Kim Beazley (Brand, Australian Labor Party, Leader of the Opposition) Share this | Hansard source

I thank the House for that extended opportunity. This is a response to a skills crisis of the Prime Minister’s own creation—that is all there is to it—and it is a product not of any sincere convictions on his part but of his political fears, a product of the political fears he has that the consequences of the skills crisis he has induced may well bring about the undoing of his government. This is a document, a statement and a program about the Prime Minister’s future and the future of his government; it is not a program or plan for the future of this nation, the future of the people of this nation and, in particular, the future of the young people in this nation who crave opportunities for education and opportunities for skilling.

And this Prime Minister, I have to say, is still in denial on this skills crisis. Only this Prime Minister would have the effrontery to say that there is no skills crisis and then announce an $800 million program to deal with one. Only this Prime Minister would have the brazen effrontery to make that sort of claim.

But it is entirely a product of his doing. It is entirely a product of his neglect and, I suspect, of his hostility over the years to those particularly in the traditional trades, which often tend to coincide with the heavily unionised. Certainly the skills and qualifications they have are influenced by the heavily unionised. The result of that is the appalling situation now confronting industry and the workforce of Australia. This government has had for over 10 years no real plans for their future and, in having no real plans for their future, has had no real plans for the future of this nation.

If you want evidence of this, Mr Speaker, and I think the Australian people are entitled to it, I go simply to one statistic. Remember, you have just heard the Prime Minister talk about apprenticeships, talk about post-school education and talk about engineers and the people we need. Here is the OECD’s statistic for this government on this area of public investment by our nation, indicating the priority this government has given this essential element of public investment for our future. The OECD’s Education at a glance report showed, just a few weeks ago, Australia is the only advanced economy in the world that has reduced its public sector investment in education since 1995. It is the only one in the world. On average, other nations have increased their investment by 48 per cent; Australia’s has been cut by seven per cent. For 10 long years the Howard government has got its priorities wrong and failed to prepare us for the future.

The Prime Minister has boasted over the last few years about rises in real wages. He has boasted about it, but he has absolutely hated it. His industrial relations changes, which he sought to defend here again today, have got nothing to do with rising wages, nothing to do with encouraging skills and everything to do with competing in the world that we confront now, not on the basis of the skills and brains of the Australian community but on the basis of lowering the wages of the Australian community. His attitude to the higher education system and the TAFE system in this nation—and you can describe his attitude to them in the last 10 years as nothing less than an attack—is of a piece with his attitude to industrial relations. It is about creating the set of circumstances where Australia’s international competitiveness is determined not by the brains and skills of our people but by the lowness of our wages. That is simply a fact, and you can go through all the statistics which demonstrate it.

Today, for example, we have a proposition to give a benefit to some 30,000 mature age trainees. There is a resonance in that figure of 30,000, because over the last 10 years 300,000 Australians have been turned away from TAFE—some of them, of course, mature age individuals who wanted the chance to advance themselves and some of them, of course, youngsters coming out of school. All of them were people who wanted to make a significant contribution with their skills to this nation, and now, 10 years on, of that 300,000, 30,000 are going to receive a mea culpa from this government—an apology. Thirty thousand will receive this government’s apology, but the fact that 300,000 can be turned away and only 30,000 picked up is a pretty fair indication that this, in keeping with the Prime Minister’s denial of a skills shortage, falls short as a plan for our future.

I will go into a real plan for this nation’s future; a plan that respects the desire and the absolute enthusiasm that there is amongst young Australians for the skills that they need to build themselves and their country a very useful future. I will detail those plans—the real plans—for the future of this nation, and claim a bit of credit, I might say, for forcing the Prime Minister kicking and screaming to this table now. But before I do this, I want to go through one other sorry piece of evidence about how we find ourselves in this position now, with a substantial, effective deskilling of our workforce and the chronic shortages that we now confront in business in accessing skilled workers, that even the Prime Minister has had to fess up to.

