost-effective services and provide a base from which quality mentoring and support for employers and apprentices could be delivered.
More harmonised and less confusing regulatory, support and mentoring arrangements
1. We agree with the Expert Panel’s finding that the system is too complex and confusing and its identification of some areas requiring attention. These include the need for harmonisation of arrangements between States and use of common terminology. A return to the distinction between “apprenticeships” and “traineeships” and ceasing use of the term “Australian Apprenticeships” would be a very easy and welcome first step.
2. We support national harmonisation of regulation and standards for the system, consistent with activity underway in legislation and regulation across a broad range of areas impacting on industry and employment. We see that an ongoing collaborative national mechanism will be necessary to achieve. However, if the role of a “national custodian” was to develop and enforce a single regulatory system , this could work against the simpler, more flexible system needed to respond quickly to changing enterprise, industry and regional needs and to interact with state-based industry frameworks and awards.
3. The provision of AAC services requires attention. In some of our regional towns three or four AAC providers have a physical presence. In others there is none. There can be role confusion where some have related training services arms and consistent feedback from employers that the process is complex and cluttered. Simplicity, transparency and “shared responsibility” may be served better by the Commonwealth either:
· Contracting State industry training service agencies to provide a simple, single state-wide AAC service alongside their other industry advice, support and regulatory roles; or
· Establishing a fully on-line service for those AAC services that are mainly administrative in nature, similar to that provided by the ATO for tax returns, complemented by a phone hotline help desk service for those needing personal assistance.
Either option (or a combination) would remove one layer from the system and should provide synergies and some cost-savings that could be redirected to higher priorities in the system.
4. We would have liked to have seen more attention in the report to Group Training. GTOs achieve well above State and National apprenticeship completion rates and actually supply much of the “after sign up” advice and support that is part of the AAC arrangements. If GTOs were paid for these services and passed those savings onto employers both apprentice numbers and completions would increase.
In a tight fiscal environment, how should Government target assistance to the Australian Apprenticeship System to support a skilled economy – ensuring apprenticeships and traineeships are affordable and a truly shared responsibility?
1. We caution against a broad-brush national industry sector approach in targeting or tightening employer and training incentives. There can be significant differences between regions in the skill needs that are of vital economic importance. For example, in addition to the trade skill shortages being experienced nationally, our region has ongoing needs for new entrant trainees in areas such as aged care, meat processing, dairying, production horticulture and accommodation and hospitality services, areas that may not meet any new test of “national economic significance” for targeting apprentice and traineeship incentives. However, they are vital regional industries and employer incentives are essential to the apprentice/trainee employment capacity of small regional enterprises in these sectors, and in other sectors such as construction, engineering, children’s services, retail and business services. A regionally responsive approach to targeted funding for training places is equally vital (see point 4).
2. Inequities in rural, regional and disadvantaged areas – and between industries experiencing a higher level of need - will become more entrenched unless the incentive regime is redesigned to direct resources to those that need it most and away from those who have a capacity to take more responsibility. The Expert Panel’s report and previous reviews could have given more consideration to the question of how large companies might take on a greater burden of cost. However, very large companies and their in-house RTOs have much more capacity to absorb reductions in apprentice and trainee incentives without undermining their capacity to employ, train or support apprentices and trainees. Similarly, whilst acknowledging trades skill shortages in the resources sector, we hear of large companies in the sector paying well above award wages to apprentices and tradespeople, exacerbating the problems that regional SMEs here and elsewhere have in attracting and retaining trade apprentices
3. National and multi-national companies make a major contribution to our national and regional economies so any reduction in apprentice and trainee incentives would need to be carefully worked through. However, if large enterprises were able to take on more responsibility, resources could be directed to support better wage subsidies for smaller and regional enterprises with less capacity and to provide them and their apprentices/trainees with the better support services to improve quality and completions. Arguably large enterprises have much greater capacity to provide these support services in-house through their supervisory structure and training and development units.
