Senate debates

Monday, 14 July 2014


Trade Support Loans Bill 2014, Trade Support Loans (Consequential Amendments) Bill 2014; Second Reading

1:00 pm

Photo of Carol BrownCarol Brown (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Families and Payments) Share this | Hansard source

I agree with the previous speaker about the importance of apprenticeships. The Trade Support Loans Bill 2014 and Trade Support Loans (Consequential Amendments) Bill 2014 establish the Trade Support Loans Program for Australian apprentices. The establishment of this program was a commitment of the Abbott government in the lead-up to the last election. However, what Mr Abbott did not tell apprentices was that the coalition were going to scrap Labor's $1 billion Tools For Your Trade program. He was deceitful. That deceit now means that what was thought to be an optional loan available in addition to the $5,500 Tools For Your Trade payment is now the only financial support this government will offer to apprentices.

The Abbott budget has taken an axe to the vital supports for Australia's apprentices and workers. These short-sighted decisions put our nation's skills base and future job creation at risk. These cuts highlight the hypocrisy of Mr Abbott's 'earn or learn' ultimatum to young Australians, and it hits apprentices; those starting out in their careers, those who can least afford it.

One Tasmanian man—and I have mentioned this man in the Senate previously—contacted my office to say he was raising his grandson, who was lucky enough to have a bricklaying apprenticeship. His grandson is in his first year of his apprenticeship. He brings home $400 a week and pays board. He is worried that his grandson will not be able to purchase his tools without the support of the Tools For Your Trade program. He does not want to see his grandson take out a loan when his income is already very low.

These and other concerns are all reasonable. Yet the minister has been unable to explain the program and address the concerns which have been raised. In fact, the Abbott government gagged members in the other place from raising the very real concerns of apprentices, families, employers and industry—and the very real concerns that have been raised in this chamber and the other chamber by members of parliament.

Labor will support this bill because the Abbott government has axed all other support for apprentices starting out in their careers, and Labor will not leave apprentices with nothing. However, Labor thinks there are a number of important issues which do need to be acknowledged. A significant issue for those who have already commenced their apprenticeships is that there are no grandfathering arrangements for those who have made financial commitments based on the Tools For Your Trade scheme. Another issue Labor has raised is the lack of information about the total liability that apprentices will face under the Trade Support Loans program. The minister has been completely unable to clearly and properly explain what this liability might be.

Given that Mr Macfarlane is unable to answer questions around financial liability, you can understand why people in the community might have concerns about young apprentices taking on a debt under the program. Labor is also concerned about inadequate protections for school based apprentices and other apprentices under 18 years of age. These concerns remain unaddressed by Mr Macfarlane. In the Senate committee inquiry and in the other place, Labor has also raised concerns about the adequacy of the privacy protections under this scheme.

Also of significant concern is the government's decision to offer these loans as a monthly payment rather than a lump sum option each year. Many apprentices already struggle to live fortnight to fortnight on low wages. Providing monthly payments will not be of assistance to these apprentices who need to outlay large sums of money up front to purchase expensive tools and equipment. This may lead to the situation where apprentices will need to take out loans from other institutions to be able to buy the tools and equipment they need to start their apprenticeships. What this means is that these apprentices will then be taking a loan out from the government to repay the other loan and may even lead to the temptation for many apprentices to use these loans as a wage supplement.

It is for these reasons that the shadow minister, Sharon Bird, sought to move second reading amendments in the other place, and that Senator Carr and Senator Lines will move second reading amendments in this place. These amendments seek to address a number of concerns that have been raised in relation to this scheme but that the government has failed to address. Labor understands that providing real support to apprentices and others who set out to train for a career is important. We understand the importance of creating opportunities for young people. But it is obvious, in spite of their rhetoric, that the Abbott government is not genuine about supporting young people into employment. In fact the budget cuts to education, changes to higher education, cuts to support for apprentices, cuts to Newstart and the punitive approach to young people who find themselves unemployed show the government has no real interest in supporting young people and developing their opportunities.