Since 1997, the Reserve Bank of Australia has repeatedly said to this government that one of the capacity constraints in the economy that will ultimately affect the prosperity of our people, the growth in the economy and ultimately factors such as the interest rate regime has been a chronic shortage of skills. First there was the November 1997 Statement on monetary policy:

This judgment is consistent with persistent reports of skill shortages and pressure on wages in the construction sector.

The November 1999 Statement on monetary policy cited:

... evidence that the strength of the labour market may be generating skills shortages in some areas.

And continued:

Skilled vacancies, according to the survey conducted by the Department of Employment, Workplace Relations and Small Business, are at historically high levels.

The 5 April statement by the governor said:

In some areas skill shortages have emerged. Pressure for higher wage rises appears to be building, even though wages growth to date has been restrained.

The November 2004 Statement on monetary policy said:

... business surveys suggest that a broad range of firms are finding it increasingly difficult to find suitable labour ... Both the NAB and ACCI-Westpac surveys suggest that the difficulty in obtaining suitable labour has moved into the upper end of the range recorded over the past two decades.

…     …         …

While economy-wide measures of wages growth have remained relatively stable, localised pressures are certainly evident in some official wage measures as well as through liaison, which points to substantial increases in wages for skilled employees in the construction and resource sectors, and in some areas of business services ... These developments are consistent with survey data showing that firms are finding it increasingly difficult to attract suitably skilled labour, pointing to the possibility of stronger wage pressures emerging in the period ahead.

The February 2005 Statement on monetary policythis is the most massive indictment of government neglect that you could conceivably imagine from the men and women who are responsible for determining monetary policy in this country—said:

The strength in the labour market is also apparent in liaison reports, which indicate strong demand for labour and shortages of skilled workers in a range of industries and sectors, from construction and engineering to accounting and information technology.

…         …         …

Higher labour costs, due to skill shortages, and higher material costs, particularly for steel products, contributed to this price movement.

And so on. In the March 2005 speech by the RBA Assistant Governor, Malcolm Edey, he stated:

The severity of the current skills shortage is captured by some of the business surveys which report the difficulty of finding suitable labour now is as high as it’s been in the last two decades ...

The May 2005 Statement on monetary policy said:

Liaison indicates that labour shortages are most pronounced among skilled workers in the non-residential construction and resources sectors, and in parts of the business services sector. However, labour shortages are becoming increasingly broadbased across industries and skill levels. Consistent with this, business surveys indicate that difficulty finding suitable labour has become a key factor constraining output.

The August 2005 Statement on monetary policy said:

Liaison reports suggest that skill shortages in specialised occupations are still acute. Shortages are becoming more widespread across industries and occupations, but remain most pronounced among skilled workers in the non-residential construction and resources sectors, and in parts of the business services sector.

The May 2006 Statement on monetary policy said:

More recently, business surveys and the Bank’s liaison with businesses point to continued tight labour market conditions and shortages of skilled labour. The NAB survey suggests that labour scarcity remains a greater constraint on activity than the more traditional concerns about lack of demand (Graph 64). Firms across a wide range of private-sector industries are using non-wage forms of remuneration that are not fully captured in the standard wage measures, such as bonus payments and more flexible working arrangements, to attract and retain employees.

The August 2006 Statement on monetary policythis is the latest statement from them on monetary policy, and they had a great deal to say—said:

Over the year to the June quarter, employment growth was strongest in the mining and electricity, gas & water industries, with the household services ...

…     …         …

Survey-based indicators and vacancy data mostly suggest that demand for labour is still strong and that the labour market will remain tight. The ABS measure of job vacancies increased in the June quarter, to show a nationwide vacancy rate of 1.5 per cent, the highest level in over thirty years (Graph 26). Private-sector measures of vacancies also show robust annual growth in job vacancies.

…         …         …

Continued strength in labour demand has led to ongoing labour shortages. Business surveys report that firms are experiencing difficulty finding suitable labour, and employers note that this remains a key factor constraining their output. Feedback from the Bank’s liaison program indicates that labour shortages are broadbased across industries and skill levels. However, shortages are most pronounced for skilled workers in the non-residential construction and resources sectors, and in much of the business services sector.