4. Despite high levels of unemployment in rural and regional areas, many experience ongoing or cyclical shortages of trades and other skilled staff. Whilst PPP and critical skills funding has sought to address this issue, central planning of such programs often leads to a mismatch between program priorities and regional SME skills needs, for both new entrants and existing workers. Industry and trade skill shortage cycles can also differ between regions. For these reasons we have significant reservations about the Expert Panel’s suggestion for Government support for apprentices and trainees to be re-focussed on a set of national priority occupations, and suggest instead that priorities be identified collaboratively by industry, training and economic development stakeholders at a regional level. The Regional Development Australia network may be well placed to facilitate this process.
5. The system needs to provide incentives for players to work strategically and collaboratively with others with a long term interest in the ongoing supply of apprentices and other skilled labour in the region. Funding reform in both the VET and job services markets would assist. A good start would be some guaranteed growth funding for TAFE, the public provider uniquely equipped to support sustained regional collaborative efforts, rather than rely primarily on competitive mechanisms to achieve growth and short term fixes. Tendering guidelines for employment and training market intermediaries could also require them to commit a % of their revenue to collaborative initiatives with industry bodies, enterprise clusters, group training and RTOs. These approaches could stimulate new pre-apprenticeship, apprentice and trainee opportunities in areas aligned with regional skills needs and support better outcomes and completions.
RTOs, governments, industry organisations and employers working better together to deliver high quality on and off-the-job-training
1. The Expert Panel’s call for better and more integrated on and off-the-job training and support to improve quality and completions is welcome. However, the proposed accreditation scheme for employers would be a considerable burden that would discourage micro, small and medium enterprises from employing apprentices and trainees. SMEs are major employers of apprentices and trainees Australia-wide and our regional employers are mostly in this category. For similar reasons we agreed with the Government’s early decision to reject the proposed Employer Contribution Scheme, which SMEs could not have absorbed.
2. We support the need that the panel identified to redirect resources to provide more frequent and structured support for apprentices, trainees and their SME employers and see this as a value-added service that they could purchase from their RTO or Group Training Company. We disagree that this should be resourced from an across-the-board redirection of incentive payments, and have identified above some alternatives: i.e. synergies/savings from contracting State training agencies to integrate AAC services into regulatory services and/or moving some administrative services online; reducing apprentice/trainee wage subsidies for large companies with capacity to pay; reductions in subsidies for large enterprise RTOs; redirecting some AAC funding to subsidising GTC mentoring and support services to make GTCs (with their proven higher completion outcomes) a more cost-attractive option for employers.
3. Our regional employers would echo the strong support that the Expert Panel heard for a return to more Government support for institutional pre-apprenticeship programs to achieve job readiness. Though recent NCVER research suggests minimal difference in completion of apprenticeships for those who have or haven’t completed a pre-apprenticeship program, they are nevertheless invaluable in pre-employment preparation, screening and decision-making and creating apprentices who can be safe and productive from day one.
Pre-apprenticeship programs are a particularly valuable support for small enterprises, especially in regional areas, that are limited in their on-job training capacity, and also for ensuring a continuing supply of partially trained apprentices during times of cyclical downturns in the construction and other industries, to fill the gap when employers do not have enough work to take on apprentices. They are also critical in engaging and supporting the disadvantaged and those most disconnected from educational and employment opportunities in the system (see next section).
4. Some traineeship and apprenticeship areas, especially in service industries, are highly suited to a complete on-the-job arrangement supported by in-house or mobile trainers and assessors and North Coast TAFE successfully supports such arrangements both within the region and for some state and national business clients, as do other high quality RTOs. However, providing accredited training completely on-the-job lowers the entry threshold for RTOs into new regions and program areas leading, at times, to unproductive competition in thin markets and doubtful quality in some RTOs. We suggest that this is a high risk area that the new VET national regulatory arrangements could pay some attention to.
5. Quality training for apprentices and trainees in “traditional trades” is often less suited to a total on-the-job model and is best supported by commitment to a more equal sharing of responsibility for training between RTOs and employers. We have been particularly pleased to see the development of an exemplary shared responsibility model involving North Coast TAFE partnering with the heavy vehicle industry, to respond to a need identified in a community forum facilitated by our Institute Council several years ago. TAFE and a regional heavy vehicle enterprise that identified the need collaborated in developing and engaging other enterprises in the model.