Youth unemployment is undeniably and unacceptably high, especially in my home state of Tasmania, where in some parts of the state it is as high as 20 per cent—that is, one in five young people without a job. Yet Mr Abbott has completely dismantled the crucial programs that support young people into employment. Not only does the budget cut nearly $1 billion in support payments under the Tools For Your Trade program—which, as I am sure, Mr Acting Deputy President, you would know, was an initiative of the Howard government—but it also slashes a further $1 billion in investment in skills and training.

The Abbott government has taken the axe to vital skills and training programs such as the National Workforce Development Fund, the Workplace English Language and Literacy program, the Australian Apprenticeships Access Program, the Accelerated Australian Apprenticeships program, the Australian Apprenticeships Mentoring Program, the National Partnership Agreement on Training Places for Single Parents, the Alternative Pathways program, the Apprenticeship to Business Owner Program, the Productive Ageing through Community Education, and the Step Into Skills program. These programs are critical in providing basic literacy and numeracy skills, supporting apprentices and upskilling existing workers to meet the needs of the modern workplace.

The government have tried to appease community backlash—and there has been considerable community concern—about these cuts by announcing a paltry $5 million for apprentice mentoring. This does not make up for axing $1 billion in investment in skills and training. If the government truly recognised the benefit of mentoring apprentices they would never have cut the Australian Apprentices Mentoring Program in the first place. The Abbott government have betrayed Australian apprentices and workers with these cuts. Investing in skills delivers a growing economy with strong employment and improved productivity. The Abbott government refuses to invest in Australia's workers, industries and regions. They are selling our future short.

Many apprentices have huge costs for tools and equipment. They will now be left with a debt under the Abbott government's program rather than being provided with funds to purchase tools. Many apprentices—including the young apprentice bricklayer I referred to earlier—who have already commenced their trade will now have the payments they were expecting to receive cancelled. This could mean that up to $3,700 for a first-year apprentice has been lost in future payments.

The provision of the optional loan is not opposed by Labor, but it should not have come at the expense of the Tools for Your Trade scheme and should have appropriate advice requirements in place to ensure informed and voluntary decisions by apprentices, some of whom are school based apprentices. The Abbott government took the axe to support for all apprentices. As well as axing the Tools for Your Trade program, they have axed, as I said, many other programs that are designed to support apprentices. Trade Support Loans of $20,000 will be available to school based apprentices aged between 16 and 18 years, and the government have failed to put in any measures to protect children, such as requiring a parent to accompany them. The government confirmed that they are looking to outsource debt management for Trade Support Loans and are potentially happy to saddle 16-year-old children with $20,000 debts and leave them in the hands of private debt collectors. This is one of the most savage cuts in the very long list of skills programs cut by this government.

In comments in The Australian, Tony Nicholson, the Director of the Brotherhood of St Laurence, makes the point that 'learn or earn' demands on young people require the government to provide the support and training programs needed to get young people the skills they need and get them into work. The Australian Apprenticeships Access Program assisted vulnerable job seekers who find it difficult to enter employment with nationally recognised prevocational training, support and assistance. The program is delivered by local providers who work with local employers to deliver training to meet industry needs, and participants receive individualised intensive job search assistance.

This government has taken the axe to support for all apprentices. There was no warning to young tradies about the cut to Tools for Your Trade before the election and they are quite right to be furious about these cuts. The budget also cut the Australian Apprenticeships Mentoring Program—a program for young people who face barriers to participation. The program helps apprentices successfully complete their apprenticeships and provides support to their employers or supervisors. Mr Abbott has slashed nearly $2 billion out of skills programs and over $1 billion of these funds supported apprentices. Labor put in place real support to help young people, particularly in rural and regional Australia, get and finish an apprenticeship. Mr Abbott is ripping this support away. Young apprentices with the world at their feet will not get the support they need and deserve.

As I said earlier in my contribution, Labor will not oppose these bills. We ask the government to very seriously consider the issues highlighted in the amendments that Labor senators will put forward to make the scheme work effectively and fairly for apprentices, whom this legislation is intended to assist. I ask the government to seriously consider support for the second reading amendments that Labor senators will put forward to ensure that this scheme in some way works effectively and fairly for Australian apprentices, particularly apprentices from my home state of Tasmania.


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