Don’t these people ever read the statements made by the people who determine the interest rate regime that applies in this country? Because I have a slightly longer period of time than is usually permitted to us, I have been able to go through the whole litany of Reserve Bank reports offering advice to the people opposite, including that exceptionally foolish and meretricious minister who has to handle these matters.

Take all of the traditional skilled trades. I am talking about all the construction workers, tilers, carpenters, plumbers, brickies and sparkies; and all the workers in the manufacturing industry, the fitters and turners, metallurgists and all those folk. The one measure which gives you an indication of how this government has dealt seriously with the trades is to ask this question: how many of those trades have turned up showing no skills shortages over the last 10 years? The best performance in any of those trades areas I have mentioned and many more has been in a trade capable of staying off the shortage list for two years. That is about the best of it. Most have been on it for 10 years, and all of them have been on it for at least eight.

It is extraordinary that we should find ourselves in this situation. The future of this nation is in this area. The traditional trades are critical to all sectors of the Australian economy, and this government has done nothing but persecute them and ignore the warnings, and hence we are now where we are. Let us make absolutely no mistake about this—this is not a plan for the future of this nation; this is a plan for the future of the Prime Minister. It is typical of his cynicism. It is typical of the sorts of things he does when he confronts a problem. It is the educational equivalent of regional rorts. You find yourself in a position where you are in serious trouble, you are 12 months out from an election, you are worried about your future—not the future of the people you have misgoverned—and what you do is fling enough money at it to give even your incompetent ministers the capacity to have the odd feather to fly with as they go out on the hustings. It does not give them much.

Let me go through the initiatives that have been announced here today, because I do recognise many of them. There is support for apprentices to undertake business training to improve their entrepreneurial skills—an idea that Labor suggested when we launched our skills account policy in January this year. There is the extension of employer incentives for diploma and advanced diploma qualifications—I proposed this in my skills blueprint in September last year. There is a wage subsidy for mature age apprentices—this goes back a fair while; it is an idea taken from Working Nation. It is an admission that perhaps those programs should not have been trashed 10 years ago. If that had not been done, perhaps the skills crisis would not be so bad.

I welcome the extra places for engineering, but it is not enough and it is far too late. Over the past 10 years there has been a decline in the number of Australian students commencing an undergraduate engineering degree. One thing they did not say today is that they are going to deal with the fact that engineering students are paying $16,000 more in HECS for their degree than they were in 1996. Our recently released higher education white paper presented an option to relieve the HECS burden on students, especially those in science and engineering. Action is needed on that front, too.

We do not mind our policies being pinched. Our policies, our plans and our blueprints for the future are out there to be stolen. That is why they are out there. They are out there to influence government as to the direction they ought to take. I am proud of the fact that the hard work done by my colleagues along the front bench here—in particular my deputy, who has carriage of this area for us—and my colleagues on the back benches, in drawing to the attention of this government and our political opponents the skills issue of this nation, is in a small way starting to pay off. I am very glad that some of that is emerging in what we have here. But this is simply nowhere near enough to address the 10 years of neglect which I have been through, which have left us in the sorry position of hearing the Reserve Bank, in report after report, trying to alarm government into doing something serious.

Let me suggest some serious policy for the government to pinch. Let me suggest a plan that will work for the future of this nation, because these are our plans for the future of this nation. The first thing I would do is this: we have got to get people back into training for traditional trades effectively. We will get rid of course fees in traditional trades and, for that matter, for childcare trainees, by establishing skills accounts for individuals. These accounts will be available for courses provided by either public or private sector providers, and they will be worth up to $3,200 over a four-year course. Pinch it; get out there and take that one. That will start to put a serious incentive into the system for people to start taking up traditional trades.

Of course, they have to have somewhere to go that will get them interested in these areas. So instead of telling kids to leave school at year 10, which seems to be the strategy of the Prime Minister, provide kids in schools with alternatives to simply sticking around with the academic subjects. One thing we will do, on being elected to office, is this: we will ensure that all kids in this country have a right to choose in their school districts a specialised trades school. What is this government’s solution for those kids who find themselves with an academic education that does not suit them? By heavens, the other day we even heard the Minister for Education, Science and Training talking not about skills but about reintroducing Latin into the school system. Forget Latin—start encouraging people to become electricians; start encouraging people to become plumbers; start encouraging people to become carpenters. Latin scholars—that is what the minister for education wants. Fair dinkum, Mr Speaker!

In addition, it is the case that young people do not necessarily know what opportunities and capacities they may have to engage in trade programs. Give them a ‘trade taster’ program even earlier in school, so that they have an opportunity to look at what it is like to be a carpenter, a plumber, a chef or an electrician. Give them that opportunity.

I will also provide more opportunities to begin apprenticeship training at school. Our Trades in Schools scheme will double the number of school based apprenticeships in areas of skill shortages. If you can come out of your school with one or two years of your apprenticeship under your belt, there is that much more incentive to stay in place and complete your apprenticeship when you leave school. We will make sure that the schools have first-class facilities in those areas where we wish to establish effectively a training culture.

Then there are the apprentices themselves. Here is a further plan for you to pinch—and, in a package worth $800 million, you could have pinched this one; I am disappointed that you did not do it: give a bonus to youngsters who complete their full apprenticeship in those traditional trades. I am talking about a couple of thousand dollars; a bit of financial incentive. Pinch it; you could have easily fitted it into an $800 million program, and it would produce a serious outcome.

When I was Minister for Employment, Education and Training in this country, 80 per cent of those who started trade apprenticeships finished them. That figure is now lower than 60 per cent. That is hopeless. We want youngsters who are in apprenticeships to complete their apprenticeships. Of course, another reason why young people are often so loath to complete their apprenticeships is that they see other kids out there earning a great deal more. That goes to apprenticeship wages. It comes back full circle to the government’s industrial relations strategy. Is their strategy to increase the wages of young Australian apprentices so that they are encouraged to stay in their apprenticeships? No, that is not their strategy. Their strategy is to use the changes in the industrial relations laws to make it even harder for young apprentices, as we found when we went to a building site with electricians recently where the apprentices were taking cuts.

The second thing is that that does create a problem, and they do know that. So what has their other solution been? Their other solution has been to bring in foreign apprentices. In order to make absolutely certain that the incentive is maintained very firmly by businesses, the education system and the Australian government, we will abolish that foreign apprenticeship trainee visa. We will make absolutely certain that our young people do get the incentive that comes with them being the exclusive recipients of the apprenticeship training that they need. That is a plan for the future of this nation. That is a plan that addresses the massive skills shortages that we now confront. That is a plan that makes absolutely certain that the future prosperity of this nation is sustained.

The government’s plan is a cover for what they intend to do about industrial relations. They will not abandon their wage cutting agenda. You have no idea, Mr Speaker, how annoying it is to sit on this side of the House and watch the Prime Minister boasting about rising real wages when you know that, in his heart of hearts, he hates absolutely every word he is saying. He moves as desperately as he can to create two Australias—firstly, a wealthy, small group in a position of dominance, and a situation where his friends at the big end of town are well advantaged; and, secondly, the rest of the Australian community, struggling with job uncertainty, unable to access a decent education and training opportunity, confronting instability in the workplace and unable to be certain that they will get work hours that are family friendly for them.

Ours will be a different Australia. Ours will be a productive Australia—an Australia that takes the participation issues seriously by addressing those things that keep people out of the workforce, like an absence of child care, and addressing those things that put people into the workforce without the skills they need, by giving them those opportunities to pick up trades. That is a real plan and a real blueprint for the future of this nation.

Debate (on motion by Mr Hunt) adjourned.

See this speech in context